iHeartMedia 2003 Annual Report Download - page 39

I
nterest Expense
Interest expense was $432.8 million and $560.1 million for the year ended December 31, 2002 and 2001, respectively, a decrease of
$127.3 million. This decrease was due to a decrease in our total debt outstanding as well as an overall decrease in LIBOR rates. At
December 31, 2002 and 2001, approximately 41% and 36%, respectively, of our debt was variable-rate debt that bears interest based upon
LIBOR. The following table sets forth our debt outstanding, the percentage of our debt that is variable rate debt and the 1-Month LIBOR rates
at December 31, 2002 and 2001:
Gain (Loss) on Sale of Assets Related to Mergers
The gain (loss) on sale of assets related to mergers for the year ended December 31, 2002 and 2001 was a $4.0 million gain and a
$213.7 million loss, respectively. The gain on sale of assets related to mergers in 2002 resulted from the sale of shares of Entravision
Corporation that we acquired in the AMFM merger. The components of the net loss on sale of assets related to mergers in 2001 was as follows:
(In millions)
Gain (Loss) on Marketable Securities
The gain (loss) on marketable securities for the year ended December 31, 2002 was a loss of $3.1 million as compared to a gain of
$25.8 million for the year ended December 31, 2001.
During 2001, we entered into a secured forward exchange contract that monetized part of our investment in American Tower Corporation
(“AMT”). To partially offset the movement in the fair value of the contract, in accordance with Statement of Financial Accounting Standard
No. 133, we reclassified 2.0 million shares of AMT from an available-for-sale classification to a trading classification. As a result of the
reclassification, a $69.7 million pre-tax unrealized holding gain was recorded. The fair value adjustment of the AMT trading shares and the
secured forward exchange contract netted a gain of $11.7 million during 2001. These gains were partially offset by $55.6 million of
impairment charges recorded on investments that had declines in their market values that were considered to be other-than-temporary.
The net loss recorded during 2002 relates to the aggregate $17.6 million gain on the net fair value adjustments of the AMT trading shares
and the secured forward exchange contract, an aggregate $4.6 million gain on the sale of shares in foreign media companies, offset by a
$25.3 million impairment charge recorded on an available-for-sale investment in a domestic media company that had a decline in its market
value that was considered to be other-than-temporary.
E
quity in Earnings of Nonconsolidated Affiliates
Equity in earnings of nonconsolidated affiliates for the year ended December 31, 2002 was $26.9 million as compared to $10.4 million for
the year ended December 31, 2001. The increase is primarily attributable to an increase in our share of net income. Our nonconsolidated
affiliates adopted Statement 142 during the year which resulted in less amortization expense related to indefinite-lived intangibles. The increase
was partially offset by impairment charges related to various international equity investments that had declines in value that were considered to
be other-than-temporary.
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(In millions)
December 31,
2002 2001
Total debt outstanding $8,778.6 $9,482.9
Variable rate debt/total debt outstanding 41% 36%
1-Month LIBOR 1.38% 1.87%
Loss related to the sale of 24.9 million shares of Lamar Advertising Company that we acquired in the AMFM merger $(235.0)
Loss related to write-downs of investments acquired in mergers (11.6)
Gain realized on the sale of five stations in connection with governmental directives regarding the AMFM merger 32.9
Net loss on sale of assets related to mergers $(213.7)