Condensed Consolidating Financial Statements

Long-term debt of AMC Networks includes $45,551 of 7.75% senior notes due July 2021, $600,000 of 4.75% senior notes due December 2022 and $1,000,000 of 5.00% senior notes due April 2024. All outstanding senior notes issued by AMC Networks are guaranteed on a senior unsecured basis by certain of its existing and future domestic restricted subsidiaries (the “Guarantor Subsidiaries”). All Guarantor Subsidiaries are owned 100% by AMC Networks. The outstanding notes are fully and unconditionally guaranteed by the Guarantor Subsidiaries on a joint and several basis.

Set forth below are condensed consolidating financial statements presenting the financial position, results of operations, comprehensive income, and cash flows of (i) the Parent Company, (ii) the Guarantor Subsidiaries on a combined basis (as such guarantees are joint and several), (iii) the direct and indirect non-guarantor subsidiaries of the Parent Company (the “Non-Guarantor Subsidiaries”) on a combined basis and (iv) reclassifications and eliminations necessary to arrive at the information for the Company on a consolidated basis.

Basis of Presentation

In presenting the condensed consolidating financial statements, the equity method of accounting has been applied to (i) the Parent Company’s interests in the Guarantor Subsidiaries and the Non-Guarantor Subsidiaries, and (ii) the Guarantor Subsidiaries’ interests in the Non-Guarantor Subsidiaries, even though all such subsidiaries meet the requirements to be consolidated under GAAP. All intercompany balances and transactions between the Parent Company, the Guarantor Subsidiaries and the Non-Guarantor Subsidiaries have been eliminated, as shown in the column “Eliminations.”

The accounting basis in all subsidiaries, including goodwill and identified intangible assets, have been allocated to the applicable subsidiaries.



Condensed Consolidating Balance Sheet
March 31, 2016
	Parent Company		Guarantor Subsidiaries		Non- Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current Assets:
Cash and cash equivalents	$	279,468	$	257,259	$	166,073	$	—		$	702,800
Accounts receivable, trade (less allowance for doubtful accounts)	—		519,912		165,232		—			685,144
Amounts due from related parties, net	—		2,743		238		—			2,981
Current portion of program rights, net	—		335,169		113,366		—			448,535
Prepaid expenses, other current assets and intercompany receivable	89		136,839		15,073		(89,558		)	62,443
Deferred tax asset, net	18,881		—		5,178		—			24,059
Total current assets	298,438		1,251,922		465,160		(89,558		)	1,925,962
Property and equipment, net of accumulated depreciation	—		89,929		84,040		—			173,969
Investment in affiliates	2,986,397		852,545		—		(3,838,942		)	—
Program rights, net	—		907,952		138,350		—			1,046,302
Long-term intercompany notes receivable	—		400,109		603		(400,712		)	—
Deferred carriage fees, net	—		44,592		2,469		—			47,061
Intangible assets, net	—		187,605		363,316		—			550,921
Goodwill	—		71,069		660,924		—			731,993
Other assets	172		101,426		100,423		—			202,021
Total assets	$	3,285,007	$	3,907,149	$	1,815,285	$	(4,329,212	)	$	4,678,229
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	301	$	98,580	$	32,527	$	—		$	131,408
Accrued liabilities and intercompany payable	51,586		74,889		131,384		(89,558		)	168,301
Current portion of program rights obligations	—		223,834		71,253		—			295,087
Deferred revenue	—		56,404		11,764		—			68,168
Current portion of long-term debt	166,500		—		—		—			166,500
Current portion of capital lease obligations	—		2,300		1,920		—			4,220
Total current liabilities	218,387		456,007		248,848		(89,558		)	833,684
Program rights obligations	—		405,338		22,104		—			427,442
Long-term debt	2,801,690		—		—		—			2,801,690
Capital lease obligations	—		8,857		31,165		—			40,022
Deferred tax liability, net	144,968		—		11,519		—			156,487
Other liabilities and intercompany notes payable	34,058		50,550		408,729		(400,712		)	92,625
Total liabilities	3,199,103		920,752		722,365		(490,270		)	4,351,950
Commitments and contingencies
Redeemable noncontrolling interests	—		—		208,513		—			208,513
Stockholders’ equity:
AMC Networks stockholders’ equity	85,904		2,986,397		852,545		(3,838,942		)	85,904
Non-redeemable noncontrolling interests	—		—		31,862		—			31,862
Total stockholders’ equity	85,904		2,986,397		884,407		(3,838,942		)	117,766
Total liabilities and stockholders’ equity	$	3,285,007	$	3,907,149	$	1,815,285	$	(4,329,212	)	$	4,678,229



Condensed Consolidating Balance Sheet
December 31, 2015
	Parent Company			Guarantor Subsidiaries		Non- Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current Assets:
Cash and cash equivalents	$	434		$	148,260	$	167,627	$	—		$	316,321
Accounts receivable, trade (less allowance for doubtful accounts)	—			538,657		135,954		—			674,611
Amounts due from related parties, net	—			3,818		244		—			4,062
Current portion of program rights, net	—			352,664		100,493		—			453,157
Prepaid expenses, other current assets and intercompany receivable	4,158			112,456		12,322		(55,947		)	72,989
Deferred tax asset, net	14,039			—		2,159		—			16,198
Total current assets	18,631			1,155,855		418,799		(55,947		)	1,537,338
Property and equipment, net	—			93,007		70,853		—			163,860
Investment in affiliates	2,797,938			845,069		—		(3,643,007		)	—
Program rights, net	—			889,756		137,638		—			1,027,394
Long-term intercompany notes receivable	—			400,163		676		(400,839		)	—
Deferred carriage fees, net	—			47,437		2,632		—			50,069
Intangible assets, net	—			190,041		359,139		—			549,180
Goodwill	—			71,700		664,575		—			736,275
Other assets	1,449			100,620		98,730		—			200,799
Total assets	$	2,818,018		$	3,793,648	$	1,753,042	$	(4,099,793	)	$	4,264,915
LIABILITIES AND STOCKHOLDERS’ DEFICIENCY
Current Liabilities:
Accounts payable	$	6		$	97,445	$	26,990	$	—		$	124,441
Accrued liabilities and intercompany payable	30,857			128,084		97,799		(55,947		)	200,793
Current portion of program rights obligations	—			225,375		64,522		—			289,897
Deferred revenue	—			54,921		9,308		—			64,229
Current portion of long-term debt	148,000			—		—		—			148,000
Current portion of capital lease obligations	—			2,393		1,168		—			3,561
Total current liabilities	178,863			508,218		199,787		(55,947		)	830,921
Program rights obligations	—			415,419		25,172		—			440,591
Long-term debt	2,519,808			—		—		—			2,519,808
Capital lease obligations	—			9,268		20,511		—			29,779
Deferred tax liability, net	126,415			—		10,818		—			137,233
Other liabilities and intercompany notes payable	32,209			62,805		409,355		(400,839		)	103,530
Total liabilities	2,857,295			995,710		665,643		(456,786		)	4,061,862
Commitments and contingencies
Redeemable noncontrolling interests	—			—		211,691		—			211,691
Stockholders’ deficiency:
AMC Networks stockholders’ (deficiency) equity	(39,277		)	2,797,938		845,069		(3,643,007		)	(39,277		)
Non-redeemable noncontrolling interests	—			—		30,639		—			30,639
Total stockholders’ (deficiency) equity	(39,277		)	2,797,938		875,708		(3,643,007		)	(8,638		)
Total liabilities and stockholders’ (deficiency) equity	$	2,818,018		$	3,793,648	$	1,753,042	$	(4,099,793	)	$	4,264,915



Condensed Consolidating Statement of Income
Three Months Ended March 31, 2016
	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenues, net	$	—		$	554,326		$	154,737		$	(2,484	)	$	706,579
Operating expenses:
Technical and operating (excluding depreciation and amortization)	—			190,110			84,847			(683		)	274,274
Selling, general and administrative	—			114,357			41,348			(1,804		)	153,901
Restructuring expense (credit)	—			(70		)	35			—			(35		)
Depreciation and amortization	—			10,075			9,557			—			19,632
Total operating expenses	—			314,472			135,787			(2,487		)	447,772
Operating income	—			239,854			18,950			3			258,807
Other income (expense):
Interest expense, net	(30,572		)	9,293			(9,750		)	—			(31,029		)
Share of affiliates’ income (loss)	246,047			(770		)	—			(245,277		)	—
Loss on extinguishment of debt	(48,334		)	—			—			—			(48,334		)
Miscellaneous, net	(79		)	(21		)	(734		)	(3		)	(837		)
Total other income (expense)	167,062			8,502			(10,484		)	(245,280		)	(80,200		)
Income from operations before income taxes	167,062			248,356			8,466			(245,277		)	178,607
Income tax expense	(53,618		)	(2,309		)	(2,616		)	—			(58,543		)
Net income including noncontrolling interests	113,444			246,047			5,850			(245,277		)	120,064
Net income attributable to noncontrolling interests	—			—			(6,620		)	—			(6,620		)
Net income (loss) attributable to AMC Networks’ stockholders	$	113,444		$	246,047		$	(770	)	$	(245,277	)	$	113,444



Condensed Consolidating Statement of Income
Three Months Ended March 31, 2015
	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenues, net	$	—		$	539,444		$	129,463		$	(225	)	$	668,682
Operating expenses:
Technical and operating (excluding depreciation and amortization)	—			196,758			65,621			(206		)	262,173
Selling, general and administrative	—			118,486			36,091			2			154,579
Restructuring expense	—			114			542			—			656
Depreciation and amortization	—			8,967			11,560			—			20,527
Total operating expenses	—			324,325			113,814			(204		)	437,935
Operating income	—			215,119			15,649			(21		)	230,747
Other income (expense):
Interest expense, net	(20,353		)	(10,466		)	(1,768		)	—			(32,587		)
Share of affiliates’ income	275,985			4,385			—			(280,370		)	—
Miscellaneous, net	(76,315		)	69,315			(3,251		)	21			(10,230		)
Total other income (expense)	179,317			63,234			(5,019		)	(280,349		)	(42,817		)
Income from operations before income taxes	179,317			278,353			10,630			(280,370		)	187,930
Income tax expense	(58,398		)	(2,367		)	(489		)	—			(61,254		)
Net income including noncontrolling interests	120,919			275,986			10,141			(280,370		)	126,676
Net income attributable to noncontrolling interests	—			—			(5,756		)	—			(5,756		)
Net income attributable to AMC Networks’ stockholders	$	120,919		$	275,986		$	4,385		$	(280,370	)	$	120,920



Condensed Consolidating Statement of Comprehensive Income
Three Months Ended March 31, 2016
	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income including noncontrolling interest	$	113,444		$	246,047		$	5,850		$	(245,277	)	$	120,064
Other comprehensive income (loss):
Foreign currency translation adjustment	(2,845		)	(2,845		)	18,230			2,845			15,385
Unrealized gain on interest rate swaps	(1,578		)	—			—			—			(1,578		)
Other comprehensive (loss) income, before income taxes	(4,423		)	(2,845		)	18,230			2,845			13,807
Income tax expense	(1,899		)	—			—			—			(1,899		)
Other comprehensive (loss) income, net of income taxes	(6,322		)	(2,845		)	18,230			2,845			11,908
Comprehensive income (loss)	107,122			243,202			24,080			(242,432		)	131,972
Comprehensive income attributable to noncontrolling interests	—			—			(7,032		)	—			(7,032		)
Comprehensive income attributable to AMC Networks’ stockholders	$	107,122		$	243,202		$	17,048		$	(242,432	)	$	124,940



Condensed Consolidating Statement of Comprehensive Income
Three Months Ended March 31, 2015
	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income including non controlling interest	$	120,919		$	275,986		$	10,141		$	(280,370	)	$	126,676
Other comprehensive income (loss):
Foreign currency translation adjustment	(71,711		)	(71,692		)	10,886			71,692			(60,825		)
Unrealized gain on interest rate swaps	696			—			—			—			696
Other comprehensive (loss) income, before income taxes	(71,015		)	(71,692		)	10,886			71,692			(60,129		)
Income tax expense	(2,279		)	—			—			—			(2,279		)
Other comprehensive (loss) income, net of income taxes	(73,294		)	(71,692		)	10,886			71,692			(62,408		)
Comprehensive income	47,625			204,294			21,027			(208,678		)	64,268
Comprehensive income attributable to noncontrolling interests	—			—			(4,332		)	—			(4,332		)
Comprehensive income attributable to AMC Networks’ stockholders	$	47,625		$	204,294		$	16,695		$	(208,678	)	$	59,936



Condensed Consolidating Statement of Cash Flows
Three Months Ended March 31, 2016
	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net cash provided by operating activities	$	204,100		$	193,453		$	19,383		$	(249,552	)	$	167,384
Cash flows from investing activities:
Capital expenditures	2			(8,151		)	(4,238		)	—			(12,387		)
(Increase) decrease to investment in affiliates	(160,665		)	(72,411		)	(13,181		)	246,257			—
Net cash used in investing activities	(160,663		)	(80,562		)	(17,419		)	246,257			(12,387		)
Cash flows from financing activities:
Proceeds from the issuance of long-term debt	982,500			—			—			—			982,500
Principal payments on long-term debt	(691,449		)	—			—			—			(691,449		)
Premium and fees paid on extinguishment of debt	(39,179		)	—			—			—			(39,179		)
Payments for financing costs	(2,070		)	—			—			—			(2,070		)
Deemed repurchases of restricted stock/units	(10,413		)	—			—			—			(10,413		)
Proceeds from stock option exercises	1,200			—			—			—			1,200
Excess tax benefits from share-based compensation arrangements	852			—			—			—			852
Principal payments on capital lease obligations	—			(597		)	(489		)	—			(1,086		)
Distributions to noncontrolling interest	—			—			(8,968		)	—			(8,968		)
Net cash provided by (used in) financing activities	241,441			(597		)	(9,457		)	—			231,387
Net increase (decrease) in cash and cash equivalents from operations	284,878			112,294			(7,493		)	(3,295		)	386,384
Effect of exchange rate changes on cash and cash equivalents	(5,844		)	(3,295		)	5,939			3,295			95
Cash and cash equivalents at beginning of period	434			148,260			167,627			—			316,321
Cash and cash equivalents at end of period	$	279,468		$	257,259		$	166,073		$	—		$	702,800



Condensed Consolidated Statement of Cash Flows
Three Months Ended March 31, 2015
	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net cash provided by operating activities	$	223,495		$	111,816		$	25,373		$	(280,489	)	$	80,195
Cash flows from investing activities:
Capital expenditures	(9		)	(13,416		)	(4,823		)	—			(18,248		)
Payments for acquisitions, net of cash acquired	—			—			(6,581		)	—			(6,581		)
Acquisition of investments	—			(82		)	(25,128		)	—			(25,210		)
Increase to investment in affiliates	(122,915		)	(14,892		)	(70,990		)	208,797			—
Net cash used in investing activities	(122,924		)	(28,390		)	(107,522		)	208,797			(50,039		)
Cash flows from financing activities:
Principal payments on long-term debt	(18,500		)	—			—			—			(18,500		)
Deemed repurchases of restricted stock/units	(12,848		)	—			—			—			(12,848		)
Proceeds from stock option exercises	130			—			—			—			130
Excess tax benefits from share-based compensation arrangements	3,672			—			—			—			3,672
Principal payments on capital lease obligations	—			(542		)	(878		)	—			(1,420		)
Net cash used in financing activities	(27,546		)	(542		)	(878		)	—			(28,966		)
Net increase (decrease) in cash and cash equivalents from operations	73,025			82,884			(83,027		)	(71,692		)	1,190
Effect of exchange rate changes on cash and cash equivalents	(73,735		)	(71,692		)	65,485			71,692			(8,250		)
Cash and cash equivalents at beginning of period	1,581			83,676			116,110			—			201,367
Cash and cash equivalents at end of period	$	871		$	94,868		$	98,568		$	—		$	194,307