-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RJRjwiGHJLxMhXZeMlIScj3fL+kQAUZW+o8yXmWO3kNkCh/m0RxPxO6p4kN3oPjc VtMZdrbwztjTuCWPwcVyPQ== 0001047469-03-004297.txt : 20030207 0001047469-03-004297.hdr.sgml : 20030207 20030206194637 ACCESSION NUMBER: 0001047469-03-004297 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20030206 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: FILED AS OF DATE: 20030207 FILER: COMPANY DATA: COMPANY CONFORMED NAME: USA INTERACTIVE CENTRAL INDEX KEY: 0000891103 STANDARD INDUSTRIAL CLASSIFICATION: TELEVISION BROADCASTING STATIONS [4833] IRS NUMBER: 592712887 STATE OF INCORPORATION: DE FISCAL YEAR END: 1202 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-20570 FILM NUMBER: 03543387 BUSINESS ADDRESS: STREET 1: 152 WEST 57TH ST CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2123147300 MAIL ADDRESS: STREET 1: 152 WEST 57TH ST CITY: NEW YORK STATE: NY ZIP: 10019 FORMER COMPANY: FORMER CONFORMED NAME: HSN INC DATE OF NAME CHANGE: 19970111 FORMER COMPANY: FORMER CONFORMED NAME: SILVER KING COMMUNICATIONS INC DATE OF NAME CHANGE: 19940420 FORMER COMPANY: FORMER CONFORMED NAME: USA NETWORKS INC DATE OF NAME CHANGE: 19980223 8-K 1 a2102579z8-k.txt 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 or 15(d) of the SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): February 6, 2003 USA INTERACTIVE (Exact name of Registrant as specified in charter) Delaware 0-20570 59-2712887 (State or other jurisdiction (Commission File (IRS Employer of incorporation) Number) Identification No.) 152 West 57th Street, New York, NY 10019 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 314-7300 ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE On February 6, 2003, the Registrant issued a press release announcing its results for the quarter and full year ended December 31, 2002. The full text of this press release, appearing in Exhibit 99.1 hereto, and forward-looking financial information, appearing in Exhibit 99.2 hereto, is incorporated herein by reference. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS (c) Exhibits. 99.1 Press Release of USA Interactive dated February 6, 2003. 99.2 Forward-Looking Financial Information. ITEM 9. REGULATION FD DISCLOSURE A copy of the Registrant's supplemental information, appearing in Exhibit 99.3 hereto, is furnished pursuant to Regulation FD. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. USA INTERACTIVE By: /s/ Dara Khosrowshahi -------------------------------- Name: Dara Khosrowshahi Title: Executive Vice President and Chief Financial Officer Date: February 6, 2003 EXHIBIT INDEX Exhibit No. Description 99.1 Press Release of USA Interactive dated February 6, 2003. 99.2 Forward-Looking Financial Information. 99.3 Supplemental Information. EX-99.1 3 a2102579zex-99_1.txt EXHIBIT 99.1 EXHIBIT 99.1 [LOGO] FOR IMMEDIATE RELEASE FEBRUARY 6, 2003 USA DELIVERS STRONG Q4 ON ALL KEY METRICS Gross Transactions up 51%, Total Revenue up 30% Adjusted EBITDA up 56%, Operating Income to $37 million GAAP EPS Grows to $0.25, Adjusted EPS to $0.17
Pro Forma (a) ---------------------------------- Q4 2002 Q4 2001 Growth ---------- ---------- ---------- $ IN MILLIONS, EXCEPT PER SHARE Gross Transaction Value $ 3,475 $ 2,303 51% Revenue $ 1,339 $ 1,030 30% Adjusted EBITDA (b) $ 192 $ 123 56% Operating Income $ 37 $ (2) NM GAAP EPS $ 0.25 $ (0.05) NM Adjusted EPS * (b) $ 0.17 $ 0.09 80%
* Referred to as Cash EPS in USA's previous filings. NEW YORK, February 6, 2003 - USA Interactive reported results for its quarter ended December 31, 2002. - - This is the last quarter in which USA will report Adjusted EBITDA. See page 2 for more information. - - USA generated $545 million in Free Cash Flow during 2002, with $741 million in Net Cash Provided by Operating Activities. - - HSN-U.S. grew Adjusted EBITDA by 11% to $84.3 million in Q4 on sales that were down slightly, due primarily to higher gross margins of 36.7%. HSN's Operating Income also grew 27% to $43.1 million. - - Travel, USA's strongest growth area, increased gross bookings 104% to $1.8 billion in Q4, driven by 101% more merchant room nights sold. The travel businesses' Adjusted EBITDA improved by 75% to $79 million and Operating Income by 107% to $44 million. - - Ticketing gross transactions increased 27% to $1.1 billion in Q4. As a result, Ticketing Adjusted EBITDA increased 60% to $34.3 million and Operating Income grew 659% to $16.6 million. 41% of tickets were sold online, versus 34% in the year ago period. - - Match.com Adjusted EBITDA grew 65% to $12.5 million and Operating Income grew 149% to $9.3 million on 111% higher revenue in Q4. Match.com's subscribers increased 90% over the prior year to 724,829 at the end of Q4. - - USA also released today its final budget for 2003. Please see related 8-K for further detail. - ----------------------------------------- (a) IMPORTANT: All results herein are presented on a comparative pro forma basis reflecting the Vivendi transaction, the roll-ups of USANi LLC and Home Shopping Network, Inc., and the merger with Ticketmaster that closed on January 17, 2003, and USA's acquisition of a majority stake in Expedia as if those transactions had been completed as of January 1, 2001, and reflect continuing operations and exclude one-time items, unless otherwise noted. 2001 data is not pro forma for the acquisitions of TV Travel Shop and Interval. Read all footnotes and important disclaimer at the end of this release. (b) Before non-recurring items, including restructuring charges. Please see page F-1 and F-2 for full reconciliations for 2002 and 2001 from Adjusted EBITDA to Operating Income, and from Adjusted Net Income to Net Income. SEE IMPORTANT NOTES AT END OF DOCUMENT FINANCIAL RESULTS AS USA HAS INDICATED IN PREVIOUS FILINGS, THE COMPANY SWITCHED ITS FOCUS FROM ADJUSTED EBITDA ("EBITDA") TO ADJUSTED NET INCOME (REFERRED TO AS "CASH NET INCOME" IN PREVIOUS FILINGS) AS ITS MOST IMPORTANT `BOTTOM LINE' PERFORMANCE METRIC FOR THE COMPANY AS A WHOLE. GOING FORWARD, FOR SEGMENT REPORTING PURPOSES, THE COMPANY HAS SWITCHED ITS FOCUS FROM ADJUSTED EBITDA TO EBITA, DEFINED AS OPERATING INCOME PLUS AMORTIZATION OF (1) NON-CASH COMPENSATION, (2) NON-CASH DISTRIBUTION AND MARKETING, (3) OTHER INTANGIBLES (AND GOODWILL IN 2001), (4) NON-RECURRING ITEMS, AND (5) HSN DISENGAGEMENT COSTS. SEGMENT RESULTS IN THIS RELEASE ARE PRESENTED ON AN EBITDA BASIS FOR PURPOSES OF COMPARISON WITH PRIOR PERIODS. NET INCOME / ADJUSTED NET INCOME - -------------------------------------------------------------------------------- Adjusted Net Income generally captures all income statement items that are ultimately settled in cash. The following table shows the reconciliation from Net Income to Adjusted Net Income. All results are pro forma for the Vivendi and Expedia transactions and the Ticketmaster merger. See pages F-1 and F-2 for full details on actual and adjusted results.
Q4 2002 Q4 2001 Growth -------------------------------------- $ IN MILLIONS Diluted net income available to common shareholders $ 128.5 $ (24.4) NM One-time items (a) (80.6) 12.2 NM ---------- --------- ---------- Diluted Net Income before one-time items 47.9 (12.2) NM Add back of preferred dividend 3.3 - NM Amortization of non-cash compensation 9.2 8.3 11% Amortization of non-cash distribution and marketing 9.9 9.0 9% Amortization of other intangibles (non-cash) 49.6 52.1 -5% Equity (income)/loss from 5.44% common interest in VUE (8.8) - NM Less: related tax and minority interest (19.4) (9.2) -111% ---------- --------- ---------- Adjusted Net Income $ 91.6 $ 48.1 90% ========== ========= ========== Adjusted EPS $ 0.17 $ 0.09 80% ========== ========= ==========
- --------------------------------- (a) Includes restructuring and one-time items in 2002 related to costs to restructure certain businesses, including ECS contract terminations, and costs incurred by the special committees of Expedia and Ticketmaster offset by the reversal of estimated purchase accounting liabilities established in prior years by HSN and PRC. Such reserves were deemed to be in excess of amounts expected to be paid. 2001 represents non-recurring costs related to restructuring operations, employee terminations and the write-down of certain investments. NET CASH PROVIDED BY OPERATING ACTIVITIES / FREE CASH FLOW - -------------------------------------------------------------------------------- Cash provided by operating activities, capital expenditures, investments to fund HSN International and the preferred dividend paid, are all consistent with amounts presented on the Company's actual cash flow statement prepared in accordance with GAAP.
FY 2002 -------------- $ IN MILLIONS Earnings before preferred dividend $ 7.4 Depreciation and all amortization 452.6 5% PIK interest on Class A Preferred (23.0) Equity in losses of unconsolidated affiliates and other investment write-offs 121.9 Minority interest (benefit) / expense 34.1 Changes in working capital and other 147.9 -------------- Net Cash Provided by Operating Activities 740.8 Capital expenditures (153.4) Investments to fund HSN International (32.0) Preferred dividend paid (10.2) -------------- Free Cash Flow $ 545.2 ==============
2 of 7 SEE IMPORTANT NOTES AT END OF DOCUMENT SEGMENT RESULTS - -------------------------------------------------------------------------------- USA reported the following segment results on a comparative pro forma basis reflecting the Vivendi transaction and USA's acquisition of a majority stake in Expedia as if those transactions had been completed as of January 1, 2001. The Ticketmaster merger completed on January 17, 2003 had no impact on the results presented below. Please see pages F-7 and F-8 for full reconciliation of segment Adjusted EBITDA to segment Operating Income:
Revenue Adjusted EBITDA (a) Operating Income ------------------------------------------------------------------------------------------- Q4 2002 Q4 2001 Growth Q4 2002 Q4 2001 Growth Q4 2002 Q4 2001 Growth ------------------------------------------------------------------------------------------- $ IN MILLIONS $ IN MILLIONS $ IN MILLIONS Operating Businesses: HSN - U.S. $ 470.3 $ 476.2 -1% $ 84.3 $ 76.1 11% $ 43.1 $ 34.0 27% Ticketing 164.3 131.8 25% 34.3 21.5 60% 16.6 2.2 659% Match.com 37.1 17.6 111% 12.5 7.6 65% 9.3 3.7 149% Hotels.com 272.6 141.7 92% 32.5 22.9 42% 25.9 17.0 52% Expedia 163.8 81.8 100% 47.0 22.2 112% 27.4 4.4 525% Interval 36.4 - NM 3.6 - NM (5.5) - NM PRC 78.0 69.8 12% 11.9 6.2 91% 1.8 (2.4) NM Corporate and other (b) - - NM (16.6) (7.0) -136% (24.8) (9.8) -154% ------------------------------------------------------------------------------------------- Sub-total 1,222.5 918.7 33% 209.5 149.4 40% 93.7 49.1 91% Emerging Businesses: Citysearch and related 8.3 10.3 -19% (10.0) (9.9) -1% (24.6) (28.7) 14% International TV shopping and other (c) 105.4 82.2 28% (3.3) (7.7) 58% (3.7) (10.6) 65% ECS / Styleclick 8.8 12.4 -29% (3.9) (7.8) 50% (4.8) (8.6) 43% ------------------------------------------------------------------------------------------- Sub-total 122.5 104.9 17% (17.2) (25.4) 32% (33.1) (48.0) 31% Foreign exchange rate fluctuation (d) (2.9) (10.2) 72% (0.2) (0.2) -3% (0.2) (0.1) -323% HSN Disengagement (e) (0.4) 19.1 NM - (0.5) 100% (9.3) (0.5) -1967% Intersegment Elimination (2.8) (2.2) -29% - - NM - - NM ------------------------------------------------------------------------------------------- Total $ 1,339.0 $ 1,030.3 30% $ 192.1 $ 123.3 56% $ 51.0 $ 0.7 7684% =========================================================================================== Attributable Adjusted EBITDA - Operating Businesses $ 177.1 $ 105.7 68% =========================== Supplemental disclosure: Total $ 192.1 $ 123.3 56% $ 51.0 $ 0.7 7684% Non-recurring items (f) (9.7) (3.0) -220% (13.6) (3.0) -349% ---------------------------------------------------------- Including non-recurring items $ 182.4 $ 120.3 52% $ 37.3 $ (2.4) NM ==========================================================
- ----------------------------- (a) See page 6 for definition. Amounts excluded from Adjusted EBITDA include: depreciation ($48.1 million and $34.6 million in Q4 2002 and Q4 2001, respectively); amortization of cable distribution fees ($15.0 million and $14.6 million in Q4 2002 and Q4 2001, respectively); amortization of non-cash items ($68.7 million and $69.5 million in Q4 2002 and Q4 2001, respectively); disengagement related payments to cable operators and marketing expenses ($9.3 million, including $0.4 million of coupons related to the disengaged markets, and $4.1 million in Q4 2002 and Q4 2001, respectively) related to the transfer of HSN's distribution to cable (which has been accomplished); and non-recurring items of $9.7 million and $3.0 million in Q4 2002 and Q4 2001, respectively. (b) Higher corporate costs are due primarily to an increase in corporate employees in connection with USA's significant expansion in 2002, as well as bonuses paid to senior executives for 2002 performance. No such bonuses were made in 2001. (c) International TV Shopping and Other includes HSE Germany, Euvia, HOT Networks, TV Travel Shop, HSN emerging businesses and overhead costs related to HSN International. (d) In order to present comparable results for International TV Shopping and Other, results for HSE-Germany have been translated from foreign currencies to U.S. dollars at a constant exchange rate. (e) 2001 amounts reflect estimated results generated by homes lost by HSN following the sale of USA Broadcasting to Univision. (f) Please see footnotes on pages F-1 and F-2 for details on restructuring and one-time items. Page 3 of 7 SEE IMPORTANT NOTES AT END OF DOCUMENT CAPITALIZATION - -------------------------------------------------------------------------------- USA has cash, securities and debt on its balance sheet, which have been adjusted to reflect how USA management looks at its capitalization as a whole. These adjustments are as follows: 1) Cash is adjusted for the percent attributable to minority interests in USA's public subsidiaries; 2) Cash is adjusted to exclude cash due to clients at Ticketmaster; 3) Securities in VUE are adjusted to exclude the estimated present value of taxes USA expects to pay on these securities, but excludes any impact of the reimbursement USA expects to receive from VUE on tax payments USA makes related to its interest in VUE; 4) Preferred stock is adjusted to reflect the face value of the security (amounts in millions):
As of 12/31/02 -------------------------------------------------------- Balance Sheet Carrying Value Adjustment As Adjusted ----------------- ---------------- ------------------ Cash and marketable securities: USA $ 2,971 $ (105) (a) $ 2,866 Expedia 584(c) (265) (b) 319 Hotels.com 396(c) (135) (b) 261 ----------------- ---------------- ------------------ Total cash and marketable securities / attributable cash $ 3,951 $ (505) $ 3,446 ================= ================ ================== Securities in VUE 2,971 (768) (d) 2,203 Long-term debt (1,236)(e) 0 (1,236) Preferred stock (0) (656) (f) (656) ----------------- ---------------- ------------------ Net cash / attributable cash and securities $ 5,686 $ (1,929) $ 3,757 ================= ================ ==================
As of 1/17/03 ------------- Diluted shares outstanding (g): Basic shares outstanding 495.9 Treasury method options, warrants and restricted stock 24.4 ------------- Diluted shares outstanding 520.3 Market Capitalization $ 11,914
- ---------------------------- (a) Reflects Ticketmaster merger, which closed on January 17, 2003, and reflects exclusion of cash due to clients (approximately $106 million) at Ticketmaster. (b) Reflects percentage of cash attributable to USA's public subsidiaries, based on the Q4 weighted average of USA's fully diluted, treasury method ownership in each of its public subsidiaries, which was 66% for Hotels.com and 55% for Expedia. (c) Cash includes $149.3 million in deferred merchant bookings at Expedia and $76.4 million in deferred revenue at Hotels.com. (d) Reflects estimated present value of taxes on the VUE securities related to USA's gain on the Vivendi transaction. (e) Amounts exclude $117.5 million of redeemable equity interests issued by Euvia that are due in 2006. Euvia has the right to extend maturity to 2016, and the amount is only due to the holder to the extent sufficient funds at Euvia are available. Otherwise, the instrument is on par with Euvia's common equity interests. Also includes $750.0 million of debt issued in December 2002, which is due in 2012. (f) The balance sheet carrying value of the convertible preferred stock issued in the Expedia transaction is based on par value, which is $0.01 per share or approximately $131,000. The adjustment is made to reflect the face value of the security, or $50 per share. (g) Fully diluted shares includes Vivendi's remaining 56.6 million shares that may be delivered to USA in connection with USA's Series B preferred interest in VUE. Reflects Ticketmaster merger, which closed on January 17, 2003. OTHER DEVELOPMENTS - -------------------------------------------------------------------------------- AS ANNOUNCED IN AN EXPEDIA PRESS RELEASE ISSUED YESTERDAY, RICHARD BARTON WILL BE LEAVING HIS CEO AND DIRECTOR POSITIONS AT EXPEDIA BUT WILL NOT BE LEAVING THE USA FAMILY AS HE HAS AGREED TO JOIN THE USA BOARD OF DIRECTORS. SEPARATELY, USA IS APPOINTING ALAN SPOON TO THE USA BOARD OF DIRECTORS AS A NEW INDEPENDENT DIRECTOR. ALAN SPOON IS PRESENTLY A GENERAL PARTNER OF POLARIS VENTURE PARTNERS AND SERVED AS AN INDEPENDENT DIRECTOR OF TICKETMASTER UNTIL RECENTLY, WHEN TICKETMASTER BECAME A PRIVATE COMPANY. Page 4 of 7 SEE IMPORTANT NOTES AT END OF DOCUMENT OPERATING METRICS
Q4 2002 Q4 2001 Growth --------- -------- ------- GROSS TRANSACTION VALUE ("GTV") Total GTV $3,475 $2,303 50.9% Interactive GTV (a) $2,868 $1,768 62.2% Internet GTV (b) $2,295 $1,267 81.1% International GTV $586 $291 101.1%
(a) INTERACTIVE GTV IS DEFINED AS GTV WHICH WAS GENERATED FROM THE TV OR PC FROM HSN, HSN.COM, TICKETMASTER.COM, HOTELS.COM, EXPEDIA, MATCH.COM, TV TRAVEL SHOP AND INTERVAL. (b) INTERNET GTV IS DEFINED AS GTV WHICH WAS GENERATED ONLINE FROM HSN.COM, TICKETMASTER.COM, HOTELS.COM, EXPEDIA, MATCH.COM AND INTERVAL. - -------------------------------------------------------------------------------- ALL HOUSEHOLD NUMBERS AS OF END OF PERIOD.
HSN - U.S. Units Shipped (mm) 10.8 11.4 -5.3% Gross Profit % 36.7% 34.0% 270 bps Return Rate 18.2% 17.9% Average price point $47.54 $47.27 0.6% Product mix: Home Licensing (a) 35% 41% Home Fashions 7% 5% Jewelry 24% 25% Health / Beauty 22% 17% Apparel / Accessories 12% 12% HSN total homes (mm) (b) 78.8 83.0 -5.1% America's Store total FTEs (mm) 9.0 12.3 -26.8% HSN.com % of Sales 13.1% 9.6%
(a) HOME LICENSING INCLUDES ELECTRONICS, COMPUTERS, AND OTHER HOMEGOODS. (b) 2001 INCLUDES BROADCAST-ONLY HOMES WHICH WERE DISENGAGED FOLLOWING THE SALE OF USA BROADCASTING TO UNIVISION, WHICH WAS COMPLETED IN JANUARY 2002. - -------------------------------------------------------------------------------- INTERNATIONAL TV SHOPPING AND OTHER - Households (mm)
Avg. 12/31/02 HSN International: Hrs. Daily Stake ---------- -------- HSE - Germany (includes Austria/Switzerland) 30.8 29.7 16 90% TVSN (China) (HH airing at least 14 hrs/week) 11.5 23.9 10 21% Shop Channel (Japan) 14.4 11.6 17 30% Euvia: (a) Euvia Travel (b) 28.3 28.8 2.4 49% Neun Live (b) 26.9 28.8 9.5 49% TV Travel Shop U.K. (a) 11.0 N/A 24 100%
(a) NOT OWNED BY USA IN PRIOR YEAR'S PERIOD. (b) IT IS EXPECTED THAT HOT NETWORKS WILL CONVEY A 3% INTEREST IN EUVIA TO A FORMER SHAREHOLDER, IN WHICH CASE HSN'S EFFECTIVE STAKE IN EUVIA WOULD BE REDUCED TO 45.6%. - -------------------------------------------------------------------------------- TICKETMASTER
Number of tickets sold (mm) 24.1 20.3 18.7% Gross value of tickets sold (mm) $1,106 $870 27.0% Share of tickets sold online 40.7% 33.9%
- -------------------------------------------------------------------------------- MATCH.COM (a)
Paid Subscribers (000s) 725 382 89.6% New Registrations (000s) 3,380 2,304 46.7% New Subscriptions (000s) 348 260 33.5% Conversion rate - registrations to subscriptions 10.3% 11.3%
(a) THE OPERATING METRICS AND FINANCIAL RESULTS PRESENTED FOR MATCH.COM INCLUDE THE IMPACT OF SOULMATES, ACQUIRED ON APRIL 12, 2002. THE 2001 OPERATING METRICS AND FINANCIAL INFORMATION DO NOT INCLUDE SOULMATES. - -------------------------------------------------------------------------------- HOTELS.COM
Merchant hotel room nights (net of cancels) (000s) 2,227 1,187 87.6% Average daily rate $117.93 $115.00 2.5% Cities served: U.S. 186 124 50.0% International 139 54 157.4% Properties under contract (a) 7,723 4,567 69.1% Affiliates 33,973 23,808 42.7%
(a) MERCHANT ONLY; EXCLUDES COMMISSIONABLE LODGING. Page 5 of 7 SEE IMPORTANT NOTES AT END OF DOCUMENT
Q4 2002 Q4 2001 Growth --------- --------- --------- INTERVAL Active members 1,499,668 1,318,093 13.8% Exchange transactions 151,021 148,988 1.4% % of Exchanges online 7.6% 3.3% EXPEDIA GROSS BOOKINGS (MM) Total gross bookings (a) $1,380 $704 96.0% Agency gross bookings 1,002 540 85.6% Merchant gross bookings (includes CCV) 378 164 130.5% CCV gross bookings 42 - N/A International gross bookings 123 48 156.3% North America gross bookings 1,257 656 91.6% ADDITIONAL METRICS (000S) Revenue from packages $46,912 $11,573 305.4% Total room nights stayed 3,168 1,522 108.1% Merchant room nights stayed 2,522 1,178 114.1% Merchant hotel average daily rate (excludes CCV) 119 109 9.2% CUSTOMERS (000S) Average Media Metrix reach (000s) (b) 11,392 9,238 23.3% Expedia.com conversion (c) 6.8% 5.2% New purchasing customers (000s) (d) 1,528 870 75.6% Cumulative purchasing customers (000s) (e) 12,360 6,294 N/A Unique purchasing customers (000s) (f) 2,225 1,383 60.9%
(a) GROSS BOOKINGS REPRESENTS THE TOTAL VALUE OF TRAVEL BOOKED THROUGH THE EXPEDIA, WWTE SITES, CLASSIC CUSTOM VACATIONS AND METROPOLITAN TRAVEL SINCE ACQUISITION. (b) AVERAGE MONTHLY MEDIA METRIX REACH REPRESENTS THE UNDUPLICATED REACH FOR THE EXPEDIA SITES. (c) CONVERSION REPRESENTS THE MONTHLY AVERAGE EXPEDIA.COM UNIQUE MONTHLY PURCHASERS DIVIDED BY THE MONTHLY AVERAGE MEDIA METRIX REACH FOR THE EXPEDIA.COM SITE. (d) EXPEDIA NEW PURCHASING CUSTOMERS REPRESENTS THE NUMBER OF NEW CUSTOMERS TRANSACTING THROUGH THE EXPEDIA SITES IN A QUARTER. (e) EXPEDIA CUMULATIVE PURCHASING CUSTOMERS REPRESENTS THE CUMULATIVE NUMBER OF CUSTOMERS THAT HAVE EVER TRANSACTED THROUGH THE EXPEDIA SITES AS OF THE END OF A QUARTER. (f) EXPEDIA QUARTERLY UNIQUE PURCHASING CUSTOMERS REPRESENTS THE NUMBER OF UNIQUE CUSTOMERS TRANSACTING THROUGH THE EXPEDIA SITES OVER THE COURSE OF A QUARTER. DEFINITIONS - -------------------------------------------------------------------------------- INTERACTIVE BUSINESSES include HSN, HSN.com, Expedia, Hotels.com, Ticketmaster.com, Match.com, TV Travel Shop and Interval online transactions. Gross transaction value related to these businesses comes predominantly from sales that are either initiated and/or transacted through the television or internet. ADJUSTED NET INCOME generally captures all income statement items that have been, or will ultimately be, settled in cash and is defined as net income available to common shareholders plus: (1) amortization of non-cash distribution and marketing expense, (2) amortization of non-cash compensation expense, (3) amortization of intangibles (and goodwill in 2001), net of related tax and minority interest expense, (4) equity income or loss from USA's 5.44% interest in VUE, and (5) non-recurring items and / or restructuring charges. See page 2 for more detail. Adjusted EPS is defined as Adjusted Net Income divided by fully diluted shares outstanding for Adjusted EPS purposes (see pages F-1, F-2, F-3 and F-4 for details). USA'S TRAVEL BUSINESSES include Expedia, Hotels.com, TV Travel Shop and Interval. FREE CASH FLOW is defined as Net Cash Provided by Operating Activities from continuing operations, less capital expenditures, investments to fund HSN International unconsolidated operations and preferred dividends paid. ADJUSTED EBITDA, also referred to as EBITDA in this release, is defined as operating income plus (1) depreciation, (2) amortization of cable distribution fees, (3) amortization of non-cash distribution, marketing, and compensation expense, (4) amortization of other intangibles, and (5) disengagement related payments to cable operators and marketing expenses related to the transfer of HSN's distribution to cable (which has been accomplished). ATTRIBUTABLE ADJUSTED EBITDA - OPERATING BUSINESSES is defined as Adjusted EBITDA from Operating Businesses, less the percentage of Adjusted EBITDA attributable to minority shareholders of USA's non-wholly owned subsidiaries. This percentage is determined based on the Q4 weighted average of USA's fully diluted, treasury method ownership in each of its non-wholly owned subsidiaries, which was 66% for Hotels.com and 55% for Expedia. Page 6 of 7 SEE IMPORTANT NOTES AT END OF DOCUMENT Hotels.com and Expedia, which USA being the controlling shareholder of both companies, are actively exploring areas where they might work together in a way that would benefit all their customers and stockholders. Although there continue to be many areas of their businesses where the companies can best achieve their goals through separate strategies and practices, there have been instances where, fully consistent with their existing contractual agreements, they have worked cooperatively, and we anticipate that they will continue to explore such possibilities in the future. As previously announced, USA voluntarily petitioned the SEC to review the presentation of revenue by Hotels.com and Expedia for merchant hotel revenue, as Hotels.com presents such revenue on a gross basis and Expedia on a net basis. The SEC has concluded its review, and will not object to the presentation of both companies. ANALYST CONFERENCE CALL USA Interactive will audiocast its conference call with analysts and investors discussing the company's fourth quarter financial results and certain forward-looking information on Thursday, February 6, 2003, at 11:00 a.m. Eastern Time (ET). The live audiocast is open to the public, and a replay will be available for 48 hours, beginning approximately one hour after completion of the call, at www.usainteractive.com/investor.relations. ADDITIONAL INFORMATION AND WHERE TO FIND IT SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements relating to USA's anticipated financial performance, business prospects, new developments, new merchandising strategies and similar matters, and/or statements preceded by, followed by or that include the words "believes," "could," "expects," "anticipates," "estimates," "intends," "plans," "projects," "seeks," or similar expressions. These forward-looking statements are necessarily estimates reflecting the best judgment of USA's senior management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. These forward-looking statements are subject to risks, uncertainties and assumptions that could have a material adverse effect on USA's business, financial condition or results of operations. You should understand that the following important factors could affect USA's future results and could cause those results to differ materially from those expressed in the forward-looking statements: (1) material adverse changes in economic conditions generally or in such conditions affecting USA's markets or industries; (2) future regulatory and legislative actions and conditions affecting USA's operating areas; (3) competition from others; (4) successful integration of our divisions' management structures; (5) product demand and market acceptance; (6) the ability to protect proprietary information and technology or to obtain necessary licenses on commercially reasonable terms; (7) the ability to maintain the integrity of USA's systems and infrastructure; (8) the ability to expand into and successfully operate in foreign markets; and (9) obtaining and retaining skilled workers and key executives. In addition, investors should consider the other information contained in or incorporated by reference into USA's filings with the U.S. Securities and Exchange Commission (the "SEC"), including its Annual Report on Form 10-K for the fiscal year ended 2001, especially in the Management's Discussion and Analysis section, its most recent Quarterly Report on Form 10-Q and its Current Reports on Form 8-K. Other unknown or unpredictable factors also could have material adverse effects on USA's future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this press release may not occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated, or if no date is stated, as of the date of this press release. USA is not under any obligation and does not intend, except as specifically stated, to make publicly available any update or other revisions to any of the forward-looking statements contained in this press release to reflect circumstances existing after the date of this press release or to reflect the occurrence of future events even if experience or future events make it clear that any expected results expressed or implied by those forward-looking statements will not be realized. ABOUT USA INTERACTIVE USA Interactive (Nasdaq: USAI) engages worldwide in the business of interactivity via the Internet, the television and the telephone. USA's multiple brands are organized across three areas: Electronic Retailing, Information & Services and Travel Services. Electronic Retailing is comprised of HSN, America's Store, HSN.com, and Home Shopping Europe and Euvia in Germany. Information & Services includes Ticketmaster, Match.com, uDate (transaction pending), Citysearch, Evite, Entertainment Publications (transaction pending) and Precision Response Corporation. Travel Services consists of Expedia (Nasdaq: EXPE), Hotels.com (Nasdaq: ROOM), Interval International, TV Travel Group and USA's forthcoming U.S. cable travel network. CONTACTS: USA COMMUNICATIONS: USA INVESTOR RELATIONS: Ron Sato Roger Clark / Lauren Rosenfield 212-314-7254 212-314-7400 USA INTERACTIVE 152 West 57th Street, 42nd Floor New York, NY 10019 212.314.7300 FAX 212.314.7309 www.usainteractive.com Page 7 of 7 SEE IMPORTANT NOTES AT END OF DOCUMENT USA INTERACTIVE RECONCILIATION FROM ACTUAL TO ADJUSTED RESULTS ($ IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
FOR THREE MONTHS ENDED DECEMBER 31, 2002: ------------------------------------------------------------------------------ PRO FORMA ADJUSTMENTS: PRO FORMA ACTUAL ADJUSTMENTS (a) PRO FORMA ONE-TIME ITEMS (b) ADJUSTED ------------ --------------- ------------ ----------------- ------------- Revenues, net $1,338,988 $1,338,988 $1,338,988 Costs related to revenues 803,911 803,911 (4,185) 799,726 ------------ --------------- ------------ ----------------- ------------- Gross Profit 535,077 535,077 4,185 539,262 Other operating costs 353,096 353,096 (5,555) 347,541 Disengagement coupons included as net revenues (405) (405) (405) ------------ --------------- ------------ ----------------- ------------- Adjusted EBITDA 182,386 182,386 9,740 192,126 Depreciation 49,739 49,739 (1,679) 48,060 HSN cable distribution fees 15,001 15,001 15,001 Amortization of non-cash items: Distribution and marketing 9,859 9,859 9,859 Compensation expense 5,700 3,528 9,228 9,228 Other intangibles 31,746 17,903 49,649 49,649 Non-recurring restructuring items -- non-EBITDA 2,221 2,221 (2,221) 0 HSN disengagement costs (e) 9,345 9,345 9,345 ------------ --------------- ------------ ----------------- ------------- Operating income 58,775 (21,431) 37,344 13,640 50,984 Interest 28,130 28,130 28,130 Equity losses in affiliates and other 24,491 24,491 (12,750) 11,741 ------------ --------------- ------------ ----------------- ------------- Earnings before income taxes and minority interest 111,396 (21,431) 89,965 890 90,855 Income taxes 52,836 5,498 58,334 (81,151) (22,817) Minority interest (16,113) 1,098 (15,015) (351) (15,366) ------------ --------------- ------------ ----------------- ------------- Earnings before preferred dividend 148,119 (14,835) 133,284 (80,612) 52,672 Preferred dividend (3,264) (3,264) (3,264) ------------ --------------- ------------ ----------------- ------------- Income from continuing operations available to common shareholders 144,855 (14,835) 130,020 (80,612) 49,408 Impact of dilutive securities (1,510) (1,510) (1,510) ------------ --------------- ------------ ----------------- ------------- Diluted Net income available 143,345 (14,835) 128,510 (80,612) 47,898 ============ =============== ============ ================= ============= Basic EPS $0.32 $0.26 $0.10 Diluted EPS $0.30 $0.25 $0.10 Diluted Net income available - continuing operations 47,898 Preferred dividend 3,264 Amortization of non-cash items 68,736 Equity gain related to VUE (8,847) Less: related tax and minority interest (19,444) ------------- Adjusted Net Income 91,607 ------------- Adjusted EPS $0.17 ============= RECONCILIATION OF SHARES OUTSTANDING: Basic weighted average shares outstanding 449,339 45,471 (c ) 494,810 494,810 Options, warrants and restricted stock, treasury method 22,364 1,166 (c ) 23,530 23,530 Conversion of preferred shares to common 19,434 19,434 19,434 ------------ ------------ ------------- Diluted weighted average shares outstanding 491,137 537,775 537,775 ============ ============ Additional impact of restricted shares 426(d) 426 ------------- Adjusted EPS weighted average shares outstanding 538,200 =============
- ------------------------- (a) Pro forma adjustments represent the impacts of the Expedia merger which occurred in February 2002, the contribution of USA Entertainment to VUE which occurred in May 2002, the roll-up of USANi LLC which occurred in conjunction with the VUE deal, the roll-up of Home Shopping Network, Inc., which occurred in June 2002, and the merger with Ticketmaster, which closed January 17, 2003, as if the transactions occurred as of the beginning of the period presented. Also included is the impact of these transactions on shares outstanding. (b) Non-recurring items include restructuring and one-time items related to restructuring operations, employee terminations and costs incurred by the special committees of Expedia and Ticketmaster, as well as the benefit of certain tax deductions related to Styleclick and Hot Germany, which are considered non-recurring. (c) Additional shares and options issued in the Ticketmaster merger, which closed on January 17, 2003. (d) For Adjusted EPS purposes, the impact of restricted shares is based on the weighted average shares outstanding, without taking into account the treasury method impact of computing dilutive securities. (e) Costs related to marketing and other activities in disengagement markets. F-1 USA INTERACTIVE RECONCILIATION FROM ACTUAL TO ADJUSTED RESULTS ($ IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
FOR THREE MONTHS ENDED DECEMBER 31, 2001: ----------------------------------------------------------------------------- PRO FORMA ADJUSTMENTS: PRO FORMA ACTUAL ADJUSTMENTS (a) PRO FORMA ONE-TIME ITEMS (b) ADJUSTED ---------- ------------------- ------------ ---------------- ------------ Revenues, net $948,506 $81,762 $1,030,268 $1,030,268 Costs related to revenues 632,634 25,597 658,231 658,231 ---------- ------------------- ------------ ---------------- ------------ Gross Profit 315,872 56,165 372,037 372,037 Other operating costs 217,771 33,960 251,731 (3,041) 248,690 ---------- ------------------- ------------ ---------------- ------------ Adjusted EBITDA 98,101 22,205 120,306 3,041 123,347 Depreciation 30,810 3,749 34,559 34,559 HSN cable distribution fees 14,591 14,591 14,591 Amortization of non-cash items: Distribution and marketing 6,519 2,521 9,040 9,040 Compensation expense 2,369 5,953 8,322 8,322 Other intangibles 20,718 31,410 52,128 52,128 Amortization of goodwill 54,320 (54,320) 0 0 HSN disengagement costs (f) 4,052 4,052 4,052 ----------------------------------------------------------------------------- Operating income (35,278) 32,892 (2,386) 3,041 655 Interest (6,176) 26,357 20,181 20,181 Equity losses in affiliates and other (26,442) (2,119) (28,561) 14,688 (13,873) ---------- ------------------- ------------ ---------------- ------------ Earnings before income taxes and minority interest (67,896) 57,130 (10,766) 17,729 6,963 Income taxes 1,113 (6,081) (4,968) (4,998) (9,966) Minority interest 20,343 (25,739) (5,396) (522) (5,918) ---------- ------------------- ------------ ---------------- ------------ Earnings before preferred dividend (46,440) 25,310 (21,130) 12,209 (8,921) Preferred dividend 0 (3,264) (3,264) (3,264) ---------- ------------------- ------------ ---------------- ------------ Income from continuing operations available to common shareholders (46,440) 22,046 (24,394) 12,209 (12,185) Impact of dilutive securities 0 0 0 ---------- ------------------- ------------ ---------------- ------------ Diluted Net income available - continuing operations (46,440) 22,046 (24,394) 12,209 (12,185) Discontinued operations (c) (10,508) 10,508 0 0 ---------- ------------------- ------------ ---------------- ------------ Diluted Net income ($56,948) $32,554 ($24,394) $12,209 ($12,185) ========== =================== ============ ================ ============ Basic and Diluted EPS - continuing operations ($0.12) ($0.05) ($0.03) Basic and Diluted EPS ($0.15) ($0.05) ($0.03) Diluted Net income available - continuing operations (12,185) Amortization of non-cash items 69,490 Less: related tax and minority interest (9,211) ------------ Adjusted Net Income 48,094 ------------ Adjusted EPS $0.09 ============ RECONCILIATION OF SHARES OUTSTANDING: Basic weighted average shares outstanding 377,139 106,351 (d) 483,490 483,490 Options, warrants and restricted stock, treasury method 0 0 0 0 Conversion of preferred shares to common 0 0 0 ---------- ------------ ------------ Diluted weighted average shares outstanding 377,139 483,490 483,490 ========== ============ Options, warrants and restricted stock, treasury method 23,740 23,740 Additional impact of restricted shares 117(e) 117 ------------ Adjusted EPS weighted average shares outstanding 507,347 ============
(a) Pro forma adjustments represent the impacts of the Expedia merger which occurred in February 2002, the contribution of USA Entertainment to VUE which occurred in May 2002, the roll-up of USANi LLC which occurred in conjunction with the VUE deal, the roll-up of Home Shopping Network, Inc., which occurred in June 2002, and the merger with Ticketmaster, which closed January 17, 2003, as if the transactions occurred as of the beginning of the period presented. Also included is the impact of these transactions on shares outstanding. (b) Non-recurring items include restructuring and one-time items related to restructuring operations, employee terminations and a write-down of investments. (c) Discontinued operations relates to the results of USA Entertainment of $(10.5) million. (d) Pro forma shares include the impact of the TM merger which closed on January 17, 2003 (45.5 mm), the Expedia transaction that closed February 4, 2002 (20.6mm), shares issued in the VUE transaction on May 7, 2002 (7.1 mm) and shares issued in the roll-up of Home Shopping Networks, Inc. which occurred in June 2002 (33.2mm). (e) For Adjusted EPS purposes, the impact of restricted shares is based on the weighted average shares outstanding, without taking into account the treasury method impact of computing dilutive securities. (f) Costs related to marketing and other activities in disengagement markets. F-2 USA INTERACTIVE RECONCILIATION FROM ACTUAL TO ADJUSTED RESULTS ($ IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
FOR TWELVE MONTHS ENDED DECEMBER 31, 2002: -------------------------------------------------------------------------------- PRO FORMA ADJUSTMENTS: PRO FORMA ACTUAL ADJUSTMENTS (A) PRO FORMA ONE-TIME ITEMS (B) ADJUSTED ----------- ---------------- ------------ ------------------ ----------- Revenues, net $4,621,224 $35,487 $4,656,711 $4,656,711 Costs related to revenues 2,818,443 10,586 2,829,029 (5,861) 2,823,168 ----------- -------------- ------------ ------------------ ------------ Gross Profit 1,802,781 24,901 1,827,682 5,861 1,833,543 Other operating costs 1,194,861 15,723 1,210,584 (52,994) 1,157,590 Disengagement coupons included as net revenues (c) (2,205) (2,205) (2,205) ----------- -------------- ------------ ------------------ ------------ Adjusted EBITDA 610,125 9,178 619,303 58,855 678,158 Depreciation 177,219 919 178,138 (1,679) 176,459 HSN cable distribution fees 53,680 53,680 53,680 Amortization of non-cash items: Distribution and marketing 37,344 4,059 41,403 41,403 Compensation expense 15,899 15,044 30,943 30,943 Other intangibles 168,430 47,859 216,289 (22,247) 194,042 Non-recurring restructuring items -- non-EBITDA 39,129 39,129 (39,129) 0 HSN disengagement costs (c) 31,671 31,671 31,671 ----------- -------------- ------------ ------------------ ------------ Operating income 86,753 (58,703) 28,050 121,910 149,960 Interest and other 67,827 34,779 102,606 102,606 Equity losses in affiliates and other (107,552) (120) (107,672) 87,042 (20,630) ----------- -------------- ------------ ------------------ ------------ Earnings before income taxes and minority interest 47,028 (24,044) 22,984 208,952 231,936 Income taxes (5,572) (1,826) (7,398) (102,782) (110,180) Minority interest (34,078) (15,885) (49,963) (726) (50,689) ----------- -------------- ------------ ------------------ ------------ Earnings before preferred dividend 7,378 (41,755) (34,377) 105,444 71,067 Preferred dividend (11,759) (1,297) (13,056) 0 (13,056) ----------- -------------- ------------ ------------------ ------------ Income from continuing operations available to common shareholders (4,381) (43,052) (47,433) 105,444 58,011 Impact of dilutive securities (5,296) (924) (6,220) (6,220) ----------- -------------- ------------ ------------------ ------------ Diluted Net income available - continuing operations (9,677) (43,976) (53,653) 105,444 51,791 Discontinued operations (d) 2,407,114 (2,407,114) 0 0 Cumulative effect of accounting change (461,389) 461,389 0 0 Impact of dilutive securities 0 0 0 ----------- -------------- ------------ ------------------ ------------ Diluted Net income $1,936,048 ($1,989,701) ($53,653) $105,444 $51,791 =========== ============== ============ ================== ============ Basic EPS - continuing operations ($0.01) ($0.10) $0.12 Diluted EPS - continuing operations ($0.02) ($0.11) $0.10 Diluted EPS $4.54 ($0.11) $0.10 Diluted Net income available - continuing operations 51,791 Amortization of non-cash items 266,388 Equity gain related to VUE (6,108) Less: related tax and minority interest (76,208) ------------ Adjusted Net Income 235,863 ------------ Adjusted EPS $0.45 ============ RECONCILIATION OF SHARES OUTSTANDING: Basic weighted average shares outstanding 426,317 66,107 (e) 492,424 492,424 Options, warrants and restricted stock, treasury method 0 0 0 25,840 25,840 Conversion of preferred shares to common 0 0 0 ----------- ------------ ------------ Diluted weighted average shares outstanding 426,317 492,424 518,265 =========== ============ Options, warrants and restricted stock, treasury method 0 0 Additional impact of restricted shares 207(f) 207 ------------ Adjusted EPS weighted average shares outstanding 518,472 ============
- ------------------------------- (a) Pro forma adjustments represent the impacts ofthe Expedia merger which occurred in February 2002, the contribution of USA Entertainment to VUE which occurred in May 2002, the roll-up of USANi LLC which occurred in conjunction with the VUE deal, the roll-up of Home Shopping Network, Inc., which occurred in June 2002, and the merger with Ticketmaster, which closed January 17, 2003, as if the transactions occurred as of the beginning of the period presented. Also included is the impact of these transactions on shares outstanding. (b) Non-recurring items include the write-down of certain investments, costs of ECS contract terminations, costs to shut-down certain operations, including HSN Espanol and HSN Italy, a write-down of goodwill for PRC as well as costs to shut-down certain PRC call centers, costs incurred by the special committees of Expedia, Hotels.com and Ticketmaster and the write-down of certain equity investments. (c) Costs related to marketing and related activities in the disengagement markets. (d) Discontinued operations relates to the gain on the contribution of USA Entertainment to VUE of $2.38 billion, the results of USA Entertainment prior to May 7, 2002 of $28.8 million and the cumulative effect of accounting change for the new goodwill rules of $(461.4) million. The company is in the process of finalizing the gain on the VUE transaction, as the tax expense was based on a preliminary estimate of the company's tax basis in the assets. (e) Pro forma shares include the impact of the TM merger which closed on January 17, 2003 (45.5 mm), the Expedia transaction that closed February 4, 2002 (2.0 mm), shares issued in the VUE transaction on May 7, 2002 (2.5mm) and shares issued in the roll-up of Home Shopping Networks, Inc. which occurred in June 2002 (16.2 mm). (f) For Adjusted EPS purposes, the impact of restricted shares is based on the weighted average shares outstanding, without taking into account the treasury method impact of computing dilutive securities. F-3 USA INTERACTIVE RECONCILIATION FROM ACTUAL TO ADJUSTED RESULTS ($ IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
FOR TWELVE MONTHS ENDED DECEMBER 31, 2001: ------------------------------------------------------------------------- PRO FORMA ADJUSTMENTS: PRO FORMA ACTUAL ADJUSTMENTS (a) PRO FORMA ONE-TIME ITEMS (b) ADJUSTED --------- ------------- ---------- ------------------ ----------- Revenues, net $ 3,468,860 $296,936 $3,765,796 $3,765,796 Costs related to revenues 2,331,297 93,132 2,424,429 2,424,429 --------- ------------- ---------- ------------------ ----------- Gross Profit 1,137,563 203,804 1,341,367 1,341,367 Other operating costs 839,636 142,940 982,576 (20,064) 962,512 --------- ------------- ---------- ------------------ ----------- Adjusted EBITDA 297,927 60,864 358,791 20,064 378,855 Depreciation 131,308 11,049 142,357 142,357 HSN cable distribution fees 43,975 43,975 43,975 Amortization of non-cash items: Distribution and marketing 26,385 8,307 34,692 34,692 Compensation expense 7,800 30,519 38,319 38,319 Other intangibles 79,164 125,798 204,962 204,962 Amortization of goodwill 215,419 (215,419) 0 0 Non-recurring restructuring items -- non-EBITDA 6,248 6,248 (6,248) 0 HSN disengagement costs (f) 4,052 4,052 0 4,052 --------- ------------- ---------- ------------------ ----------- Operating income (216,424) 100,610 (115,814) 26,312 (89,502) Interest and other (19,184) 103,647 84,463 84,463 Equity losses in affiliates and other (51,849) (8,460) (60,309) 21,366 (38,943) --------- ------------- ---------- ------------------ ----------- Earnings before income taxes and minority interest (287,457) 195,797 (91,660) 47,678 (43,982) Income taxes (2,450) (27,766) (30,216) (9,349) (39,565) Minority interest 103,108 (99,880) 3,228 (3,822) (594) --------- ------------- ---------- ------------------ ----------- Earnings before preferred dividend (186,799) 68,151 (118,648) 34,507 (84,141) Preferred dividend 0 (13,056) (13,056) (13,056) --------- ------------- ---------- ------------------ ----------- Income from continuing operations available to common (186,799) 55,095 (131,704) 34,507 (97,197) shareholders Impact of dilutive securities 0 0 0 --------- ------------- ---------- ------------------ ----------- Diluted Net income available - continuing operations (186,799) 55,095 (131,704) 34,507 (97,197) ========= ============= ========== ================== =========== Discontinued operations (c) 570,407 (570,407) 0 0 --------- ------------- ---------- ------------------ ----------- Diluted Net income $383,608 ($515,312) ($131,704) $34,507 ($97,197) ========= ============= ========== ================== =========== Basic and Diluted EPS - continuing operations ($0.50) ($0.27) ($0.20) Diluted EPS $1.03 ($0.27) ($0.20) Diluted Net income available - continuing operations (97,197) Amortization of non-cash items 277,973 Less: related tax and minority interest (58,204) ---------- Adjusted Net Income 122,572 ---------- Adjusted EPS $0.24 ========== RECONCILIATION OF SHARES OUTSTANDING: Basic weighted average shares outstanding 374,101 106,351 (d ) 480,452 480,452 Options, warrants and restricted stock, treasury method 0 0 0 0 0 Conversion of preferred shares to common 0 0 0 --------- ---------- ----------- Diluted weighted average shares outstanding 374,101 480,452 480,452 ========= ========== Options, warrants and restricted stock, treasury method 31,501 31,501 Additional impact of restricted shares 114 (e) 114 ----------- Adjusted EPS weighted average shares outstanding 512,067 ==========
- ----------------------------- (a) Pro forma adjustments represent the impacts of the Expedia merger which occurred in February 2002, the contribution of USA Entertainment to VUE which occurred in May 2002, the roll-up of USANi LLC which occurred in conjunction with the VUE deal, the roll-up of Home Shopping Network, Inc., which occurred in June 2002, the merger of TM and TMCS, which occurred on January 31, 2001, and the merger with Ticketmaster, which closed January 17, 2003, as if the transactions occurred as of the beginning of the period presented. Also included is the impact of these transactions on shares outstanding. (b) Non-recurring items include one-time items related to restructuring operations, employee terminations and benefits and a write-down of investments. (c) Discontinued operations relates to a gain on sale of USAB to Univision of $517.8 million, the results of USA Entertainment of $61.8 million and the cumulative effect of accounting change for the new rules on film accounting of $(9.2) million. (d) Pro forma shares include the impact of the TM merger which closed on January 17, 2003 (45.5 mm), the Expedia transaction that closed February 4, 2002 (20.6 mm), shares issued in the VUE transaction on May 7, 2002 (7.1 mm) and shares issued in the roll-up of Home Shopping Networks, Inc. which occurred in June 2002 (33.2mm). (e) For Adjusted EPS purposes, the impact of restricted shares is based on the weighted average shares outstanding, without taking into account the treasury method impact of computing dilutive securities. (f) Costs related to marketing and other activities in disengagement markets. F-4 USA INTERACTIVE SEGMENT RESULTS FOR THREE MONTHS ENDED DECEMBER 31, 2002 ($ IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
Revenue Adjusted EBITDA (a) Operating Income ----------------------------- ---------------------------- ----------------------------- Q4 2002 Q4 2001 Growth Q4 2002 Q4 2001 Growth Q4 2002 Q4 2001 Growth --------- --------- ------ -------- -------- -------- -------- -------- -------- $ IN MILLIONS $ IN MILLIONS $ IN MILLIONS Operating Businesses: HSN - U.S. $ 470.3 $ 476.2 -1% $ 84.3 $ 76.1 11% $ 43.1 $ 34.0 27% Ticketing 164.3 131.8 25% 34.3 21.5 60% 16.6 2.2 659% Match.com 37.1 17.6 111% 12.5 7.6 65% 9.3 3.7 149% Hotels.com 272.6 141.7 92% 32.5 22.9 42% 25.9 17.0 52% Expedia 163.8 81.8 100% 47.0 22.2 112% 27.4 4.4 525% Interval 36.4 - NM 3.6 - NM (5.5) - NM PRC 78.0 69.8 12% 11.9 6.2 91% 1.8 (2.4) NM Corporate and other (b) - - NM (16.6) (7.0) -136% (24.8) (9.8) -154% --------- --------- ------ -------- -------- -------- -------- -------- -------- Sub-total 1,222.5 918.7 33% 209.5 149.4 40% 93.7 49.1 91% Emerging Businesses: Citysearch and related 8.3 10.3 -19% (10.0) (9.9) -1% (24.6) (28.7) 14% International TV shopping and other (c) 105.4 82.2 28% (3.3) (7.7) 58% (3.7) (10.6) 65% ECS / Styleclick 8.8 12.4 -29% (3.9) (7.8) 50% (4.8) (8.6) 43% --------- --------- ------ -------- -------- -------- -------- -------- -------- Sub-total 122.5 104.9 17% (17.2) (25.4) 32% (33.1) (48.0) 31% Foreign exchange rate fluctuation (d) (2.9) (10.2) 72% (0.2) (0.2) -3% (0.2) (0.1) 323% HSN Disengagement (e) (0.4) 19.1 NM - (0.5) 100% (9.3) (0.5) 1967% Intersegment Elimination (2.8) (2.2) -29% - - NM - - NM --------- --------- ------ -------- -------- -------- -------- -------- -------- Total $1,339.0 $ 1,030.3 30% $ 192.1 $ 123.3 56% $ 51.0 $ 0.7 7684% ========= ========= ====== ======== ======== ======== ======== ======== ======= Attributable Adjusted EBITDA - Operating $ 177.1 $ 105.7 68% Businesses ======== ======== ======= Supplemental disclosure: Total $ 192.1 $ 123.3 56% $ 51.0 $ 0.7 7684% Non-recurring items (f) (9.7) (3.0) -220% (13.6) (3.0) -349% -------- -------- -------- -------- -------- -------- Including non-recurring items $ 182.4 $ 120.3 52% $ 37.3 $ (2.4) NM ======== ======== ======== ======== ======== =======
(a) Amounts excluded from Adjusted EBITDA include Depreciation ($48.0 million and $34.6 million in Q4 2002 and Q4 2001, respectively); amortization of cable distribution fees ($15.0 million and $14.6 million in Q4 2002 and Q4 2001, respectively);amortization of non-cash items ($68.7 millionand $69.5 million in Q4 2002 and Q4 2001, respectively); disengagement related payments to cable operators and marketing expenses ($9.3 million, including $0.4 million of coupons related to the disengaged markets, and $4.1 million in Q4 2002 and Q4 2001, respectively) related to the transfer of HSN's distribution to cable (which has been accomplished); and non-recurring items of $9.7 million and $3.0 million in Q4 2002 and Q4 2001, respectively. (b) Higher corporate costs are due primarily to an increase in corporate employees in connection with USA's significant expansion in 2002, as well as bonuses paid to senior executives for 2002 performance. No such bonuses were made in 2001. (c) International TV Shopping and Other includes HSE Germany, Euvia, Hot Networks, TV Travel Shop, HSN emerging businesses and overhead costs related to HSN International. (d) In order to present comparable results for International TV Shopping and Other, results have been translated from foreign currencies to USA dollars at a constant exchange rate. (e) 2001 amounts reflect estimated results generated by homes lost by HSN following the sale of USA Broadcasting to Univision. (f) Non-recurring items in 2002 include restructuring and one-time items related to restructuring operations,employee terminations and costs incurred by the special committees of Expedia and Ticketmaster,as well as the benefit of certain tax deductions related to Styleclick and Hot Germany, which are considered non-recurring. Non-recurring items in 2001 relate to restructuring operations, employee terminations and write-downs of certain investments. F-5 USA INTERACTIVE SEGMENT RESULTS FOR TWELVE MONTHS ENDED DECEMBER 31, 2002 ($ IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
Revenue Adjusted EBITDA (a) Operating Income -------------------------- ------------------------- ---------------------------- YTD 2002 YTD 2001 Growth YTD 2002 YTD 2001 Growth YTD 2002 YTD 2001 Growth -------- -------- ------ -------- -------- ------ -------- -------- ------- $ IN MILLIONS $ IN MILLIONS $ IN MILLIONS Operating Businesses: HSN - U.S. $1,613.4 $1,556.9 4% $ 272.0 $ 222.1 22% $ 117.6 $ 78.6 50% Ticketing 655.2 579.7 13% 148.0 106.2 39% 78.2 41.7 87% Match.com 125.2 49.3 154% 36.1 16.5 118% 22.7 8.8 157% Hotels.com 945.4 536.5 76% 131.2 81.4 61% 106.1 62.2 71% Expedia 589.2 296.9 98% 173.7 60.9 185% 93.8 (13.4) 802% Interval 38.7 - NM 4.0 - NM (5.3) - NM PRC 295.2 298.7 -1% 35.3 34.3 3% (2.8) 2.9 NM Corporate and other (b) - - NM (45.9) (31.2) -47% (64.9) (55.0) -18% -------- -------- ------ -------- -------- ------ -------- -------- ------- Sub-total 4,262.4 3,318.0 28% 754.4 490.3 54% 345.4 126.0 174% Emerging Businesses: Citysearch and related 30.8 46.1 -33% (38.0) (43.4) 13% (100.4) (130.3) 23% International TV shopping and other (c) 371.5 319.4 16% (13.7) (24.5) 44% (30.5) (33.3) 8% ECS / Styleclick 39.2 34.2 15% (23.7) (53.6) 56% (32.0) (62.5) 49% -------- -------- ------ -------- -------- ------ -------- -------- ------- Sub-total 441.5 399.8 10% (75.4) (121.5) 38% (163.0) (226.1) 28% Foreign exchange rate fluctuation (d) (34.4) (46.9) 27% (0.8) (1.2) 36% (0.8) (0.6) NM HSN Disengagement (e) (2.2) 102.0 NM - 11.2 NM (31.7) 11.2 NM Intersegment Elimination (10.6) (7.1) -50% - - NM - - NM -------- -------- ------ -------- -------- ------ -------- -------- ------- Total $4,656.7 $3,765.8 24% $ 678.2 $ 378.9 79% $ 150.0 $ (89.5) NM ======== ======== ====== ======== ======== ====== ======== ======== ======= Attributable Adjusted EBITDA - Operating Businesses $ 630.9 $ 324.1 95% NM ======== ======== ====== ======= Supplemental disclosure: Total $ 678.2 $ 378.9 79% $ 150.0 $ (89.5) NM Non-recurring items (f) (58.9) (20.1) -193% (121.9) (26.3) -363% -------- -------- ------ -------- -------- ------- Including non-recurring items $ 619.3 $ 358.8 73% $ 28.1 $(115.8) 124% ======== ======== ====== ======== ======== =======
(a) Amounts excluded from Adjusted EBITDA include Depreciation ($176.5 million and $142.4 million in 2002 and 2001, respectively); amortization of cable distribution fees ($53.7 million and $44.0 million in 2002 and 2001, respectively); amortization of non-cash items ($266.4 million and $278.0 million in 2002 and 2001, respectively); disengagement related payments to cable operators and marketing expenses ($31.7 million, including $2.2 million of coupons related to the disengaged markets, and $4.1 million in 2002 and 2001, respectively) related to the transfer of HSN's distribution to cable (which has been accomplished); and non-recurring items of $58.9 million and $20.1 million in 2002 and 2001, respectively. (b) Higher corporate costs are due primarily to an increase in corporate employees in connection with USA's significant expansion in 2002, as well as bonuses paid to senior executives for 2002 performance. No such bonuses were made in 2001. (c) International TV Shopping and Other includes HSE Germany, Euvia, Hot Networks, TV Travel Shop, HSN emerging businesses and overhead costs related to HSN International. (d) In order to present comparable results for International TV Shopping and Other, results have been translated from foreign currencies to USA dollars at a constant exchange rate. (e) 2001 amounts reflect estimated results generated by homes lost by HSN following the sale of USA Broadcasting to Univision. (f) Non-recurring items in 2002 include restructuring and one-time items related to restructuring operations, employee terminations and costs incurred by the special committees of Expedia and Ticketmaster, as well as the benefit of certain tax deductions related to Styleclick and Hot Germany, which are considered non-recurring. Non-recurring items in 2001 relate to restructuring operations, employee terminations and write-downs of certain investments. F-6 USA INTERACTIVE RECONCILIATION SCHEDULES ($ IN MILLIONS, ROUNDING DIFFERENCES MAY EXIST)
Q4 2002 (a) ------------------------------------------------------------------------------------ OPERATING EXPENSES, EX. D&A, AMORTIZATION DISENGAGEMENT & OF CABLE AMORTIZATION NONRECURRING ADJUSTED DISTRIBUTION OF NON-CASH REVENUE ITEMS EBITDA DEPRECIATION FEES ITEMS ------------------------------------------------------------------------------------ OPERATING BUSINESSES: HSN - U.S. $ 470 $ (386) $ 84 $ (14) $ (15) $ (12) Ticketing 164 (130) 34 (8) - (10) Personals 37 (25) 13 (2) - (1) Hotels.com 273 (240) 32 (1) - (6) Expedia 164 (117) 47 (4) - (16) Interval 36 (33) 4 (2) - (7) PRC 78 (66) 12 (10) - - Corporate expense and other adjustments - (17) (17) (1) - (7) ------------------------------------------------------------------------------------ Subtotal $ 1,223 $ (1,013) $ 210 $ (42) $ (15) $ (58) EMERGING BUSINESSES: Citysearch 8 (18) (10) (2) - (13) International TV shopping and other 103 (106) (4) (3) - 3 ECS / Styleclick 9 (13) (4) (1) - (0) ------------------------------------------------------------------------------------ Subtotal $ 120 $ (137) (17) $ (6) $ - $ (10) Disengaged HSN homes (0) 0 - - - - Intersegment elimination (3) 3 - - - - ------------------------------------------------------------------------------------ TOTAL $ 1,339 $ (1,147) $ 192 $ (48) $ (15) $ (69) ====================================================================================
HSN DISENGAGEMENT NON-RECURRING OPERATING COSTS ITEMS (b) INCOME -------------------------------------------- OPERATING BUSINESSES: HSN - U.S. $ (9) $ - $ 34 Ticketing - - 17 Personals - - 9 Hotels.com - - 26 Expedia - (1) 27 Interval - - (6) PRC - (4) (2) Corporate expense and other adjustments - - (25) -------------------------------------------- Subtotal $ (9) $ (5) $ 80 EMERGING BUSINESSES: Citysearch - (4) (29) International TV shopping and other - - (4) ECS / Styleclick - (5) (10) -------------------------------------------- Subtotal $ - $ (9) $ (42) Disengaged HSN homes - - Intersegment elimination - - -------------------------------------------- TOTAL $ (9) $ (14) $ 37 ============================================
Q4 2001 (a) ------------------------------------------------------------------------------------- OPERATING EXPENSES, EX. D&A, AMORTIZATION DISENGAGEMENT & OF CABLE AMORTIZATION NONRECURRING ADJUSTED DISTRIBUTION OF NON-CASH REVENUE ITEMS EBITDA DEPRECIATION FEES ITEMS ------------------------------------------------------------------------------------- OPERATING BUSINESSES: HSN - U.S. $ 476 $ (400) $ 76 $ (12) $ (14) $ (12) Ticketing 132 (110) 21 (7) - (12) Personals 18 (10) 8 (0) - (3) Hotels.com 142 (119) 23 (1) - (5) Expedia 82 (60) 22 (4) - (14) Interval - - - - - - PRC 70 (64) 6 (9) - - Corporate expense and other adjustments - (7) (7) 1 - (4) ------------------------------------------------------------------------------------- Subtotal $ 919 $ (769) $ 149 $ (31) $ (14) $ (51) EMERGING BUSINESSES: Citysearch 10 (20) (10) (1) - (18) International TV shopping and other 72 (80) (8) (2) (1) (0) ECS / Styleclick 12 (20) (8) (1) - (0) ------------------------------------------------------------------------------------- Subtotal $ 95 $ (120) (26) $ (4) $ (1) $ (18) Disengaged HSN homes 19 (20) (0) - - - Intersegment elimination (2) 2 - - - - ------------------------------------------------------------------------------------- TOTAL $ 1,030 $ (907) $ 123 $ (35) $ (15) $ (69) =====================================================================================
HSN DISENGAGEMENT NON-RECURRING OPERATING COSTS ITEMS (b) INCOME -------------------------------------------- OPERATING BUSINESSES: HSN - U.S. $ (4) $ (1) $ 33 Ticketing - - 2 Personals - - 4 Hotels.com - - 17 Expedia - - 4 Interval - - - PRC - (1) (3) Corporate expense and other adjustments - - (10) -------------------------------------------- Subtotal $ (4) $ (2) $ 47 EMERGING BUSINESSES: Citysearch - - (29) International TV shopping and other - (1) (11) ECS / Styleclick - - (9) -------------------------------------------- Subtotal $ - $ (1) $ (49) Disengaged HSN homes - - (0) Intersegment elimination - - - -------------------------------------------- TOTAL $ (4) $ (3) $ (2) ============================================
(a) Pro forma for Expedia and VUE transactions. (b) See F-1 and F-2 for a description of non-recurring items which, for purposes of this reconciliation, have been allocated to the applicable business. The financial, statistical and other information contained herein is unaudited. As filed with Securities and Exchange Commission on February 6, 2003. F-7 USA INTERACTIVE RECONCILIATION SCHEDULES ($ IN MILLIONS, ROUNDING DIFFERENCES MAY EXIST)
PRO FORMA 2002 (a) ------------------------------------------------------------------------------------- OPERATING EXPENSES, EX. D&A, AMORTIZATION DISENGAGEMENT & OF CABLE AMORTIZATION NONRECURRING ADJUSTED DISTRIBUTION OF NON-CASH REVENUE ITEMS EBITDA DEPRECIATION FEES ITEMS ------------------------------------------------------------------------------------- OPERATING BUSINESSES: HSN - U.S. $ 1,613 $ (1,341) $ 272 $ (53) $ (52) $ (49) Ticketing 655 (507) 148 (29) - (41) Personals 125 (89) 36 (8) - (6) Hotels.com 945 (814) 131 (3) - (22) Expedia 589 (415) 174 (16) - (64) Interval 39 (35) 4 (2) - (7) PRC 295 (260) 35 (38) - - Corporate expense and other adjustments - (46) (46) (7) - (12) ------------------------------------------------------------------------------------- Subtotal $ 4,262 $ (3,508) $ 754 $ (156) $ (52) $ (200) EMERGING BUSINESSES: Citysearch 31 (69) (38) (8) - (55) International TV shopping and other 337 (352) (14) (10) (1) (6) ECS / Styleclick 39 (63) (24) (3) - (5) ------------------------------------------------------------------------------------- Subtotal $ 407 $ (483) (76) $ (20) $ (1) $ (66) Disengaged HSN homes (2) 2 - - - - Intersegment elimination (11) 11 - - - - TOTAL $ 4,657 $ (3,979) $ 678 $ (176) $ (54) $ (266) =====================================================================================
HSN DISENGAGEMENT NON-RECURRING OPERATING COSTS ITEMS (b) INCOME -------------------------------------------- OPERATING BUSINESSES: HSN - U.S. $ (32) $ - $ 86 Ticketing - - 78 Personals - - 23 Hotels.com - (1) 106 Expedia - (2) 92 Interval - - (5) PRC - (35) (38) Corporate expense and other adjustments - - (65) -------------------------------------------- Subtotal $ (32) $ (38) $ 276 EMERGING BUSINESSES: Citysearch - (6) (106) International TV shopping and other - (49) (81) ECS / Styleclick - (29) (61) -------------------------------------------- Subtotal $ - $ (84) $ (248) Disengaged HSN homes - - - Intersegment elimination - - - TOTAL $ (32) $ (122) $ 28 ============================================
PRO FORMA 2001 (a) ------------------------------------------------------------------------------------- OPERATING EXPENSES, EX. D&A, AMORTIZATION DISENGAGEMENT & OF CABLE AMORTIZATION NONRECURRING ADJUSTED DISTRIBUTION OF NON-CASH REVENUE ITEMS EBITDA DEPRECIATION FEES ITEMS ------------------------------------------------------------------------------------- OPERATING BUSINESSES: HSN - U.S. $ 1,557 $ (1,335) $ 222 $ (49) $ (42) $ (49) Ticketing 580 (473) 106 (23) - (41) Personals 49 (33) 17 (2) - (6) Hotels.com 536 (455) 81 (2) - (18) Expedia 297 (236) 61 (11) - (63) Interval N/A N/A N/A N/A N/A - PRC 299 (264) 34 (31) - - Corporate expense and other adjustments - (31) (31) (5) - (19) ------------------------------------------------------------------------------------- Subtotal $ 3,318 $ (2,828) $ 490 $ (123) $ (42) $ (196) EMERGING BUSINESSES: Citysearch 46 (90) (43) (7) - (80) International TV shopping and other 273 (298) (26) (4) (2) (2) ECS / Styleclick 34 (88) (54) (9) - (0) ------------------------------------------------------------------------------------- Subtotal $ 353 $ (476) (123) $ (20) $ (2) $ (82) Disengaged HSN homes 102 (91) 11 - - - Intersegment elimination (7) 7 - - - - ------------------------------------------------------------------------------------- TOTAL $ 3,766 $ (3,387) $ 379 $ (142) $ (44) $ (278) =====================================================================================
HSN DISENGAGEMENT NON-RECURRING OPERATING COSTS ITEMS (b) INCOME -------------------------------------------- OPERATING BUSINESSES: HSN - U.S. $ (4) $ (1) $ 77 Ticketing - - 42 Personals - - 9 Hotels.com - - 62 Expedia - - (13) Interval N/A N/A N/A PRC - (9) (6) Corporate expense and other adjustments - (3) (59) -------------------------------------------- Subtotal $ (4) $ (13) $ 113 EMERGING BUSINESSES: - Citysearch - (1) (131) International TV shopping and other - (2) (35) ECS / Styleclick - (11) (73) -------------------------------------------- Subtotal $ - $ (13) $ (240) Disengaged HSN homes - - 11 Intersegment elimination - - - -------------------------------------------- TOTAL $ (4) $ (26) $ (116) ============================================
(a) Pro forma for Expedia and VUE transactions. (b) See F-1 and F-2 for a description of non-recurring items which, for purposes of this reconciliation, have been allocated to the applicable business. F-8 EX-99.2 4 a2102579zex-99_2.txt EXHIBIT 99.2 USA PROVIDES FINAL 2003 BUDGET TO INVESTMENT COMMUNITY As filed with the Securities and Exchange Commission on February 6, 2003 On October 24, 2002, USA Interactive ("USA") released its preliminary budget for 2003. Today, we provide our final 2003 budget along with our year-end earnings report. The budget was revised to reflect our 2002 results, some pending and all recently completed transactions, and the current state of our businesses. In conjunction with the release of future quarterly results, we will report how we are performing against this budget. PRESENTATION OF NON-GAAP MEASURES USA believes that certain non-GAAP measures, including EBITA, Adjusted Net Income, (previously referred to as "Cash Net Income"), Adjusted EPS (previously referred to as "Cash EPS") and Free Cash Flow, are helpful to investors, when presented in conjunction with the comparable GAAP measures. The non-GAAP measures are not meant to replace or supersede the GAAP measures, but rather to supplement the information to present the readers of the financial statements the same information as management considers in assessing the results of operations and performance of USA and its business units. When presenting non-GAAP financial measures, USA will clearly present a reconciliation of the most directly comparable GAAP measures. These non-GAAP measures are consistent with how management views the results of operations in assessing performance. The final rules on these measures were just released by the SEC in January, so we, like the rest of the world, are in the process of interpreting the rules. While we believe that the measures we present comply with the rules, we will continue to monitor any developments in their interpretation. Accordingly, we can give no assurance that we will be able to provide these or comparable measures in future filings. OUR NEW ORGANIZATION In December, we organized our operations into three groups: Electronic Retailing, Information and Services and Travel Services and will report our results accordingly in 2003. And as we indicated in October, our previous distinction between "Operating" and "Emerging" businesses has been eliminated. This has also slightly changed some of our segment presentation as follows: - As part of our purchase and integration of Ticketmaster, we have eliminated the Ticketmaster public company corporate structure and allocated overhead expenses to Ticketing, Personals and Citysearch as appropriate. - We have created a new Local services group, which includes Citysearch, eVite and EPI, the acquisition of which is pending and which we have assumed for all Page 1 purposes herein will close on April 1, 2003. These businesses will work closely in creating promotions for hundreds of thousands of local merchants. - HSN - U.S. now includes Ingenious Designs Ltd. ("IDL"), which was previously classified as an emerging business (inside International TV Shopping and Other) since its original business plan was to develop infomercial products as well as products for HSN. We have since refocused IDL to develop exclusive product for HSN and believe that it should be reported as part of the core HSN business as a result of that change in strategy. - TV Travel Shop is reported separately as part of the Travel Services group, and International TV Shopping now includes just HSN Germany and Euvia. - We have added a segment called "Interactive Development." As part of our continued expansion in the interactive commerce space, we have determined that it is very important for us to continue to invest in growth initiatives that will develop into new lines of business or will help us leverage our scale in multiple lines of business. Initiatives such as the potential launch of the U.S.-based TV travel network and entry into new commerce verticals are included in this segment. FINAL VS. PRELIMINARY BUDGET As compared to our preliminary budget, USA expects 2003 revenue to be slightly higher than previously budgeted, due to the inclusion of EPI and anticipated revenue increases at Expedia and Ticketing which are expected to offset the lower revised revenue budget for Hotels.com that it previously announced in January. With respect to EBITA, USA expects about 3% higher EBITA growth in 2003 as compared to the preliminary budget. Again, the acquisition of EPI and anticipated increases at Expedia, bolstered by an improved outlook at HSN International, is expected to more than offset reductions at Hotels.com and HSN-U.S. The lowering of EBITA at HSN-U.S. is based on a small reduction to revenue growth and an increase in amortization of cable fees. (We made a mistake in our calculation of amortization of cable fees in our preliminary budget and have corrected it, based on the most recent data.) Operating Income is expected to be 31% higher than the preliminary budget, due to the inclusion of EPI and due to a reduction in amortization of intangibles relating to the step-up in basis of HSN as a result of the Vivendi transaction and other acquisitions completed in 2002 and 2003, including the acquisitions of Interval and TV Travel Shop, the Ticketmaster merger and the pending acquisition of EPI. Net income available to common shareholders is now expected to increase even more substantially, due to the increase in Operating Income and decreases in book taxes due to additional deferred taxes. This is offset by higher net interest expense due to a $750 million bond offering that we completed in Q4 of 2002. While the issuance of the bonds Page 2 causes modest short-term earnings dilution, we believe that our long-term return on that capital will exceed its cost. GAAP EPS is now expected to grow even more dramatically in 2003 than previously anticipated. Adjusted Net Income remains basically unchanged from the preliminary budget, as the drivers of increases in Operating Income and Net Income are primarily non-cash. Adjusted EPS is down 5% from the preliminary budget due to a higher 2003 shares outstanding figure based on the most recent data. Free Cash Flow is expected to be 4% to 5% lower than the preliminary budget. The inclusion of EPI and changes in various segments are expected to partially offset increases in capital expenditures (primarily relating to various real estate projects) and increased interest expense due to the company's recently completed bond offering. Net Cash from operating activities is expected to be about 2% higher than the preliminary budget. Because of USA's business fundamentals, working capital is currently a positive source of free cash flow for USA. However, it could be less robust depending on economic conditions, and in the event of sudden changes in economic conditions, could even decline. As we did in our preliminary budget, we continue to budget for cash distributions by VUE to USA under the parties' partnership agreement, including tax distributions relating to the VUE preferred interests. As we have already publicly disclosed, Vivendi is disputing these payments. Our final budget also includes estimates for the amortization of non-cash compensation. Our long-term goal is that non-cash compensation (after adjusting for taxes and minority interest) will range from 5% to 8% of Adjusted Net Income. While we have transitioned the significant majority of our equity compensation to restricted stock, our public subsidiaries may issue some employee stock options in 2003 as they complete the transition to 100% restricted stock. As we have announced previously, USA will prospectively expense options issuances for GAAP purposes. It is important to note that our 2003 budget represents USA management's best estimate of the company's performance for the upcoming year based on the current state of the economy. This budget does not take into account a war scenario or any other major domestic or world event which significantly might affect our businesses. Please feel free to contact USA Investor Relations at 212-314-7400, or at IR@USAINTERACTIVE.COM if you have any questions or for further information. Page 3 USA INTERACTIVE 2003 BUDGET Pro Forma for Vivendi and Expedia transactions and Ticketmaster merger ($ IN MILLIONS EXCEPT PER SHARE AMOUNTS)
2003 GROWTH PRO FORMA PRO FORMA ----------------------------------------------------------------- 2001 2002 Q1 Q2 Q3 Q4 FY '01-'02' 02-'03 ---------------------------------------------------------------------------------------------- REVENUE ELECTRONIC RETAILING: HSN - U.S. $ 1,558 $ 1,615 $ 430 $ 421 $ 432 $ 523 $ 1,805 4% 12% International TV shopping (a) 271 309 97 92 91 106 387 14% 25% ---------------------------------------------------------------------------------------------- Total Electronic Retailing 1,829 1,924 527 513 523 628 2,192 5% 14% INFORMATION & SERVICES: Ticketing (b) 580 655 171 195 168 161 695 13% 6% Personals (c) 49 125 40 46 48 51 184 154% 47% Local services (d) 46 31 8 49 33 158 247 -33% 703% PRC 299 295 73 76 82 85 316 -1% 7% ECS / Styleclick (e) 34 39 3 - - - 3 15% -91% ---------------------------------------------------------------------------------------------- Total Information & Services 1,008 1,146 295 366 331 455 1,446 14% 26% TRAVEL SERVICES: Expedia 297 589 186 212 228 219 845 98% 43% Hotels.com 536 945 245 305 355 345 1,250 76% 32% Interval (f) N/A 39 56 54 59 56 226 N/A N/A TV Travel Shop (g) N/A 26 16 16 21 13 66 N/A N/A ---------------------------------------------------------------------------------------------- Total Travel Services 833 1,599 503 587 664 633 2,387 92% 49% Interactive Development 1 - - - - - - Disengaged HSN homes 102 (2) - - - - - Intersegment elimination (7) (11) (4) (4) (4) (5) (16) ---------------------------------------------------------------------------------------------- TOTAL REVENUE $ 3,766 $ 4,657 $ 1,322 $ 1,461 $ 1,514 $ 1,712 $ 6,008 24% 29% ============================================================================================== EBITA ELECTRONIC RETAILING: HSN - U.S. $ 127 $ 163 $ 35 $ 45 $ 46 $ 65 $ 192 28% 18% International TV shopping (a) (26) (12) 2 1 (0) 5 8 52% NM ---------------------------------------------------------------------------------------------- Total Electronic Retailing 101 151 38 46 46 70 200 49% 33% INFORMATION & SERVICES: Ticketing (b) 74 108 28 39 26 26 119 45% 10% Personals (c) 15 28 4 11 13 10 38 93% 35% Local services (d) (40) (32) (7) (7) (19) 60 27 19% NM PRC 3 (3) 0 1 2 3 7 NM NM ECS / Styleclick (e) (62) (27) (2) (3) (0) - (5) 57% 82% ---------------------------------------------------------------------------------------------- Total Information & Services (10) 75 24 41 22 99 186 NM 149% TRAVEL SERVICES: Expedia 50 158 41 57 63 60 221 218% 40% Hotels.com 80 128 26 40 52 51 169 60% 32% Interval (f) N/A 2 17 11 16 14 58 N/A N/A TV Travel Shop (g) N/A (7) (0) 0 4 (3) 0 N/A N/A ---------------------------------------------------------------------------------------------- Total Travel Services 130 281 83 108 135 122 448 117% 59% Interactive Development (h) (1) (3) (2) (6) (10) (12) (30) Corporate expense and other adjustments (38) (56) (13) (13) (13) (13) (53) -46% 5% Disengaged HSN homes 11 - - - - - - ---------------------------------------------------------------------------------------------- TOTAL EBITA* $ 193 $ 448 $ 129 $ 177 $ 180 $ 265 $ 751 133% 68% ============================================================================================== ATTRIBUTABLE EBITA EXCLUDING INTERVAL AND EPI* $ 149 $ 331 $ 85 $ 129 $ 133 $ 145 $ 493 122% 49% Net Income $ (132) $ (54) $ 7 $ 35 $ 27 $ 80 $ 149 59% NM GAAP EPS (diluted) $ (0.27) $ (0.11) $ 0.01 $ 0.06 $ 0.05 $ 0.14 $ 0.27 60% NM Adjusted Net Income* $ 123 $ 236 $ 72 $ 104 $ 95 $ 143 $ 414 92% 76% Adjusted EPS* $ 0.24 $ 0.45 $ 0.14 $ 0.18 $ 0.17 $ 0.25 $ 0.75 90% 64% Diluted Shares Outstanding: GAAP EPS 480 492 527 529 532 534 534 Adjusted EPS 512 518 529 551 534 555 555
For 2004, USA currently anticipates growth in: revenues and EBITA of approximately 24% and 46%, respectively; Operating Income of approximately 120%; each of Net Income and GAAP EPS (diluted) of approximately 130%; and each of Adjusted Net Income and Adjusted EPS of approximately 35%. * EXCLUDES NON-RECURRING ITEMS, INCLUDING RESTRUCTURING CHARGES. ADJUSTED EPS WAS PREVIOUSLY REFERRED TO AS CASH EPS. Page 1 of 9 READ IMPORTANT FOOTNOTES AND DISCLAIMER AT THE END OF THIS DOCUMENT As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE 2003 BUDGET Pro Forma for Vivendi and Expedia transactions and Ticketmaster merger ($ IN MILLIONS EXCEPT PER SHARE AMOUNTS)
2003 GROWTH PRO FORMA PRO FORMA ----------------------------------------------------------------- 2001 2002 Q1 Q2 Q3 Q4 FY '01-'02' 02-'03 ---------------------------------------------------------------------------------------------- OPERATING INCOME ELECTRONIC RETAILING: HSN - U.S. $ 72 83 $ 18 $ 28 $ 30 $ 48 $ 123 14% 49% International TV shopping (a) (25) (12) 2 0 (0) 5 7 54% NM ---------------------------------------------------------------------------------------------- Total Electronic Retailing 47 71 20 29 29 53 130 51% 83% INFORMATION & SERVICES: Ticketing (b) 33 67 20 31 18 19 87 103% 30% Personals (c) 9 23 2 9 11 8 29 156% 29% Local services (d) (117) (81) (19) (23) (35) 44 (33) 31% 59% PRC 3 (3) 0 1 2 3 7 NM NM ECS / Styleclick (e) (62) (32) (2) (3) (0) - (5) 49% 83% ---------------------------------------------------------------------------------------------- Total Information & Services (135) (26) 1 15 (4) 73 85 81% NM TRAVEL SERVICES: Expedia (13) 94 16 38 45 42 140 NM 50% Hotels.com 62 106 20 32 45 43 141 71% 33% Interval (f) N/A (5) 11 5 9 8 33 N/A N/A TV Travel Shop (g) N/A (11) (2) (2) 2 (5) (7) N/A N/A ---------------------------------------------------------------------------------------------- Total Travel Services 49 184 44 74 101 88 307 277% 67% Interactive Development (2) (5) (6) (10) (14) (16) (44) Corporate expense and other adjustments (60) (74) (32) (32) (32) (32) (129) -24% -75% Disengaged HSN homes 11 - - - - - - Intersegment Elimination - - - - - - - OPERATING INCOME EXCLUDING ---------------------------------------------------------------------------------------------- NON-RECURRING ITEMS $ (90) $ 150 $ 27 $ 76 $ 80 $ 166 $ 348 NM 132% ============================================================================================== Non-recurring items (26) (122) - - - - - ---------------------------------------------------------------------------------------------- OPERATING INCOME $ (116) $ 28 $ 27 $ 76 $ 80 $ 166 $ 348 NM 1140% ==============================================================================================
FREE CASH FLOW (i) 2002 2003 '02 - '03 ---------------------------- Net income before preferred dividend $ 10 $ 168 1538% Depreciation and amortization 429 631 47% Noncash interest income (23) (39) -68% Equity losses of unconsolidated affiliates 122 (3) NM Minority interest (benefit) / expense 34 78 130% Other changes in working capital and other 169 247 46% ---------------------------- Net Cash provided by Operating Activities $ 741 $ 1,083 46% Capital expenditures (153) (254) -66% Investments in HSN International (32) (4) 87% Preferred dividend (10) (13) -28% ---------------------------- FREE CASH FLOW $ 545 $ 811 49% ============================
For 2004, USA currently anticipates growth in each of Free Cash Flow and Net Cash Provided by Operating Activities of approximately 25%. Page 2 of 9 READ IMPORTANT FOOTNOTES AND DISCLAIMER AT THE END OF THIS DOCUMENT As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE 2003 BUDGET Pro Forma for Vivendi and Expedia transactions and Ticketmaster merger ($ IN MILLIONS EXCEPT PER SHARE AMOUNTS)
PRO FORMA PRO FORMA BUDGET GROWTH GROWTH 2001 2002 2003 '01 - '02 '02 - '03 ------------------------------------------------------- P&L Revenue $ 3,766 $ 4,657 $ 6,008 Operating expenses (3,573) (4,209) (5,257) ------------------------------------------------------- EBITA 193 448 751 133% 68% ====================================================== Amortization of non-cash compensation, distribution and marketing (73) (72) (113) Amortization of other intangibles (non-cash) (j) (205) (194) (270) Disengagement costs (4) (32) (20) ------------------------------------------------------- Operating income (90) 150 348 NM 132% Interest and dividend income 84 103 82 Equity losses of unconsolidated affiliates and other (39) (21) (7) ------------------------------------------------------- Income before taxes and minority interest (44) 232 424 NM 83% Income tax expense (40) (110) (177) Minority interest expense (k) (1) (51) (78) Impact of dilutive securities (k) - (6) (6) ------------------------------------------------------- Net income before preferred dividend (84) 65 162 NM 150% Preferred dividend (13) (13) (13) ------------------------------------------------------- Net income available to common shareholders, before non-recurring $ (97) $ 52 $ 149 NM 188% items ======================================================= After-tax impact of non-recurring items (35) (105) - ------------------------------------------------------- Net income available to common shareholders $ (132) $ (54) $ 149 59% NM ======================================================= GAAP diluted shares outstanding 480 492 534 GAAP EPS (diluted) $ (0.27) $ (0.11) $ 0.27 60% NM ======================================================= Adjusted Net Income calculation: Net income available to common shareholders $ (132) $ (54) $ 149 After-tax impact of non-recurring items 35 105 - Preferred dividend - - 13 Equity Income from 5.44% common interest in VUE (l) - (6) - Amortization of non-cash items 278 266 383 Less: related tax and minority interest (58) (76) (131) ------------------------------------------------------- ADJUSTED NET INCOME $ 123 $ 236 $ 414 92% 76% ======================================================= Adjusted EPS diluted shares outstanding 512 518 555 ADJUSTED EPS $ 0.24 $ 0.45 $ 0.75 90% 64% ======================================================= GAAP EPS diluted shares outstanding calculation: (m) Basic shares outstanding 480 492 508 Treasury method options, warrants and restricted stock (n)(o) 0 0 26 ------------------------------ GAAP diluted shares outstanding 480 492 534 Adjusted EPS diluted shares outstanding calculation: (m) Basic shares outstanding 480 492 508 Treasury method options and warrants (n)(o) 31 26 26 Restricted stock (o) 0 0 2 Common shares issuable for convertible preferred (p) 0 - 19 ------------------------------ Adjusted EPS diluted shares outstanding 512 518 555 ==============================
Page 3 of 9 READ IMPORTANT FOOTNOTES AND DISCLAIMER AT THE END OF THIS DOCUMENT As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE 2003 BUDGET Pro Forma for Vivendi and Expedia transactions and Ticketmaster merger IMPORTANT: This Budget reflects USA management's expectations for performance in 2003 and its preliminary outlook for 2004 based on the current state of the economy. This budget does not take into account a war scenario or other major domestic or world event which significantly might affect our businesses. DEFINITIONS EBITA is defined as Operating Income plus: amortization of (1) non-cash distribution and marketing expense, (2) non-cash compensation expense, (3) other intangibles (and goodwill in 2001), and (4) disengagement related payments to cable operators and marketing expenses related to the transfer of HSN's distribution to cable (which has been accomplished). Excludes non-recurring items. Attributable EBITA is defined as EBITA, less the percentage of EBITA attributable to minority shareholders of USA's public and other non-wholly owned subsidiaries. Adjusted Net Income is defined as net income available to common shareholders plus: amortization of (1) non-cash distribution and marketing expense, (2) non-cash compensation, (3) other intangibles (and goodwill in 2001), net of related tax and minority interest expense and (4) equity income from USA's 5.44% common interest in VUE. Excludes non-recurring items. All amounts are presented on a fully diluted, treasury method basis except with respect to restricted stock, all of which is treated as outstanding for purposes of Adjusted EPS. Free Cash Flow is defined as Net Cash Provided by Operating Activities, less capital expenditures, other investments relating to operations and preferred dividends paid. Free Cash Flow also includes cash received and tax payments related to the VUE securities. Free Cash Flow includes cash distributions of 3.6% of the face value of the VUE Class B preferred interest and assumes in 2003 the receipt of $29.2 million in tax distributions relating to the VUE preferred interests, which tax distributions are currently the subject of dispute between USA and Vivendi. The tax distributions assume there is sufficient income at VUE and a tax rate of 40%. Tax payments of $157 million in 2002 and an estimated $100 - $125 million in 2003 related to the sale of USA Broadcasting to Univision which closed in August 2001 are included in discontinued operations and accordingly have no impact on net cash from operations or free cash flow. BUDGET FOOTNOTES (a) International TV Shopping includes HSE Germany, Euvia, Hot Networks, and overhead costs related to HSN International. (b) USA expects Ticketing EBITA growth in 2003 to be slower than 2002 due mainly to investment in new products and due to exceptionally strong 2002 results. (c) USA expects Personals EBITA growth in 2003 to be slower than 2002 due mainly to increased consumer marketing to grow the subscriber base. (d) Local Services is comprised of Citysearch, Evite, and Entertainment Publications, Inc. ("EPI") (transaction pending). Results from EPI are included from April 1, 2003 although the actual closing date of the transaction could differ. Revenue, EBITA and Operating Income for 2003 from the assumed closing date are $205, $41, and $25 million respectively. (e) During Q4 2002, ECS / Styleclick announced several contract terminations and Styleclick announced at the beginning of Q1 2003 that the company has retained an investment banking firm to assist it in reviewing strategic alternatives, including but not limited to mergers, acquisitions, or a possible sale of Styleclick. (f) Includes results from Interval from September 24, 2002. (g) Includes results from TV Travel Shop from May 1, 2002. (h) Interactive Development represents USA's investment in growth initiatives that are anticipated to develop into new lines of business. Initiatives such as the potential launch of the U.S.- based TV travel network and entry into new commerce verticals are included in this segment. (i) For the purposes of the calculation of Free Cash Flow, Net Income before preferred dividend is defined as actual Net Income before preferred dividend, rather than proforma Net Income as shown on page 1. (j) The increase in amortization of intangibles relates primarily to the step-up in basis of HSN related to the Vivendi transaction and other acquisitions completed in 2002, including the acquisitions of Interval and TV Travel Group, the Ticketmaster merger and the pending acquisition of EPI. To the extent additional acquisitions are completed in the future, amortization of intangibles could increase. (k) Minority interest is calculated based on USA's basic ownership in Hotels.com, Expedia and Euvia. Impact of dilutive securities represents additional minority interest related to treasury method options, warrants and restricted stock at Hotels.com and Expedia. (l) As equity gains or losses arising from USA's common interest in VUE are not factors reviewed by USA in evaluating its operations, such gains or losses are excluded from the calculation of Adjusted Net Income. (m) For purposes of calculating GAAP EPS (diluted), restricted stock is amortized over the vesting period and the restricted shares are treated on a treasury method basis in the shares outstanding calculation. For purposes of calculating Adjusted EPS, restricted stock amortization is excluded from Adjusted Net Income, but all restricted shares issued and outstanding are included in the shares outstanding calculation. (n) Shares outstanding (for GAAP EPS (diluted) and Adjusted EPS) will vary if the warrants issued in the Vivendi or Expedia transactions are converted or are treated on an as converted basis for purposes of calculating treasury method dilution. (o) In 2003, USA is replacing options with restricted stock as part of its non-cash compensation program. Expedia and Hotels may continue to issue options in 2003 as they complete the transition to 100% restricted stock. For GAAP purposes, USA will prospectively expense option issuances. (p) In connection with the Expedia transaction which was completed in February 2002, USA issued $656 million face value 1.99% convertible preferred stock, which is initially convertible at $33.75 into approximately 19.4 million shares. The company anticipates that the preferred stock will have a dilutive impact to Adjusted EPS in 2003, thus 19.4 million shares will be treated on an as converted basis for purposes of Adjusted EPS in 2003. Page 4 of 9 READ IMPORTANT FOOTNOTES AND DISCLAIMER AT THE END OF THIS DOCUMENT As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE 2003 BUDGET Pro Forma for Vivendi and Expedia transactions and Ticketmaster merger ($ IN MILLIONS EXCEPT PER SHARE AMOUNTS) RECONCILIATION SCHEDULES
PRO FORMA 2001 -------------------------------------------------------------------------------- OPERATING EXPENSES, EX. D&A, DISENGAGEMENT AMORTIZATION AND OF CABLE AMORTIZATION NON-RECURRING DISTRIBUTION OF NON-CASH REVENUE ITEMS DEPRECIATION FEES EBITA ITEMS -------------------------------------------------------------------------------- ELECTRONIC RETAILING: HSN - U.S. $ 1,558 $ (1,340) $ (49) $ (42) $ 127 $ (51) International TV shopping 271 (291) (3) (2) (26) 1 -------------------------------------------------------------------------------- Total Electronic Retailing 1,829 (1,631) (52) (44) 101 (50) INFORMATION & SERVICES: Ticketing 580 (482) (24) - 74 (41) Personals 49 (33) (2) - 15 (6) Local information 46 (79) (7) - (40) (77) PRC 299 (264) (31) - 3 - ECS / Styleclick 34 (88) (9) - (62) (0) -------------------------------------------------------------------------------- Total Information & Services 1,008 (946) (72) - (10) (124) TRAVEL SERVICES: Expedia 297 (236) (11) - 50 (63) Hotels.com 536 (455) (2) - 80 (18) Interval N/A N/A N/A N/A N/A N/A TV Travel Shop N/A N/A N/A N/A N/A N/A -------------------------------------------------------------------------------- Total Travel Services 833 (691) (13) - 130 (81) Interactive Development 1 (1) (1) - (1) (1) Corporate expense and other adjustments - (33) (5) - (38) (22) Disengaged HSN homes 102 (91) - - 11 - Intersegment elimination (7) 7 - - - - -------------------------------------------------------------------------------- TOTAL $ 3,766 $ (3,386) $ (143) $ (44) $ 193 $ (278) ================================================================================
HSN NON- DISENGAGEMENT RECURRING OPERATING COSTS ITEMS (A) INCOME NET INCOME ---------------------------------------------------- ELECTRONIC RETAILING: HSN - U.S. $ (4) $ (1) $ 71 $ 81 International TV shopping - (2) (27) (55) ---------------------------------------------------- Total Electronic Retailing (4) (3) 44 26 INFORMATION & SERVICES: Ticketing - - 33 (1) Personals - - 9 6 Local information - (1) (118) (97) PRC - (9) (6) (6) ECS / Styleclick - (11) (73) (57) ---------------------------------------------------- Total Information & Services - (20) (155) (156) TRAVEL SERVICES: Expedia - - (13) (11) Hotels.com - - 62 35 Interval N/A N/A N/A N/A TV Travel Shop N/A N/A N/A N/A ---------------------------------------------------- Total Travel Services - - 49 24 Interactive Development - - (2) (2) Corporate expense and other adjustments - (3) (63) (24) Disengaged HSN homes - 11 - Intersegment elimination - - - ---------------------------------------------------- TOTAL $ (4) $ (26) $ (116) $ (132) ====================================================
PRO FORMA 2002 --------------------------------------------------------------------------------- OPERATING EXPENSES, EX. D&A, DISENGAGEMENT AMORTIZATION AND OF CABLE AMORTIZATION NON-RECURRING DISTRIBUTION OF NON-CASH REVENUE ITEMS DEPRECIATION FEES EBITA ITEMS --------------------------------------------------------------------------------- ELECTRONIC RETAILING: HSN - U.S. $ 1,615 $ (1,347) $ (53) $ (52) $ 163 $ (49) International TV shopping 309 (313) (7) (1) (12) 1 --------------------------------------------------------------------------------- Total Electronic Retailing 1,924 (1,660) (61) (54) 151 (48) INFORMATION & SERVICES: Ticketing 655 (517) (30) - 108 (41) Personals 125 (89) (8) - 28 (6) Local information 31 (56) (7) - (32) (48) PRC 295 (260) (38) - (3) - ECS / Styleclick 39 (63) (3) - (27) (5) --------------------------------------------------------------------------------- Total Information & Services 1,146 (985) (86) - 75 (100) TRAVEL SERVICES: Expedia 589 (415) (16) - 158 (64) Hotels.com 945 (814) (3) - 128 (22) Interval 39 (35) (2) - 2 (7) TV Travel Shop 26 (31) (2) - (7) (4) --------------------------------------------------------------------------------- Total Travel Services 1,599 (1,295) (23) - 281 (97) Interactive Development - (3) - - (3) (3) Corporate expense and other adjustments - (48) 85 - (56) (19) Disengaged HSN homes (2) 2 - - - - Intersegment elimination (11) 11 - - - - --------------------------------------------------------------------------------- TOTAL $ 4,657 $ (3,979) $ (84) $ (54) $ 448 $ (266) =================================================================================
HSN NON- DISENGAGEMENT RECURRING OPERATING COSTS ITEMS (A) INCOME NET INCOME ------------------------------------------------------ ELECTRONIC RETAILING: HSN - U.S. $ (32) $ - $ 83 $ 55 International TV shopping - (49) (61) (136) ------------------------------------------------------ Total Electronic Retailing (32) (49) 22 (81) INFORMATION & SERVICES: Ticketing - - 67 15 Personals - - 23 14 Local information - - (81) (30) PRC - (35) (38) (23) ECS / Styleclick - (29) (61) (38) ------------------------------------------------------ Total Information & Services - (65) (90) (62) TRAVEL SERVICES: Expedia - (2) 92 20 Hotels.com - (1) 106 47 Interval - - (5) (4) TV Travel Shop - - (11) (15) ------------------------------------------------------ Total Travel Services - (2) 182 48 Interactive Development - - (5) (4) Corporate expense and other adjustments - (6) (80) 45 Disengaged HSN homes - - - - Intersegment elimination - - - - ------------------------------------------------------ TOTAL $ (32) $ (122) $ 28 $ (54) ======================================================
Page 5 of 9 READ IMPORTANT FOOTNOTES AND DISCLAIMER AT THE END OF THIS DOCUMENT As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE 2003 BUDGET Pro Forma for Vivendi and Expedia transactions and Ticketmaster merger ($ IN MILLIONS EXCEPT PER SHARE AMOUNTS)
RECONCILIATION SCHEDULES Q1 2003 ------------------------------------------------------------------------------- OPERATING EXPENSES, EX. D&A, DISENGAGEMENT AMORTIZATION AND OF CABLE AMORTIZATION NON-RECURRING DISTRIBUTION OF NON-CASH REVENUE ITEMS DEPRECIATION FEES EBITA ITEMS -------------------------------------------------------------------------------- ELECTRONIC RETAILING: HSN - U.S. $ 430 $ (368) $ (13) $ (14) $ 35 $ (12) International TV shopping 97 (92) (3) - 2 (0) -------------------------------------------------------------------------------- Total Electronic Retailing 527 (461) (15) (14) 38 (12) INFORMATION & SERVICES: Ticketing 171 (136) (8) - 28 (8) Personals 40 (34) (2) - 4 (2) Local services 8 (13) (2) - (7) (13) PRC 73 (66) (6) - 0 - ECS / Styleclick 3 (5) (0) - (2) (0) -------------------------------------------------------------------------------- Total Information & Services 295 (253) (18) - 24 (23) TRAVEL SERVICES: Expedia 186 (140) (5) - 41 (25) Hotels.com 245 (218) (1) - 26 (6) Interval 56 (37) (2) - 17 (6) TV Travel Shop 16 (15) (1) - (0) (2) -------------------------------------------------------------------------------- Total Travel Services 503 (411) (9) - 83 (39) Interactive Development - (2) - - (2) (4) Corporate expense and other adjustments - (11) (2) - (13) (19) Disengaged HSN homes - - - - - - Intersegment elimination (4) 4 - - - - -------------------------------------------------------------------------------- TOTAL $ 1,322 $ (1,134) $ (44) $ (14) $ 129 $ (97) ================================================================================
RECONCILIATION SCHEDULES HSN NON- DISENGAGEMENT RECURRING OPERATING COSTS ITEMS (A) INCOME NET INCOME ---------------------------------------------------- ELECTRONIC RETAILING: HSN - U.S. $ (6) $ - $ 18 $ 11 International TV shopping - - 2 (0) ---------------------------------------------------- Total Electronic Retailing (6) - 20 10 INFORMATION & SERVICES: Ticketing - - 20 12 Personals - - 2 1 Local services - - (19) (14) PRC - - 0 (2) ECS / Styleclick - - (2) (1) ---------------------------------------------------- Total Information & Services - - 1 (3) TRAVEL SERVICES: Expedia - - 16 2 Hotels.com - - 20 10 Interval - - 11 6 TV Travel Shop - - (2) (2) ---------------------------------------------------- Total Travel Services - - 44 16 Interactive Development - - (6) (3) Corporate expense and other adjustments - - (32) (12) Disengaged HSN homes - - - - Intersegment elimination - - - - ---------------------------------------------------- TOTAL $ (6) $ - $ 27 $ 7 ====================================================
Q2 2003 ------------------------------------------------------------------------------- OPERATING EXPENSES, EX. D&A, DISENGAGEMENT AMORTIZATION AND OF CABLE AMORTIZATION NON-RECURRING DISTRIBUTION OF NON-CASH REVENUE ITEMS DEPRECIATION FEES EBITA ITEMS ------------------------------------------------------------------------------- ELECTRONIC RETAILING: HSN - U.S. $ 421 $ (349) $ (12) $ (14) $ 45 $ (12) International TV shopping 92 (89) (3) - 1 (0) ------------------------------------------------------------------------------- Total Electronic Retailing 513 (438) (15) (14) 46 (12) INFORMATION & SERVICES: Ticketing 195 (148) (8) - 39 (8) Personals 46 (31) (3) - 11 (2) Local services 49 (54) (3) - (7) (16) PRC 76 (69) (6) - 1 - ECS / Styleclick - (2) (1) - (3) (1) ------------------------------------------------------------------------------- Total Information & Services 366 (304) (21) - 41 (26) TRAVEL SERVICES: Expedia 212 (150) (5) - 57 (19) Hotels.com 305 (264) (1) - 40 (8) Interval 54 (40) (2) - 11 (6) TV Travel Shop 16 (15) (1) - 0 (2) ------------------------------------------------------------------------------- Total Travel Services 587 (469) (9) - 108 (34) Interactive Development - (6) - - (6) (4) Corporate expense and other adjustments - (11) (2) - (13) (19) Disengaged HSN homes - - - - - - Intersegment elimination (4) 4 - - - - ------------------------------------------------------------------------------- TOTAL $ 1,461 $ (1,225) $ (46) $ (14) $ 177 $ (96) ===============================================================================
HSN NON- DISENGAGEMENT RECURRING OPERATING COSTS ITEMS (A) INCOME NET INCOME ------------------------------------------------------ ELECTRONIC RETAILING: HSN - U.S. $ (5) $ - $ 28 $ 17 International TV shopping - - 0 (1) ------------------------------------------------------ Total Electronic Retailing (5) - 29 16 INFORMATION & SERVICES: Ticketing - - 31 19 Personals - - 9 6 Local services - - (23) (12) PRC - - 1 0 ECS / Styleclick - - (3) (2) ------------------------------------------------------ Total Information & Services - - 15 11 TRAVEL SERVICES: Expedia - - 38 9 Hotels.com - - 32 15 Interval - - 5 3 TV Travel Shop - - (2) (2) ------------------------------------------------------ Total Travel Services - - 74 25 Interactive Development - - (10) (6) Corporate expense and other adjustments - - (32) (12) Disengaged HSN homes - - - - Intersegment elimination - - $ - - ------------------------------------------------------ TOTAL $ (5) $ - $ 76 $ 35 ======================================================
Page 6 of 9 READ IMPORTANT FOOTNOTES AND DISCLAIMER AT THE END OF THIS DOCUMENT As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE 2003 BUDGET Pro Forma for Vivendi and Expedia transactions and Ticketmaster merger ($ IN MILLIONS EXCEPT PER SHARE AMOUNTS)
RECONCILIATION SCHEDULES Q3 2003 -------------------------------------------------------------------------------- OPERATING EXPENSES, EX. D&A, DISENGAGEMENT AMORTIZATION AND OF CABLE AMORTIZATION NON-RECURRING DISTRIBUTION OF NON-CASH REVENUE ITEMS DEPRECIATION FEES EBITA ITEMS -------------------------------------------------------------------------------- ELECTRONIC RETAILING: HSN - U.S. $ 432 $ (359) $ (12) $ (15) $ 46 $ (12) International TV shopping 91 (89) (3) - (0) (0) -------------------------------------------------------------------------------- Total Electronic Retailing 523 (448) (14) (15) 46 (12) INFORMATION & SERVICES: Ticketing 168 (134) (8) - 26 (8) Personals 48 (32) (3) - 13 (2) Local services 33 (49) (3) - (19) (16) PRC 82 (73) (7) - 2 - ECS / Styleclick - (0) (0) - (0) - -------------------------------------------------------------------------------- Total Information & Services 331 (289) (20) - 22 (26) TRAVEL SERVICES: Expedia 228 (160) (5) - 63 (19) Hotels.com 355 (301) (2) - 52 (7) Interval 59 (41) (2) - 16 (6) TV Travel Shop 21 (17) (1) - 4 (2) -------------------------------------------------------------------------------- Total Travel Services 664 (519) (10) - 135 (34) Interactive Development - (10) - - (10) (4) Corporate expense and other adjustments - (11) (2) - (13) (19) Disengaged HSN homes - - - - - - Intersegment elimination (4) 4 - - - - TOTAL $ 1,514 $ (1,273) $ (46) $ (15) $ 180 $ (95) =================================================================================
HSN NON- DISENGAGEMENT RECURRING OPERATING COSTS ITEMS (A) INCOME NET INCOME ------------------------------------------------------ ELECTRONIC RETAILING: HSN - U.S. $ (5) $ - $ 30 $ 18 International TV shopping - - (0) (1) ------------------------------------------------------ Total Electronic Retailing (5) - 29 17 INFORMATION & SERVICES: Ticketing - - 18 11 Personals - - 11 7 Local services - - (35) (26) PRC - - 2 1 ECS / Styleclick - - (0) (0) ------------------------------------------------------ Total Information & Services - - (4) (7) TRAVEL SERVICES: Expedia - - 45 11 Hotels.com - - 45 21 Interval - - 9 5 TV Travel Shop - - 2 0 ------------------------------------------------------ Total Travel Services - - 101 38 Interactive Development - - (14) (8) Corporate expense and other adjustments - - (32) (11) Disengaged HSN homes - - - - Intersegment elimination - - - - TOTAL $ (5) $ - $ 80 $ 27 =====================================================
Q4 2003 ------------------------------------------------------------------------------ OPERATING EXPENSES, EX. D&A, DISENGAGEMENT AMORTIZATION AND OF CABLE AMORTIZATION NON-RECURRING DISTRIBUTION OF NON-CASH REVENUE ITEMS DEPRECIATION FEES EBITA ITEMS ------------------------------------------------------------------------------- ELECTRONIC RETAILING: HSN - U.S. $ 523 $ (429) $ (13) $ (15) $ 65 $ (12) International TV shopping 106 (99) (2) - 5 (0) Total Electronic Retailing 628 (528) (15) (15) 70 (12) INFORMATION & SERVICES: Ticketing 161 (127) (8) - 26 (8) Personals 51 (38) (3) - 10 (2) Local services 158 (95) (2) - 60 (16) PRC 85 (75) (6) - 3 - ECS / Styleclick - - - - - - ------------------------------------------------------------------------------ Total Information & Services 455 (335) (20) - 99 (26) TRAVEL SERVICES: Expedia 219 (154) (5) - 60 (18) Hotels.com 345 (292) (2) - 51 (8) Interval 56 (40) (2) - 14 (6) TV Travel Shop 13 (16) (1) - (3) (2) ------------------------------------------------------------------------------ Total Travel Services 633 (502) (10) - 122 (34) Interactive Development - (12) - - (12) (4) Corporate expense and other adjustments - (11) (2) - (13) (19) Disengaged HSN homes - - - - - - Intersegment elimination (5) 5 - - - - ------------------------------------------------------------------------------ TOTAL $ 1,712 $ (1,384) $ (47) $ (15) $ 265 $ (95) ===============================================================================
HSN NON- DISENGAGEMENT RECURRING OPERATING COSTS ITEMS (A) INCOME NET INCOME ----------------------------------------------------- ELECTRONIC RETAILING: HSN - U.S. $ (5) $ - $ 48 $ 29 International TV shopping - - 5 2 Total Electronic Retailing (5) - 53 31 INFORMATION & SERVICES: Ticketing - - 19 11 Personals - - 8 5 Local services - - 44 21 PRC - - 3 1 ECS / Styleclick - - - (0) ------------------------------------------------------ Total Information & Services - - 73 38 TRAVEL SERVICES: Expedia - - 42 10 Hotels.com - - 43 20 Interval - - 8 5 TV Travel Shop - - (5) (4) ------------------------------------------------------ Total Travel Services - - 88 31 Interactive Development - - (16) (9) Corporate expense and other adjustments - - (32) (11) Disengaged HSN homes - - - - Intersegment elimination - - - - ------------------------------------------------------ TOTAL $ (5) $ - $ 166 $ 80 =====================================================
Page 7 of 9 READ IMPORTANT FOOTNOTES AND DISCLAIMER AT THE END OF THIS DOCUMENT As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE 2003 BUDGET Pro Forma for Vivendi and Expedia transactions and Ticketmaster merger ($ IN MILLIONS EXCEPT PER SHARE AMOUNTS) RECONCILIATION SCHEDULES
FY 2003 -------------------------------------------------------------------------------- OPERATING EXPENSES, EX. D&A, DISENGAGEMENT AMORTIZATION AND OF CABLE AMORTIZATION NON-RECURRING DISTRIBUTION OF NON-CASH REVENUE ITEMS DEPRECIATION FEES EBITA ITEMS -------------------------------------------------------------------------------- ELECTRONIC RETAILING: HSN - U.S. $ 1,805 $ (1,506) $ (49) $ (58) $ 192 $ (49) International TV shopping 387 (369) (10) - 8 (1) -------------------------------------------------------------------------------- Total Electronic Retailing 2,192 (1,875) (59) (58) 200 (50) - INFORMATION & SERVICES: - Ticketing 695 (545) (31) - 119 (31) Personals 184 (134) (12) - 38 (9) Local services 247 (211) (9) - 27 (60) PRC 316 (283) (26) - 7 - ECS / Styleclick 3 (7) (1) - (5) (1) -------------------------------------------------------------------------------- Total Information & Services 1,446 (1,181) (80) - 186 (101) - TRAVEL SERVICES: - Expedia 845 (604) (20) - 221 (80) Hotels.com 1,250 (1,075) (6) - 169 (28) Interval 226 (159) (9) - 58 (25) TV Travel Shop 66 (63) (3) - 0 (8) -------------------------------------------------------------------------------- Total Travel Services 2,387 (1,901) (38) - 448 (141) - Interactive Development - (30) - - (30) (14) Corporate expense and other adjustments - (45) (7) - (53) (77) Disengaged HSN homes - - - - - - Intersegment elimination (16) 16 - - - - -------------------------------------------------------------------------------- TOTAL $ 6,008 $ (5,016) $ (184) $ (58) $ 751 $ (383) ================================================================================
HSN NON- DISENGAGEMENT RECURRING OPERATING COSTS ITEMS (A) INCOME NET INCOME ------------------------------------------------------ ELECTRONIC RETAILING: HSN - U.S. $ (20) $ - $ 123 $ 74 International TV shopping - - 7 0 ------------------------------------------------------ Total Electronic Retailing (20) - 130 74 INFORMATION & SERVICES: Ticketing - - 87 53 Personals - - 29 19 Local services - - (33) (30) PRC - - 7 0 ECS / Styleclick - - (5) (4) ------------------------------------------------------ Total Information & Services - - 85 38 TRAVEL SERVICES: Expedia - - 140 32 Hotels.com - - 141 66 Interval - - 33 19 TV Travel Shop - - (7) (7) ------------------------------------------------------ Total Travel Services - - 307 109 Interactive Development - - (44) (27) Corporate expense and other adjustments - - (129) (46) Disengaged HSN homes - - - - Intersegment elimination - - - - ------------------------------------------------------ TOTAL $ (20) $ - $ 348 $ 149 ======================================================
Page 8 of 9 READ IMPORTANT FOOTNOTES AND DISCLAIMER AT THE END OF THIS DOCUMENT As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE 2003 BUDGET RECONCILIATION FOOTNOTES (A) Non-recurring items include one-time items related to restructuring operations, employee terminations and benefits and a write-down of investments. (B) Non-recurring items include the write down of certain investments, costs of ECS contract terminations, costs to shut-down certain operations, including HSN Espanol, HSN Italy, Styleclick and ECS, a write-down of goodwill for PRC as well as costs to shutdown certain PRC call centers, costs incurred by the special committees of Expedia, Hotels.com and Ticketmaster and the write-down of certain equity investments. SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 This business outlook contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements relating to USA's anticipated financial performance, business prospects, new developments, new merchandising strategies and similar matters, and/or statements preceded by, followed by or that include the words "believes," "could," "expects," "anticipates," "estimates," "intends," "plans," "projects," "seeks," or similar expressions. These forward-looking statements are necessarily estimates reflecting the best judgment of USA's senior management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. These forward-looking statements are subject to risks, uncertainties and assumptions that could have a material adverse effect on USA's business, financial condition or results of operations. You should understand that the following important factors could affect USA's future results and could cause those results to differ materially from those expressed in the forward-looking statements: (1) material adverse changes in economic or political conditions generally or in such conditions affecting USA's markets or industries; (2) future regulatory and legislative actions and conditions affecting USA's operating areas; (3) competition from others; (4) successful integration of our divisions' management structures; (5) product demand and market acceptance; (6) the ability to protect proprietary information and technology or to obtain necessary licenses on commercially reasonable terms; (7) the ability to maintain the integrity of USA's systems and infrastructure; (8) the ability to expand into and successfully operate in foreign markets; and (9) obtaining and retaining skilled workers and key executives. In addition, investors should consider the other information contained in or incorporated by reference into USA's filings with the U.S. Securities and Exchange Commission (the "SEC"), including its Annual Report on Form 10-K for the fiscal year ended 2001, especially in the Management's Discussion and Analysis section, its most recent Quarterly Report on Form 10-Q and its Current Reports on Form 8-K. Other unknown or unpredictable factors also could have material adverse effects on USA's future results, performance or achievements. In light of these risks, uncertainties, assumptions and factors, the forward-looking events discussed in this business outlook may not occur. These forward-looking statements should not be regarded as an indication that USA considers them to be a reliable prediction of future events. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated, or if no date is stated, as of the date of this business outlook. USA is not under any obligation and does not intend, except as specifically stated, to make publicly available any update or other revisions to any of the forward-looking statements contained in this press release to reflect circumstances existing after the date of this press release or to reflect the occurrence of future events even if experience or future events make it clear that any expected results expressed or implied by those forward-looking statements will not be realized. USA does not make any representations to any person regarding the ultimate performance of USA compared to the information contained in this business outlook and USA is not under any obligation and does not intend to make publicly available any update or other revisions to any of the forward-looking statements contained in this business outlook to reflect circumstances existing after the date of this business outlook or to reflect the occurrence of future events even if experience or future events make it clear that any or all of the assumptions underlying the business outlook are shown to be in error or any expected results expressed or implied by those forward-looking statements will not be realized. Page 9 of 9 EX-99.3 5 a2102579zex-99_3.txt EXHIBIT 99.3 Exhibit 99.3 USA INTERACTIVE PRO FORMA SEGMENT RESULTS $ IN MILLIONS, ROUNDING DIFFERENCES MAY EXIST
------------------------------------------------------------------------------------------------ PRO FORMA 2001 (a) ------------------------------------------------------------------------------------------------ OPERATING EXPENSES, EX. D&A, AMORTIZATION DISENGAGEMENT & ADJUSTED OF CABLE AMORTIZATION REVENUE NONRECURRING ITEMS EBITDA DEPRECIATION DISTRIBUTION FEES OF NON-CASH ITEMS ------- ------------------ -------- ------------ ----------------- ----------------- OPERATING BUSINESSES: HSN - U.S. $ 1,557 $(1,335) $ 222 $ (49) $ (42) $ (49) Ticketing 580 (473) 106 (23) -- (41) Personals 49 (33) 17 (2) -- (6) Hotels.com 536 (455) 81 (2) -- (18) Expedia 297 (236) 61 (11) -- (63) Interval N/A N/A N/A N/A N/A -- PRC 299 (264) 34 (31) -- -- Corporate expense and other adjustments -- (31) (31) (5) -- (19) ------- ------- ------- ------- ------- ------- Subtotal $ 3,318 $(2,828) $ 490 $ (123) $ (42) $ (196) EMERGING BUSINESSES: -- Citysearch 46 (90) (43) (7) -- (80) International TV shopping and other 273 (298) (26) (4) (2) (2) ECS/Styleclick 34 (88) (54) (9) -- (0) ------- ------- ------- ------- ------- ------- Subtotal $ 353 $ (476) (123) $ (20) $ (2) $ (82) Disengaged HSN homes 102 (91) 11 -- -- -- Intersegment elimination (7) 7 -- -- -- -- ------- ------- ------- ------- ------- ------- TOTAL $ 3,766 $(3,387) $ 379 $ (142) $ (44) $ (278) ======= ======= ======= ======= ======= ======= ------------------------------------------- ------------------------------------------- HSN DISENGAGEMENT NON-RECURRING OPERATING COSTS ITEMS (B) INCOME ------------- ------------- --------- OPERATING BUSINESSES: HSN - U.S. $ (4) $ (1) $ 77 Ticketing -- -- 42 Personals -- -- 9 Hotels.com -- -- 62 Expedia -- -- (13) Interval N/A N/A N/A PRC -- (9) (6) Corporate expense and other adjustments -- (3) (59) ------- ------- ------- Subtotal $ (4) $ (13) $ 113 EMERGING BUSINESSES: Citysearch -- (1) (131) International TV shopping and other -- (2) (35) ECS/Styleclick -- (11) (73) ------- ------- ------- Subtotal $ -- $ (13) $ (240) Disengaged HSN homes -- -- 11 Intersegment elimination -- -- -- ------- ------- ------- TOTAL $ (4) $ (26) $ (116) ======= ======= =======
------------------------------------------------------------------------------------------------ PRO FORMA 2002 (a) ------------------------------------------------------------------------------------------------ OPERATING EXPENSES, EX. D&A, AMORTIZATION DISENGAGEMENT & ADJUSTED OF CABLE AMORTIZATION REVENUE NONRECURRING ITEMS EBITDA DEPRECIATION DISTRIBUTION FEES OF NON-CASH ITEMS ------- ------------------ -------- ------------ ----------------- ----------------- OPERATING BUSINESSES: HSN - U.S. $ 1,613 $(1,341) $ 272 $ (53) $ (52) $ (49) Ticketing 655 (507) 148 (29) -- (41) Personals 125 (89) 36 (8) -- (6) Hotels.com 945 (814) 131 (3) -- (22) Expedia 589 (415) 174 (16) -- (64) Interval 39 (35) 4 (2) -- (7) PRC 295 (260) 35 (38) -- -- Corporate expense and other adjustments -- (46) (46) (7) -- (12) ------- ------- ------- ------- ------- ------- Subtotal $ 4,262 $(3,507) $ 754 $ (156) $ (52) $ (200) EMERGING BUSINESSES: Citysearch 31 (69) (38) (8) -- (55) International TV shopping and other 337 (352) (14) (10) (1) (6) ECS/Styleclick 39 (63) (24) (3) -- (5) ------- ------- ------- ------- ------- ------- Subtotal $ 407 $ (483) (76) $ (20) $ (1) $ (66) Disengaged HSN homes (1) 1 -- -- -- -- Intersegment elimination (11) 11 -- -- -- -- ------- ------- ------- ------- ------- ------- TOTAL $ 4,657 $(3,979) $ 678 $ (176) $ (54) $ (266) ======= ======= ======= ======= ======= ======= ------------------------------------------- ------------------------------------------- HSN DISENGAGEMENT NON-RECURRING OPERATING COSTS ITEMS (B) INCOME ------------- ------------- --------- OPERATING BUSINESSES: HSN - U.S. $ (32) $ -- $ 86 Ticketing -- -- 78 Personals -- -- 23 Hotels.com -- (1) 106 Expedia -- (2) 92 Interval -- -- (5) PRC -- (35) (38) Corporate expense and other adjustments -- -- (65) ------- ------- ------- Subtotal $ (32) $ (38) $ 276 EMERGING BUSINESSES: Citysearch -- (6) (106) International TV shopping and other -- (49) (81) ECS/Styleclick -- (29) (61) ------- ------- ------- Subtotal $ -- $ (84) $ (248) Disengaged HSN homes -- -- -- Intersegment elimination -- -- -- ------- ------- ------- TOTAL $ (32) $ (122) $ 28 ======= ======= =======
- ---------- (a) Data for 2001 and 2002 is pro forma for Expedia and Vivendi transactions and the exchange of Holdco shares by Liberty, which closed on February 4, 2002, May 7, 2002, and June 24, 2002, respectively. (b) Non-recurring items include one time items related to restructuring operations, employee terminations and benefits and a write-down of investments. (c) See footnotes to quarterly reconciliations for description of non-recurring items. The financial, statistical and other information contained herein is unaudited. As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE PRO FORMA SEGMENT RESULTS $ IN MILLIONS, ROUNDING DIFFERENCES MAY EXIST
------------------------------------------------------------------------------------------------ Q1 2002 (a) ------------------------------------------------------------------------------------------------ OPERATING EXPENSES, EX. D&A, AMORTIZATION DISENGAGEMENT & ADJUSTED OF CABLE AMORTIZATION REVENUE NONRECURRING ITEMS EBITDA DEPRECIATION DISTRIBUTION FEES OF NON-CASH ITEMS ------- ------------------ -------- ------------ ----------------- ----------------- OPERATING BUSINESSES: HSN - U.S. $ 395 $ (338) $ 58 $ (12) $ (12) $ (12) Ticketing 153 (120) 34 (7) -- (10) Personals 25 (18) 7 (1) -- (3) Hotels.com 166 (140) 26 (1) -- (6) Expedia 116 (81) 35 (3) -- (16) Interval -- -- -- -- -- -- PRC 70 (64) 6 (9) -- -- Corporate expense and other adjustments -- (8) (8) (1) -- (2) ------- ------- ------- ------- ------- ------- Subtotal $ 926 $ (770) $ 156 $ (35) $ (12) $ (48) EMERGING BUSINESSES: Citysearch 7 (18) (11) (3) -- (16) International TV shopping and other 65 (70) (5) (1) (1) (0) ECS/Styleclick 12 (21) (8) (1) -- (0) ------- ------- ------- ------- ------- ------- Subtotal $ 85 $ (109) (24) $ (4) $ (1) $ (17) Disengaged HSN homes -- -- -- -- -- -- Intersegment elimination (3) 3 -- -- -- -- ------- ------- ------- ------- ------- ------- TOTAL $ 1,007 $ (876) $ 132 $ (39) $ (13) $ (65) ======= ======= ======= ======= ======= ======= ------------------------------------------- ------------------------------------------- HSN DISENGAGEMENT NON-RECURRING OPERATING COSTS ITEMS (B) INCOME ------------- ------------- --------- OPERATING BUSINESSES: HSN - U.S. $ (12) $ -- $ 10 Ticketing -- -- 17 Personals -- -- 3 Hotels.com -- -- 19 Expedia -- -- 16 Interval -- -- -- PRC -- -- (3) Corporate expense and other adjustments -- -- (11) ------- ------- ------- Subtotal $ (12) $ -- $ 49 EMERGING BUSINESSES: Citysearch -- -- (30) International TV shopping and other -- -- (7) ECS/Styleclick -- -- (9) ------- ------- ------- Subtotal $ -- $ -- $ (46) Disengaged HSN homes -- -- -- Intersegment elimination -- -- -- ------- ------- ------- TOTAL $ (12) $ -- $ 3 ======= ======= =======
------------------------------------------------------------------------------------------------ Q2 2002 (a) ------------------------------------------------------------------------------------------------ OPERATING EXPENSES, EX. D&A, AMORTIZATION DISENGAGEMENT & ADJUSTED OF CABLE AMORTIZATION REVENUE NONRECURRING ITEMS EBITDA DEPRECIATION DISTRIBUTION FEES OF NON-CASH ITEMS ------- ------------------ -------- ------------ ----------------- ----------------- OPERATING BUSINESSES: HSN - U.S. $ 376 $ (314) $ 63 $ (14) $ (12) $ (12) Ticketing 175 (132) 44 (7) -- (10) Personals 30 (20) 10 (2) -- (1) Hotels.com 230 (197) 33 0 -- (5) Expedia 143 (99) 43 (5) -- (17) Interval -- -- -- -- -- -- PRC 72 (64) 8 (9) -- -- Corporate expense and other adjustments -- (10) (10) (1) -- 1 ------- ------- ------- ------- ------- ------- Subtotal $ 1,026 $ (835) $ 190 $ (37) $ (12) $ (45) EMERGING BUSINESSES: Citysearch 8 (16) (9) (2) -- (13) International TV shopping and other 78 (84) (6) (2) (1) (1) ECS/Styleclick 10 (17) (6) (1) -- (5) ------- ------- ------- ------- ------- ------- Subtotal $ 96 $ (117) (21) $ (5) $ (1) Disengaged HSN homes (1) 1 -- -- -- -- Intersegment elimination (3) 3 -- -- -- -- ------- ------- ------- ------- ------- ------- TOTAL $ 1,118 $ (948) $ 169 $ (41) $ (13) $ (45) ======= ======= ======= ======= ======= ======= ------------------------------------------- ------------------------------------------- HSN DISENGAGEMENT NON-RECURRING OPERATING COSTS ITEMS (B) INCOME ------------- ------------- --------- OPERATING BUSINESSES: HSN - U.S. $ (6) $ -- $ 18 Ticketing -- -- 27 Personals -- -- 7 Hotels.com -- -- 28 Expedia -- -- 22 Interval -- -- -- PRC -- (32) (32) Corporate expense and other adjustments -- -- (10) ------- ------- ------- Subtotal $ (6) $ (32) $ 59 EMERGING BUSINESSES: Citysearch -- -- (23) International TV shopping and other -- (18) (28) ECS/Styleclick -- (21) (33) ------- ------- ------- Subtotal $ -- $ (39) $ (85) Disengaged HSN homes -- -- -- Intersegment elimination -- -- -- ------- ------- ------- TOTAL $ (6) $ (70) $ (26) ======= ======= =======
- ---------- (a) Data for 2001 and 2002 is pro forma for Expedia and Vivendi transactions and the exchange of Holdco shares by Liberty, which closed on February 4, 2002, May 7, 2002, and June 24, 2002, respectively. (b) Non-recurring items include restructuring and one-time items related to restructuring operations, costs to shut down certain operations and a write-down of goodwill for PRC. The financial, statistical and other information contained herein is unaudited. As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE PRO FORMA SEGMENT RESULTS $ IN MILLIONS, ROUNDING DIFFERENCES MAY EXIST
------------------------------------------------------------------------------------------------ Q3 2002 (a) ------------------------------------------------------------------------------------------------ OPERATING EXPENSES, EX. D&A, AMORTIZATION DISENGAGEMENT & ADJUSTED OF CABLE AMORTIZATION REVENUE NONRECURRING ITEMS EBITDA DEPRECIATION DISTRIBUTION FEES OF NON-CASH ITEMS ------- ------------------ -------- ------------ ----------------- ----------------- OPERATING BUSINESSES: HSN - U.S. $ 371 $ (303) $ 67 $ (14) $ (13) $ (12) Ticketing 162 (126) 36 (8) -- (10) Personals 33 (26) 7 (2) -- (1) Hotels.com 277 (237) 40 (1) -- (5) Expedia 167 (118) 49 (4) -- (16) Interval 2 (2) 0 (0) -- (0) PRC 75 (65) 10 (10) -- -- Corporate expense and other adjustments -- (11) (11) (3) -- (4) ------- ------- ------- ------- ------- ------- Subtotal $ 1,088 $ (889) $ 198 $ (43) $ (13) $ (49) EMERGING BUSINESSES: Citysearch 8 (16) (8) (2) -- (13) International TV shopping and other 92 (91) 0 (3) -- (7) ECS/Styleclick 8 (13) (5) (1) -- (0) ------- ------- ------- ------- ------- ------- Subtotal $ 107 $ (120) (13) $ (6) $ -- $ (20) Disengaged HSN homes -- -- -- -- -- -- Intersegment elimination (2) 2 -- -- -- -- ------- ------- ------- ------- ------- ------- TOTAL $ 1,192 $(1,007) $ 185 $ (48) $ (13) $ (69) ======= ======= ======= ======= ======= ======= ------------------------------------------- ------------------------------------------- HSN DISENGAGEMENT NON-RECURRING OPERATING COSTS ITEMS (B) INCOME ------------- ------------- --------- OPERATING BUSINESSES: HSN - U.S. $ (5) $ -- $ 24 Ticketing -- -- 18 Personals -- -- 4 Hotels.com -- (1) 33 Expedia -- (1) 27 Interval -- -- 0 PRC -- -- (1) Corporate expense and other adjustments -- (19) ------- ------- ------- Subtotal $ (5) $ (2) $ 88 EMERGING BUSINESSES: Citysearch -- (1) (24) International TV shopping and other -- (31) (41) ECS/Styleclick -- (4) (9) ------- ------- ------- Subtotal $ -- $ (36) $ (75) Disengaged HSN homes -- -- -- Intersegment elimination -- -- -- ------- ------- ------- TOTAL $ (5) $ (38) $ 13 ======= ======= =======
------------------------------------------------------------------------------------------------ Q4 2002 (a) ------------------------------------------------------------------------------------------------ OPERATING EXPENSES, EX. D&A, AMORTIZATION DISENGAGEMENT & ADJUSTED OF CABLE AMORTIZATION REVENUE NONRECURRING ITEMS EBITDA DEPRECIATION DISTRIBUTION FEES OF NON-CASH ITEMS ------- ------------------ -------- ------------ ----------------- ----------------- OPERATING BUSINESSES: HSN - U.S. $ 470 $ (386) $ 84 $ (14) $ (15) $ (12) Ticketing 164 (130) 34 (8) -- (10) Personals 37 (25) 13 (2) -- (1) Hotels.com 273 (240) 32 (1) -- (6) Expedia 164 (117) 47 (4) -- (16) Interval 36 (33) 4 (2) -- (7) PRC 78 (66) 12 (10) -- -- Corporate expense and other adjustments -- (17) (17) (1) -- (7) ------- ------- ------- ------- ------- ------- Subtotal $ 1,223 $(1,013) $ 210 $ (42) $ (15) $ (58) EMERGING BUSINESSES: Citysearch 8 (18) (10) (2) -- (13) International TV shopping and other 103 (106) (4) (3) -- 3 ECS/Styleclick 9 (13) (4) (1) -- (0) ------- ------- ------- ------- ------- ------- Subtotal $ 120 $ (137) (17) $ (6) $ -- $ (10) Disengaged HSN homes (0) 0 -- -- -- -- Intersegment elimination (3) 3 -- -- -- -- ------- ------- ------- ------- ------- ------- TOTAL $ 1,339 $(1,147) $ 192 $ (48) $ (15) $ (69) ======= ======= ======= ======= ======= ======= ------------------------------------------- ------------------------------------------- HSN DISENGAGEMENT NON-RECURRING OPERATING COSTS ITEMS (C) INCOME ------------- ------------- --------- OPERATING BUSINESSES: HSN - U.S. $ (9) $ -- $ 34 Ticketing -- -- 17 Personals -- -- 9 Hotels.com -- -- 26 Expedia -- (1) 27 Interval -- -- (6) PRC -- (4) (2) Corporate expense and other adjustments -- -- (25) ------- ------- ------- Subtotal $ (9) $ (5) $ 80 EMERGING BUSINESSES: Citysearch -- (4) (29) International TV shopping and other -- -- (4) ECS/Styleclick -- (5) (10) ------- ------- ------- Subtotal $ -- $ (9) $ (42) Disengaged HSN homes -- -- Intersegment elimination -- -- ------- ------- ------- TOTAL $ (9) $ (14) $ 37 ======= ======= =======
(a) Data for 2001 and 2002 is pro forma for Expedia and Vivendi transactions and the exchange of Holdco shares by Liberty, which closed on February 4, 2002, May 7, 2002, and June 24, 2002, respectively. (b) Non-recurring items include restructuring and one-time items related shut down of HSN Italy, costs of contract terminations, write down of investments and costs incurred by the special committees of Expedia and Ticketmaster,. (c) Non-recurring items include restructuring and one-time items related to restructuring operations, employee terminations and costs incurred by the special committees of Expedia and Ticketmaster, as well as the benefit of certain tax deductions related to Styleclick and Hot Germany, which are considered non-recurring. The financial, statistical and other information contained herein is unaudited. As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE RESULTS OF OPERATIONS $ IN MILLIONS; ROUNDING DIFFERENCES MAY EXIST. UNAUDITED.
2001 (a) 2002 (a) ----------------------------------------------- ------------------------------------------------ P&L Q1 Q2 Q3 Q4 YE 12/31 Q1 Q2 Q3 Q4 YE 12/31 ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- Revenues, net $ 877.9 $ 940.3 $ 917.3 $1,030.3 $3,765.8 $1,007.4 $1,117.8 $1,192.5 $1,339.0 $4,656.7 Operating costs and expenses: Costs related to revenues 571.5 597.9 596.8 658.2 2,424.4 628.4 683.6 713.2 803.9 2,829.0 ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- Gross profit 306.4 342.4 320.5 372.0 1,341.4 379.1 434.2 479.3 535.1 1,827.7 ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- Other costs and expenses 232.1 236.2 245.5 248.7 962.5 247.5 272.7 300.7 352.2 1,173.1 Depreciation 33.0 36.8 38.1 34.6 142.4 38.9 41.1 48.4 48.1 176.5 Amortization of non-cash compensation 12.9 8.8 8.4 8.3 38.3 8.3 6.9 6.5 9.2 30.9 Amortization of non-cash distribution and marketing 8.0 10.6 7.1 9.0 34.7 11.0 10.1 10.4 9.9 41.4 Amortization of other intangibles (non-cash) 59.6 61.9 60.7 66.7 248.9 58.4 60.2 64.5 64.7 247.7 One time charges 0.0 10.6 12.7 3.0 26.3 0.0 62.5 31.4 4.4 98.3 HSN disengagement costs 0.0 0.0 0.0 4.1 4.1 11.5 6.2 4.6 9.3 31.7 ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- Total operating costs 345.6 364.8 372.4 374.4 1,457.2 375.6 459.7 466.6 497.7 1,799.6 ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- Operating income (39.2) (22.3) (51.9) (2.4) (115.8) 3.5 (25.6) 12.8 37.3 28.1 Interest expense, net 21.9 19.3 23.0 20.2 84.5 (4.2) 26.2 28.0 28.1 78.1 Equity losses in affiliates and other (6.5) (5.9) (19.3) (28.6) (60.3) 12.3 (101.8) (18.2) 24.5 (83.2) ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- 15.4 13.4 3.8 (8.4) 24.2 8.0 (75.6) 9.9 52.6 (5.1) ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- Earnings before income taxes and minority interest (23.8) (8.9) (48.1) (10.8) (91.7) 11.5 (101.2) 22.6 90.0 23.0 Income tax expense (15.9) (6.1) (3.3) (5.0) (30.2) (15.2) (13.0) (37.5) 58.3 (7.4) Minority interest 5.0 1.2 2.3 (5.4) 3.2 (8.1) (11.2) (15.6) (15.0) (50.0) ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- Net earnings/(loss) from continuing operations (34.6) (13.8) (49.1) (21.1) (118.6) (11.8) (125.4) (30.5) 133.3 (34.4) ======= ======= ======= ======== ======== ======== ======== ======== ======== ======== Preferred dividend (3.3) (3.3) (3.3) (3.3) (13.1) (3.3) (3.3) (3.3) (3.3) (13.1) Impact of dilutive securities 0.0 0.0 0.0 0.0 0.0 (2.0) (2.0) (1.1) (1.5) (6.2) ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- Net earnings available to common shareholders $ (37.9) $ (17.1) $ (52.4) $ (24.4) $ (131.7) $ (17.1) $ (130.6) $ (34.9) $ 128.5 $ (53.7) ======= ======= ======= ======== ======== ======== ======== ======== ======== ======== Adjusted Net Income Calculation: Net income before preferred dividend (34.6) (13.8) (49.1) (21.1) (118.6) (11.8) (125.4) (30.5) 133.3 (34.4) After tax and minority interest impact of non-recurring items 0.0 7.6 14.7 12.2 34.5 0.0 139.0 47.0 (80.6) 105.4 Preferred dividends (3.3) (3.3) (3.3) (3.3) (13.1) (3.3) (3.3) (3.3) 0.0 (13.1) Equity income from 5.44% common interest in VUE 0.0 0.0 0.0 0.0 0.0 0.0 0.0 2.7 (8.8) (6.1) Amortization of non-cash items 71.7 70.6 66.2 69.5 278.0 64.7 64.2 68.8 68.7 266.4 Less: related tax and minority interest (12.3) (22.1) (14.5) (9.2) (58.2) (19.8) (22.5) (19.6) (21.0) (82.4) ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- Adjusted Net Income 21.5 39.0 13.9 48.1 122.6 29.8 52.0 65.2 91.6 235.9 ======= ======= ======= ======== ======== ======== ======== ======== ======== ======== Weighted average basic shares 476.5 480.1 482.8 483.5 480.5 487.5 492.5 493.9 494.8 492.4 Dilutive impact of options, warrants and restricted stock 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 23.5 0.0 Impact of conversion of preferred shares 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 19.4 0.0 ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- Weighted average diluted shares 476.5 480.1 482.8 483.5 480.5 487.5 492.5 493.9 537.8 492.4 Weighted average basic shares 476.5 480.1 482.8 483.5 480.5 487.5 492.5 493.9 494.8 492.4 Dilutive impact of restricted stock 0.4 0.4 0.3 0.3 0.3 0.2 0.2 0.3 0.5 0.3 Dilutive impact of options and warrants 27.5 29.4 26.3 23.1 30.8 29.4 27.0 21.1 23.5 25.8 Impact of conversion of preferred shares 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 19.4 0.0 ------- ------- ------- -------- -------- -------- -------- -------- -------- -------- Adjusted EPS shares outstanding 504.4 509.9 509.4 506.9 511.6 517.1 519.7 515.3 538.2 518.5 Basic earnings per share $ (.08) $ (.04) $ (.11) $ (.05) $ (.27) $ (.03) $ (.26) $ (.07) $ .26 $ (.10) Diluted earnings per share $ (.08) $ (.04) $ (.11) $ (.05) $ (.27) $ (.03) $ (.27) $ (.07) $ .24 $ (.11) Adjusted earnings per share $ .04 $ .08 $ .03 $ .09 $ .24 $ .06 $ .10 $ .13 $ .17 $ .45
- ---------- (a) Data for 2001 and 2002 is pro forma for Expedia and Vivendi transactions and the exchange of Holdco shares by Liberty, which closed on February 4, 2002, May 7, 2002, and June 24, 2002, respectively. THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE OPERATING METRICS $ IN MILLIONS
2000 2001 2002 ------- ----------------------------------------------- ------------------------------------------------ YE Q1 Q2 Q3 Q4 YE Q1 Q2 Q3 Q4 YE 12/31 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- -------- GROSS TRANSACTION VALUE ("GTV") Total GTV $ 7,082 $ 2,167 $ 2,429 $ 2,135 $ 2,303 $ 9,033 $ 2,782 $ 3,256 $ 3,391 $ 3,475 $12,903 Interactive GTV (a) $ 4,722 $ 1,548 $ 1,792 $ 1,632 $ 1,768 $ 6,739 $ 2,218 $ 2,668 $ 2,839 $ 2,868 $10,593 % of Total 67% 71% 74% 76% 77% 75% 80% 82% 84% 83% 82% Internet GTV (b) $ 3,088 $ 1,148 $ 1,390 $ 1,232 $ 1,267 $ 5,038 $ 1,801 $ 2,225 $ 2,356 $ 2,295 $ 8,677 % of Total 44% 53% 57% 58% 55% 56% 65% 68% 69% 66% 67% International GTV $ 800 $ 254 $ 289 $ 252 $ 291 $ 1,086 $ 335 $ 465 $ 551 $ 586 $ 1,937 % of Total 11% 12% 12% 12% 13% 12% 12% 14% 16% 17% 15%
- ---------- (a) Interactive GTV is defined as GTV which was generated from the TV or PC from HSN, HSN.com, Ticketmaster.com, Hotels.com, Expedia, Match.com, TV Travel Shop and Interval. (b) Internet GTV is defined as GTV which was generated online from HSN.com, Ticketmaster.com, Hotels.com, Expedia, Match.com and Interval. THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. PRO FORMA FOR EXPEDIA TRANSACTION. As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE OPERATING METRICS IN MILLIONS EXCEPT PER UNIT
2000 2001 2002 ------ ------------------------------------------ ------------------------------------------ YE Q1 Q2 Q3 Q4 YE Q1 Q2 Q3 Q4 YE ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ HSN - U.S. Units shipped 35.2 8.6 9.0 9.5 11.4 38.5 9.6 9.3 9.1 10.8 38.7 Gross profit % 34.9% 33.5% 34.5% 34.3% 33.9% 34.0% 35.5% 38.4% 38.1% 36.7% 37.1% Return rate 19.6% 19.6% 19.6% 19.0% 17.9% 18.9% 19.0% 18.8% 18.5% 18.2% 18.6% Product mix:* Home & Licensing N/A 37% 35% 36% 41% 38% 32% 28% 29% 35% 31% Home Fashions N/A 4% 4% 5% 5% 4% 7% 6% 8% 7% 7% Jewelry N/A 26% 26% 25% 25% 25% 24% 26% 25% 24% 25% Health/Beauty N/A 19% 22% 20% 17% 19% 24% 24% 23% 22% 23% Apparel/Accessories N/A 14% 13% 14% 12% 13% 13% 16% 15% 12% 14% Average Price Point $47.82 $50.06 $47.36 $46.13 $47.27 $47.63 $45.41 $44.18 $44.37 $47.54 $45.46 HSN total homes (end of period) 77.1 80.2 81.1 82.8 83.0 83.0 74.9 77.1 77.8 78.8 78.8 America's Store FTE's (end of period) 8.6 8.3 10.6 11.0 12.3 12.3 10.2 11.1 8.7 9.0 9.0 HSN.com % of Sales 3% 5% 8% 8% 10% 8% 11% 11% 11% 13% 12%
THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. * In Q1 2002, HSN reclassfied certain items in its product mix. As such, wellness, ingestibles, and fitness categories were moved out of the Home Goods category and into the Health & Beauty category. Product Mix for 1999 and 2000 assuming reclassification not available. Home Licensing includes electronics, computers, and other licensed homegoods. As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE OPERATING METRICS IN MILLIONS
2000 2001 2002 ------ ------------------------------------------ ------------------------------------------ YE Q1 Q2 Q3 Q4 YE Q1 Q2 Q3 Q4 YE ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ TICKETING Number of tickets sold 83.0 23.6 23.6 19.3 20.3 86.8 23.9 24.3 22.8 24.1 95.1 Gross value of tickets sold $3,256 $ 937 $1,016 $ 788 $ 870 $3,611 $ 997 $1,144 $1,041 $1,106 $4,288 Share of tickets sold online 24.5% 29.5% 33.2% 31.9% 33.9% 32.1% 37.8% 43.0% 40.8% 40.7% 40.6%
THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE OPERATING METRICS IN THOUSANDS
2000 2001 2002 ------- ----------------------------------------------- ------------------------------------------------ YE Q1 Q2 Q3 Q4 YE Q1 Q2 Q3 Q4 YE ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- -------- MATCH.COM(a) Paid subscribers 156.9 189.5 216.6 252.7 382.2 382.2 527.7 604.2 653.2 724.8 724.8 New registrations 1,135.6 1,054.5 1,059.5 1,216.0 2,304.0 5,634.3 2,911.7 3,284.5 3,422.5 3,379.7 12,998.5 New subscriptions (first time only) 399.5 121.7 134.8 154.2 260.4 671.0 342.4 313.2 328.5 347.6 1,331.7 Conversion rate (Reg to Subs) 35.2% 11.5% 12.7% 12.7% 11.3% 11.9% 11.8% 9.5% 9.6% 10.3% 10.2%
THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on February 6, 2003. (a) The operating metrics include the impact of Soulmates, acquired on April 12, 2002. The 2001 operating metrics do not include Soulmates. USA INTERACTIVE OPERATING METRICS
2000 2001 2002 ------- ------------------------------------------- ------------------------------------------- YE Q1 Q2 Q3 Q4 YE Q1 Q2 Q3 Q4 YE ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- HOTELS.COM Hotel room nights sold (thousands) 2,433 799 1,030 1,227 1,187 4,243 1,408 1,883 2,320 2,227 7,838 Average Daily Rate $131.70 $124.35 $129.65 $120.64 $115.00 $121.10 $115.70 $118.95 $115.88 $117.93 $117.17 Affiliates (including TravelNow) 16,200 18,649 20,857 22,793 23,808 23,808 25,755 28,340 30,646 33,973 33,973 Properties 2,600 3,084 3,374 3,890 4,567 4,567 6,058 6,467 6,571 7,723 7,723 Cities served 97 135 146 171 178 178 218 243 285 325 325 U.S. N/A 100 111 119 124 124 146 154 165 186 186 International N/A 35 35 52 54 54 72 89 120 139 139
THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE OPERATING METRICS IN THOUSANDS
2000 2001 ------ ------------------------------------------------------------------ YE Q1 Q2 Q3 Q4 YE ------ ---------- ---------- ---------- ---------- ---------- EXPEDIA (in thousands) GROSS BOOKINGS Total gross bookings (a) $1,793 $ 674,000 $ 802,000 $ 723,000 $ 704,000 $2,903,000 Agency gross bookings N/A $ 579,000 $ 644,000 $ 559,000 $ 540,000 $2,322,000 Merchant gross bookings (includes CCV) N/A $ 95,000 $ 158,000 $ 164,000 $ 164,000 $ 581,000 CCV gross bookings N/A $ 0 $ 0 $ 0 $ 0 $ 0 International gross bookings N/A $ 40,000 $ 44,000 $ 47,000 $ 48,000 $ 179,000 North America gross bookings N/A $ 634,000 $ 758,000 $ 675,000 $ 656,000 $2,723,000 ADDITIONAL METRICS Revenue from packages N/A $ 3,649 $ 6,365 $ 9,408 $ 11,573 $ 30,995 Total room nights stayed N/A 752 1,102 1,270 1,522 4,646 Merchant room nights stayed N/A 494 729 970 1,178 3,371 Merchant hotel average daily rate (excludes CCV) N/A $ 117 $ 122 $ 119 $ 109 N/A CUSTOMERS Average monthly Media Metrix reach (b) N/A 6,969 7,502 9,410 9,238 N/A Expedia.com conversion (c) N/A 5.7% 7.0% 5.5% 5.2% N/A Expedia new purchasing customers (d) 1,769 671 904 918 870 3,363 Expedia cumulative purchasing customers (e) 2,932 3,603 4,507 5,424 6,294 6,294 Expedia quarterly unique purchasing customers (f) 2,741 1,007 1,336 1,393 1,383 5,119 2002 ------------------------------------------------------------------ Q1 Q2 Q3 Q4 YE ---------- ---------- ---------- ---------- ---------- EXPEDIA (in thousands) GROSS BOOKINGS Total gross bookings (a) $1,107,000 $1,335,000 $1,466,000 $1,380,000 $5,288,000 Agency gross bookings $ 797,000 $ 937,000 $1,042,000 $1,002,000 $3,778,000 Merchant gross bookings (includes CCV) $ 310,000 $ 398,000 $ 424,000 $ 378,000 $1,510,000 CCV gross bookings $ 18,000 $ 82,000 $ 67,000 $ 42,000 $ 209,000 International gross bookings $ 85,000 $ 94,000 $ 138,000 $ 123,000 $ 440,000 North America gross bookings $1,022,000 $1,241,000 $1,328,000 $1,257,000 $4,848,000 ADDITIONAL METRICS Revenue from packages $ 25,456 $ 41,527 $ 49,881 $ 46,912 $ 163,776 Total room nights stayed 2,042 2,627 3,207 3,168 11,044 Merchant room nights stayed 1,644 2,077 2,602 2,522 8,845 Merchant hotel average daily rate (excludes CCV) $ 118 $ 120 $ 114 $ 119 N/A .......... CUSTOMERS Average monthly Media Metrix reach (b) 11,242 12,161 12,615 11,392 N/A Expedia.com conversion (c) 5.8% 6.3% 6.7% 6.8% N/A Expedia new purchasing customers (d) 1,316 1,529 1,693 1,528 6,066 Expedia cumulative purchasing customers (e) 7,610 9,139 10,832 12,360 12,360 Expedia quarterly unique purchasing customers (f) 1,874 2,217 2,492 2,225 8,808
- ---------- (a) Gross bookings represents the total value of travel booked through the Expedia, WWTE sites, Classic Custom Vacations and Metropolitan Travel since acquisition. (b) Average monthly Media Metrix reach represents the unduplicated reach for the Expedia sites. (c) Conversion represents the monthly average Expedia.com unique monthly purchasers divided by the monthly average Media Metrix reach for the Expedia.com site. (d) Expedia new purchasing customers represents the number of new customers transacting through the Expedia sites in a quarter. (e) Expedia cumulative purchasing customers represents the cumulative number of customers that have ever transacted through the Expedia sites as of the end of a quarter. (f) Expedia quarterly unique purchasing customers represents the number of unique customers transacting through the Expedia sites over the course of a quarter. THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE OPERATING METRICS
2001 ------------------------------------------------------------- Q1 Q2 Q3 Q4 YE --------- --------- --------- --------- --------- INTERVAL Active members 1,232,675 1,260,904 1,292,688 1,318,093 1,318,093 Total exchange confirmations 200,777 166,489 154,565 148,988 670,818 % of Exchanges online 0.0% 1.8% 2.8% 3.3% 1.8% 2002 ------------------------------------------------------------- Q1 Q2 Q3 Q4 YE --------- --------- --------- --------- --------- INTERVAL Active members 1,359,146 1,433,390 1,470,582 1,499,668 1,499,668 Total exchange confirmations 220,079 180,731 166,771 151,021 718,602 % of Exchanges online 5.7% 5.8% 6.5% 7.6% 6.3%
THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. PRO FORMA FOR USA'S ACQUISITION OF INTERVAL. As filed with the Securities and Exchange Commission on February 6, 2003. USA INTERACTIVE OPERATING METRICS IN MILLIONS CAPITALIZATION Ticker (NASDAQ) USAI As of 1/17/03 ------------- Shares Outstanding (millions) (a): USA Common Stock 431 USA Class B 65 ------- Total Shares Outstanding 496 Estimated dilutive options and warrants (treasury method) 24 ------- Fully diluted shares 520 ======= Market Capitalization: Outstanding equity capitalization $11,355 Fully diluted equity capitalization $11,914 As of 12/31/02 (b) ------------------ Attributable Cash (c) $ 3,446 Securities in VUE (d) 2,203 Debt and Preferred Stock (1,892) ------- Net Attributable Cash and Securities $ 3,757 ======= - ---------- (a) Fully diluted shares includes treasury method options and warrants and other dilutive securities, and includes Vivendi's remaining 56.6 million shares that may be delivered to USA in connection with USA's Series B preferred interest in VUE. (b) Pro forma for Ticketmaster merger, which closed on 1/17/03. Please see USA Q4 earnings release filed February 6, 2003 for reconciliation to balance sheet values. (c) Includes attributable cash from USA's public subsidiaries, based on the Q4 weighted average of USA's fully diluted, treasury method ownership in public subsidiaries, which was 66% for Hotels.com and 55% for Expedia. Excludes cash due to clients at Ticketmaster. Consolidated cash is $3.1 billion as of January 17, 2003. (d) Includes securities issued to USA in the Vivendi transaction, as follows: Class A and Class B preferred interests and 5.4% common interest in Vivendi Universal Entertainment ("VUE") at balance sheet carrying values, less the estimated present value of taxes on the VUE securities related to USA's gain on the Vivendi transaction. Absolute % of Fully Shares % of Shares Diluted Shares Owned Outstanding (QTD) -------- ----------- -------------- Hotels.com (NASDAQ: ROOM) 39.0 67% 66% Expedia (NASDAQ: EXPE) 35.4 60% 55% ESTIMATED OPERATING METRICS FOR 2002 (ROUNDED) Primary Consumer web sites 34 Active/registered customers (a) 25 million Customer names in database (a) 90 million Customer inbound telephone minutes 800 million Customer inbound telephone calls 150 million Orders processed 110 million Items Shipped 45 million In-house merchants 150 Merchandise SKUs 68,000 Telephone operator positions 12,000 Ticketing outlets 3,500 Fulfillment center square feet 2.4 million (a) Assumes 25% duplication across USA brands. REVENUE MIX Revenue sources (Q4 '02): Merchandise 42% Travel 36% Ticketing 12% Teleservices 6% Personals 3% Other 1% ------- Total 100% ======= THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on February 6, 2003. -----END PRIVACY-ENHANCED MESSAGE-----