Time Magazine 2010 Annual Report Download - page 60

Download and view the complete annual report

Please find page 60 of the 2010 Time Magazine annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 130

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130

The following table summarizes the Company’s aggregate contractual obligations at December 31, 2010, and
the estimated timing and effect that such obligations are expected to have on the Company’s liquidity and cash flows
in future periods (millions):
Contractual Obligations
(a)(b)(c)
Total 2011 2012-2013 2014-2015 Thereafter
Outstanding debt obligations (Note 8) .... $ 16,599 $ 15 $ 1,370 $ 1,000 $ 14,214
Interest (Note 8) ................... 17,099 1,065 2,045 1,914 12,075
Capital lease obligations (Note 8) ....... 95 14 27 22 32
Operating lease obligations (Note 16) .... 2,488 401 729 630 728
Purchase obligations. . ............... 21,415 4,444 5,328 3,450 8,193
Total contractual obligations and
outstanding debt . . . ............... $ 57,696 $ 5,939 $ 9,499 $ 7,016 $ 35,242
(a)
The table does not include the effects of certain put/call or other buy-out arrangements that are contingent in nature involving certain of the
Company’s investees (Note 16).
(b)
The table does not include the Company’s reserve for uncertain tax positions and related accrued interest and penalties, which at
December 31, 2010 totaled $2.4 billion, as the specific timing of any cash payments relating to this obligation cannot be projected with
reasonable certainty.
(c)
The references to Note 8 and Note 16 refer to the notes to the accompanying consolidated financial statements.
The following is a description of the Company’s material contractual obligations at December 31, 2010:
• Outstanding debt obligations — represents the principal amounts due on outstanding debt obligations as of
December 31, 2010. Amounts do not include any fair value adjustments, bond premiums, discounts, interest
payments or dividends.
• Interest — represents amounts based on the outstanding debt balances, interest rates and maturity schedules
of the respective instruments as of December 31, 2010. Interest ultimately paid on these obligations may
differ based on changes in interest rates for variable-rate debt, as well as any potential future refinancings
entered into by the Company.
• Capital lease obligations — represents the minimum lease payments under noncancelable capital leases,
primarily for certain transponder leases at the Networks segment.
• Operating lease obligations — represents the minimum lease payments under noncancelable operating
leases, primarily for the Company’s real estate and operating equipment in various locations around the
world.
• Purchase obligations — represents an agreement to purchase goods or services that is enforceable and
legally binding on the Company and that specifies all significant terms, including: fixed or minimum
quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the
transaction. The purchase obligation amounts do not represent the entire anticipated purchases in the future,
but represent only those items for which the Company is contractually obligated. Additionally, the
Company also purchases products and services as needed, with no firm commitment. For this reason,
the amounts presented in the table alone do not provide a reliable indicator of the Company’s expected
future cash outflows. For purposes of identifying and accumulating purchase obligations, the Company has
included all material contracts meeting the definition of a purchase obligation (i.e., legally binding for a
fixed or minimum amount or quantity). For those contracts involving a fixed or minimum quantity, but with
variable pricing terms, the Company has estimated the contractual obligation based on its best estimate of
the pricing that will be in effect at the time the obligation is incurred. Additionally, the Company has
included only the obligations represented by those contracts as they existed at December 31, 2010, and did
not assume renewal or replacement of the contracts at the end of their respective terms. If a contract includes
a penalty for non-renewal, the Company has included that penalty, assuming it will be paid in the period
48
TIME WARNER INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION – (Continued)