Condensed Consolidating Financial Statements

6 Months Ended

Jun. 30, 2019

Condensed Financial Information Disclosure [Abstract]

Condensed Consolidating Financial Statements

Condensed Consolidating Financial Statements

Debt of AMC Networks includes $600 million of 4.75% senior notes due December 2022, $1 billion of 5.00% senior notes due April 2024 and $800 million of 4.75% senior notes due August 2025. All outstanding senior notes issued by AMC Networks (for purposes of this Note 20, "Parent Company") 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
June 30, 2019
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current Assets:
Cash and cash equivalents	$	93		$	486,735		$	219,514	$	—		$	706,342
Accounts receivable, trade (less allowance for doubtful accounts)	—			578,372			259,915		—			838,287
Current portion of program rights, net	—			286,888			147,258		(377		)	433,769
Prepaid expenses, other current assets and intercompany receivable	(12,513		)	197,289			22,281		(40,876		)	166,181
Total current assets	(12,420		)	1,549,284			648,968		(41,253		)	2,144,579
Property and equipment, net of accumulated depreciation	—			197,164			67,452		—			264,616
Investment in affiliates	3,865,679			1,673,727			—		(5,539,406		)	—
Program rights, net	—			876,166			239,209		(1,337		)	1,114,038
Long-term intercompany notes receivable	—			—			92		(92		)	—
Deferred carriage fees, net	—			21,261			2,059		—			23,320
Intangible assets, net	—			156,477			400,894		—			557,371
Goodwill	—			64,618			727,465		—			792,083
Deferred tax asset, net	9			—			48,989		—			48,998
Operating lease right-of-use asset	99,141			18,487			58,049		—			175,677
Other assets	—			165,489			274,478		1,085			441,052
Total assets	$	3,952,409		$	4,722,673		$	2,467,655	$	(5,581,003	)	$	5,561,734
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	(19	)	$	34,008		$	71,364	$	—		$	105,353
Accrued liabilities and intercompany payable	40,572			126,975			105,188		(40,876		)	231,859
Current portion of program rights obligations	—			255,601			90,198		—			345,799
Deferred revenue	—			27,708			29,498		(629		)	56,577
Current portion of long-term debt	37,500			—			—		—			37,500
Current portion of lease obligations	13,643			5,854			11,948		—			31,445
Total current liabilities	91,696			450,146			308,196		(41,505		)	808,533
Program rights obligations	—			273,890			15,838		—			289,728
Long-term debt, net	3,073,419			—			—		—			3,073,419
Lease obligations	122,332			19,989			81,014		—			223,335
Deferred tax liability, net	100,226			—			34,775		—			135,001
Other liabilities and intercompany notes payable	22,916			118,159			19,434		(92		)	160,417
Total liabilities	3,410,589			862,184			459,257		(41,597		)	4,690,433
Commitments and contingencies
Redeemable noncontrolling interests	—			(5,190		)	307,978		—			302,788
Stockholders' equity:
AMC Networks stockholders' equity	541,820			3,865,679			1,673,727		(5,539,406		)	541,820
Non-redeemable noncontrolling interests	—			—			26,693		—			26,693
Total stockholders' equity	541,820			3,865,679			1,700,420		(5,539,406		)	568,513
Total liabilities and stockholders' equity	$	3,952,409		$	4,722,673		$	2,467,655	$	(5,581,003	)	$	5,561,734

Condensed Consolidating Balance Sheet
December 31, 2018
(In thousands)	Parent Company		Guarantor Subsidiaries		Non- Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current Assets:
Cash and cash equivalents	$	121	$	368,151	$	186,614	$	—		$	554,886
Accounts receivable, trade (including amounts due from related parties, net, less allowance for doubtful accounts)	16		600,121		235,840		—			835,977
Current portion of program rights, net	—		292,002		148,955		(218		)	440,739
Prepaid expenses, other current assets and intercompany receivable	6,543		158,936		23,549		(57,219		)	131,809
Total current assets	6,680		1,419,210		594,958		(57,437		)	1,963,411
Property and equipment, net of accumulated depreciation	—		175,040		71,222		—			246,262
Investment in affiliates	3,656,003		1,655,083		—		(5,311,086		)	—
Program rights, net	—		969,802		245,862		(1,613		)	1,214,051
Long-term intercompany notes receivable	—		—		190		(190		)	—
Deferred carriage fees, net	—		15,993		838		—			16,831
Intangible assets, net	—		161,417		417,490		—			578,907
Goodwill	—		65,282		732,755		—			798,037
Deferred tax asset, net	—		—		19,272		—			19,272
Other assets	—		149,724		292,068					441,792
Total assets	$	3,662,683	$	4,611,551	$	2,374,655	$	(5,370,326	)	$	5,278,563
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable	$	—	$	34,630	$	72,436	$	—		$	107,066
Accrued liabilities and intercompany payable	35,189		173,836		114,943		(59,050		)	264,918
Current portion of program rights obligations	—		259,414		84,175		—			343,589
Deferred revenue	—		34,608		20,816		—			55,424
Current portion of long-term debt	18,750		—		2,584		—			21,334
Current portion of capital lease obligations	—		2,941		2,149		—			5,090
Total current liabilities	53,939		505,429		297,103		(59,050		)	797,421
Program rights obligations	—		349,814		23,435		—			373,249
Long-term debt, net	3,088,221		—		—		—			3,088,221
Capital lease obligations	—		1,420		20,007		—			21,427
Deferred tax liability, net	140,474		—		4,969		—			145,443
Other liabilities and intercompany notes payable	63,369		98,885		45,972		(190		)	208,036
Total liabilities	3,346,003		955,548		391,486		(59,240		)	4,633,797
Commitments and contingencies
Redeemable noncontrolling interests	—		—		299,558		—			299,558
Stockholders' equity:
AMC Networks stockholders' equity	316,680		3,656,003		1,655,083		(5,311,086		)	316,680
Non-redeemable noncontrolling interests	—		—		28,528		—			28,528
Total stockholders' equity	316,680		3,656,003		1,683,611		(5,311,086		)	345,208
Total liabilities and stockholders' equity	$	3,662,683	$	4,611,551	$	2,374,655	$	(5,370,326	)	$	5,278,563

Condensed Consolidating Statement of Income
Three Months Ended June 30, 2019
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenues, net	$	—		$	517,109		$	260,819		$	(5,629	)	$	772,299
Operating expenses:
Technical and operating (excluding depreciation and amortization)	—			233,579			153,147			(1,103		)	385,623
Selling, general and administrative	—			109,447			68,339			(4,422		)	173,364
Depreciation and amortization	—			12,587			13,306			—			25,893
Restructuring and other related charges	—			16,575			587			—			17,162
Total operating expenses	—			372,188			235,379			(5,525		)	602,042
Operating income	—			144,921			25,440			(104		)	170,257
Other income (expense):
Interest expense, net	(39,028		)	3,723			334			—			(34,971		)
Share of affiliates’ income	162,140			15,834			—			(177,974		)	—
Miscellaneous, net	(41		)	100			(2,860		)	104			(2,697		)
Total other income (expense)	123,071			19,657			(2,526		)	(177,870		)	(37,668		)
Income from operations before income taxes	123,071			164,578			22,914			(177,974		)	132,589
Income tax benefit (expense)	5,672			(2,438		)	(1,838		)	—			1,396
Net income including noncontrolling interests	128,743			162,140			21,076			(177,974		)	133,985
Net income attributable to noncontrolling interests	—			—			(5,242		)	—			(5,242		)
Net income attributable to AMC Networks’ stockholders	$	128,743		$	162,140		$	15,834		$	(177,974	)	$	128,743

Condensed Consolidating Statement of Income
Three Months Ended June 30, 2018
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenues, net	$	—		$	549,262		$	216,006		$	(3,883	)	$	761,385
Operating expenses:
Technical and operating (excluding depreciation and amortization)	—			248,181			129,742			(1,114		)	376,809
Selling, general and administrative	—			120,463			53,686			(2,773		)	171,376
Depreciation and amortization	—			11,175			10,494			—			21,669
Total operating expenses	—			379,819			193,922			(3,887		)	569,854
Operating income	—			169,443			22,084			4			191,531
Other income (expense):
Interest expense, net	(37,834		)	11,715			(7,814		)	—			(33,933		)
Share of affiliates’ income (loss)	172,233			(4,192		)	—			(168,041		)	—
Miscellaneous, net	259			(2,504		)	(12,470		)	(4		)	(14,719		)
Total other income (expense)	134,658			5,019			(20,284		)	(168,045		)	(48,652		)
Income from operations before income taxes	134,658			174,462			1,800			(168,041		)	142,879
Income tax expense	(28,477		)	(2,229		)	(1,841		)	—			(32,547		)
Net income including noncontrolling interests	106,181			172,233			(41		)	(168,041		)	110,332
Net income attributable to noncontrolling interests	—			—			(4,151		)	—			(4,151		)
Net income attributable to AMC Networks’ stockholders	$	106,181		$	172,233		$	(4,192	)	$	(168,041	)	$	106,181

Condensed Consolidating Statement of Income
Six Months Ended June 30, 2019
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenues, net	$	—		$	1,091,339		$	473,579		$	(8,398	)	$	1,556,520
Operating expenses:
Technical and operating (excluding depreciation and amortization)	—			454,067			273,865			(2,161		)	725,771
Selling, general and administrative	—			221,028			131,170			(6,322		)	345,876
Depreciation and amortization	—			25,124			24,825			—			49,949
Restructuring and other related charges	—			16,292			3,512			—			19,804
Total operating expenses	—			716,511			433,372			(8,483		)	1,141,400
Operating income	—			374,828			40,207			85			415,120
Other income (expense):
Interest expense, net	(77,957		)	6,906			635			—			(70,416		)
Share of affiliates’ income	386,384			8,523			—			(394,907		)	—
Miscellaneous, net	(140		)	809			(16,066		)	(85		)	(15,482		)
Total other income (expense)	308,287			16,238			(15,431		)	(394,992		)	(85,898		)
Income from operations before income taxes	308,287			391,066			24,776			(394,907		)	329,222
Income tax expense	(36,147		)	(4,682		)	(4,251		)	—			(45,080		)
Net income including noncontrolling interests	272,140			386,384			20,525			(394,907		)	284,142
Net income attributable to noncontrolling interests	—			—			(12,002		)	—			(12,002		)
Net income attributable to AMC Networks’ stockholders	$	272,140		$	386,384		$	8,523		$	(394,907	)	$	272,140

Condensed Consolidating Statement of Income
Six Months Ended June 30, 2018
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Revenues, net	$	—		$	1,124,179		$	386,392		$	(8,363	)	$	1,502,208
Operating expenses:
Technical and operating (excluding depreciation and amortization)	—			470,802			228,264			(1,892		)	697,174
Selling, general and administrative	—			242,522			101,775			(6,472		)	337,825
Depreciation and amortization	—			21,979			20,044			—			42,023
Total operating expenses	—			735,303			350,083			(8,364		)	1,077,022
Operating income	—			388,876			36,309			1			425,186
Other income (expense):
Interest expense, net	(74,741		)	23,612			(15,990		)	—			(67,119		)
Share of affiliates’ income	419,715			13,306			—			(433,021		)	—
Loss on extinguishment of debt	—			—			—			—			—
Miscellaneous, net	53			(1,770		)	3,945			(1		)	2,227
Total other income (expense)	345,027			35,148			(12,045		)	(433,022		)	(64,892		)
Income from operations before income taxes	345,027			424,024			24,264			(433,021		)	360,294
Income tax expense	(81,976		)	(4,309		)	(3,141		)	—			(89,426		)
Net income including noncontrolling interests	263,051			419,715			21,123			(433,021		)	270,868
Net income attributable to noncontrolling interests	—			—			(7,817		)	—			(7,817		)
Net income attributable to AMC Networks’ stockholders	$	263,051		$	419,715		$	13,306		$	(433,021	)	$	263,051

Condensed Consolidating Statement of Comprehensive Income
Three Months Ended June 30, 2019
(In thousands)	Parent Company			Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income including noncontrolling interests	$	128,743		$	162,140	$	21,076		$	(177,974	)	$	133,985
Other comprehensive income (loss):
Foreign currency translation adjustment	553					553			(553		)	553
Unrealized loss on interest rate swaps	(1,625		)	—		—			—			(1,625		)
Other comprehensive income, before income taxes	(1,072		)	—		553			(553		)	(1,072		)
Income tax expense	374			—		—			—			374
Other comprehensive (loss) income, net of income taxes	(698		)	—		553			(553		)	(698		)
Comprehensive income	128,045			162,140		21,629			(178,527		)	133,287
Comprehensive income attributable to noncontrolling interests	—			—		(5,033		)	—			(5,033		)
Comprehensive income attributable to AMC Networks' stockholders	$	128,045		$	162,140	$	16,596		$	(178,527	)	$	128,254

Condensed Consolidating Statement of Comprehensive Income
Three Months Ended June 30, 2018
(In thousands)	Parent Company			Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income including noncontrolling interest	$	106,181		$	172,233	$	(41	)	$	(168,041	)	$	110,332
Other comprehensive income (loss):
Foreign currency translation adjustment	(45,759		)	—		45,759			(45,759		)	(45,759		)
Other comprehensive (loss) income, net of income taxes	(45,759		)	—		45,759			(45,759		)	(45,759		)
Comprehensive income	60,422			172,233		45,718			(213,800		)	64,573
Comprehensive income attributable to noncontrolling interests	—			—		(2,173		)	—			(2,173		)
Comprehensive income attributable to AMC Networks’ stockholders	$	60,422		$	172,233	$	43,545		$	(213,800	)	$	62,400

Condensed Consolidating Statement of Comprehensive Income
Six Months Ended June 30, 2019
(In thousands)	Parent Company			Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income including noncontrolling interest	$	272,140		$	386,384	$	20,525		$	(394,907	)	$	284,142
Other comprehensive income (loss):
Foreign currency translation adjustment	(5,210		)	—		(5,210		)	5,210			(5,210		)
Unrealized loss on interest rate swaps	(2,263		)	—		—			—			(2,263		)
Other comprehensive loss, before income taxes	(7,473		)	—		(5,210		)	5,210			(7,473		)
Income tax expense	523			—		—			—			523
Other comprehensive loss, net of income taxes	(6,950		)	—		(5,210		)	5,210			(6,950		)
Comprehensive income	265,190			386,384		15,315			(389,697		)	277,192
Comprehensive income attributable to noncontrolling interests	—			—		(11,831		)	—			(11,831		)
Comprehensive income attributable to AMC Networks’ stockholders	$	265,190		$	386,384	$	3,484		$	(389,697	)	$	265,361

Condensed Consolidating Statement of Comprehensive Income
Six Months Ended June 30, 2018
(In thousands)	Parent Company			Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Eliminations			Consolidated
Net income including noncontrolling interest	$	263,051		$	419,715	$	21,123		$	(433,021	)	$	270,868
Other comprehensive income (loss):
Foreign currency translation adjustment	(26,955		)	—		26,955			(26,955		)	(26,955		)
Other comprehensive (loss) income, net of income taxes	(26,955		)	—		26,955			(26,955		)	(26,955		)
Comprehensive income	236,096			419,715		48,078			(459,976		)	243,913
Comprehensive income attributable to noncontrolling interests	—			—		(6,736		)	—			(6,736		)
Comprehensive income attributable to AMC Networks’ stockholders	$	236,096		$	419,715	$	41,342		$	(459,976	)	$	237,177

Condensed Consolidating Statement of Cash Flows
Six Months Ended June 30, 2019
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net cash provided by operating activities	$	273,682		$	400,444		$	9,726		$	(394,915	)	$	288,937
Cash flows from investing activities:
Capital expenditures	—			(45,445		)	(4,018		)	—			(49,463		)
Return of capital from investees	—			—			5,908			—			5,908
Investment in and loans to investees	—			—			—			—			—
Payments for acquisition of a business, net of cash acquired	—			—			—			—			—
Increase (decrease) to investment in affiliates	(221,104		)	(44,279		)	—			265,383			—
Net cash (used in) provided by investing activities	(221,104		)	(89,724		)	1,890			265,383			(43,555		)
Cash flows from financing activities:
Proceeds from the issuance of long-term debt	—			—			—			—			—
Repayment of long-term debt	—			—			(2,717		)	—			(2,717		)
Deemed repurchases of restricted stock units	(23,019		)	—			—			—			(23,019		)
Purchase of treasury stock	(58,440		)	—			—			—			(58,440		)
Proceeds from stock option exercises	4,630			—			—			—			4,630
Principal payments on finance lease obligations	—			(1,536		)	(1,054		)	—			(2,590		)
Distributions to noncontrolling interests	—			—			(10,129		)	—			(10,129		)
Net cash used in financing activities	(76,829		)	(1,536		)	(13,900		)	—			(92,265		)
Net (decrease) increase in cash and cash equivalents from operations	(24,251		)	309,184			(2,284		)	(129,532		)	153,117
Effect of exchange rate changes on cash and cash equivalents	24,223			(190,600		)	35,184			129,532			(1,661		)
Cash and cash equivalents at beginning of period	121			368,151			186,614			—			554,886
Cash and cash equivalents at end of period	$	93		$	486,735		$	219,514		$	—		$	706,342

Condensed Consolidated Statement of Cash Flows
Six Months Ended June 30, 2018
(In thousands)	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net cash provided by operating activities	$	296,928		$	852,314		$	(437,627	)	$	(433,038	)	$	278,577
Cash flows from investing activities:
Capital expenditures	—			(32,827		)	(4,575		)	—			(37,402		)
Return of capital from investees	—			—			347			—			347
Investment in investees	—			—			(87,488		)	—			(87,488		)
Payments for acquisition of a business, net of cash acquired	—			—			(34,879		)	—			(34,879		)
Increase (decrease) to investment in affiliates	(46,945		)	(1,550,189		)	896,005			701,129			—
Net cash (used in) provided by investing activities	(46,945		)	(1,583,016		)	769,410			701,129			(159,422		)
Cash flows from financing activities:
Proceeds from the issuance of long-term debt	—			—			—			—			—
Principal payments on long-term debt	—			—			—			—			—
Payments for financing costs	—			—			—			—			—
Deemed repurchases of restricted stock units	(15,734		)	—			—			—			(15,734		)
Purchase of treasury stock	(242,409		)	—			—			—			(242,409		)
Proceeds from stock option exercises	4,317			—			—			—			4,317
Principal payments on capital lease obligations	—			(1,464		)	(1,161		)	—			(2,625		)
Distributions to noncontrolling interests	—			—			(6,967		)	—			(6,967		)
Net cash used in financing activities	(253,826		)	(1,464		)	(8,128		)	—			(263,418		)
Net (decrease) increase in cash and cash equivalents from operations	(3,843		)	(732,166		)	323,655			268,091			(144,263		)
Effect of exchange rate changes on cash and cash equivalents	6,408			584,331			(321,044		)	(268,091		)	1,604
Cash and cash equivalents at beginning of period	320			391,248			167,215			—			558,783
Cash and cash equivalents at end of period	$	2,885		$	243,413		$	169,826		$	—		$	416,124