Time Magazine 2012 Annual Report Download - page 48

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TIME WARNER INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION – (Continued)
Restructuring and Severance Costs. For the years ended December 31, 2012, 2011 and 2010, the
Company incurred Restructuring and severance costs primarily related to employee terminations and other exit
activities. Restructuring and severance costs by segment are as follows (millions):
Year Ended December 31,
2012 2011 2010
Networks ............................................... $ 67 $ 52 $ 6
Film and TV Entertainment ................................ 23 41 30
Publishing .............................................. 27 18 61
Corporate .............................................. 2 2 —
Total restructuring and severance costs ....................... $ 119 $ 113 $ 97
The total number of employees terminated across the segments in 2012, 2011 and 2010 was approximately
1,100, 1,200 and 500, respectively.
Operating Income. Operating Income was $5.918 billion, $5.805 billion and $5.428 billion for the years
ended December 31, 2012, 2011 and 2010, respectively. Excluding the items noted under “Transactions and
Other Items Affecting Comparability” totaling $208 million of expense, $59 million of expense and $28 million
of income for the years ended December 31, 2012, 2011 and 2010, respectively, Operating Income increased
$262 million and $464 million in 2012 and 2011, respectively. The increase in 2012 reflected an increase at the
Networks segment, offset in part by decreases at the Publishing and Film and TV Entertainment segments. The
increase in 2011 reflected increases at all of the segments. The segment variations are discussed under “Business
Segment Results.”
Interest Expense, Net. Interest expense, net was $1.253 billion, $1.210 billion and $1.178 billion for the
years ended December 31, 2012, 2011 and 2010, respectively. The increase for the year ended December 31,
2012 reflected higher average net debt in 2012, partially offset by an approximate $30 million decrease in interest
expense due to lower average interest rates. The increase for the year ended December 31, 2011 reflected higher
average debt in 2011, primarily related to the issuance of $2.0 billion aggregate principal amount of debt
securities in April 2011 and $1.0 billion aggregate principal amount of debt securities in October 2011, partially
offset by an approximate $60 million decline in interest expense due to lower average interest rates.
Other Loss, Net. Other loss, net detail is shown in the table below (millions):
Year Ended December 31,
2012 2011 2010
Investment gains (losses), net ............................... $ (73) $ (168) $ 32
Amounts related to the separation of TWC .................... 4 (5) (6)
Amounts related to the disposition of WMG ................... (7) — —
Premiums paid and transaction costs incurred in connection with
debt redemptions ....................................... — — (364)
Income (loss) from equity method investees ................... (46) (40) 6
Other .................................................. (1) (16) 1
Other loss, net ........................................... $ (123) $ (229) $ (331)
Investment gains (losses), net, amounts related to the separation of TWC, amounts related to the disposition
of WMG and premiums paid and transaction costs incurred in connection with debt redemptions are discussed
under “Transactions and Other Items Affecting Comparability.”
32