Transaction Accounting Adjustments | |||||||||
Assets |
(a) As Originally Reported |
(b) Separation Adjustments |
(c) Other | Pro Forma | |||||
(In millions) | |||||||||
Current assets | |||||||||
Cash and cash equivalents | $ | 269.0 | $ | (0.3) | $ | (877.0) |
(1)
| $ | 48.1 |
695.0 |
(2)
| ||||||||
(38.6) |
(3)
| ||||||||
Accounts receivable, net | 501.3 | (134.8) | - | 366.5 | |||||
Inventories | 29.7 | - | - | 29.7 | |||||
Current portion of subscription acquisition costs | 226.2 | - | - | 226.2 | |||||
Other current assets | 58.0 | (17.3) | - | 40.7 | |||||
Total current assets
| 1,084.2 | (152.4) | (220.6) | 711.2 | |||||
Property, plant, and equipment | 865.9 | (337.2) | - | 528.7 | |||||
Less accumulated depreciation | (518.8) | 223.7 | - | (295.1) | |||||
Net property, plant, and equipment | 347.1 | (113.5) | - | 233.6 | |||||
Operating lease assets | 364.3 | (20.1) | - | 344.2 | |||||
Subscription acquisition costs | 178.5 | - | - | 178.5 | |||||
Other assets | 264.8 | (9.7) | (2.3) |
(2)
| 259.3 | ||||
6.5 |
(2)
| ||||||||
Intangible assets, net | 1,545.2 | (717.2) | - | 828.0 | |||||
Goodwill | 1,719.2 | (81.4) | - | 1,637.8 | |||||
Total assets
| $ | 5,503.3 | $ | (1,094.3) | $ | (216.4) | $ | 4,192.6 |
Transaction Accounting Adjustments | |||||||||
Liabilities and Shareholders' Equity |
(a) As Originally Reported |
(b) Separation Adjustments |
(c) Other | Pro Forma | |||||
(In millions except per share data) | |||||||||
Current liabilities | |||||||||
Current portion of long-term debt | $ | 4.1 | $ | - | $ | (4.1) | (1) | $ | 18.1 |
18.1 |
(2)
| ||||||||
Current portion of operating lease liabilities | 36.5 | (2.0) | - | 34.5 | |||||
Accounts payable | 195.1 | (26.7) | - | 168.4 | |||||
Accrued expenses and other liabilities | 140.5 | (60.3) | 66.9 |
(4)
| 147.1 | ||||
Current portion of unearned revenues | 401.3 | (5.3) | - | 396.0 | |||||
Total current liabilities
| 777.5 | (94.3) | 80.9 | 764.1 | |||||
Long-term debt | 2,743.5 | - | (2,743.5) |
(1)
| 683.4 | ||||
683.4 |
(2)
| ||||||||
Operating lease liabilities | 425.0 | (18.3) | - | 406.7 | |||||
Unearned revenues | 215.6 | - | - | 215.6 | |||||
Deferred income taxes | 462.4 | - | (66.9) |
(4)
| 395.5 | ||||
Other noncurrent liabilities | 198.8 | (8.8) | - | 190.0 | |||||
Total liabilities
| 4,822.8 | (121.4) | (2,046.1) | 2,655.3 | |||||
Shareholders' equity | |||||||||
Series preferred stock, par value $1 per share | - | - | - | - | |||||
Common stock, par value $1 per share | 40.7 | - | - | 40.7 | |||||
Class B stock, par value $1 per share, convertible to common stock | 5.1 | - | - | 5.1 | |||||
Additional paid-in capital | 185.7 | - | 7.8 |
(5)
| 193.5 | ||||
Retained earnings | 531.1 | (971.2) | 1,680.8 |
(3)
| 1,381.8 | ||||
972.9 |
(3)
| ||||||||
(824.0) |
(3)
| ||||||||
(7.8) | (5) | ||||||||
Accumulated other comprehensive loss | (82.1) | (1.7) | - | (83.8) | |||||
Total shareholders' equity | 680.5 | (972.9) | 1,829.7 | 1,537.3 | |||||
Total liabilities and shareholders' equity | $ | 5,503.3 | $ | (1,094.3) | $ | (216.4) | $ | 4,192.6 |
Transaction Accounting Adjustments | ||||||||||
(In millions except per share data) |
(a) As Originally Reported |
(b) Separation Adjustments |
(c) Other |
(d) Autonomous Entity Adjustments | Pro Forma | |||||
Revenues | ||||||||||
Advertising related | $ | 338.2 | $ | (81.6) | $ | - | $ | - | $ | 256.6 |
Consumer related | 345.9 | (96.8) | - | - | 249.1 | |||||
Other | 24.5 | (3.7) | - | - | 20.8 | |||||
Total revenues | 708.6 | (182.1) | - | - | 526.5 | |||||
Operating expenses
| ||||||||||
Production, distribution, and editorial | 266.4 | (95.4) | - | - | 171.0 | |||||
Selling, general, and administrative | 319.0 | (36.5) | (4.1) |
(6)
| 3.2 | 281.6 | ||||
Acquisition, disposition, and restructuring related activities | 18.4 | - | - | - | 18.4 | |||||
Depreciation and amortization | 28.8 | (6.6) | - | - | 22.2 | |||||
Total operating expenses | 632.6 | (138.5) | (4.1) | 3.2 | 493.2 | |||||
Income from operations
| 76.0 | (43.6) | 4.1 | (3.2) | 33.3 | |||||
Non-operating income, net | 1.5 | (0.3) | - | - | 1.2 | |||||
Interest expense, net | (38.3) | - | 27.1 |
(2)
| - | (11.2) | ||||
Earnings from continuing operations before income taxes | 39.2 | (43.9) | 31.2 | (3.2) | 23.3 | |||||
Income tax expense | (14.4) | 11.2 | (8.0) |
(7)
| 0.8 | (10.4) | ||||
Earnings from continuing operations
| $ | 24.8 | $ | (32.7) | $ | 23.2 | $ | (2.4) | $ | 12.9 |
Earnings from continuing operations | $ | 24.3 | $ | (32.7) | $ | 23.2 | $ | (2.4) | $ | 12.7 |
attributable to common shareholders | 0.3 | (8) | ||||||||
Basic earnings per share attributable to common shareholders
| ||||||||||
Continuing operations | $ | 0.52 | $ | 0.27 | ||||||
Basic average common shares outstanding | 46.5 | 46.5 | ||||||||
Diluted earnings per share attributable to common shareholders
| ||||||||||
Continuing operations | $ | 0.51 | $ | 0.27 | ||||||
Diluted average common shares outstanding | 47.2 | 47.1 |
Transaction Accounting Adjustments | ||||||||||
(In millions except per share data) |
(e) As Originally Reported |
(b) Separation Adjustments |
(c) Other |
(d) Autonomous Entity Adjustments | Pro Forma | |||||
Revenues | ||||||||||
Advertising related | $ | 1,525.6 | $ | (475.9) | $ | - | $ | - | $ | 1,049.7 |
Consumer related | 1,370.6 | (377.8) | - | - | 992.8 | |||||
Other | 81.2 | (14.9) | - | - | 66.3 | |||||
Total revenues | 2,977.4 | (868.6) | - | - | 2,108.8 | |||||
Operating expenses
| ||||||||||
Production, distribution, and editorial | 1,024.5 | (362.4) | - | - | 662.1 | |||||
Selling, general, and administrative | 1,278.3 | (161.6) | 7.8 |
(5)
| 10.8 | 1,128.6 | ||||
(6.7) | (6) | |||||||||
Acquisition, disposition, and restructuring related activities | (49.8) | (7.3) | - | - | (57.1) | |||||
Depreciation and amortization | 163.0 | (28.6) | - | - | 134.4 | |||||
Total operating expenses | 2,416.0 | (559.9) | 1.1 | 10.8 | 1,868.0 | |||||
Income from operations
| 561.4 | (308.7) | (1.1) | (10.8) | 240.8 | |||||
Non-operating income, net | 10.8 | (1.0) | - | 0.4 | 10.2 | |||||
Interest expense, net | (178.6) | 0.2 | 24.8 |
(2)
| - | (153.6) | ||||
Earnings from continuing operations before income taxes | 393.6 | (309.5) | 23.7 | (10.4) | 97.4 | |||||
Income tax expense | (87.0) | 78.9 | (6.0) |
(7)
| 2.6 | (11.5) | ||||
Earnings from continuing operations
| $ | 306.6 | $ | (230.6) | $ | 17.7 | $ | (7.8) | $ | 85.9 |
Earnings from continuing operations | $ | 291.4 | $ | (230.6) | $ | 17.7 | $ | (7.8) | $ | 82.0 |
attributable to common shareholders | 11.3 | (8) | ||||||||
Basic earnings per share attributable to common shareholders
| ||||||||||
Continuing operations | $ | 6.31 | $ | 1.77 | ||||||
Basic average common shares outstanding | 46.2 | 46.2 | ||||||||
Diluted earnings per share attributable to common shareholders
| ||||||||||
Continuing operations | $ | 6.27 | $ | 1.76 | ||||||
Diluted average common shares outstanding | 46.5 | 46.4 |
(In millions except per share data) |
(e) As Originally Reported |
(f) Reclassification Adjustments | Pro Forma | |||
Revenues | ||||||
Advertising related | $ | 1,399.0 | $ | (330.5) | $ | 1,068.5 |
Consumer related | 1,348.7 | (347.9) | 1,000.8 | |||
Other | 100.9 | (13.5) | 87.4 | |||
Total revenues | 2,848.6 | (691.9) | 2,156.7 | |||
Operating expenses
| ||||||
Production, distribution, and editorial | 1,047.6 | (342.9) | 704.7 | |||
Selling, general, and administrative | 1,259.1 | (145.6) | 1,113.5 | |||
Acquisition, disposition, and restructuring related activities | 26.8 | (2.3) | 24.5 | |||
Depreciation and amortization | 219.9 | (34.3) | 185.6 | |||
Impairment of goodwill and other long-lived assets | 389.3 | (22.3) | 367.0 | |||
Total operating expenses | 2,942.7 | (547.4) | 2,395.3 | |||
Loss from operations
| (94.1) | (144.5) | (238.6) | |||
Non-operating expense, net | (1.3) | (1.0) | (2.3) | |||
Interest expense, net | (145.8) | 1.3 | (144.5) | |||
Loss from continuing operations before income taxes | (241.2) | (144.2) | (385.4) | |||
Income tax benefit | 32.2 | 36.8 | 69.0 | |||
Loss from continuing operations
| $ | (209.0) | $ | (107.4) | $ | (316.4) |
Loss from continuing operations attributable to common shareholders
| $ | (450.7) | $ | (107.4) | $ | (558.1) |
Basic loss per share attributable to common shareholders
| ||||||
Continuing operations | $ | (9.85) | $ | (12.21) | ||
Basic average common shares outstanding | 45.7 | 45.7 | ||||
Diluted loss per share attributable to common shareholders
| ||||||
Continuing operations | $ | (9.85) | $ | (12.21) | ||
Diluted average common shares outstanding | 45.7 | 45.7 |
(In millions except per share data) |
(e) As Originally Reported |
(f) Reclassification Adjustments | Pro Forma | |||
Revenues | ||||||
Advertising related | $ | 1,686.6 | $ | (449.4) | $ | 1,237.2 |
Consumer related | 1,416.8 | (316.5) | 1,100.3 | |||
Other | 85.1 | (9.1) | 76.0 | |||
Total revenues | 3,188.5 | (775.0) | 2,413.5 | |||
Operating expenses
| ||||||
Production, distribution, and editorial | 1,161.2 | (320.7) | 840.5 | |||
Selling, general, and administrative | 1,350.0 | (149.2) | 1,200.8 | |||
Acquisition, disposition, and restructuring related activities | 100.9 | (1.0) | 99.9 | |||
Depreciation and amortization | 247.6 | (32.1) | 215.5 | |||
Impairment of goodwill and other long-lived assets | 41.8 | - | 41.8 | |||
Total operating expenses | 2,901.5 | (503.0) | 2,398.5 | |||
Income from operations
| 287.0 | (272.0) | 15.0 | |||
Non-operating income, net | 24.2 | (2.1) | 22.1 | |||
Interest expense, net | (170.6) | - | (170.6) | |||
Earnings (loss) from continuing operations before income taxes | 140.6 | (274.1) | (133.5) | |||
Income tax benefit (expense) | (11.5) | 69.9 | 58.4 | |||
Earnings (loss) from continuing operations | $ | 129.1 | $ | (204.2) | $ | (75.1) |
Earnings (loss) from continuing operations attributable to common shareholders
| $ | 50.8 | $ | (204.2) | $ | (153.4) |
Basic earnings (loss) per share attributable to common shareholders
| ||||||
Continuing operations | $ | 1.12 | $ | (3.39) | ||
Basic average common shares outstanding | 45.3 | 45.3 | ||||
Diluted earnings (loss) per share attributable to common shareholders
| ||||||
Continuing operations | $ | 1.12 | $ | (3.39) | ||
Diluted average common shares outstanding | 45.5 | 45.3 |
(In millions) | ||
Carrying value of long-term debt at September 30, 2021 | ||
Current portion of long-term debt | $ | 4.1 |
Long-term debt | 2,743.5 | |
Total long-term debt | $ | 2,747.6 |
Unamortized discount and debt issuance costs relating to debt repaid in connection with the Transactions | 42.7 | |
Debt breakage fees | 63.0 | |
Pro forma closing net debt amount | 2,853.3 | |
Adjusted target net debt | ||
Target net debt | 1,950.0 | |
Adjustment for warrants redemption (1)
| 26.0 | |
less: Adjusted target net debt | (1,976.0) | |
Debt repaid with NMG SpinCo cash | 877.3 | |
Adjustment for LMG cash on hand at September 30, 2021 | (0.3) | |
Net cash payment required (2)
| $ | 877.0 |
Facility |
Pro forma outstanding
as of September 30, 2021
(In millions)
|
Interest terms(1)
|
Pro forma interest expense(2)
(In millions)
| ||||||||
Principal balance | Unamortized debt issuance costs | Carrying value |
Three months ended September 30, 2021 | Year ended June 30, 2021 | |||||||
$725 million term loan | $ | 725.0 | $ | (23.5) | $ | 701.5 |
L+5.25%(3)
| $ | 10.9 | $ | 44.3 |
$200 million revolving credit facility | - | (6.5) | (6.5) | L+5.25% | 0.3 | 1.3 | |||||
Total long-term debt | 725.0 | (30.0) | 695.0 | $ | 11.2 | $ | 45.6 | ||||
Reclass revolver debt issuance costs (4)
| - | 6.5 | 6.5 | ||||||||
Current portion of long-term debt | (18.1) | - | (18.1) | ||||||||
Long-term debt | $ | 706.9 | $ | (23.5) | $ | 683.4 |
(In millions) | Three months ended September 30, 2021 |
Year ended June 30, 2021 | ||
Interest expense on historical debt facilities | $ | (38.3) | $ | (178.4) |
Interest expense on new debt facilities | 11.2 | 45.6 | ||
Debt breakage fees | - | 63.0 | ||
Acceleration of amortization of debt issuance costs relating to debt repaid in connection with the Transactions | - | 42.7 | ||
Acceleration of amortization of debt issuance costs relating to terminated revolving credit facility ($0 outstanding) | - | 2.3 | ||
Net interest expense adjustment | $ | (27.1) | $ | (24.8) |
(In millions) | ||
Cash distribution to shareholders based on merger consideration of $16.99 per share - See below | $ | 824.0 |
Adjusted target net debt satisfied by Gray | 1,976.0 | |
Net consideration | 2,800.0 | |
LMG cash on hand sent to Gray in Transactions | 0.3 | |
Net assets disposed of | ||
Assets | 1,094.3 | |
Liabilities | (121.4) | |
Less: Net assets disposed of | (972.9) | |
Unamortized discount and debt issuance costs | (45.0) | |
Debt breakage fees | (63.0) | |
Other transaction-related expenses | ||
Estimated transaction fees(1)
| (32.0) | |
Settlement of share-based awards(2)
| (6.6) | |
Total other transaction-related expenses | (38.6) | |
Pro forma gain on disposal | $ | 1,680.8 |
(In millions except per share data) | ||
Total shares to receive merger consideration | ||
Common stock, par value $1 per share | 40.7 | |
Class B stock, par value $1 per share, convertible to common stock | 5.1 | |
Restricted stock issued under historical share-based compensation plans | 1.8 | |
Stock options issued under historical share-based compensation plans (1)
| 0.8 | |
Other equity instruments issued under historical share-based compensation plans | 0.1 | |
Total number of shares | 48.5 | |
Total cash distribution to shareholders at $16.99 per share | $ | 824.0 |
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Meredith Corporation published this content on 15 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 15 November 2021 12:00:22 UTC.