Time Magazine 2014 Annual Report Download - page 47

TIME WARNER INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION – (Continued)
The remaining changes in Other loss, net for the year ended December 31, 2014 included lower net losses from equity
method investees. The remaining changes in Other loss, net for the year ended December 31, 2013 reflected the absence of
the 2012 adjustment to reduce a liability for deferred compensation and higher net losses from equity method investees.
Income Tax Provision. Income tax provision was $785 million, $1.614 billion and $1.370 billion for the years ended
December 31, 2014, 2013 and 2012, respectively. The Company’s effective tax rate was 17%, 32% and 34% for the years
ended December 31, 2014, 2013 and 2012, respectively. The decrease in the effective tax rate in 2014 was primarily due to
the recognition of a tax benefit attributable to the reversal of tax reserves in connection with a Federal tax settlement, which
decreased the effective tax rate by 15% for the year ended December 31, 2014. The decrease in the effective tax rate in 2013
was primarily due to a decrease in tax reserves and the recognition of additional foreign tax credit carryovers, partially offset
by additional U.S. tax on unremitted foreign earnings.
Income from Continuing Operations. Income from continuing operations was $3.894 billion, $3.354 billion and $2.663
billion for the years ended December 31, 2014, 2013 and 2012, respectively. Excluding the items noted under “Transactions
and Other Items Affecting Comparability” totaling $234 million of income, $47 million of income and $206 million of
expense for the years ended December 31, 2014, 2013 and 2012, respectively, Income from continuing operations increased
$353 million and $438 million in 2014 and 2013, respectively. The increase in 2014 primarily reflected lower income tax
expense, partially offset by lower Operating Income. The increase in 2013 primarily reflected higher Operating Income,
partially offset by higher income tax expense. Basic and diluted income per common share from continuing operations
attributable to Time Warner Inc. common shareholders were $4.49 and $4.41, respectively, for the year ended December 31,
2014, $3.63 and $3.56, respectively, for the year ended December 31, 2013 and $2.77 and $2.73, respectively, for the year
ended December 31, 2012.
Discontinued Operations, Net of Tax. Discontinued operations, net of tax was $67 million of losses, $337 million of
income and $259 million of income for the years ended December 31, 2014, 2013 and 2012, respectively. Basic and diluted
loss per common share from discontinued operations attributable to Time Warner Inc. common shareholders were both $0.07
for the year ended December 31, 2014. Basic and diluted income per common share were both $0.36 for the year ended
December 31, 2013 and $0.28 and $0.27, respectively, for the year ended December 31, 2012.
Net Loss Attributable to Noncontrolling Interests. For the year ended December 31, 2012, Net loss attributable to
noncontrolling interests was $3 million.
Net Income Attributable to Time Warner Inc. Shareholders. Net income attributable to Time Warner Inc. shareholders
was $3.827 billion, $3.691 billion and $2.925 billion for the years ended December 31, 2014, 2013 and 2012, respectively.
Basic and Diluted net income per common share attributable to Time Warner Inc. common shareholders were $4.42 and
$4.34, respectively, for the year ended December 31, 2014, $3.99 and $3.92, respectively, for the year ended December 31,
2013 and $3.05 and $3.00, respectively, for the year ended December 31, 2012.
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