Time Magazine 2014 Annual Report Download - page 132

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2014 FINANCIAL HIGHLIGHTS – RECONCILIATIONS AND OTHER INFORMATION
Set forth below are definitions of the non-GAAP financial measures that are used in the 2014 Financial Highlights pages
of this Annual Report to Shareholders and reconciliations of such non-GAAP financial measures to the most directly
comparable financial measures calculated in accordance with generally accepted accounting principles. On June 6, 2014, the
Company completed the legal and structural separation of Time Inc. from the Company. Accordingly, the financial
information for periods prior to 2014 set forth below has been recast to present the financial position and results of operations
of the Company’s former Time Inc. segment as discontinued operations.
“Adjusted Operating Income” is Operating Income excluding the impact of noncash impairments of goodwill,
intangible and fixed assets; gains and losses on operating assets (other than deferred gains on sale-leasebacks); gains and
losses recognized in connection with pension and other postretirement benefit plan curtailments or settlements; external costs
related to mergers, acquisitions or dispositions, as well as contingent consideration related to such transactions, to the extent
such costs are expensed; amounts related to securities litigation and government investigations; and the foreign currency loss
during the three months ended December 31, 2014, related to the translation of net monetary assets denominated in
Venezuelan currency resulting from the Company’s change to begin using the SICAD 2 exchange rate.
“Adjusted EPS” is Diluted Income per Common Share from Continuing Operations attributable to Time Warner Inc.
common shareholders with the following items excluded from Income from Continuing Operations attributable to Time
Warner Inc. common shareholders: noncash impairments of goodwill, intangible and fixed assets and investments; gains and
losses on operating assets (other than deferred gains on sale-leasebacks), liabilities and investments; gains and losses
recognized in connection with pension and other postretirement benefit plan curtailments or settlements; external costs
related to mergers, acquisitions, investments or dispositions, as well as contingent consideration related to such transactions,
to the extent such costs are expensed; amounts related to securities litigation and government investigations; the foreign
currency loss during the three months ended December 31, 2014 related to the translation of net monetary assets
denominated in Venezuelan currency resulting from the Company’s change to begin using the SICAD 2 exchange rate; and
amounts attributable to businesses classified as discontinued operations; as well as the impact of taxes and noncontrolling
interests on the above items and the Company’s share of the above items with respect to equity method investments.
“Free Cash Flow” is Cash Provided by Operations from Continuing Operations plus payments related to securities
litigation and government investigations (net of any insurance recoveries), external costs related to mergers, acquisitions,
investments or dispositions, to the extent such costs are expensed, contingent consideration payments made in connection
with acquisitions, and excess tax benefits from equity instruments, less capital expenditures, principal payments on capital
leases and partnership distributions, if any.
Reconciliation of Adjusted Operating Income to Operating Income
(millions; unaudited)
Year Ended December 31,
2014 2013 2009
(recast) (recast)
Adjusted Operating Income ................................. $ 5,833 $ 6,195 $ 4,339
Asset impairments ........................................ (69) (61) (52)
Gain (loss) on operating assets, net ........................... 464 129 (33)
Venezuelan foreign currency loss(1) ........................... (173) - -
Other(2) ................................................. (80) 5 (30)
Operating Income ......................................... $ 5,975 $ 6,268 $ 4,224
(1) Venezuelan foreign currency loss during 2014 related to the translation of net monetary assets denominated in Venezuelan currency resulting from the
Company’s change to begin using the SICAD 2 exchange rate.
(2) For 2014 and 2013, Other includes gains and losses recognized in connection with pension and other postretirement benefit plan curtailments or
settlements; external costs related to mergers, acquisitions or dispositions; and amounts related to securities litigation and government investigations. For
2009, Other includes only amounts related to securities litigation and government investigations.
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