Time Magazine 2009 Annual Report Download - page 127

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These intersegment transactions are recorded by each segment at estimated fair value as if the transactions were
with third parties and, therefore, affect segment performance. While intersegment transactions are treated like third-
party transactions to determine segment performance, the revenues (and corresponding expenses or assets
recognized by the segment that is counterparty to the transaction) are eliminated in consolidation and,
therefore, do not affect consolidated results. Additionally, transactions between divisions within the same
reporting segment (e.g., a transaction between HBO and Turner within the Networks segment) are eliminated
in arriving at segment performance and, therefore, do not affect segment results. Revenues recognized by Time
Warner’s segments on intersegment transactions are as follows:
2009 2008 2007
Years Ended December 31,
(millions)
(recast) (recast)
Intersegment Revenues
Networks ........................................... $ 94 $ 96 $ 105
Filmed Entertainment .................................. 613 534 571
Publishing .......................................... 13 14 20
Total intersegment revenues ............................. $ 720 $ 644 $ 696
2009 2008 2007
Years Ended December 31,
(millions)
(recast) (recast)
Operating Income (Loss) before Depreciation and
Amortization
Networks
(a)
........................................ $ 3,967 $ 3,487 $ 3,336
Filmed Entertainment
(b)
............................... 1,447 1,228 1,215
Publishing
(c)
....................................... 419 (6,416) 1,104
Corporate
(d)
....................................... (325) (336) (553)
Intersegment eliminations . . ........................... 35 35 (3)
Total operating income (loss) before depreciation and
amortization ..................................... $ 5,543 $ (2,002) $ 5,099
(a)
For the year ended December 31, 2009, includes a $52 million noncash impairment of intangible assets related to Turner’s interest in a
general entertainment network in India. For the year ended December 31, 2008, includes an $18 million noncash impairment of GameTap,
an online video game business, as well as a $3 million loss on the sale of GameTap. For the year ended December 31, 2007, includes a
$34 million noncash impairment of the Court TV tradename as a result of rebranding the Court TV network name to truTV.
(b)
For the year ended December 31, 2009, includes a $33 million loss on the sale of Warner Bros.’ Italian cinema assets.
(c)
For the year ended December 31, 2009, includes a $33 million noncash impairment of certain fixed assets. For the year ended December 31,
2008, includes a $7.139 billion noncash impairment to reduce the carrying value of goodwill and intangible assets, a $30 million noncash
impairment related to a sub-lease with a tenant that filed for bankruptcy in September 2008, a $21 million noncash impairment of Southern
Living At Home, which was sold in the third quarter of 2009, and a $5 million noncash impairment related to certain other asset write-offs.
For the year ended December 31, 2007, includes a $6 million gain on the sale of four non-strategic magazine titles.
(d)
For the years ended December 31, 2009, 2008 and 2007, includes $30 million, $21 million and $18 million, respectively in net expenses
related to securities litigation and government investigations. The year ended December 31, 2007 also includes $153 million in legal
reserves related to securities litigation.
115
TIME WARNER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)