Time Magazine 2015 Annual Report Download - page 33

choices available to consumers has made it much more difficult to attract and obtain their attention and time. There can be no
assurance that the Company will be able to compete successfully in the future against existing or new competitors.
The Company is exposed to risks associated with weak economic conditions and increased volatility and disruption in
the financial markets. The Company’s financial condition and results of operations may be adversely affected by weak
economic conditions in the U.S. and other countries where the Company does business and the impact of those conditions on
advertisers, affiliates, suppliers, retailers, insurers, theater operators and others with which it does business. The global
economy continues to be volatile, with slower economic growth in some large emerging economies such as China, India and
Brazil and economic uncertainties arising from governmental actions in some countries such as Russia and Venezuela. These
conditions could lead to lower consumer spending for the Company’s content and products in these regions and countries,
particularly if advertisers, licensees, retailers, theater operators and consumers reduce their demand for the Company’s
content and products due to the negative impact of these conditions on them. Consumer spending in these regions and
countries may be further negatively impacted by governmental actions to manage national economic matters, whether
through austerity or stimulus measures or initiatives intended to control wages, unemployment, credit availability, inflation,
taxation and other economic drivers.
Increased volatility and disruptions in the financial markets could make it more difficult and more expensive for the
Company to refinance outstanding indebtedness and obtain new financing. The adoption of new statutes and regulations, new
interpretations of existing statutes and regulations or the enforcement of laws and regulations applicable to the financial
markets or the financial services industry could result in a reduction in the amount of available credit or an increase in the
cost of credit. Disruptions in the financial markets can also adversely affect the Company’s lenders, insurers and
counterparties, including vendors, retailers and film co-financing partners. The inability of the Company’s counterparties to
obtain capital on acceptable terms could impair their ability to perform under agreements with the Company and lead to
negative effects on the Company, including business disruptions, decreased revenues, increases in bad debt expenses and, in
the case of film co-financing partners, greater risk to the Company with respect to the performance of its feature films.
The Company faces risks relating to conducting business internationally that could adversely affect its businesses and
operating results. It is important for the Company to achieve sufficient scale in key international territories in a cost-
effective manner to be able to compete successfully in those territories. Failure to achieve sufficient scale could adversely
affect the Company’s results of operations. In addition, there are risks inherent in international business operations,
including:
• issues related to integrating and managing international operations and investments;
• potentially adverse tax developments;
• lack of sufficient protection for intellectual property in some countries;
• territorial restrictions on content licensing;
• currency exchange restrictions, export controls and currency devaluation risks in some foreign countries, including,
but not limited to, Argentina and Venezuela;
• the existence in some countries of statutory shareholder minority rights and restrictions on foreign direct
ownership;
• the existence of quotas and other content-related limitations or restrictions (e.g., government censorship);
• restrictions on television advertising, marketing and network packaging;
• issues related to occupational safety and adherence to local labor laws and regulations;
• political or social unrest;
• higher than anticipated costs of entry;
• the presence of corruption in certain countries;
• the absence of good diplomatic relations between the U.S. and certain countries; and
• the potential for government appropriation of the Company’s assets.
One or more of these factors could harm the Company’s international operations or investments and its operating results.
Some of the Company’s operations are conducted in foreign currencies, and the value of these currencies fluctuates in
relation to the U.S. dollar. Although the Company hedges a portion of its foreign currency exposures, significant fluctuations
in exchange rates in the past have had, and in the future could have, an adverse effect on the Company’s results of operations
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