Condensed Consolidating Financial Statements

Debt of AMC Networks includes $600.0 million of 4.75% senior notes due December 2022, $1.0 billion of 5.00% senior notes due April 2024 and $800.0 million of 4.75% senior notes due August 2025. 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
September 30, 2017
(In thousands)	Parent Company		Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Eliminations			Consolidated
ASSETS
Current Assets:
Cash and cash equivalents	$	268	$	402,762	$	149,259		$	—		$	552,289
Accounts receivable, trade (less allowance for doubtful accounts)	—		527,232		184,944			—			712,176
Amounts due from related parties, net	—		478		—			—			478
Current portion of program rights, net	—		301,362		151,347			—			452,709
Prepaid expenses, other current assets and intercompany receivable	748		199,921		12,484			(113,701		)	99,452
Total current assets	1,016		1,431,755		498,034			(113,701		)	1,817,104
Property and equipment, net of accumulated depreciation	—		125,657		46,964			—			172,621
Investment in affiliates	3,426,758		923,595		—			(4,350,353		)	—
Program rights, net	—		1,054,542		184,964			—			1,239,506
Long-term intercompany notes receivable	—		466,027		450			(466,477		)	—
Deferred carriage fees, net	—		32,696		1,491			—			34,187
Intangible assets, net	—		172,989		300,710			—			473,699
Goodwill	—		67,246		623,608			—			690,854
Deferred tax asset, net	—		—		20,405			—			20,405
Other assets	1,413		140,417		300,558			—			442,388
Total assets	$	3,429,187	$	4,414,924	$	1,977,184		$	(4,930,531	)	$	4,890,764
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	34	$	33,325	$	45,545		$	—		$	78,904
Accrued liabilities and intercompany payable	57,650		159,579		148,967			(113,701		)	252,495
Current portion of program rights obligations	—		246,401		72,072			—			318,473
Deferred revenue	—		34,253		17,326			—			51,579
Current portion of capital lease obligations	—		2,873		1,844			—			4,717
Total current liabilities	57,684		476,431		285,754			(113,701		)	706,168
Program rights obligations	—		434,191		20,976			—			455,167
Long-term debt, net	3,097,350		—		—			—			3,097,350
Capital lease obligations	—		4,509		22,869			—			27,378
Deferred tax liability, net	177,580		—		(4,217		)	—			173,363
Other liabilities and intercompany notes payable	42,200		73,035		481,621			(466,477		)	130,379
Total liabilities	3,374,814		988,166		807,003			(580,178		)	4,589,805
Commitments and contingencies
Redeemable noncontrolling interests	—		—		217,697			—			217,697
Stockholders’ equity:
AMC Networks stockholders’ equity	54,373		3,426,758		923,595			(4,350,353		)	54,373
Non-redeemable noncontrolling interests	—		—		28,889			—			28,889
Total stockholders’ equity	54,373		3,426,758		952,484			(4,350,353		)	83,262
Total liabilities and stockholders’ equity	$	3,429,187	$	4,414,924	$	1,977,184		$	(4,930,531	)	$	4,890,764



Condensed Consolidating Balance Sheet
December 31, 2016
(In thousands)	Parent Company		Guarantor Subsidiaries	Non- Guarantor Subsidiaries	Eliminations		Consolidated
ASSETS
Current Assets:
Cash and cash equivalents	565		320,950	159,874	—		481,389
Accounts receivable, trade (less allowance for doubtful accounts)	—		537,751	162,904	—		700,655
Amounts due from related parties, net	—		508	—	—		508
Current portion of program rights, net	—		307,050	134,080	—		441,130
Prepaid expenses, other current assets and intercompany receivable	948		151,175	15,961	(95,423	)	72,661
Total current assets	1,513		1,317,434	472,819	(95,423	)	1,696,343
Property and equipment, net of accumulated depreciation	—		104,272	62,364	—		166,636
Investment in affiliates	3,029,922		784,024	—	(3,813,946	)	—
Program rights, net	—		947,657	160,929	—		1,108,586
Long-term intercompany notes receivable	—		432,099	817	(432,916	)	—
Deferred carriage fees, net	—		42,656	1,230	—		43,886
Intangible assets, net	—		180,297	305,512	—		485,809
Goodwill	—		69,154	588,554	—		657,708
Deferred tax asset, net	—		—	8,598	—		8,598
Other assets	1,471		116,608	194,950	—		313,029
Total assets	3,032,906		3,994,201	1,795,773	(4,342,285	)	4,480,595
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	—		40,033	48,644	—		88,677
Accrued liabilities and intercompany payable	71,680		182,667	125,505	(95,423	)	284,429
Current portion of program rights obligations	—		226,474	74,371	—		300,845
Deferred revenue	—		42,782	10,861	—		53,643
Current portion of long-term debt	222,000		—	—	—		222,000
Current portion of capital lease obligations	—		2,645	1,939	—		4,584
Total current liabilities	293,680		494,601	261,320	(95,423	)	954,178
Program rights obligations	—		365,262	32,913	—		398,175
Long-term debt, net	2,597,263		—	—	—		2,597,263
Capital lease obligations	—		6,647	28,635	—		35,282
Deferred tax liability, net	145,364		—	427	—		145,791
Other liabilities and intercompany notes payable	26,681		97,769	440,685	(432,916	)	132,219
Total liabilities	3,062,988		964,279	763,980	(528,339	)	4,262,908
Commitments and contingencies
Redeemable noncontrolling interests	—		—	219,331	—		219,331
Stockholders’ equity:
AMC Networks stockholders’ (deficiency) equity	(30,082	)	3,029,922	784,024	(3,813,946	)	(30,082	)
Non-redeemable noncontrolling interests	—		—	28,438	—		28,438
Total stockholders’ (deficiency) equity	(30,082	)	3,029,922	812,462	(3,813,946	)	(1,644	)
Total liabilities and stockholders’ (deficiency) equity	3,032,906		3,994,201	1,795,773	(4,342,285	)	4,480,595



Condensed Consolidating Statement of Income
Three Months Ended September 30, 2017
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenues, net	$	—		$	494,563		$	157,346		$	(3,886	)	$	648,023
Operating expenses:
Technical and operating (excluding depreciation and amortization)	—			232,432			91,142			(831		)	322,743
Selling, general and administrative	—			99,481			42,352			(3,145		)	138,688
Depreciation and amortization	—			10,072			10,866			—			20,938
Impairment and related charges	—			—			11,036			—			11,036
Restructuring (credit) expense	—			(10		)	1,274			—			1,264
Total operating expenses	—			341,975			156,670			(3,976		)	494,669
Operating income	—			152,588			676			90			153,354
Other income (expense):
Interest expense, net	(34,403		)	10,543			(7,950		)	—			(31,810		)
Share of affiliates’ income	171,490			10,784			—			(182,274		)	—
Loss on extinguishment of debt	(3,004		)	—			—			—			(3,004		)
Miscellaneous, net	(1,076		)	(244		)	13,830			(90		)	12,420
Total other income (expense)	133,007			21,083			5,880			(182,364		)	(22,394		)
Income from operations before income taxes	133,007			173,671			6,556			(182,274		)	130,960
Income tax (expense) benefit	(46,005		)	(2,181		)	8,062			—			(40,124		)
Net income including noncontrolling interests	87,002			171,490			14,618			(182,274		)	90,836
Net income attributable to noncontrolling interests	—			—			(3,834		)	—			(3,834		)
Net income attributable to AMC Networks’ stockholders	$	87,002		$	171,490		$	10,784		$	(182,274	)	$	87,002



Condensed Consolidating Statement of Income
Three Months Ended September 30, 2016
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenues, net	$	—		$	484,704		$	152,007		$	(2,065	)	$	634,646
Operating expenses:
Technical and operating (excluding depreciation and amortization)	—			251,595			87,891			(687		)	338,799
Selling, general and administrative	—			97,633			41,077			(1,594		)	137,116
Depreciation and amortization	—			9,965			12,317			—			22,282
Restructuring expense	—			18,764			548			—			19,312
Total operating expenses	—			377,957			141,833			(2,281		)	517,509
Operating income	—			106,747			10,174			216			117,137
Other income (expense):
Interest expense, net	(29,250		)	9,649			(9,603		)	—			(29,204		)
Share of affiliates’ income (loss)	110,101			(4,402		)	—			(105,699		)	—
Loss on extinguishment of debt	(2,295		)	—			—			—			(2,295		)
Miscellaneous, net	(123		)	385			2,942			(216		)	2,988
Total other income (expense)	78,433			5,632			(6,661		)	(105,915		)	(28,511		)
Income from operations before income taxes	78,433			112,379			3,513			(105,699		)	88,626
Income tax expense	(13,040		)	(2,278		)	(5,839		)	—			(21,157		)
Net income (loss) including noncontrolling interests	65,393			110,101			(2,326		)	(105,699		)	67,469
Net income attributable to noncontrolling interests	—			—			(2,076		)	—			(2,076		)
Net income (loss) attributable to AMC Networks’ stockholders	$	65,393		$	110,101		$	(4,402	)	$	(105,699	)	$	65,393



Condensed Consolidating Statement of Income
Nine Months Ended September 30, 2017
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenues, net	$	—		$	1,610,247		$	480,153		$	(11,643	)	$	2,078,757
Operating expenses:
Technical and operating (excluding depreciation and amortization)	—			694,336			264,231			(2,367		)	956,200
Selling, general and administrative	—			335,585			138,669			(9,584		)	464,670
Depreciation and amortization	—			30,399			34,638			—			65,037
Impairment and related charges	—			—			28,148			—			28,148
Restructuring expense	—			2,649			1,238			—			3,887
Total operating expenses	—			1,062,969			466,924			(11,951		)	1,517,942
Operating income	—			547,278			13,229			308			560,815
Other income (expense):
Interest expense, net	(93,548		)	30,531			(22,751		)	—			(85,768		)
Share of affiliates’ income	592,012			19,610			—			(611,622		)	—
Loss on extinguishment of debt	(3,004		)	—			—			—			(3,004		)
Miscellaneous, net	(1,419		)	2,085			42,090			(308		)	42,448
Total other income (expense)	494,041			52,226			19,339			(611,930		)	(46,324		)
Income from operations before income taxes	494,041			599,504			32,568			(611,622		)	514,491
Income tax (expense) benefit	(168,225		)	(7,492		)	2,318			—			(173,399		)
Net income including noncontrolling interests	325,816			592,012			34,886			(611,622		)	341,092
Net income attributable to noncontrolling interests	—			—			(15,276		)	—			(15,276		)
Net income attributable to AMC Networks’ stockholders	$	325,816		$	592,012		$	19,610		$	(611,622	)	$	325,816



Condensed Consolidating Statement of Income
Nine Months Ended September 30, 2016
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenues, net	$	—		$	1,559,188		$	473,809		$	(6,940	)	$	2,026,057
Operating expenses:
Technical and operating (excluding depreciation and amortization)	—			665,627			251,773			(2,064		)	915,336
Selling, general and administrative	—			343,526			135,083			(4,849		)	473,760
Depreciation and amortization	—			29,992			33,475			—			63,467
Restructuring expense	—			18,806			860			—			19,666
Total operating expenses	—			1,057,951			421,191			(6,913		)	1,472,229
Operating income	—			501,237			52,618			(27		)	553,828
Other income (expense):
Interest expense, net	(89,992		)	28,481			(29,055		)	—			(90,566		)
Share of affiliates’ income (loss)	498,281			(24,548		)	—			(473,733		)	—
Loss on extinguishment of debt	(50,638		)	—			—			—			(50,638		)
Miscellaneous, net	(373		)	173			(22,437		)	27			(22,610		)
Total other income (expense)	357,278			4,106			(51,492		)	(473,706		)	(163,814		)
Income from operations before income taxes	357,278			505,343			1,126			(473,733		)	390,014
Income tax expense	(101,262		)	(7,062		)	(10,766		)	—			(119,090		)
Net income (loss) including noncontrolling interests	256,016			498,281			(9,640		)	(473,733		)	270,924
Net income attributable to noncontrolling interests	—			—			(14,908		)	—			(14,908		)
Net income (loss) attributable to AMC Networks’ stockholders	$	256,016		$	498,281		$	(24,548	)	$	(473,733	)	$	256,016



Condensed Consolidating Statement of Comprehensive Income
Three Months Ended September 30, 2017
(In thousands)	Parent Company			Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income including noncontrolling interest	$	87,002		$	171,490	$	14,618		$	(182,274	)	$	90,836
Other comprehensive income (loss):
Foreign currency translation adjustment	15,791			—		15,791			(15,791		)	15,791
Unrealized loss on interest rate swaps	(174		)	—		—			—			(174		)
Unrealized gain on available for sale securities	6,596			—		—			—			6,596
Other comprehensive income, before income taxes	22,213			—		15,791			(15,791		)	22,213
Income tax expense	(2,363		)	—		—			—			(2,363		)
Other comprehensive income, net of income taxes	19,850			—		15,791			(15,791		)	19,850
Comprehensive income	106,852			171,490		30,409			(198,065		)	110,686
Comprehensive income attributable to noncontrolling interests	—			—		(4,633		)	—			(4,633		)
Comprehensive income attributable to AMC Networks’ stockholders	$	106,852		$	171,490	$	25,776		$	(198,065	)	$	106,053



Condensed Consolidating Statement of Comprehensive Income
Three Months Ended September 30, 2016
(In thousands)	Parent Company			Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income (loss) including noncontrolling interest	$	65,393		$	110,101	$	(2,326	)	$	(105,699	)	$	67,469
Other comprehensive income (loss):
Foreign currency translation adjustment	(763		)	—		(763		)	763			(763		)
Unrealized gain on interest rate swaps	896			—		—			—			896
Other comprehensive income (loss), before income taxes	133			—		(763		)	763			133
Income tax expense	(1,363		)	—		—			—			(1,363		)
Other comprehensive (loss), net of income taxes	(1,230		)	—		(763		)	763			(1,230		)
Comprehensive income (loss)	64,163			110,101		(3,089		)	(104,936		)	66,239
Comprehensive income attributable to noncontrolling interests	—			—		(2,108		)	—			(2,108		)
Comprehensive income (loss) attributable to AMC Networks’ stockholders	$	64,163		$	110,101	$	(5,197	)	$	(104,936	)	$	64,131



Condensed Consolidating Statement of Comprehensive Income
Nine Months Ended September 30, 2017
(In thousands)	Parent Company			Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income including noncontrolling interest	$	325,816		$	592,012	$	34,886		$	(611,622	)	$	341,092
Other comprehensive income (loss):
Foreign currency translation adjustment	63,475			—		63,475			(63,475		)	63,475
Unrealized loss on interest rate swaps	(35		)	—		—			—			(35		)
Unrealized gain on available for sale securities	9,534			—		—			—			9,534
Other comprehensive income, before income taxes	72,974			—		63,475			(63,475		)	72,974
Income tax expense	(3,495		)	—		—			—			(3,495		)
Other comprehensive income, net of income taxes	69,479			—		63,475			(63,475		)	69,479
Comprehensive income	395,295			592,012		98,361			(675,097		)	410,571
Comprehensive income attributable to noncontrolling interests	—			—		(17,997		)	—			(17,997		)
Comprehensive income attributable to AMC Networks’ stockholders	$	395,295		$	592,012	$	80,364		$	(675,097	)	$	392,574



Condensed Consolidating Statement of Comprehensive Income
Nine Months Ended September 30, 2016
(In thousands)	Parent Company			Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income (loss) including noncontrolling interest	$	256,016		$	498,281	$	(9,640	)	$	(473,733	)	$	270,924
Other comprehensive income (loss):
Foreign currency translation adjustment	(3,767		)	—		(3,767		)	3,767			(3,767		)
Unrealized loss on interest rate swaps	(1,447		)	—		—			—			(1,447		)
Other comprehensive (loss), before income taxes	(5,214		)	—		(3,767		)	3,767			(5,214		)
Income tax expense	(11,574		)	—		—			—			(11,574		)
Other comprehensive (loss), net of income taxes	(16,788		)	—		(3,767		)	3,767			(16,788		)
Comprehensive income (loss)	239,228			498,281		(13,407		)	(469,966		)	254,136
Comprehensive income attributable to noncontrolling interests	—			—		(13,564		)	—			(13,564		)
Comprehensive income (loss) attributable to AMC Networks’ stockholders	$	239,228		$	498,281	$	(26,971	)	$	(469,966	)	$	240,572



Condensed Consolidating Statement of Cash Flows
Nine Months Ended September 30, 2017
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net cash provided by operating activities	$	374,873		$	498,874		$	11,714		$	(611,888	)	$	273,573
Cash flows from investing activities:
Capital expenditures	—			(47,811		)	(13,983		)	—			(61,794		)
Investment in and loans to investees	—			—			(43,000		)	—			(43,000		)
Increase to investment in affiliates	(289,891		)	(394,117		)	254,014			429,994			—
Net cash (used in) provided by investing activities	(289,891		)	(441,928		)	197,031			429,994			(104,794		)
Cash flows from financing activities:
Proceeds from the issuance of long-term debt	1,536,000			—			—			—			1,536,000
Principal payments on long-term debt	(1,257,965		)	—			—			—			(1,257,965		)
Payments for financing costs	(10,405		)	—			—			—			(10,405		)
Deemed repurchases of restricted stock units	(13,373		)	—			—			—			(13,373		)
Purchase of treasury stock	(347,334		)	—			—			—			(347,334		)
Principal payments on capital lease obligations	—			(2,019		)	(1,409		)	—			(3,428		)
Distributions to noncontrolling interests	—			—			(16,110		)	—			(16,110		)
Net cash used in financing activities	(93,077		)	(2,019		)	(17,519		)	—			(112,615		)
Net increase (decrease) in cash and cash equivalents from operations	(8,095		)	54,927			191,226			(181,894		)	56,164
Effect of exchange rate changes on cash and cash equivalents	7,798			26,885			(201,841		)	181,894			14,736
Cash and cash equivalents at beginning of period	565			320,950			159,874			—			481,389
Cash and cash equivalents at end of period	$	268		$	402,762		$	149,259		$	—		$	552,289



Condensed Consolidating Statement of Cash Flows
Nine Months Ended September 30, 2016
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net cash provided by operating activities	$	347,413		$	504,454		$	51,115		$	(476,390	)	$	426,592
Cash flows from investing activities:
Capital expenditures	—			(29,538		)	(14,967		)	—			(44,505		)
Payments for acquisitions, net of cash acquired	—			—			(354		)	—			(354		)
(Increase) decrease to investment in affiliates	(359,772		)	36,431			—			323,341			—
Net cash (used in) provided by investing activities	(359,772		)	6,893			(15,321		)	323,341			(44,859		)
Cash flows from financing activities:
Proceeds from the issuance of long-term debt	982,500			—			—			—			982,500
Principal payments on long-term debt	(811,000		)	—			—			—			(811,000		)
Premium and fees paid on extinguishment of debt	(40,953		)	—			—			—			(40,953		)
Payments for financing costs	(2,070		)	—			—			—			(2,070		)
Deemed repurchases of restricted stock/units	(10,821		)	—			—			—			(10,821		)
Purchase of treasury stock	(109,997		)	—			—			—			(109,997		)
Proceeds from stock option exercises	1,217			—			—			—			1,217
Excess tax benefits from share-based compensation arrangements	764			—			—			—			764
Principal payments on capital lease obligations	—			(1,834		)	(1,348		)	—			(3,182		)
Distributions to noncontrolling interest	—			—			(9,010		)	—			(9,010		)
Net cash provided by (used in) financing activities	9,640			(1,834		)	(10,358		)	—			(2,552		)
Net (decrease) increase in cash and cash equivalents from operations	(2,719		)	509,513			25,436			(153,049		)	379,181
Effect of exchange rate changes on cash and cash equivalents	3,145			(153,049		)	(15,883		)	153,049			(12,738		)
Cash and cash equivalents at beginning of period	434			148,260			167,627			—			316,321
Cash and cash equivalents at end of period	$	860		$	504,724		$	177,180		$	—		$	682,764