Time Magazine 2015 Annual Report Download - page 45

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TIME WARNER INC.
MANAGEMENT’S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION - (Continued)
The Venezuelan foreign currency losses are included in Selling, general and administrative expenses in the
accompanying Consolidated Statement of Operations.
Other
Other reflects external costs related to mergers, acquisitions or dispositions of $10 million, $80 million and $33 million
for the years ended December 31, 2015, 2014 and 2013, respectively. External costs related to mergers, acquisitions or
dispositions for the year ended December 31, 2015 consisted of $3 million at the Turner segment, $6 million at the Warner
Bros. segment and $1 million at Corporate. External costs related to mergers, acquisitions or dispositions for the year ended
December 31, 2014 consisted of $14 million at the Turner segment primarily related to exit costs in connection with the
shutdown of CNN Latino, $19 million at the Warner Bros. segment primarily related to the acquisition of the operations
outside the U.S. of Eyeworks Group and $47 million at Corporate primarily related to the legal and structural separation of
the Company’s former Time Inc. segment from the Company (the “Time Separation”). External costs related to mergers,
acquisitions or dispositions for the year ended December 31, 2013 were primarily related to the Time Separation.
For the year ended December 31, 2013, other includes a gain of $38 million related to the curtailment of post-
retirement benefits (the “Curtailment”).
External costs related to mergers, acquisitions or dispositions and the gain related to the Curtailment are included in
Selling, general and administrative expenses in the accompanying Consolidated Statement of Operations.
Investment Gains (Losses), Net
For the year ended December 31, 2015, the Company recognized $31 million of net investment losses, consisting of
$63 million of net losses related to fair value adjustments on warrants to purchase common stock of CME held by the
Company and $32 million of net miscellaneous investment gains.
For the year ended December 31, 2014, the Company recognized $30 million of net investment gains, consisting of
$29 million of gains related to fair value adjustments on warrants to purchase common stock of CME held by the Company
and $1 million of net miscellaneous investment gains.
For the year ended December 31, 2013, the Company recognized $61 million of net investment gains, consisting of a
$65 million gain on the sale of the Company’s investment in a theater venture in Japan, which included a $10 million gain
related to a foreign currency contract, $6 million of net miscellaneous investment losses and a noncash gain of $2 million
associated with an option to acquire securities that was terminated during the third quarter of 2013.
Amounts Related to the Separation of Time Warner Cable Inc.
For the years ended December 31, 2015, 2014 and 2013, the Company recognized losses of $4 million, $10 million and
$7 million, respectively, related to changes in the value of a Time Warner Cable Inc. (“TWC”) tax indemnification
receivable, which has been reflected in Other loss, net in the accompanying Consolidated Statement of Operations. For the
year ended December 31, 2015, the Company also recognized a loss of $4 million related to payments made to TWC in
accordance with a tax sharing arrangement. For the years ended December 31, 2014 and 2013, the Company also recognized
a loss of $1 million and income of $10 million, respectively, related to the expiration, exercise and net change in the
estimated fair value of Time Warner equity awards held by TWC employees, which has also been reflected in Other loss, net
in the accompanying Consolidated Statement of Operations.
Amounts Related to the Disposition of Warner Music Group
For the years ended December 31, 2014 and 2013, the Company recognized income of $2 million and a loss of $1
million, respectively, primarily related to a tax indemnification obligation associated with the disposition of Warner Music
31