Condensed Consolidating Financial Statements

12 Months Ended

Dec. 31, 2012

Condensed Consolidating Financial Statements [Abstract]

CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

16. CONDENSED CONSOLIDATING FINANCIAL STATEMENTS

The Company’s Senior Secured First Lien Notes are guaranteed by all of the Company’s existing and future wholly-owned domestic subsidiaries. All of the guarantees are full and unconditional and joint and several. None of the Company’s foreign subsidiaries are guarantors of the Notes.

Set forth below are consolidating financial statements related to the Company, its material guarantor subsidiary Entravision Holdings, LLC, and its non-guarantor subsidiaries. Consolidating balance sheets are presented as of December 31, 2012 and 2011 and the related consolidating statements of operations and cash flows are presented for each of the three years ended December 31, 2012. The equity method of accounting has been used by the Company to report its investment in subsidiaries.

Consolidating Balance Sheet

December 31, 2012

(In thousands)

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated Total
ASSETS
Current assets
Cash and cash equivalents	$	35,631		$	—		$	499	$	—		$	36,130
Trade receivables, net of allowance for doubtful accounts		47,779			—			251		—			48,030
Prepaid expenses and other current assets		3,778			—			467		—			4,245
Total current assets		87,188			—			1,217		—			88,405
Property and equipment, net		58,900			—			2,535		—			61,435
Intangible assets subject to amortization, net		22,349			—			—		—			22,349
Intangible assets not subject to amortization		38,739			178,262			3,700		—			220,701
Goodwill		35,653			—			994		—			36,647
Investment in subsidiaries		164,355			—			—		(164,355	)		—
Other assets		8,514			—			10,603		(10,603	)		8,514
Total assets	$	415,698		$	178,262		$	19,049	$	(174,958	)	$	438,051
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Current maturities of long-term debt	$	150		$	—		$	—	$	—		$	150
Advances payable, related parties		118			—			—		—			118
Accounts payable and accrued expenses		47,537			—			742		(9,121	)		39,158
Total current liabilities		47,805			—			742		(9,121	)		39,426
Long-term debt, less current maturities		340,664			—			—		—			340,664
Other long-term liabilities		7,359			—			—		—			7,359
Deferred income taxes		14,469			32,214			—		(1,482	)		45,201
Total liabilities		410,297			32,214			742		(10,603	)		432,650
Stockholders’ equity
Class A common stock		5			—			—		—			5
Class B common stock		2			—			—		—			2
Class C common stock		1			—			—		—			1
Member’s capital		—			804,654			12,652		(817,306	)		—
Additional paid-in capital		930,814			—			—		—			930,814
Accumulated deficit		(925,421	)		(658,606	)		5,655		652,951			(925,421	)
Total stockholders’ equity		5,401			146,048			18,307		(164,355	)		5,401
Total liabilities and stockholders’ equity	$	415,698		$	178,262		$	19,049	$	(174,958	)	$	438,051

Consolidating Balance Sheet

December 31, 2011

(In thousands)

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated Total
ASSETS
Current assets
Cash and cash equivalents	$	58,276		$	—		$	443	$	—		$	58,719
Trade receivables, net of allowance for doubtful accounts		43,951			—			319		—			44,270
Prepaid expenses and other current assets		5,678			—			261		—			5,939
Total current assets		107,905			—			1,023		—			108,928
Property and equipment, net		62,046			—			3,180		—			65,226
Intangible assets subject to amortization, net		24,598			—			—		—			24,598
Intangible assets not subject to amortization		38,739			178,262			3,700		—			220,701
Goodwill		35,653			—			994		—			36,647
Investment in subsidiaries		170,580			—			—		(170,580	)		—
Other assets		11,221			—			12,603		(12,603	)		11,221
Total assets	$	450,742		$	178,262		$	21,500	$	(183,183	)	$	467,321
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Current maturities of long-term debt	$	—		$	—		$	—	$	—		$	—
Advances payable, related parties		118			—			—		—			118
Accounts payable and accrued expenses		49,633			—			930		(10,813	)		39,750
Total current liabilities		49,751			—			930		(10,813	)		39,868
Long-term debt, less current maturities		379,662			—			—		—			379,662
Other long-term liabilities		8,327			—			—		—			8,327
Deferred income taxes		13,563			28,252			—		(1,790	)		40,025
Total liabilities		451,303			28,252			930		(12,603	)		467,882
Stockholders’ equity
Class A common stock		5			—			—		—			5
Class B common stock		2			—			—		—			2
Class C common stock		1			—			—		—			1
Member’s capital		—			804,654			12,652		(817,306	)		—
Additional paid-in capital		938,453			—			—		—			938,453
Accumulated deficit		(939,022	)		(654,644	)		7,918		646,726			(939,022	)
Total stockholders’ equity		(561	)		150,010			20,570		(170,580	)		(561	)
Total liabilities and stockholders’ equity	$	450,742		$	178,262		$	21,500	$	(183,183	)	$	467,321

Consolidating Statement of Operations

Year Ended December 31, 2012

(In thousands)

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Total
Net revenue	$	222,050		$	—		$	3,149		$	(1,946	)	$	223,253
Expenses:
Direct operating expenses		92,627			—			1,575			(1,946	)		92,256
Selling, general and administrative expenses		37,320			—			498			—			37,818
Corporate expenses		17,976			—			—			—			17,976
Depreciation and amortization		15,743			—			683			—			16,426
		163,666			—			2,756			(1,946	)		164,476
Operating income (loss)		58,384			—			393			—			58,777
Interest expense		(35,407	)		—			—			—			(35,407	)
Interest income		86			—			—			—			86
Income (loss) on debt extinguishment		(3,743	)		—			—			—			(3,743	)
Income (loss) before income taxes		19,320			—			393			—			19,713
Income tax (expense) benefit		(1,833	)		(3,962	)		(317	)		—			(6,112	)
Income (loss) before equity in net income (loss) of subsidiaries and nonconsolidated affiliate		17,487			(3,962	)		76			—			13,601
Equity in income (loss) of subsidiaries		(3,886	)		—			—			3,886			—
Net income (loss) applicable to common stockholders	$	13,601		$	(3,962	)	$	76		$	3,886		$	13,601

Consolidating Statement of Operations

Year Ended December 31, 2011

(In thousands)

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Total
Net revenue	$	193,081		$	—		$	3,906		$	(2,591	)	$	194,396
Expenses:
Direct operating expenses		89,584			—			1,597			(2,591	)		88,590
Selling, general and administrative expenses		36,305			—			206			—			36,511
Corporate expenses		15,669			—			—			—			15,669
Depreciation and amortization		17,839			—			814			—			18,653
		159,397			—			2,617			(2,591	)		159,423
Operating income (loss)		33,684			—			1,289			—			34,973
Interest expense		(37,650	)		—			—			—			(37,650	)
Interest income		3			—			—			—			3
Other income (loss)		687			—			—			—			687
Income (loss) on debt extinguishment		(423	)		—			—			—			(423	)
Income (loss) before income taxes		(3,699	)		—			1,289			—			(2,410	)
Income tax (expense) benefit		(1,510	)		(3,423	)		(857	)		—			(5,790	)
Income (loss) before equity in net income (loss) of subsidiaries and nonconsolidated affiliate		(5,209	)		(3,423	)		432			—			(8,200	)
Equity in income (loss) of subsidiaries		(2,991	)		—			—			2,991			—
Net income (loss) applicable to common stockholders	$	(8,200	)	$	(3,423	)	$	432		$	2,991		$	(8,200	)

Consolidating Statement of Operations

Year Ended December 31, 2010

(In thousands)

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Total
Net revenue	$	199,314		$	—		$	3,604		$	(2,442	)	$	200,476
Expenses:
Direct operating expenses		85,895			—			1,349			(2,442	)		84,802
Selling, general and administrative expenses		37,489			—			557			—			38,046
Corporate expenses		18,416			—			—			—			18,416
Depreciation and amortization		18,417			—			812			—			19,229
Impairment charge		11,992			15,368			8,749			—			36,109
		172,209			15,368			11,467			(2,442	)		196,602
Operating income (loss)		27,105			(15,368	)		(7,863	)		—			3,874
Interest expense		(24,429	)		—			—			—			(24,429	)
Interest income		260			—			—			—			260
Income (loss) on debt extinguishment		(987	)		—			—			—			(987	)
Income (loss) before income taxes		1,949			(15,368	)		(7,863	)		—			(21,282	)
Income tax benefit (expense)		(2,617	)		3,225			2,768			—			3,376
Income (loss) before equity in net income (loss) of subsidiaries and nonconsolidated affiliate		(668	)		(12,143	)		(5,095	)		—			(17,906	)
Equity in income (loss) of subsidiaries		(17,238	)		—			—			17,238			—
Income (loss) before equity in net income (loss) of nonconsolidated affiliates		(17,906	)		(12,143	)		(5,095	)		17,238			(17,906	)
Equity in net income (loss) of nonconsolidated affiliates		(180	)		—			—			—			(180	)
Net income (loss) applicable to common stockholders	$	(18,086	)	$	(12,143	)	$	(5,095	)	$	17,238		$	(18,086	)

Consolidating Statement of Cash Flows

Year ended December 31, 2012

(In thousands)

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Total
Cash flows from operating activities:
Net income (loss)	$	13,601		$	(3,962	)	$	76		$	3,886		$	13,601
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		15,743			—			683			—			16,426
Deferred income taxes		2,470			3,962			45			—			6,477
Amortization of debt issue costs		2,284			—			—			—			2,284
Amortization of syndication contracts		707			—			—			—			707
Payments on syndication contracts		(1,698	)		—			—			—			(1,698	)
Non-cash stock-based compensation		2,651			—			—			—			2,651
Other (income) loss		—			—			—			—			—
(Gain) loss on debt extinguishment		3,743			—			—			—			3,743
Changes in assets and liabilities, net of effect of acquisitions and dispositions:		—												—
(Increase) decrease in restricted cash		—			—			—			—			—
(Increase) decrease in accounts receivable		(3,808	)		—			68			—			(3,740	)
(Increase) decrease in amounts due from related party		394			—			(394	)					—
(Increase) decrease in prepaid expenses and other assets		517			—			(196	)		—			321
Increase (decrease) in accounts payable, accrued expenses and other liabilities		(552	)		—			(188	)		—			(740	)
Net cash provided by (used in) operating activities		36,052			—			94			3,886			40,032
Cash flows from investing activities:
Purchases of property and equipment and intangibles		(9,818	)		—			(38	)		—			(9,856	)
Investment in subsidiaries		3,886			—			—			(3,886	)		—
Purchase of a business		—			—			—			—			—
Net cash provided by (used in) investing activities		(5,932	)		—			(38	)		(3,886	)		(9,856	)
Cash flows from financing activities:
Proceeds from issuance of common stock		23			—			—			—			23
Payments on long-term debt		(61,800	)		—			—			—			(61,800	)
Dividends paid		(10,313	)		—			—			—			(10,313	)
Proceeds from borrowings on long-term debt		20,000			—			—			—			20,000
Payments of deferred debt and offering costs		(675	)		—			—			—			(675	)
Net cash provided by (used in) financing activities		(52,765	)		—			—			—			(52,765	)
Net increase (decrease) in cash and cash equivalents		(22,645	)		—			56			—			(22,589	)
Cash and cash equivalents:
Beginning		58,276			—			443			—			58,719
Ending	$	35,631		$	—		$	499		$	—		$	36,130

Consolidating Statement of Cash Flows

Year ended December 31, 2011

(In thousands)

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Total
Cash flows from operating activities:
Net income (loss)	$	(8,200	)	$	(3,423	)	$	432		$	2,991		$	(8,200	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		17,839			—			814			—			18,653
Deferred income taxes		883			3,423			259			—			4,565
Amortization of debt issue costs		2,207			—			—			—			2,207
Amortization of syndication contracts		1,482			—			—			—			1,482
Payments on syndication contracts		(1,976	)		—			—			—			(1,976	)
Non-cash stock-based compensation		2,343			—			—			—			2,343
Other (income) loss		(687	)		—			—			—			(687	)
(Gain) loss on debt extinguishment		423			—			—			—			423
Changes in assets and liabilities, net of effect of acquisitions and dispositions:		—												—
(Increase) decrease in restricted cash		809			—			—			—			809
(Increase) decrease in accounts receivable		(505	)		—			(69	)		—			(574	)
(Increase) decrease in amounts due from related party		1,300			—			(1,300	)					—
(Increase) decrease in prepaid expenses and other assets		283			—			53			—			336
Increase (decrease) in accounts payable, accrued expenses and other liabilities		(1,965	)		—			195			—			(1,770	)
Net cash provided by (used in) operating activities		14,236			—			384			2,991			17,611
Cash flows from investing activities:
Purchases of property and equipment and intangibles		(8,333	)		—			(191	)		—			(8,524	)
Investment in subsidiaries		2,991			—			—			(2,991	)		—
Purchase of a business		(598	)		—			—			—			(598	)
Net cash provided by (used in) investing activities		(5,940	)		—			(191	)		(2,991	)		(9,122	)
Cash flows from financing activities:
Proceeds from issuance of common stock		42			—			—			—			42
Payments on long-term debt		(17,071	)		—			—			—			(17,071	)
Dividends paid		(5,102	)		—			—			—			(5,102	)
Payments of deferred debt and offering costs		(29	)		—			—			—			(29	)
Net cash provided by (used in) financing activities		(22,160	)		—			—			—			(22,160	)
Net increase (decrease) in cash and cash equivalents		(13,864	)		—			193			—			(13,671	)
Cash and cash equivalents:
Beginning		72,140			—			250			—			72,390
Ending	$	58,276		$	—		$	443		$	—		$	58,719

Consolidating Statement of Cash Flows

Year ended December 31, 2010

(In thousands)

	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Total
Cash flows from operating activities:
Net income (loss)	$	(18,086	)	$	(12,143	)	$	(5,095	)	$	17,238		$	(18,086	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		18,417			—			812			—			19,229
Impairment charge		11,992			15,368			8,749			—			36,109
Deferred income taxes		1,994			(3,225	)		(3,111	)		—			(4,342	)
Amortization of debt issue costs		1,140			—			—			—			1,140
Amortization of syndication contracts		1,159			—			—			—			1,159
Payments on syndication contracts		(2,724	)		—			—			—			(2,724	)
Equity in net income (loss) of nonconsolidated affiliate		180			—			—			—			180
Non-cash stock-based compensation		2,970			—			—			—			2,970
(Gain) loss on debt extinguishment		934			—			—			—			934
Reserve for note receivable		3,018			—			—			—			3,018
Change in fair value of interest rate swap agreements		(12,188	)		—			—			—			(12,188	)
Changes in assets and liabilities, net of effect of acquisitions and dispositions:		—												—
(Increase) decrease in restricted cash		(809	)		—			—			—			(809	)
(Increase) decrease in accounts receivable		2,051			—			40			—			2,091
(Increase) decrease in amounts due from related party		184			—			(184	)					—
(Increase) decrease in prepaid expenses and other assets		389			—			(79	)		—			310
Increase (decrease) in accounts payable, accrued expenses and other liabilities		7,930			—			204			—			8,134
Net cash provided by (used in) operating activities		18,551			—			1,336			17,238			37,125
Cash flows from investing activities:
Investment in subsidiaries		17,238									(17,238	)		—
Purchases of property and equipment and intangibles		(7,158	)		—			(1,492	)		—			(8,650	)
Net cash provided by (used in) investing activities		10,080			—			(1,492	)		(17,238	)		(8,650	)
Cash flows from financing activities:
Proceeds from issuance of common stock		239			—			—			—			239
Payments on long-term debt		(362,949	)		—			—			—			(362,949	)
Termination of swap agreements		(4,039	)		—			—			—			(4,039	)
Proceeds from borrowings on long-term debt		394,888			—			—			—			394,888
Payments of deferred debt and offering costs		(11,890	)		—			—			—			(11,890	)
Net cash provided by (used in) financing activities		16,249			—			—			—			16,249
Net increase (decrease) in cash and cash equivalents		44,880			—			(156	)		—			44,724
Cash and cash equivalents:
Beginning		27,260			—			406			—			27,666
Ending	$	72,140		$	—		$	250		$	—		$	72,390

ENTRAVISION HOLDINGS, LLC

NOTES TO FINANCIAL STATEMENTS