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Discovery, Inc. Reports Second Quarter 2018 Results

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Discovery, Inc. Reports Second Quarter 2018 Results

PR Newswire

SILVER SPRING, Md., Aug. 7, 2018 /PRNewswire/ -- Discovery, Inc. ("Discovery" or the "Company") (NASDAQ:DISCA, DISCB, DISCK)) today reported financial results for the second quarter ended June 30, 2018.

"We delivered solid financial results in our first full quarter as a combined company and continued to make great progress with our integration of Scripps Networks Interactive and our pivot to digital, mobile and direct to consumer products and services," said David Zaslav, President and Chief Executive Officer for Discovery. "As the global leader in real life entertainment, we are uniquely positioned in the media marketplace to deliver long-term value for our passionate superfans, shareholders and business partners around the world."

Second Quarter 2018 Results
Second quarter revenues of $2,845 million increased 63% on a reported basis compared with the prior year quarter. Excluding the impact of foreign currency fluctuations and the Scripps Networks Interactive ("Scripps Networks"), Motor Trend Group, LLC ("MTG") and the Oprah Winfrey Network ("OWN") transactions (collectively, "the Transactions")(1), revenues remained consistent, with a 5% increase in International Networks, offset by a 1% decrease in U.S. Networks and the sale of the education business(2) on April 30, 2018. On a pro forma(3) combined basis, excluding the impact of foreign currency fluctuations, total company second quarter revenues increased 1%, as International Networks revenues increased 5% and U.S. Networks revenues increased 1%, partially offset by a 69% decrease in Education and Other revenues.

Second quarter Adjusted Operating Income Before Depreciation and Amortization ("Adjusted OIBDA")(4) increased 69% to $1,214 million on a reported basis compared with the prior year quarter. Excluding the impact of the Transactions and foreign currency fluctuations, Adjusted OIBDA remained consistent with the prior year quarter with a 12% increase at International Networks, which was offset by a 4% decrease at U.S. Networks. On a pro forma combined basis, excluding the impact of foreign currency fluctuations, total company second quarter Adjusted OIBDA increased 5%, as International Networks' Adjusted OIBDA increased 14% and U.S. Networks Adjusted OIBDA increased 1%.

Second quarter net income available to Discovery, Inc. ("DCI Net Income") was $216 million, compared with $374 million in the prior year quarter, as improved operating results were more than offset by higher restructuring and other charges associated with the integration of Scripps Networks, higher interest expense and a gain related to the sale of the education business versus a small loss last year related to the sale of the Raw and Betty production studios. Diluted earnings per share(5) decreased to $0.30 due to lower DCI Net Income. Adjusted Earnings Per Diluted Share ("Adjusted EPS")(4),(5), which excludes the impact of amortization of acquisition-related intangible assets, net of tax was $0.66. Adjusted EPS excluding restructuring and other charges as well as this year's gain on disposition versus last year's small loss on disposition was $0.77, and included $140 million (or $0.20 per share) of after-tax restructuring and other charges and $64 million (or $0.09 per share) of after-tax impact from this year's gain on disposition versus last year's small loss on disposition.

(1)

The Transactions refer to the Company's acquisition of Scripps Networks on March 6, 2018, acquisition of a controlling interest in OWN on
November 30, 2017 and the contribution of businesses from MTG on September 25, 2017.

(2)

The Company sold a majority stake in the education business on April 30, 2018.

(3)

Pro forma is defined as the results of the Company as if the Transactions had occurred on January 1, 2017. Refer to page 6 for the full list of pro
forma adjustments and to page 11 for pro forma operating results.

(4)

See full definitions of Adjusted OIBDA and Adjusted EPS on page 5.

(5)

All per share amounts are calculated using DCI Net Income. Refer to table on page 21 for the full schedule.

Free cash flow(1) increased to $522 million for the second quarter of 2018 as cash flow from operations increased to $556 million while capital expenditures of $34 million were relatively consistent with the prior year. Second quarter cash flow from operations increased primarily due to higher operating results due to the Transactions offset by higher content costs, higher interest expense and higher restructuring costs.

SECOND QUARTER SEGMENT RESULTS

Total Company


(dollars in millions)


Three Months Ended June 30,


Six Months Ended June 30,



2018


2017


Change


2018


2017


Change

Revenues:













U.S. Networks


$

1,780



$

890



100 %


$

2,954



$

1,719



72 %

International Networks


1,051



811



30 %


2,149



1,558



38 %

Education and Other


14



44



(68) %


49



81



(40) %

Corporate and Inter-Segment Eliminations






— %






— %

Total revenues


$

2,845



$

1,745



63 %


$

5,152



$

3,358



53 %














Adjusted OIBDA:













U.S. Networks


$

983



$

567



73 %


$

1,635



$

1,068



53 %

International Networks


336



236



42 %


473



430



10 %

Education and Other




5



(100) %


3



(1)



NM

Corporate and Inter-Segment Eliminations


(105)



(91)



(15) %


(200)



(177)



(13) %

Total Adjusted OIBDA


$

1,214



$

717



69 %


$

1,911



$

1,320



45 %


U.S. Networks






(dollars in millions)


Three Months Ended June 30,


Six Months Ended June 30,



2018


2017


Change


2018


2017


Change

Revenues:













Distribution


$

654



$

400



64 %


$

1,168



$

808



45 %

Advertising


1,090



472



NM


1,717



877



96 %

Other


36



18



100 %


69



34



NM

Total revenues


$

1,780



$

890



100 %


$

2,954



$

1,719



72 %

Adjusted OIBDA


$

983



$

567



73 %


$

1,635



$

1,068



53 %


NM: Not Meaningful

U.S. Networks' revenues for the second quarter of 2018 increased to $1,780 million on a reported basis compared with the prior year quarter. Excluding the impact of the Transactions, revenues decreased 1%, as distribution and advertising revenues both remained consistent, while other revenues decreased 33% due to lower program and merchandising sales. On a pro forma combined basis, U.S. Networks' revenues for the second quarter increased 1%, as distribution revenues and advertising revenues each increased 1%, while other revenues decreased 10%. The growth in pro forma combined distribution revenues was primarily due to an increase in contractual affiliate rates, partially offset by a decline in affiliate subscribers and to a lesser extent, lower contributions from content deliveries under licensing agreements.

(1)

Free cash flow is defined as cash provided by operating activities less purchases of property and equipment.

 

On a pro forma combined basis, total portfolio subscribers declined 5%, while subscribers to our fully distributed networks declined 3%. The growth in pro forma advertising revenues was primarily driven by continued monetization of our digital content offerings, and to a lesser extent higher pricing, partially offset by lower audience delivery on our linear networks.

Operating expenses for U.S. Networks on a reported basis increased to $797 million compared with prior year quarter operating expenses of $323 million. Excluding the impact of the Transactions, operating expenses increased 5%, as costs of revenues increased 3% and SG&A expenses increased 7%. On a pro forma combined basis, total operating expenses increased 1% as costs of revenues increased 1% and SG&A expenses remained consistent. The increase in pro forma combined operating expenses was primarily attributable to higher marketing spending due to the timing of premieres partially offset by lower personnel costs.

U.S. Networks' Adjusted OIBDA increased 73% to $983 million compared with the prior year quarter. Excluding the impact of the Transactions, U.S. Networks' Adjusted OIBDA decreased 4%. On a pro forma combined basis, Adjusted OIBDA increased 1%, as increases in distribution and advertising revenue were partially offset by increases in costs of revenues.

 

International Networks


(dollars in millions)


Three Months Ended June 30,


Six Months Ended June 30,



2018


2017


Change


2018


2017


Change

Revenues:













Distribution


$

532



$

457



16 %


$

1,069



$

904



18 %

Advertising


473



333



42 %


858



615



40 %

Other


46



21



NM


222



39



NM

Total revenues


$

1,051



$

811



30 %


$

2,149



$

1,558



38 %

Adjusted OIBDA


$

336



$

236



42 %


$

473



$

430



10 %

International Networks' revenues for the second quarter of 2018 increased 30% to $1,051 million compared with the prior year quarter. Excluding the impact of the acquisition of Scripps Networks and foreign currency fluctuations, International Networks' revenues increased 5%, driven by a 6% increase in distribution revenues and a 60% increase in other revenues, while advertising revenues remained flat. On a pro forma combined basis, excluding the impact of foreign currency fluctuations, International Networks' revenues increased 5%, driven by a 6% increase in distribution revenues, a 2% increase in advertising revenues and a 37% increase in other revenues. Pro forma distribution revenue growth was primarily driven by increases in digital subscription revenues in Europe and higher pricing in Latin America, partially offset by pricing declines in Asia. Pro forma advertising revenue growth was primarily due to increased sell through resulting in higher sales volumes and higher pricing in certain markets in Europe. Pro forma other revenues increased primarily due to higher content sales.

Operating expenses for International Networks on a reported basis increased 24% compared with the prior year quarter. Excluding the impact of the acquisition of Scripps Networks and foreign currency fluctuations, operating expenses increased 2%, as costs of revenues increased 2% and SG&A increased 3%. On a pro forma combined basis, excluding currency effects, operating expenses increased 2%, as costs of revenues increased 4%, primarily driven by spending on sports content and associated production costs, while SG&A decreased 3% due to lower personnel costs.

International Networks' Adjusted OIBDA increased 42% to $336 million compared with the prior year quarter. Excluding the impact of the acquisition of Scripps Networks and foreign currency fluctuations, International Networks' Adjusted OIBDA increased 12%. On a pro forma combined basis, excluding currency effects, Adjusted OIBDA increased 14%. The increase in pro forma combined Adjusted OIBDA was primarily driven by increases in revenues, partially offset by increases in costs of revenues.

 

Education and Other


(dollars in millions)


Three Months Ended June 30,


Six Months Ended June 30,



2018


2017


Change


2018


2017


Change

Revenues


$

14



$

44



(68) %



$

49



$

81



(40) %

Adjusted OIBDA


$



$

5



(100) %



$

3



$

(1)



NM

Education and Other revenues for the second quarter of 2018 decreased $30 million and Adjusted OIBDA decreased $5 million, primarily due to the sale of a majority stake in the education business on April 30, 2018.

Corporate and Inter-Segment Eliminations
Adjusted OIBDA for the second quarter of 2018 decreased 15% compared with the prior year quarter. Excluding the impact of the acquisition of Scripps Networks and foreign currency fluctuations, Adjusted OIBDA decreased 4%. Excluding the impact of foreign currency fluctuations and on a pro forma basis, the Adjusted OIBDA loss decreased 9% compared with the prior year quarter due to reductions in personnel costs as a result of the integration of Scripps Networks partially offset by increases in technology costs.

FULL YEAR 2018 OUTLOOK(1)
Discovery will provide forward-looking guidance in connection with this quarterly earnings announcement on its quarterly earnings conference call and webcast referenced hereafter.

(1)

Discovery is unable to provide a reconciliation of the forward-looking guidance to GAAP measures as, at this time, Discovery cannot determine
all of the adjustments that would be required.

 

NON-GAAP FINANCIAL MEASURES
In addition to the results prepared in accordance with U.S. generally accepted accounting principles ("GAAP") provided in this release, the Company has presented Adjusted OIBDA, Adjusted EPS and free cash flow. These non-GAAP measures should be considered in addition to, but not as a substitute for, operating income, net income, earnings per diluted share and other measures of financial performance reported in accordance with GAAP.  Please review the supplemental financial schedules beginning on page 19 for reconciliations to the most comparable GAAP measures.

Adjusted OIBDA and Adjusted OIBDA Excluding the Impact of Currency Effects
The Company evaluates the operating performance of its segments based on financial measures such as revenues and Adjusted Operating Income Before Depreciation and Amortization ("Adjusted OIBDA"). Adjusted OIBDA is defined as operating income excluding: (i) mark-to-market share-based compensation, (ii) depreciation and amortization, (iii) restructuring and other charges, (iv) certain impairment charges, (v) gains and losses on business and asset dispositions, (vi) certain inter-segment eliminations related to production studios, and (vii) third-party transaction costs directly related to the acquisition and integration of Scripps Networks.

The Company uses Adjusted OIBDA to assess the operating results and performance of its segments, perform analytical comparisons, identify strategies to improve performance and allocate resources to each segment. The Company believes Adjusted OIBDA is relevant to investors because it allows them to analyze the operating performance of each segment using the same metric management uses. The Company excludes mark-to-market share-based compensation, restructuring and other charges, certain impairment charges, gains and losses on business and asset dispositions and Scripps Networks transaction and integration costs from the calculation of Adjusted OIBDA due to their impact on comparability between periods. The Company also excludes depreciation of fixed assets and amortization of intangible assets, as these amounts do not represent cash payments in the current reporting period. Certain corporate expenses are excluded from segment results to enable executive management to evaluate segment performance based upon the decisions of segment executives. Total Adjusted OIBDA should be considered in addition to, but not a substitute for, operating income, net income and other measures of financial performance reported in accordance with GAAP. Refer to the comments that follow for our methodology for calculating growth rates excluding the impact of currency effects.

Adjusted EPS and Adjusted EPS Excluding the Impact of Currency Effects
Adjusted EPS is defined as earnings excluding the impact of amortization of acquisition-related intangible assets per diluted share. The Company believes Adjusted EPS is relevant to investors because this metric allows them to evaluate the performance of the Company's operations exclusive of the non-cash amortization of acquisition-related intangible assets that impact the comparability of results from period to period. Refer to the comments that follow for our methodology for calculating growth rates excluding the impact of currency effects.

Methodology for Calculating Growth Rates Excluding the Impact of Currency Effects
In addition to the Transactions, the impact of exchange rates on our business is an important factor in understanding period-to-period comparisons of our results. For example, our international revenues are favorably impacted as the U.S. dollar weakens relative to other foreign currencies, and unfavorably impacted as the U.S dollar strengthens relative to other foreign currencies. We believe the presentation of results on a constant currency basis (ex-FX), in addition to results reported in accordance with GAAP provides useful information about our operating performance because the presentation ex-FX excludes the effects of foreign currency volatility and highlights our core operating results. The presentation of results on a constant currency basis should be considered in addition to, but not a substitute for, measures of financial performance reported in accordance with GAAP.

The ex-FX change represents the percentage change on a period-over-period basis adjusted for foreign currency impacts. The ex-FX change is calculated as the difference between the current year amounts translated at a baseline rate, a spot rate for each of our currencies determined early in the fiscal year as part of our forecasting process (the "2018 Baseline Rate"), and the prior year amounts translated at the same 2018 Baseline Rate. In addition, consistent with the assumption of a constant currency environment, our ex-FX results exclude the impact of our foreign currency hedging activities, as well as realized and unrealized foreign currency transaction gains and losses.

Results on a constant currency basis, as we present them, may not be comparable to similarly titled measures used by other companies.

Selling, General and Administrative Expense
Selling, general and administrative expense, as presented, excludes mark-to-market based compensation and Scripps Networks transaction and integration costs due to their impact on comparability between periods.

Free Cash Flow
The Company defines free cash flow as cash provided by operating activities less acquisitions of property and equipment. The Company uses free cash flow as it believes it is an important indicator for management and investors of the Company's liquidity, including its ability to reduce debt, make strategic investments and return capital to stockholders.

Pro Forma Adjustments
The discussion and tables beginning on page 11 compares our actual and pro forma combined results as if the Transactions occurred on January 1, 2017. Management believes reviewing our actual operating results in addition to combined pro forma results is useful in identifying trends in, or reaching conclusions regarding, the overall operating performance of our businesses. Our combined U.S. Networks, International Networks and Corporate and Inter-Segment Eliminations pro forma information is based on the historical operating results of the respective businesses as applicable to each segment and includes adjustments directly attributable to the Transactions as if they had occurred on January 1, 2017, such as:

1. The impact of the purchase price allocation to the fair value of assets, liabilities, and noncontrolling interests, such as intangible amortization;
2. Adjustments to remove items associated with the Transactions that will not have a continuing impact on the combined entity, such as transaction costs and the impact of employee retention agreements; and
3. Changes to align accounting policies.

Adjustments do not include costs related to integration activities, cost savings or synergies that have been or may be achieved by the combined businesses. Pro forma amounts are not necessarily indicative of what our results would have been had we operated the acquired businesses since January 1, 2017, and should not be taken as indicative of the Company's future consolidated results of operations.

Actual amounts for the three and six months ended June 30, 2018 include the results of operations for the Discovery and Scripps Networks, OWN and MTG businesses for the period since each respective transaction. Scripps Networks was acquired on March 6, 2018, OWN was consolidated on November 30, 2017 and MTG was consolidated on September 25, 2017.

Conference Call Information
Discovery will host a conference call today, August 7, 2018 at 8:30 a.m. ET to discuss its second quarter results. To listen to the call, visit https://corporate.discovery.com or dial 1-844-452-2811 inside the U.S. and 1-574-990-9832 outside of the U.S., using conference ID: 7895109 and passcode: DISCA.

Cautionary Statement Concerning Forward-Looking Statements
This press release contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations, forecasts and assumptions that involve risks and uncertainties and on information available to the Company as of the date hereof. The Company's actual results could differ materially from those stated or implied, due to risks and uncertainties associated with its business, which include the risk factors disclosed in its Annual Report on Form 10-K filed with the SEC on February 28, 2018.

Forward-looking statements include statements regarding the Company's expectations, beliefs, intentions or strategies regarding the future, and can be identified by forward-looking words such as "anticipate," "believe," "could," "continue," "estimate," "expect," "intend," "may," "should," "will" and "would" or similar words. Forward-looking statements in this release include, without limitation, statements regarding investing in the Company's programming, strategic growth initiatives, and the timing and effects of the Scripps Networks acquisition and related transactions. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

About Discovery
Discovery, Inc. (NASDAQ:DISCA, DISCB, DISCK)) is a global leader in real life entertainment, serving a passionate audience of superfans around the world with content that inspires, informs and entertains. Discovery delivers over 8,000 hours of original programming each year and has category leadership across deeply loved content genres around the world. Available in 220 countries and territories and in nearly 50 languages, Discovery is a platform innovator, reaching viewers on all screens, including TV Everywhere products such as the GO portfolio of apps and Discovery Kids Play; direct-to-consumer streaming services such as Eurosport Player and Motor Trend OnDemand; digital-first and social content from Group Nine Media and a strategic alliance with the PGA Tour to create the Global Home of Golf. Discovery's portfolio of premium brands includes Discovery Channel, HGTV, Food Network, TLC, Investigation Discovery, Travel Channel, Turbo/Velocity, Animal Planet, and Science Channel, as well as OWN: Oprah Winfrey Network in the U.S., Discovery Kids in Latin America, and Eurosport, the leading provider of locally relevant, premium sports and Home of the Olympic Games across Europe. For more information, please visit https://corporate.discovery.com and follow @DiscoveryIncTV across social platforms.

DISCOVERY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited; in millions, except per share amounts)




Three Months Ended June 30,


Six Months Ended June 30,



2018


2017


2018


2017

Revenues:







Distribution


$

1,186



$

857



$

2,237



$

1,712


Advertising


1,563



805



2,575



1,492


Other


96



83



340



154


Total revenues


2,845



1,745



5,152



3,358


Costs and expenses:









Costs of revenues, excluding depreciation and amortization


995



634



2,055



1,241


Selling, general and administrative


687



389



1,296



804


Depreciation and amortization


410



80



603



160


Restructuring and other charges


187



8



428



32


(Gain) loss on disposition


(84)



4



(84)



4


Total costs and expenses


2,195



1,115



4,298



2,241


Operating income


650



630



854



1,117


Interest expense


(196)



(91)



(373)



(182)


Loss on extinguishment of debt








(54)


Loss from equity investees, net


(40)



(42)



(62)



(95)


Other expense, net


(47)



(24)



(69)



(37)


Income before income taxes


367



473



350



749


Income tax expense


(123)



(93)



(103)



(148)


Net income


244



380



247



601


Net income attributable to noncontrolling interests


(23)





(28)




Net income attributable to redeemable noncontrolling interests


(5)



(6)



(11)



(12)


Net income available to Discovery, Inc.


$

216



$

374



$

208



$

589











Net income per share allocated to Discovery, Inc. Series A, B and C
common stockholders:









Basic


$

0.30



$

0.65



$

0.31



$

1.02


Diluted(1)


$

0.30



$

0.64



$

0.31



$

1.01











Weighted average shares outstanding:









Basic


523



384



473



387


Diluted(1)


712



578



661



583




(1)

Diluted shares adjust for the potential dilution that would occur if common stock equivalents, including convertible preferred stock and share-based awards, were
converted into common stock or exercised.

 

 

DISCOVERY, INC.

CONSOLIDATED BALANCE SHEETS

(unaudited; in millions, except par value)




June 30, 2018


December 31, 2017

ASSETS





Current assets:





Cash and cash equivalents


$

392



$

7,309


Receivables, net


2,747



1,838


Content rights, net


358



410


Prepaid expenses and other current assets


409



434


Total current assets


3,906



9,991







Noncurrent content rights, net


3,258



2,213


Property and equipment, net


784



597


Assets held for sale


68




Goodwill, net


13,119



7,073


Intangible assets, net


10,368



1,770


Equity method investments


1,023



335


Other noncurrent assets


966



576


Total assets


$

33,492



$

22,555


LIABILITIES AND EQUITY





Current liabilities:





Accounts payable


$

300



$

277


Accrued liabilities


1,473



1,309


Deferred revenues


277



255


Current portion of debt


646



30


Total current liabilities


2,696



1,871







Noncurrent portion of debt


17,683



14,755


Deferred income taxes


1,968



319


Other noncurrent liabilities


1,109



587


Total liabilities


23,456



17,532


Redeemable noncontrolling interests


410



413


Equity:





Discovery, Inc. stockholders' equity:





Series A-1 convertible preferred stock: $0.01 par value; 8 authorized; 8 shares issued





Series C-1 convertible preferred stock: $0.01 par value; 6 authorized; 6 shares issued





Series A common stock: $0.01 par value; 1,700 shares authorized; 159 and 157 shares
issued


1



1


Series B convertible common stock: $0.01 par value; 100 shares authorized; 7 shares
issued





Series C common stock: $0.01 par value; 2,000 shares authorized; 524 and 383 shares
issued


5



4


Additional paid-in capital


10,590



7,295


Treasury stock, at cost


(6,737)



(6,737)


Retained earnings


4,867



4,632


Accumulated other comprehensive loss


(790)



(585)


Total Discovery, Inc. stockholders' equity


7,936



4,610


     Noncontrolling interests


1,690




Total equity


9,626



4,610


Total liabilities and equity


$

33,492



$

22,555


 

 

DISCOVERY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited; in millions)



Six Months Ended June 30,


2018


2017

Operating Activities




Net income

$

247



$

601


Adjustments to reconcile net income to cash provided by operating activities:




Share-based compensation expense

49



22


Depreciation and amortization

603



160


Content rights expense and impairment

1,660



910


(Gain) loss on disposition

(84)



4


Equity in losses of equity method investee companies and cash distributions

95



100


Deferred income taxes

(80)



(88)


Loss on extinguishment of debt



54


Other, net

25



16


Changes in operating assets and liabilities, net of acquisitions and dispositions:




Receivables, net

(176)



(249)


Content rights and payables, net

(1,583)



(947)


Accounts payable and accrued liabilities

(68)



(151)


Income taxes receivable and prepaid income taxes

(42)



32


Foreign currency and other, net

70



(21)


Cash provided by operating activities

716



443


Investing Activities




Business acquisitions, net of cash acquired

(8,565)




Payments for investments

(48)



(270)


Proceeds from dispositions, net of cash disposed

107



29


Purchases of property and equipment

(82)



(78)


Distributions from equity method investees



18


Proceeds from derivative instruments, net

1



5


Other investing activities, net

4



3


Cash used in investing activities

(8,583)



(293)


Financing Activities




Commercial paper borrowings, net

579



25


Borrowings under revolving credit facility



350


Principal repayments of revolving credit facility

(50)



(200)


Borrowings under term loan facilities

2,000




Principal repayments of term loans

(1,500)




Borrowings from debt, net of discount and including premiums



659


Principal repayments of debt, including discount payment and premiums to par value



(650)


Principal repayments of capital lease obligations

(25)



(19)


Repurchases of stock



(501)


Cash settlement of common stock repurchase contracts



58


Distributions to noncontrolling interests and redeemable noncontrolling interests

(59)



(20)


Share-based plan proceeds, net

26



11


Borrowings under program financing line of credit

23




Other financing activities, net

(17)



(8)


Cash provided by (used in) financing activities

977



(295)


Effect of exchange rate changes on cash and cash equivalents

(27)



51


Net change in cash and cash equivalents

(6,917)



(94)


Cash and cash equivalents, beginning of period

7,309



300


Cash and cash equivalents, end of period

$

392



$

206


 

 

 

DISCOVERY, INC.

SUPPLEMENTAL FINANCIAL DATA

UNAUDITED SELECTED PRO FORMA FINANCIALS(1)

(unaudited; amounts in millions)


TOTAL COMPANY REPORTED AND PRO FORMA FINANCIAL RESULTS




Three Months Ended June 30,











2018


2017


Actual
Change


Pro Forma
Combined
Change


Pro
Forma
Ex-FX(2)



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%


%

Revenues:

















Distribution


$

1,186


$


$

1,186



$

857


$

277


$

1,134



$

329


38 %


$

52


5 %


3 %

Advertising


1,563


1


1,564



805


715


1,520



758


94 %


44


3 %


1 %

Other


96


(2)


94



83


32


115



13


16 %


(21)


(18) %


(19) %

Total revenues


2,845


(1)


2,844



1,745


1,024


2,769



1,100


63 %


75


3 %


1 %

Costs of revenues,
excluding
depreciation and
amortization


995


5


1,000



634


335


969



361


57 %


31


3 %


1 %

Selling, general and
administrative


636


(1)


635



394


259


653



242


61 %


(18)


(3)%


(5)%

Adjusted OIBDA(3)


$

1,214


$

(5)


$

1,209



$

717


$

430


$

1,147



497


69 %


62


5 %


5 %



TOTAL COMPANY UNAUDITED RECONCILIATION OF REPORTED AND PRO FORMA OPERATING INCOME TO
ADJUSTED OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION




Three Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Operating income


650


66


716



630


121


751



$

20


3 %


$

(35)


(5) %

Restructuring and other charges


187



187



8



8



179


NM


179


NM

Depreciation and amortization


410


(70)


340



80


311


391



330


NM


(51)


(13) %

Mark-to-market share-
based compensation


26


(1)


25



(5)


(2)


(7)



31


NM


32


NM

Scripps Networks
transaction and
integration costs


25



25







25


100 %


25


100 %

(Gain) loss on disposition


(84)



(84)



4



4



(88)


NM


(88)


NM

Adjusted OIBDA(3)


$

1,214


$

(5)


$

1,209



$

717


$

430


$

1,147



497


69 %


62


5 %


































(1) Pro forma is defined as the results of the Company as if the Transactions had occurred on January 1, 2017. Refer to page 6 for full list of adjustments to pro forma
results.

(2) Refer to page 5 for our methodology for calculating growth rates excluding the impact of currency effects.

(3) See full definition of Adjusted OIBDA on page 5.

NM: Not Meaningful

 

 

DISCOVERY, INC.

SUPPLEMENTAL FINANCIAL DATA

UNAUDITED SELECTED PRO FORMA FINANCIALS(1)

(unaudited; amounts in millions)


U.S. NETWORKS REPORTED AND PRO FORMA FINANCIAL RESULTS




Three Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Revenues:















Distribution


$

654


$

(1)


$

653



$

400


$

249


$

649



$

254


64 %


$

4


1 %

Advertising


1,090


1


1,091



472


607


1,079



618


NM


12


1 %

Other


36


(1)


35



18


20


38



18


100 %


(3)


(8)%

Total revenues


1,780


(1)


1,779



890


876


1,766



890


100 %


13


1 %

Costs of revenues,
excluding
depreciation and
amortization


(490)


1


(489)



(216)


(267)


(483)



(274)


NM


(6)


(1) %

Selling, general and
administrative


(307)


(1)


(308)



(107)


(202)


(309)



(200)


NM


1


— %

Adjusted OIBDA(2)


983


(1)


982



567


407


974



416


73 %


8


1 %


U.S. NETWORKS UNAUDITED RECONCILIATION OF REPORTED AND PRO FORMA OPERATING INCOME TO
ADJUSTED OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION




Three Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Operating income


$

667


$

69


$

736



$

559


$

133


$

692



$

108


19 %


$

44


6 %

Depreciation and
amortization


295


(70)


225



6


283


289



289


NM


(64)


(22) %

Restructuring and
other charges


19



19







19


100 %


19


100 %

Inter-segment
eliminations


(2)



(2)



2


(7)


(5)



(4)


NM


3


60 %

Mark-to-market
share-based
compensation







(2)


(2)




— %


2


100 %

Scripps Networks
transaction and
integration costs


4



4







4


100 %


4


100 %

Adjusted OIBDA(2)


983


(1)


982



567


407


974



416


73 %


8


1 %


(1) Pro forma is defined as the results of the Company as if the Transactions had occurred on January 1, 2017. Refer to page 6 for full list of adjustments to pro forma
results.

(2) See full definition of Adjusted OIBDA on page 5.

 

 

DISCOVERY, INC.

SUPPLEMENTAL FINANCIAL DATA

UNAUDITED SELECTED PRO FORMA FINANCIALS(1)

(unaudited; amounts in millions)


INTERNATIONAL NETWORKS REPORTED AND PRO FORMA FINANCIAL RESULTS 




Three Months Ended June 30,











2018


2017


Actual
Change


Pro Forma
Combined
Change


Pro
Forma
Ex-FX(2)



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%


%

Revenues:

















Distribution


$

532


$

1


$

533



$

457


$

28


$

485



$

75


16 %


$

48


10 %


6 %

Advertising


473



473



333


108


441



140


42 %


32


7 %


2 %

Other


46


(1)


45



21


12


33



25


NM


12


36 %


37 %

Total revenues


1,051



1,051



811


148


959



240


30%


92


10 %


5 %

Costs of revenues,
excluding
depreciation and
amortization


(499)


(6)


(505)



(400)


(68)


(468)



(99)


(25 )%


(37)


(8) %


(4) %

Selling, general and
administrative


(216)


1


(215)



(175)


(35)


(210)



(41)


(23) %


(5)


(2)%


3 %

Adjusted OIBDA(3)


336


(5)


331



236


45


281



100


42 %


50


18 %


14 %


INTERNATIONAL NETWORKS UNAUDITED RECONCILIATION OF OPERATING INCOME TO PRO FORMA
ADJUSTED OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION




Three Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Operating income


$

102


$

(5)


$

97



$

177


$

12


$

189



$

(75)


(42) %


$

(92)


(49) %

Depreciation and
amortization


83



83



55


27


82



28


51 %


1


1 %

Restructuring and
other charges


146



146



4



4



142


NM


142


NM

Inter-segment
eliminations


5



5




6


6



5


100 %


(1)


(17) %

Adjusted OIBDA(3)


336


(5)


331



236


45


281



100


42 %


50


18 %


(1) Pro forma is defined as the results of the Company as if the Transactions had occurred on January 1, 2017. Refer to page 6 for full list of adjustments to pro forma
results.

(2) Refer to page 5 for our methodology for calculating growth rates excluding the impact of currency effects.

(3) See full definition of Adjusted OIBDA on page 5.

 

 

DISCOVERY, INC.

SUPPLEMENTAL FINANCIAL DATA

UNAUDITED SELECTED PRO FORMA FINANCIALS(1)

(unaudited; amounts in millions)


CORPORATE AND INTER-SEGMENT ELIMINATIONS REPORTED AND PRO FORMA FINANCIAL RESULTS




Three Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Revenues:


$


$


$



$


$


$



$


— %


$


— %

Costs of revenues,
excluding
depreciation and
amortization






(1)



(1)



1


100 %


1


100 %

Selling, general and
administrative


(105)


1


(104)



(90)


(22)


(112)



(15)


(17) %


8


7 %

Adjusted OIBDA(2)


(105)


1


(104)



(91)


(22)


(113)



(14)


(15) %


9


8 %


CORPORATE AND INTER-SEGMENT ELIMINATIONS' UNAUDITED RECONCILIATION OF OPERATING
INCOME TO PRO FORMA ADJUSTED OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION




Three Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Operating income


$

(204)


$

2


$

(202)



$

(108)


$

(24)


$

(132)



$

(96)


(89) %


$

(70)


(53) %

Mark-to-market
share-based
compensation


26


(1)


25



(5)



(5)



31


NM


30


NM

Depreciation and
amortization


31



31



18


1


19



13


72 %


12


63 %

Restructuring and
other charges


21



21



4



4



17


NM


17


NM

Scripps Networks
transaction and
integration costs


21



21







21


100 %


21


100 %

Inter-segment
eliminations







1


1




— %


(1)


(100) %

Adjusted OIBDA(2)


(105)


1


(104)



(91)


(22)


(113)



(14)


(15) %


9


8 %


(1) Pro forma is defined as the results of the Company as if the Transactions had occurred on January 1, 2017. Refer to page 6 for full list of adjustments to pro forma
results.

(2) See full definition of Adjusted OIBDA on page 5.

 

 

 

DISCOVERY, INC.

SUPPLEMENTAL FINANCIAL DATA

UNAUDITED SELECTED PRO FORMA FINANCIALS(1)

(unaudited; amounts in millions)


TOTAL COMPANY REPORTED AND PRO FORMA FINANCIAL RESULTS(2)




Six Months Ended June 30,











2018


2017


Actual
Change


Pro Forma
Combined
Change


Pro
Forma
Ex-FX(3)



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%


%

Revenues:

















Distribution


$

2,237


$

177


$

2,414



$

1,712


$

555


$

2,267



$

525


31 %


$

147


6 %


4 %

Advertising


2,575


426


3,001



$

1,492


1,357


2,849



1,083


73 %


152


5 %


3 %

Other


340


19


359



154


68


222



186


NM


137


62 %


56 %

Total revenues


5,152


622


5,774



3,358


1,980


5,338



1,794


53 %


436


8 %


6 %

Costs of revenues,
excluding
depreciation and
amortization


2,055


205


2,260



1,241


642


1,883



814


66 %


377


20 %


16 %

Selling, general and
administrative


1,186


159


1,345



797


524


1,321



389


49 %


24


2 %


2 %

Adjusted OIBDA(4)


1,911


258


2,169



1,320


814


2,134



591


45 %


35


2 %


1 %


TOTAL COMPANY UNAUDITED RECONCILIATION OF REPORTED AND PRO FORMA OPERATING INCOME TO
ADJUSTED OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION




Six Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Operating income


854


213


1,067



1,117


191


1,308



(263)


(24) %


(241)


(18) %

Restructuring and
other charges


428


10


438



32



32



396


NM


406


NM

Depreciation and
amortization


603


64


667



160


622


782



443


NM


(115)


(15)%

Mark-to-market
share-based
compensation


29



29



7


1


8



22


NM


21


NM

Scripps Networks
transaction and
integration costs


81


(28)


53







81


100 %


53


100 %

(Gain) loss on
disposition


(84)



(84)



4



4



(88)


NM


(88)


NM

Inter-segment
eliminations



(1)


(1)








— %


(1)


(100) %

Adjusted OIBDA(4)


1,911


258


2,169



1,320


814


2,134



591


45 %


35


2 %


(1) Pro forma is defined as the results of the Company as if the Transactions had occurred on January 1, 2017. Refer to page 6 for full list of adjustments to pro forma
results.

(2) Certain updates were made to previously disclosed pro forma adjustments as a result of further information identified after March 31, 2018. These changes impact
the costs of revenue, depreciation and amortization, and restructuring and other charges line items. The pro forma adjustments disclosed above are inclusive of these
updates and therefore many not reconcile to previously disclosed amounts.

(3) Refer to page 5 for our methodology for calculating growth rates excluding the impact of currency effects.

(4) See full definition of Adjusted OIBDA on page 5.

 

 

DISCOVERY, INC.

SUPPLEMENTAL FINANCIAL DATA

UNAUDITED SELECTED PRO FORMA FINANCIALS(1)

(unaudited; amounts in millions)


U.S. NETWORKS REPORTED AND PRO FORMA FINANCIAL RESULTS(2)




Six Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Revenues:















Distribution


$

1,168


$

155


$

1,323



$

808


$

500


$

1,308



$

360


45 %


$

15


1 %

Advertising


1,717


357


2,074



877


1,168


2,045



840


96 %


29


1 %

Other


69


6


75



34


43


77



35


NM


(2)


(3) %

Total revenues


2,954


518


3,472



1,719


1,711


3,430



1,235


72 %


42


1 %

Costs of revenues,
excluding
depreciation and
amortization


(811)


(152)


(963)



(426)


(510)


(936)



(385)


90 %


(27)


(3) %

Selling, general and
administrative


(508)


(111)


(619)



(225)


(404)


(629)



(283)


NM


10


2 %

Adjusted OIBDA(3)


1,635


255


1,890



1,068


797


1,865



567


53 %


25


1 %


U.S. NETWORKS UNAUDITED RECONCILIATION OF REPORTED AND PRO FORMA OPERATING INCOME TO
ADJUSTED OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION






Six Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Operating income


$

1,182


$

209


$

1,391



$

1,042


$

246


$

1,288



$

140


13 %


$

103


8 %

Restructuring and
other charges


53


6


59



4



4



49


NM


55


NM

Depreciation and
amortization


395


44


439



14


568


582



381


NM


(143)


(25) %

Mark-to-market
share-based
compensation







(2)


(2)




— %


2


100 %

Inter-segment
eliminations


1


(4)


(3)



8


(15)


(7)



(7)


(88) %


4


57 %

Scripps Networks
transaction and
integration costs


4



4







4


100 %


4


100 %

Adjusted OIBDA(3)


1,635


255


1,890



1,068


797


1,865



567


53 %


25


1 %


(1) Pro forma is defined as the results of the Company as if the Transactions had occurred on January 1, 2017. Refer to page 6 for full list of adjustments to pro forma
results.

(2) Certain updates were made to previously disclosed pro forma adjustments as a result of further information identified after March 31, 2018. These changes impact
the costs of revenue, depreciation and amortization, and restructuring and other charges line items. The pro forma adjustments disclosed above are inclusive of these
updates and therefore many not reconcile to previously disclosed amounts.

(3) See full definition of Adjusted OIBDA on page 5.

 

 

DISCOVERY, INC.

SUPPLEMENTAL FINANCIAL DATA

UNAUDITED SELECTED PRO FORMA FINANCIALS(1)

(unaudited; amounts in millions)


INTERNATIONAL NETWORKS REPORTED AND PRO FORMA FINANCIAL RESULTS(2) 




Six Months Ended June 30,











2018


2017


Actual
Change


Pro Forma
Combined
Change


Pro
Forma
Ex-FX(3)



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%


%

Revenues:

















Distribution


$

1,069


$

22


$

1,091



$

904


$

55


$

959



$

165


18 %


$

132


14 %


8 %

Advertising


858


69


927



615


189


804



243


40 %


123


15 %


6 %

Other


222


13


235



39


25


64



183


NM


171


NM


NM

Total revenues


2,149


104


2,253



1,558


269


1,827



591


38 %


426


23 %


15 %

Costs of revenues,
excluding
depreciation and
amortization


(1,226)


(53)


(1,279)



(781)


(132)


(913)



(445)


(57) %


(366)


(40) %


(31) %

Selling, general and
administrative


(450)


(26)


(476)



(347)


(69)


(416)



(103)


(30) %


(60)


(14) %


(4) %

Adjusted OIBDA(4)


473


25


498



430


68


498



43


10 %



— %


4 %


INTERNATIONAL NETWORKS UNAUDITED RECONCILIATION OF OPERATING INCOME TO PRO FORMA
ADJUSTED OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION




Six Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Operating income


$

71


$

1


$

72



$

300


$

3


$

303



$

(229)


(76) %


$

(231)


(76) %

Depreciation and
amortization


150


19


169



109


53


162



41


38 %


7


4 %

Inter-segment
eliminations


6


3


9




12


12



6


100 %


(3)


(25) %

Restructuring and
other charges


246


2


248



21



21



225


NM


227


NM

Adjusted OIBDA(4)


473


25


498



430


68


498



43


10 %



— %


(1) Pro forma is defined as the results of the Company as if the Transactions had occurred on January 1, 2017. Refer to page 6 for full list of adjustments to pro forma
results.

(2) Certain updates were made to previously disclosed pro forma adjustments as a result of further information identified after March 31, 2018. These changes impact
the costs of revenue, depreciation and amortization, and restructuring and other charges line items. The pro forma adjustments disclosed above are inclusive of these
updates and therefore many not reconcile to previously disclosed amounts.

(3) Refer to page 5 for our methodology for calculating growth rates excluding the impact of currency effects.

(4) See full definition of Adjusted OIBDA on page 5.

 

 

DISCOVERY, INC.

SUPPLEMENTAL FINANCIAL DATA

UNAUDITED SELECTED PRO FORMA FINANCIALS(1)

(unaudited; amounts in millions)


CORPORATE AND INTER-SEGMENT ELIMINATIONS REPORTED AND PRO FORMA FINANCIAL RESULTS(2)




Six Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Revenues:


$


$


$



$


$


$




— %



— %

Costs of revenues,
excluding depreciation
and amortization


(1)



(1)



(1)



(1)




— %



— %

Selling, general and
administrative


(199)


(22)


(221)



(176)


(51)


(227)



(23)


(13)%


6


3 %

Adjusted OIBDA(3)


(200)


(22)


(222)



(177)


(51)


(228)



(23)


(13)%


6


3 %


CORPORATE AND INTER-SEGMENT ELIMINATIONS UNAUDITED RECONCILIATION OF OPERATING
INCOME TO PRO FORMA ADJUSTED OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION




Six Months Ended June 30,









2018


2017


Actual
Change


Pro Forma
Combined
Change



Actual

Pro Forma
Adjustments

Pro Forma
Combined


Actual

Pro Forma
Adjustments

Pro Forma
Combined


$

%


$

%

Operating income


$

(489)


$

3


$

(486)



$

(225)


$

(58)


$

(283)



$

(264)


NM


$

(203)


(72)%

Mark-to-market
share-based
compensation


29



29



7


3


10



22


NM


19


NM

Depreciation and
amortization


55


1


56



35


1


36



20


57 %


20


56 %

Restructuring and
other charges


128


2


130



6



6



122


NM


124


NM

Scripps Networks
transaction and
integration costs


77


(28)


49







77


100 %


49


100 %

Inter-segment
eliminations







3


3




— %


(3)


(100) %

Adjusted OIBDA(3)


(200)


(22)


(222)



(177)


(51)


(228)



(23)


(13) %


6


3 %


(1) Pro forma is defined as the results of the Company as if the Transactions had occurred on January 1, 2017. Refer to page 6 for full list of adjustments to pro forma results.

(2) Certain updates were made to previously disclosed pro forma adjustments as a result of further information identified after March 31, 2018. These changes impact the costs of revenue, depreciation and amortization, and restructuring and other charges line items. The pro forma adjustments disclosed above are inclusive of these updates and therefore many not reconcile to previously disclosed amounts.

(3) See full definition of Adjusted OIBDA on page 5.

 

 

DISCOVERY, INC.

SUPPLEMENTAL FINANCIAL DATA

RECONCILIATION OF NET INCOME TO

ADJUSTED OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION

(unaudited; in millions)




Three Months Ended June 30, 2018



U.S. Networks


International
Networks


Education and
Other


Corporate and
Inter-Segment
Eliminations


Total

Net income available to Discovery, Inc.










$

216

Net income attributable to redeemable
noncontrolling interests










5

Net income attributable to noncontrolling interests










23

Income tax expense










123

Other expense, net










47

Loss from equity investees, net










40

Interest expense










196

Operating income


667


102


85


(204)


650

   Inter-segment eliminations


(2)


5


(3)



Restructuring and other charges


19


146


1


21


187

Depreciation and amortization


295


83


1


31


410

Mark-to-market share-based compensation





26


26

Scripps Networks transaction and integration costs


4




21


25

(Gain) loss on disposition




(84)



$

(84)

Total Adjusted OIBDA


983


336


$


(105)


$

1,214






















Three Months Ended June 30, 2017



U.S. Networks


International
Networks


Education and
Other


Corporate and
Inter-Segment
Eliminations


Total

Net income available to Discovery, Inc.










$

374

Net income attributable to redeemable
noncontrolling interests










6

Income tax expense










93

Other expense, net










24

Loss from equity investees, net










42

Interest expense










91

Operating income


559


177


2


(108)


630

   Inter-segment eliminations


2



(2)



Restructuring and other charges



4



4


8

Depreciation and amortization


6


55


1


18


80

Mark-to-market share-based compensation





(5)


(5)

Scripps Networks transaction and integration costs






(Gain) loss on disposition




4



4

Total Adjusted OIBDA


567


236


5


(91)


$

717

 

 

DISCOVERY, INC.

SUPPLEMENTAL FINANCIAL DATA

RECONCILIATION OF NET INCOME TO

ADJUSTED OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION

(unaudited; in millions)




Six Months Ended June 30, 2018



U.S. Networks


International
Networks


Education and
Other


Corporate and
Inter-Segment
Eliminations


Total

Net income available to Discovery, Inc.










$

208


Net income attributable to redeemable
noncontrolling interests










11


Net income attributable to noncontrolling interests










28


Income tax expense










103


Other expense, net










69


Loss from equity investees, net










62


Interest expense










373


Operating income


1,182


71


90


(489)


854


   Inter-segment eliminations


1


6


(7)




Restructuring and other charges


53


246


1