iHeartMedia 2001 Annual Report Download - page 45

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45
Reconciliation of Reported Basis to Pro Forma Basis
(In thousands)
Years Ended December 31,
2000 1999
Reported Revenue $ 5,345,306 $ 2,678,160
Acquisitions * 1,362,064 3,412,918
Divestitures (70,376) (95,967)
Foreign Exchange adjustments 120,674 —
Pro Forma Revenue $ 6,757,668 $ 5,995,111
Reported Divisional Operating Expenses $ 3,480,706 $ 1,632,115
Acquisitions * 698,289 2,304,545
Divestitures (33,659) (48,315)
Foreign Exchange adjustments 94,840 —
Pro Forma Divisional Operating Expenses $ 4,240,176 $ 3,888,345
* Due to the significance of the AMFM merger, its results of operations are included in both 1999 and 2000 for the
12-month periods. Thus, included in the acquisition amounts for 1999 and 2000 are the results of operations for
AMFM for 12 and 8 months respectively. For all other 2000 acquisitions, adjustments are included in the 1999
acquisition amounts to include the operating results of the acquisition for the corresponding time that the acquisition
was owned in 2000.
Revenue and divisional operating expenses increased on a reported basis $2.7 billion and $1.8
billion, respectively primarily due to our 1999 and 2000 acquisitions as well as internal growth. Included
in our fiscal year 2000 reported basis amounts are the revenues and divisional operating expenses for a
twelve-month period from our 1999 acquisitions, the most significant being Jacor Communications in
May 1999 and Dame Media Inc. and Dauphin OTA in July 1999. Also included in our fiscal year 2000
reported basis amounts are the revenues and divisional operating expenses of our 2000 acquisitions for
the time period that we operated them in fiscal year 2000. Our 2000 acquisitions included Ackerley’s
South Florida Outdoor Advertising Division in January 2000, SFX in August 2000, AMFM in August
2000, and Donrey in September 2000. Included in reported revenue for 2000, is approximately $969.3
million of revenue related to SFX and approximately $713.5 million of revenue related to AMFM.
Included in reported divisional operating expenses for 2000, is approximately $882.5 million related to
SFX and approximately $352.3 million related to AMFM. In addition to the acquisition activity,
reported revenue and divisional operating expenses increased for other reasons discussed below in our
pro forma presentation.
On a pro forma basis, revenues increased in fiscal year 2000 due to higher advertising rates in
our radio and outdoor businesses as well as increased inventory demand within the advertising industry.
The increase in the number of live entertainment events and the number of show dates in fiscal year 2000
also contributed to the increase in revenue on a pro forma basis. Divisional operating expenses increased
on a pro forma basis in fiscal year 2000 due primarily to the increase in selling costs related to the
increase in revenue.
Corporate expenses increased $72.4 million on a reported basis primarily due to $38.4 million of
additional expense directly related to additional corporate employees obtained in our acquisitions. In
addition, corporate expenses increased due to the additional corporate employees hired subsequent to our
acquisitions to accommodate for the growth of the company. As a result of our acquisitions, we
increased corporate head count throughout 2000 to 350 employees as compared to 225 employees at the
end of 1999.