Time Magazine 2012 Annual Report Download - page 44

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TIME WARNER INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION – (Continued)
RESULTS OF OPERATIONS
Recent Accounting Guidance
See Note 1, “Description of Business, Basis of Presentation and Summary of Significant Accounting
Policies,” to the accompanying consolidated financial statements for a discussion of recent accounting guidance
adopted.
Transactions and Other Items Affecting Comparability
As more fully described herein and in the related notes to the accompanying consolidated financial
statements, the comparability of Time Warner’s results has been affected by transactions and certain other items
in each period as follows (millions):
Year Ended December 31,
2012 2011 2010
Asset impairments ........................................... $ (186) $ (44) $ (20)
Gain on operating assets, net ................................... 9770
Other ..................................................... (31) (22) (22)
Impact on Operating Income ................................... (208) (59) 28
Investment gains (losses), net .................................. (73) (168) 32
Amounts related to the separation of Time Warner Cable Inc. ......... 4 (5) (6)
Amounts related to the disposition of Warner Music Group .......... (7) — —
Premiums paid and transaction costs incurred in connection with debt
redemptions .............................................. — — (364)
Pretax impact(a) ............................................. (284) (232) (310)
Income tax impact of above items ............................... 100 43 131
Impact of items on income from continuing operations attributable to
Time Warner Inc. shareholders ............................... $ (184) $ (189) $ (179)
(a) For the year ended December 31, 2010, pretax impact amount does not include $23 million of external costs related to mergers,
acquisitions or dispositions.
In addition to the items affecting comparability described above, the Company incurred Restructuring and
severance costs of $119 million, $113 million and $97 million for the years ended December 31, 2012, 2011 and
2010, respectively. During the year ended December 31, 2010, the Company also recognized a $58 million
reserve reversal in connection with the resolution of litigation related to the sale of the Atlanta Hawks and
Thrashers sports franchises and certain operating rights to the Philips Arena (the “Winter Sports Teams”). For
further discussion of Restructuring and severance costs, see “Consolidated Results” and “Business Segment
Results.”
Asset Impairments
During the year ended December 31, 2012, the Company recognized $174 million of charges at the
Networks segment in connection with the Imagine and TNT Turkey Shutdowns primarily related to certain
receivables, including value added tax receivables, inventories and long-lived assets, including Goodwill. For the
year ended December 31, 2012, the Company also recognized $12 million of other miscellaneous noncash asset
impairments consisting of $2 million at the Networks segment, $4 million at the Film and TV Entertainment
segment and $6 million at the Publishing segment.
28