UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 or 15(d) of the SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): July 25, 2001 USA NETWORKS, INC. (Exact name of Registrant as specified in charter) Delaware 0-20570 59-2712887 (State or other jurisdiction (Commission File (IRS Employer of incorporation) Number) Identification No.) 152 West 57th Street, New York, NY 10019 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 314-7300
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS (c) Exhibits. 99.1 Press Release of USA Networks, Inc. dated July 25, 2001. 99.2 Supplemental Information. ITEM 9. REGULATION FD DISCLOSURE On July 25, 2001, the Registrant issued a press release announcing its results for the quarter ended June 30, 2001. The full text of this press release, appearing in Exhibit 99.1 hereto, and Supplemental Information, appearing in Exhibit 99.2 hereto, are furnished pursuant to Regulation FD. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. USA NETWORKS, INC. By: /s/ JULIUS GENACHOWSKI --------------------------------- Name: Julius Genachowski Title: Senior Vice President and General Counsel Date: July 25, 2001 EXHIBIT INDEX Exhibit No. Description 99.1 Press Release of USA Networks, Inc. dated July 25, 2001. 99.2 Supplemental Information.
Exhibit 99.1 FOR IMMEDIATE RELEASE [LOGO] JULY 25, 2001 18% EBITDA GROWTH FROM USA'S OPERATING BUSINESSES TOTAL EBITDA GROWS 28% ON 21% HIGHER REVENUE IN Q2 COMPANY EMERGING AS LEADER IN INTERACTIVE COMMERCE NEW YORK, July 25, 2001 - USA Networks, Inc. (NASDAQ: USAI) reported results today for its quarter ended June 30, 2001. Highlights are presented on a pro forma comparative basis to the same period last year. HIGHLIGHTS o USA's OPERATING BUSINESSES increased EBITDA by 18% to a record $290.9 million on 18% higher revenue to a record $1.278 billion. Three of USA's largest divisions posted all-time best quarters: USA Network, Ticketmaster, and HRN. o USA's COMBINED BUSINESSES grew EBITDA by 28% to a record $249.3 million on 21% higher revenue to a record $1.371 billion. Operating margins expanded to 18.2% from 17.1% for the combined businesses. o CABLE AND STUDIOS increased revenue by 14% to $444.2 million and EBITDA by 23% to $171.3 million. EBITDA grew 17% at USA Network, 11% at SCI FI, and 123% at Studios USA. o HSN grew its combined revenue by 15% to $462 million (including 11% growth in the U.S.) and EBITDA by 7% to $61.1 million. HSN attracted 525,000 new customers in the U.S. during the period, a 12% increase versus Q2 '00. HSN.com grew revenue by more than 350% from the year-ago period. o HOTEL RESERVATIONS NETWORK increased revenue by 77% to $138.3 million and EBITDA by 62% to $21 million. HRN increased the number of its mostly-exclusive affiliates to nearly 21,000 affiliates during the period. o USA INTERNET COMMERCE GROUP grew revenue by 79% to $238 million and EBITDA by 81% to $43 million. The group expects to be second in profitability only to eBay in retail transactions conducted over the Internet this year. USA ICG is comprised of HSN.com, Hotel Reservations Network, Ticketmaster.com and Match.com. o USA TRAVEL GROUP is expected to generate approximately $4 billion in pro forma gross bookings in 2001, more than any other interactive travel company. Including all of its interactive businesses, USA's pro forma share of retail transactions conducted via the Internet and television in the U.S. is expected to grow to an estimated 9% in 2001. USA Travel Group will consist of HRN, USA Travel Channel, and pending acquisitions Expedia and National Leisure Group. M E D I A R E L E A S E 152 West 57th Street, 42nd Floor New York, New York 10019 212.314.7300 Fax 212.314.7309
FINANCIAL RESULTS On a comparative pro forma basis, USA reported the following, excluding discontinued operations (USA Broadcasting): ACTUAL PRO FORMA ($ IN MILLIONS) Q2 01 Q2 00 GROWTH ------ ------- ------ REVENUES - OPERATING BUSINESSES Cable and studios...................... $444.2 $390.7 14% Electronic retailing - U.S............. 381.8 344.0 11% Electronic retailing - Germany......... 80.2 57.1 40% Ticketing.............................. 163.9 143.0 15% Hotel reservations..................... 138.3 78.1 77% Teleservices........................... 75.6 70.2 8% Intersegment elimination............... (6.5) -- --------- -------- ----- SUB-TOTAL - OPERATING.............. 1,277.5 1,083.1 18% Euro exchange rate fluctuation (a).......... (13.8) (6.7) REVENUES - EMERGING BUSINESSES Citysearch, Match.com, and related..... 23.1 20.2 Styleclick............................. 2.4 6.3 Electronic Commerce Solutions.......... 6.0 3.8 HSN - other international.............. 7.5 3.6 USA Films.............................. 62.6 20.8 TRIO, NWI, Crime and emerging media.... 6.2 3.7 --------- -------- SUB-TOTAL - EMERGING............... 107.7 58.4 --------- -------- ----- TOTAL.............................. $1,371.4 $1,134.9 21% --------- -------- ----- --------- -------- ----- EBITDA - OPERATING BUSINESSES Cable and studios...................... $171.3 $139.4 23% Electronic retailing - U.S............. 55.2 52.6 5% Electronic retailing - Germany......... 5.9 4.7 24% Ticketing.............................. 35.5 31.6 13% Hotel reservations..................... 21.0 12.9 62% Teleservices........................... 10.2 11.9 (15%) Corporate and other.................... (8.2) (6.8) --------- -------- ----- SUB-TOTAL - OPERATING.............. 290.9 246.3 18% Euro exchange rate fluctuation (a)..... (1.0) (0.6) Nonrecurring charges (b)............... (7.8) EBITDA - EMERGING BUSINESSES Citysearch, Match.com, and related..... (8.2) (15.3) Styleclick............................. (5.8) (15.2) Electronic Commerce Solutions.......... (8.6) (6.3) HSN - other international.............. (7.5) (2.5) USA Films.............................. 0.6 (2.3) TRIO, NWI, Crime and emerging media.... (2.4) (2.0) Intersegment elimination............... (3.9) -- --------- -------- ----- SUB-TOTAL - EMERGING............... (35.8) (43.5) Styleclick restructuring charge (c).... (4.8) -- TOTAL.............................. $249.3 $194.4 28% --------- -------- ----- --------- -------- ----- o Excludes results from USA Broadcasting, the sale of which to Univision was announced in December 2000. o Presented as if the acquisition of Styleclick had occurred at the beginning of the periods presented. o EBITDA is defined as net income plus (1) provision for income taxes, (2) minority interest, (3) interest income and expense, (4) depreciation and amortization, (5) amortization of cable distribution fees ($10.6 million and $8.3 million, respectively), and (6) amortization of non-cash distribution and marketing expense and non-cash compensation. (a) In order to present comparable results for HSN Germany, the results have been translated from Euros to U.S. dollars at a constant exchange rate. (b) Represents one-time compensation expense related to a consulting agreement with a senior executive recognized in Q2 '00. (c) Represents non-recurring cash costs related to consolidating Styleclick's operations in Chicago and the shutdown of the FirstAuction.com website. -- More --
BUSINESS MIX 62% of USA's Q2 revenue came from direct consumer transactions, 23% was derived from subscriptions and production fees, and 15% was advertising-related. The operating business reported the following: ACTUAL PRO FORMA ($ IN MILLIONS) Q2 01 Q2 00 GROWTH MIX ------ ------- ------ --- REVENUES - OPERATING BUSINESSES Entertainment................................... $444.2 $390.7 14% 35% Electronic retailing............................ 462.0 401.1 15% 36% Information and Services........................ 377.8 291.3 30% 30% Intersegment elimination........................ (6.5) -- (1%) -------- -------- --- ---- TOTAL....................................... $1,277.5 $1,083.1 18% 100% ======== ======== === ==== EBITDA - OPERATING BUSINESSES Entertainment................................... $171.3 $139.4 23% 59% Electronic retailing............................ 61.1 57.3 7% 21% Information and Services........................ 66.7 56.4 18% 23% Corporate and other............................. (8.2) (6.8) (3%) -------- -------- --- ---- TOTAL....................................... $290.9 $246.3 18% 100% ====== ====== === ==== CASH NET INCOME AND EARNINGS PER SHARE PRO FORMA (a) (b) Q2 01 (a) Q2 00 ----- ------ Fully converted cash net income per share....... 0.14 0.11 Fully converted earnings per share.............. 0.04 (0.01) Cash net income per share....................... 0.20 0.17 Basic loss per share............................ (0.02) (0.07) (a) Amounts based on net income before gain on sale of broadcasting stations in Q2 '01, which the Company estimates will be in the $40 million - $50 million range and will be disclosed in the Company's 10-Q, and before loss from discontinued operations in Q2 '00 of $15.2 million. (b) Excluding one-time expense ($10.6 million, pre-tax in Q2 '01, and $11.6 million, pre-tax, in Q2 `00). Due to regulatory restrictions, Universal and Liberty own a significant portion of their interests in USA through USA subsidiaries. This structure causes USA to record net losses in situations where net income would otherwise have been recorded if their ownership were entirely in USA common stock. Fully converted earnings and fully converted cash net income reflect the impact as if all shares exchangeable into common stock had been exchanged during the period. -- More --
ENTERTAINMENT HIGHLIGHTS USA NETWORK grew EBITDA 17% to $123.3 million on 6% higher revenue of $221.4 million, its best quarter in its 24 years. o USA tied Lifetime as primetime's highest-rated cable network in June. USA was the 2nd highest-rated cable network in the second quarter with an average 1.8 rating in primetime. o Excluding WWF from Q2 `00, USA's primetime delivery increased by 13% in Adults 25-54 and 25% in Adults 18-34. o WATERBOY achieved a 5.1 rating, becoming the highest-rated network-window movie premiere in USA's history. USA delivered four of the five highest-rated theatrical network premieres in basic cable during the first half of 2001. o The DAYTIME MOVIE averaged a 0.8 rating and increased delivery of Adults 25-54 by 36%. The SATURDAY AFTERNOON MOVIE block averaged a 1.3 rating, and the new strategy to target female viewers yielded a 58% increase in delivery of Women 25-54. Monday - Saturday primetime movies averaged a 1.8 in Q2, increasing delivery of Adults 25-54 by 19%. o JAG, cable's top-rated acquired strip series, improved its ratings by 17% from Q2 '00. o Sunday Prime averaged a 1.5 rating in Q2, up 15%. Delivery of targeted Men 25-54 improved by 37%. o USA's two-week coverage of the 2001 FRENCH OPEN TENNIS TOURNAMENT averaged a 0.7 rating, up 40% from 2000. o USA renewed its deal with the PGA Tour through 2007, increasing its coverage to 35 events annually and adding year-round weekend programming. The deal also provides for USA to be the Tour's exclusive interactive commerce partner. o USA Network has been one of the highest-rated cable networks for more than a decade. SCI FI increased EBITDA by 11% to $27.8 million on 1% lower revenue of $70.3 million. o SCI FI averaged a 0.8 primetime rating in Q2 and household delivery of 547,000, an increase of 9% from Q2 '00. o SCI FI's Friday night originals - INVISIBLE MAN, FARSCAPE and OUTER LIMITS - have increased delivery of Adults 25-54 by 22% and are out delivering TBS, A&E, Comedy Central, Discovery, ESPN and FX in Adults 25-54 in that time period. o CROSSING OVER WITH JOHN EDWARD on Sunday saw delivery of Women 25-54 increase by 35%. o SCI FI continues to have the highest concentration of adult viewers 25-54 of any network on television, while ranking in the top 10 among basic cable networks in its delivery of Adults, Women and Men 25-54. o SCI FI is the #1 provider of original scripted series in cable primetime. STUDIOS USA, net, grew EBITDA by 123% to $20.2 million on 38% higher revenue to a record $152.5 million. o Over 20 million watched LAW & ORDER'S season finale -- the largest audience for a finale in the show's 11-year history. o LAW & ORDER: SVU averaged 13.3 million weekly viewers during the 2000-01 season, 9% higher than last season. o THE DISTRICT, the #1 series in Saturday primetime, was also the 2nd highest rated new television drama in 2000-01. o INVISIBLE MAN, which airs both on SCI FI and in syndication, is averaging 2.9 million viewers per week. o MAURY is averaging nearly 4 million viewers a day, and its #4 ranking among talk shows is a 10-year best for Mr. Povich. o Studios USA received orders for two new drama series for the 2001-02 season: THE AGENCY and LAW & ORDER: CRIMINAL INTENT. This brings the amount of Studios USA primetime programming on the major networks to 5 hours, its new record. o Studios USA is the #3 producer of primetime and first-run syndicated programming, including two of the top four syndicated talk shows and two of the top ten primetime dramas. -- More --
ENTERTAINMENT HIGHLIGHTS (CONTINUED) CABLE AND STUDIOS: Q2 01 Q2 00 GROWTH ----- ----- ------ Revenue ($ IN MILLIONS): USA Network................................. $221.4 $208.9 6% SCI FI...................................... 70.3 71.3 (1%) Studios, net................................ 152.5 110.5 38% ------- -------- ----- Total................................. $444.2 $390.7 14% ====== ====== ====== EBITDA ($ IN MILLIONS): USA Network................................. $123.3 $105.4 17% SCI FI...................................... 27.8 24.9 11% Studios, net................................ 20.2 9.1 123% ------- -------- ----- Total................................. $171.3 $139.4 23% ====== ======= ===== Households (IN MILLIONS @ 6/30): USA Network................................. 81.9 78.2 5% SCI FI...................................... 70.9 62.7 13% Advertising and other revenue / affiliate revenue: USA Network mix............................. 59:41 59:41 SCI FI mix.................................. 66:34 66:34 USA FILMS USA Home Entertainment's home video release of TRAFFIC debuted at #1 and was the 3rd best selling DVD in the U.S. during Q2. The widely acclaimed TRAFFIC has grossed more than $200 million at the worldwide box office. USA Films' theatrical releases in Q2 were ONE NIGHT AT MCCOOL'S, BLOODY ANGELS, WHATEVER HAPPENED TO HAROLD SMITH and PANDEMONIUM. USA's future release THE MAN WHO WASN'T THERE shared the Best Director prize at the 2001 Cannes Film Festival. -- More --
ELECTRONIC RETAILING HIGHLIGHTS HSN increased EBITDA by 5% to $55.2 million on 11% higher revenue of $381.8 million in the United States. o HSN added approximately 525,000 new customers during the period, a 12% increase over Q2 '00. o HSN.com shipped 1.1 million packages during the first half of 2001, a 500%+ increase from the same period in 2000. o HSN acquired the IMPROVEMENTS brand catalog from Hanover Direct, adding to HSN's array of shopping platforms. o Customer orders are being filled 17% faster versus last year and fulfillment-related customer service calls have declined by 25% as a result of HSN's ongoing investments to enhancing the customer's shopping experience. HSN's more highly skilled representatives have increased upselling "take rates" on inbound calls by 160%, thereby driving incremental sales without using TV airtime. Q2 01 Q2 00 GROWTH ----- ----- ------ U.S. units shipped (IN MILLIONS)..................... 9.1 8.1 12% On air gross profit %........................... 33.3% 34.7% On air return rate.............................. 20.0% 19.6% On air product mix: Homegoods................................... 48% 46% Jewelry..................................... 27% 28% Health / Beauty............................. 12% 13% Apparel / Accessories....................... 13% 13% HSN cable / DBS homes (IN MILLIONS @ 6/30)........... 69.2 63.2 9% HSN total homes (IN MILLIONS @ 6/30)................. 80.8 76.4 6% HSN - INTERNATIONAL o HSN International introduced Home Shopping Europe as the new European brand for modern home shopping, including the German, Italian, French and Dutch / Flemish services. o HSN International launched its second GLOBAL TODAY'S SPECIAL whereby more than 9,000 Lenox collectibles sold-out across every HSN service simultaneously in a single day. o In a joint venture with Prosieben, HSN launched a live transactional TV and travel show in Germany. o Home Shopping Espanol launched in Mexico through PCTV in May, becoming the only Spanish-language television network available in the continental United States, Puerto Rico and Mexico. o HSN is the world's most distributed television retailer, with services in 8 languages reaching 155 million homes globally. -- More --
ELECTRONIC RETAILING HIGHLIGHTS (CONTINUED) TV HOUSEHOLDS LIVE HOURS 6/01 6/00 GROWTH DAILY 6/01 STAKE ---- ---- ------ ---------- ----- Consolidated Services: (IN MILLIONS @ 6/30) Germany (includes Austria / Switzerland).............. 30.1 28.6 1.5 20 hours 42% Home Shopping Espanol (U.S. / Puerto Rico / Mexico)... 5.9 2.7 3.2 18 hours 100% Unconsolidated Services: TVSN (China).......................................... 20.3 -- 20.3 5 hours 21% Shop Channel (Japan) ................................. 10.3 7.9 2.4 12 hours 30% Italy................................................. 9.4 -- 9.4 10 hours 33% Belgium / The Netherlands............................. 2.2 -- 2.2 8 hours 47% France / Belgium...................................... 1.6 1.4 0.2 8 hours 47% INFORMATION & SERVICES HIGHLIGHTS TICKETMASTER grew ticketing EBITDA by 13% to $35.5 million on 15% higher revenue to a record $163.9 million, its best quarter in its 25-year history. o Online ticket sales accounted for a record 33.2% of total tickets sold by Ticketmaster, versus 25.5% in Q2 '00. Ticketmaster hosted 80 Internet pre-sales during the quarter, including those for Madonna, Aerosmith and Sugar Ray. o Match.com increased the number of paying subscribers to more than 215,000, a 38% increase from 12/00. Match.com earned $2.8 million in EBITDA in Q2. o Citysearch reduced its EBITDA losses for the 5th consecutive quarter and increased its unique users to 4.5 million in June, a 29% increase since January 2001. o Ticketmaster is the world's leading ticketing and access company. Q2 01 Q2 00 GROWTH ----- ----- ------ Number of tickets sold (IN MILLIONS)............ 23.5 22.3 6% Gross value of tickets sold (IN MILLIONS)....... $1,016 $881 15% Revenue per ticket.............................. $6.29 $5.89 7% Share of tickets sold online......................... 33.2% 25.5% Top-selling events in Q2 `01......................... Aerosmith, Seattle Mariners, Tim McGraw, New York Yankees, WWF and Janet Jackson -- More --
INFORMATION & SERVICES HIGHLIGHTS (CONTINUED) HOTEL RESERVATIONS NETWORK increased EBITDA by 62% to $21.0 million on 77% higher revenue of $138.3 million, its best quarter in its 10-year history. o HRN expanded into eleven new markets and sold more than 1 million room nights during Q2. o HRN now has nearly 21,000 mostly-exclusive affiliates under contract. o HRN is the #1 provider of discount hotel accommodations worldwide. Q2 01 Q2 00 GROWTH ----- ----- ------ Hotel room nights sold.......................... 1,030,000 586,721 76% Affiliates (including TravelNow)................ 20,857 10,500 99% Properties...................................... 3,374 1,925 75% Cities served (AS OF 6/30)...................... 146 60 143% PRECISION RESPONSE decreased EBITDA by 15% to $10.2 million on 8% higher revenue of $75.6 million. o PRC's business was affected by an economy-related slowdown in the outsourcing of customer care programs, particularly with respect to services provided to the dot com sector. As a result, revenue growth and gross profit margins were adversely impacted. o PRC recently announced its acquisition of Hancock Information Group, a leader in high-tech, business-to-business teleservicing. o Precision Response Corporation is a global leader in Customer Relationship Management (CRM) and outsourced customer care. SHARES OUTSTANDING, MARKET CAPITALIZATION, NET DEBT As of July 20, 2001, USA had outstanding 736.8 million shares, including exchangeable securities, with an aggregate market capitalization of approximately $20 billion. USA's net cash balance, including that of its public subsidiaries and an advance receivable to Universal, was approximately $100 million as of June 30, 2001. Net cash is expected to increase following the receipt of additional cash proceeds from the sale of USA Broadcasting to Univision. STATEMENTS OF OPERATIONS The actual quarterly results are not comparable due to: 1) the acquisition of Precision Response in April, 2000; 2) the acquisition of Styleclick.com in August 2000; and 3) Ticketmaster's acquisition of TicketWeb in May 2000. -- More --
ANALYST CONFERENCE CALL USA Networks, Inc. will audiocast its conference call with analysts and investors discussing the company's second quarter financial results on Wednesday, July 25, 2001, at 11:00 a.m. Eastern Time (ET). The live audiocast is open to the public at www.usanetworks.com/investor.relations. A replay of the audiocast will begin approximately one hour after its completion at www.usanetworks.com/investor.relations. IMPORTANT DISCLOSURES / LEGEND AND FORWARD LOOKING STATEMENTS / FOOTNOTES USA and Expedia will file a joint prospectus/proxy statement and other relevant documents concerning USA's acquisition of Expedia with the Securities and Exchange Commission ("SEC"). INVESTORS ARE URGED TO READ THE JOINT PROSPECTUS/PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED IN THE FUTURE WITH THE SEC BECAUSE THOSE DOCUMENTS CONTAIN IMPORTANT INFORMATION. Investors will be able to obtain such documents free of charge at the SEC's website at www.sec.gov. In addition, such documents may also be obtained free of charge by contacting USA Networks, Inc., 152 West 57th Street, New York, New York, 10019, Attention: Investor Relations, or Expedia, Inc., 13810 SE Eastgate Way, Suite 400, Bellevue, WA 98005, Attention: Investor Relations. This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include information relating to possible or assumed future results of operations of USA after giving effect to the acquisitions discussed in this press release, including those preceded by, followed by or that include the words "believes," "projects," "expects," "anticipates" or similar expressions. These statements reflect the current views of USA with respect to future events. The following important factors, in addition to those described in USA's filings with the SEC, could affect the future results of USA, and could cause those results to differ materially from those expressed in the forward-looking statements: material adverse changes in economic conditions in the markets served by our businesses; future regulatory actions and conditions in our businesses' operating areas; competition from others; successful integration of our divisions, including recently acquired and to be acquired businesses; product demand and market acceptance; the ability to protect proprietary information and technology or to obtain necessary licenses on commercially reasonable terms; and obtaining and retaining key executives and employees. These forward-looking statements are made as of the date of this press release, and USA undertakes no obligation to update or revise them, whether as a result of new information, future events or any other reason. The financial, statistical and other information contained in this press release and its attachments is unaudited. USA Network and SCI FI ratings and household delivery data per NMR Galaxy Explorer for NHI defined periods versus comparable periods. Subscriber counts based on Nielsen People Meter Installed Sample, June `01 vs. `00. All ratings within each network's coverage area. Studios' syndicated program ratings per NSS (GAA % where applicable), and broadcast network data per NTI for comparable time periods. Subject to qualifications. Online retail market data per PhocusWright (2001). Internet and television retailing market information sources include, but are not limited to Boston Consulting Group / Shop.org (May 2001), Jupiter (December 2000, August 2000, December 1999), Forrester (July 2000), and various other published industry and Wall Street analyst research. Operating metrics in this press release are pro forma for the pending transactions. ABOUT USA NETWORKS, INC. USA Networks, Inc. (NASDAQ: USAI), is focused on the new convergence of entertainment, information and direct selling. The Company is organized within two groups, the Entertainment Group and the Interactive Group, comprised of interrelated business divisions which include the following assets: USA Entertainment's USA Network, SCI FI Channel, TRIO, NWI, Crime, Studios USA, and USA Films; and USA Interactive's HSN, HSN International, HSN Interactive, Ticketmaster (NASDAQ: TMCS), which operates Citysearch and Match.com, Hotel Reservations Network (NASDAQ: ROOM), Electronic Commerce Solutions, Styleclick (NASDAQ: IBUY) and Precision Response Corporation. CONTACTS: USA COMMUNICATIONS: USA INVESTOR RELATIONS: Adrienne Becker Roger Clark 212-314-7254 212-314-7400
USA NETWORKS, INC. AND SUBSIDIARIES BUSINESS SEGMENT INFORMATION - CONTINUING OPERATIONS UNAUDITED ( $ IN THOUSANDS ) THREE MONTHS ENDED JUNE 30, ACTUAL PRO FORMA (a) ACTUAL ----------- ------------- ----------- 2001 2000 2000 ----------- ------------- ----------- REVENUES - OPERATING BUSINESSES Cable and studios $ 444,203 $ 390,688 $ 390,688 Electronic retailing - U.S. 381,822 343,950 343,950 Electronic retailing - Germany 80,194 57,138 57,138 Ticketing 163,898 143,019 143,019 Hotel reservations 138,302 78,082 78,082 Teleservices 75,624 70,212 70,212 Intersegment Elimination (6,531) -- -- ----------- ----------- ----------- SUB-TOTAL 1,277,512 1,083,089 1,083,089 Euro's exchange rate fluctuation (c) (13,774) (6,667) (6,667) REVENUES - EMERGING BUSINESSES Citysearch, Match.com and related 23,054 20,239 20,239 Styleclick 2,438 6,286 5,792 Electronic Commerce Solutions 5,994 3,794 3,794 HSN - international and other 7,484 3,627 3,627 USA Films 62,561 20,773 20,773 Trio, NWI, Crime, other emerging media 6,179 3,709 3,709 ----------- ----------- ----------- SUB-TOTAL 107,710 58,428 57,934 ----------- ----------- ----------- TOTAL $ 1,371,448 $ 1,134,850 $ 1,134,356 =========== =========== =========== EBITDA - OPERATING BUSINESSES (b) Cable and studios $ 171,302 $ 139,370 $ 139,370 Electronic retailing - U.S. 55,207 52,552 52,552 Electronic retailing - Germany 5,864 4,726 4,726 Ticketing 35,521 31,568 31,568 Hotel reservations 20,994 12,921 12,921 Teleservices 10,183 11,927 11,927 Corporate and other (8,175) (6,796) (6,796) ----------- ----------- ----------- SUB-TOTAL 290,896 246,268 246,268 Euro's exchange rate fluctuation (c) (992) (575) (575) Nonrecurring charges (d) -- (7,806) (7,806) EBITDA - EMERGING BUSINESSES Citysearch, Match.com and related (8,207) (15,251) (15,251) Styleclick (5,842) (15,150) (9,971) Electronic Commerce Solutions (8,613) (6,283) (6,283) HSN - international and other (7,494) (2,457) (2,457) USA Films 632 (2,334) (2,334) Trio, NWI, Crime, other emerging media (2,354) (1,997) (1,997) Intersegment Elimination (3,949) -- -- ----------- ----------- ----------- SUB-TOTAL (35,827) (43,472) (38,293) ----------- ----------- ----------- Styleclick restructuring charge (e) (4,773) -- -- ----------- ----------- ----------- TOTAL $ 249,304 $ 194,415 $ 199,594 =========== =========== =========== (a) Presented as if the acquisition of Styleclick had occurred at the beginning of the period presented. (b) EBITDA is defined as net income plus, (1) provision for income taxes, (2) minority interest, (3) interest income and expense, (4) depreciation and amortization, (5) amortization of cable distribution fees of $10,642 and $8,267, respectively, and (6) amortization of non-cash distribution and marketing expense and non-cash compensation expense. (c) In order to present comparable results for HSN Germany, the results have been translated from Euros to U.S. dollars at a constant exchange rate. (d) As part of a resignation agreement with a senior executive, the company recorded one-time compensation expense related to a consulting arrangement. (e) Represents non-recurring costs related to consolidating Styleclick's operations in Chicago and the shutdown of the Firstauction.com website.
USA NETWORKS, INC. AND SUBSIDIARIES BUSINESS SEGMENT INFORMATION - CONTINUING OPERATIONS UNAUDITED ( $ IN THOUSANDS ) SIX MONTHS ENDED JUNE 30, ACTUAL PRO FORMA (a) ACTUAL ----------- ------------- ----------- 2001 2000 2000 ----------- ------------- ----------- REVENUES - OPERATING BUSINESSES Cable and studios $ 881,854 $ 769,641 $ 769,641 Electronic retailing - U.S. 767,194 702,429 702,429 Electronic retailing - Germany 159,055 122,936 122,936 Ticketing 314,007 270,980 270,980 Hotel reservations 243,588 133,345 133,345 Teleservices 156,316 139,861 70,212 Intersegment Elimination (6,531) -- -- ----------- ----------- ----------- SUB-TOTAL 2,515,483 2,139,192 2,069,543 Euro's exchange rate fluctuation (c) (27,479) (14,557) (14,557) REVENUES - EMERGING BUSINESSES Citysearch, Match.com and related 43,982 37,214 37,214 Styleclick 6,457 14,155 12,409 Electronic Commerce Solutions 10,743 8,460 8,460 HSN - international and other 12,031 7,457 7,457 USA Films 113,567 51,080 51,080 Trio, NWI, Crime, other emerging media 12,341 4,271 4,271 ----------- ----------- ----------- SUB-TOTAL 199,121 122,637 120,891 ----------- ----------- ----------- TOTAL $ 2,687,125 $ 2,247,272 $ 2,175,877 =========== =========== =========== EBITDA - OPERATING BUSINESSES (b) Cable and studios $ 334,709 $ 278,127 $ 278,127 Electronic retailing - U.S. 106,942 108,250 108,250 Electronic retailing - Germany 11,509 13,400 13,400 Ticketing 65,754 58,951 58,951 Hotel reservations 36,816 21,097 21,097 Teleservices 20,200 21,388 11,927 Corporate and other (16,112) (22,707) (22,707) ----------- ----------- ----------- SUB-TOTAL 559,818 478,506 469,045 Euro's exchange rate fluctuation (c) (1,928) (1,609) (1,609) Nonrecurring charges (d) -- (1,498) (1,498) EBITDA - EMERGING BUSINESSES Citysearch, Match.com and related (19,694) (32,627) (32,627) Styleclick (16,278) (25,858) (16,338) Electronic Commerce Solutions (15,095) (11,846) (11,846) HSN - international and other (13,908) (3,950) (3,950) USA Films (403) (152) (152) Trio, NWI, Crime, other emerging media (4,053) (4,263) (4,263) Intersegment Elimination (3,949) -- -- ----------- ----------- ----------- SUB-TOTAL (73,380) (78,696) (69,176) ----------- ----------- ----------- Styleclick restructuring charge (e) (4,773) -- -- ----------- ----------- ----------- TOTAL $ 479,737 $ 396,703 $ 396,762 =========== =========== =========== (a) Presented as if the acquisitions of Precision Response and Styleclick had occurred at the beginning of the period presented. (b) EBITDA is defined as net income plus, (1) provision for income taxes, (2) minority interest, (3) interest income and expense, (4) depreciation and amortization, (5) amortization of cable distribution fees of $19,398 and $16,490, respectively, and (6) amortization of non-cash distribution and marketing expense and non-cash compensation expense. (c) In order to present comparable results for HSN Germany, the results have been translated from Euros to U.S. dollars at a constant exchange rate. (d) Represents one-time credits recognized in Q1 '00 by HSN in connection with a favorable settlement of litigation relating to an HSN broadcasting affiliation agreement ($4,661) and a cable affiliation agreement ($1,647). In addition, as part of a resignation agreement with a senior executive, the Company recorded a one-time compensation expense related to a consulting arrangement. (e) Represents non-recurring costs related to consolidating Styleclick's operations in Chicago and the shutdown of the Firstauction.com website.
USA NETWORKS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS UNAUDITED ( $ IN THOUSANDS, EXCEPT PER SHARE DATA ) THREE MONTHS ENDED JUNE 30, ACTUAL PRO FORMA (a) ACTUAL ----------- ------------- ----------- 2001 2000 2000 ----------- ------------- ----------- Revenues, net $ 1,371,448 $ 1,134,850 $ 1,134,356 Operating costs and expenses: Costs related to revenues 831,652 676,330 676,102 Other costs and expenses 290,492 264,105 258,660 Amortization of non cash distribution and marketing expense (b) 6,631 1,271 1,271 Amortization of non cash compensation expense (c) 1,308 4,823 4,823 Amortization of cable distribution fees 10,642 8,267 8,267 Depreciation and amortization 146,530 142,044 127,968 ----------- ----------- ----------- Total operating costs and expenses 1,287,255 1,096,840 1,077,091 ----------- ----------- ----------- Operating income 84,193 38,010 57,265 Interest expense, net (12,915) (7,860) (7,748) Other, net (13,731) (1,929) (1,929) ----------- ----------- ----------- Earnings before income taxes and minority interest 57,547 28,221 47,588 Income tax expense (22,828) (29,589) (23,998) Minority interest (44,997) (30,203) (36,910) ----------- ----------- ----------- Net loss from continuing operations (d) $ (10,278) $ (31,571) $ (13,320) =========== =========== =========== Net loss from continuing operations, excluding one-time charges and non-operating gains $ (7,544) $ (26,864) $ (8,613) =========== =========== =========== Fully converted net earnings from continuing operations, excluding one-time charges and non-operating gains $ 27,680 $ (6,974) $ 21,406 =========== =========== =========== Weighted average diluted shares 373,762 363,582 361,977 =========== =========== =========== Weighted average fully converted shares 763,378 724,735 748,548 =========== =========== =========== EPS FROM CONTINUING OPERATIONS Basic loss per share $ (.03) $ (.09) $ (.04) =========== =========== =========== Basic loss per share, excluding one-time charges and non-operating gains $ (.02) $ (.07) $ (.02) =========== =========== =========== Fully converted earnings per share, excluding one-time charges $ .04 $ (.01) $ .03 =========== =========== =========== EBITDA (e) $ 249,304 $ 194,415 $ 199,594 =========== =========== =========== (a) Presented as if the acquisition of Styleclick had occurred at the beginning of the period presented. (b) Amortization of warrants and stock issued in exchange for distribution and marketing services. (c) Expense relates to the Company's bonus stock purchase program and restricted stock awards. (d) Q2 '01 excludes the gain on sale of of broadcasting stations, the sale of which to Univision was announced in December 2000. The Company estimates the gain will be in the $40 million - $50 million range and will be disclosed in the Company's 10-Q. Q2 '00 excludes the results of USA Broadcasting. The results for the discontinued operations was an after tax loss of $15,235. (e) EBITDA is defined as net income plus, (1) provision for income taxes, (2) minority interest, (3) interest income and expense, (4) depreciation and amortization, (5) amortization of cable distribution fees of $10,642 and $8,267, respectively, and (6) amortization of non-cash distribution and marketing expense and non-cash compensation expense.
USA NETWORKS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS UNAUDITED ( $ IN THOUSANDS, EXCEPT PER SHARE DATA ) SIX MONTHS ENDED JUNE 30, PRO FORMA (a) ACTUAL PRO FORMA (a)(b) ACTUAL ------------- ----------- ---------------- ----------- 2001 2001 2000 2000 ----------- ----------- ---------------- ----------- Revenues, net $ 2,687,125 $ 2,687,125 $ 2,247,272 $ 2,175,877 Operating costs and expenses: Costs related to revenues 1,631,825 1,631,825 1,341,933 1,287,504 Other costs and expenses 575,563 575,563 508,636 491,611 Amortization of non cash distribution and marketing expense (c) 14,648 14,648 1,874 1,874 Amortization of non cash compensation expense (d) 4,163 4,163 6,156 6,156 Amortization of cable distribution fees 19,398 19,398 16,490 16,490 Depreciation and amortization 284,129 284,129 278,176 232,958 ----------- ----------- ----------- ----------- Total operating costs and expenses 2,529,726 2,529,726 2,153,265 2,036,593 ----------- ----------- ----------- ----------- Operating income 157,399 157,399 94,007 139,284 Interest expense, net (24,331) (24,331) (16,462) (15,777) Other, net (20,253) (20,253) (2,566) (2,560) ----------- ----------- ----------- ----------- Earnings before income taxes and minority interest 112,815 112,815 74,979 120,947 Income tax expense (48,285) (49,290) (70,430) (59,071) Minority interest (94,334) (91,186) (71,710) (82,295) ----------- ----------- ----------- ----------- Loss from continuing operations, before cumulative effect of accounting change (29,804) (27,661) (67,161) (20,419) Cumulative effect of accounting change, net of tax (e) (9,187) (9,187) -- -- ----------- ----------- ----------- ----------- Net loss from continuing operations (f) $ (38,991) $ (36,848) $ (67,161) $ (20,419) =========== =========== =========== =========== Net loss from continuing operations, excluding one-time charges and non-operating gains, before cum. effect of accounting change $ (27,070) $ (24,927) $ (63,313) $ (16,571) =========== =========== =========== =========== Fully converted net earnings from continuing operations, excluding one-time charges and non-operating gains, before cum effect of accounting change $ 38,492 $ 40,635 $ (25,034) $ 40,238 =========== =========== =========== =========== Weighted average diluted shares 372,085 372,085 362,732 349,757 =========== =========== =========== =========== Weighted average fully converted shares 762,463 762,463 723,885 740,224 =========== =========== =========== =========== EPS FROM CONTINUING OPERATIONS, BEFORE CUM. EFFECT OF ACCOUNTING CHANGE: Basic loss per share $ (.08) $ (.07) $ (.19) $ (.06) =========== =========== =========== =========== Basic loss per share, excluding one-time charges and non-operating gains $ (.07) $ (.07) $ (.17) $ (.05) =========== =========== =========== =========== Fully converted earnings per share, excluding one-time charges $ .05 $ .05 $ (.03) $ .05 =========== =========== =========== =========== EBITDA (g) $ 479,737 $ 479,737 $ 396,703 $ 396,762 =========== =========== =========== =========== (a) Presented as if the merger of Ticketmaster and TMCS had occurred at the beginning of the period presented. The merger has no impact on revenues or EBITDA. Pro forma results reflect the impact of the merger on minority interest and income taxes. (b) Presented as if the acquisitions of Precision Response and Styleclick had occurred at the beginning of the period presented. (c) Amortization of warrants and stock issued in exchange for distribution and marketing services. (d) Expense relates to the Company's bonus stock purchase program and restricted stock awards. (e) Represents the cumulative effect of adoption of SOP 00-2, "Accounting by Producers and Distributors of Films". (f) 2001 excludes the gain on sale of of broadcasting stations, the sale of which to Univision was announced in December 2000. The Company estimates the gain will be in the $40 million - $50 million range and will be disclosed in the Company's 10-Q. Q2 '00 excludes the results of USA Broadcasting. The results for the discontinued operations was an after tax loss of $27,008. (g) EBITDA is defined as net income plus, (1) provision for income taxes, (2) minority interest, (3) interest income and expense, (4) depreciation and amortization, (5) amortization of cable distribution fees of $19,398 and $16,490 respectively, and (6) amortization of non-cash distribution and marketing expense and non-cash compensation expense.
USA NETWORKS, INC. AND SUBSIDIARIES EPS AND CASH NET INCOME RECONCILIATION INFORMATION - CONTINUING OPERATIONS UNAUDITED ( $ IN THOUSANDS, EXCEPT PER SHARE DATA ) THREE MONTHS ENDED JUNE 30, PRO FORMA ACTUAL PRO FORMA (a) ACTUAL --------- --------- ------------- --------- 2001 2001 2000 2000 --------- --------- ------------- --------- BASIC LOSS PER SHARE: Net loss ($ 10,278) ($ 10,278) ($ 31,571) ($ 13,320) Impact of unusual items, net of tax and minority interest (b) 2,734 2,734 4,707 4,707 --------- --------- --------- --------- BASIC LOSS, EXCLUDING UNUSUAL ITEMS (b) $ (7,544) $ (7,544) $ (26,864) $ (8,613) ========= ========= ========= ========= Weighted average basic shares 373,762 373,762 363,582 361,977 ========= ========= ========= ========= Basic loss per share: $ (.03) $ (.03) $ (.09) $ (.04) ========= ========= ========= ========= Basic loss per share excluding unusual items (b) $ (.02) $ (.02) $ (.07) $ (.02) ========= ========= ========= ========= ============================================================================================================================ CASH NET INCOME: Net loss $ (10,278) $ (10,278) $ (31,571) ($ 13,320) Impact of goodwill amortization, net of tax and minority interest 80,933 80,933 88,254 90,676 --------- --------- --------- --------- CASH NET INCOME 70,655 70,655 56,683 77,356 Impact of unusual items, net of tax and minority interest (b) 2,734 2,734 4,707 4,707 --------- --------- --------- --------- CASH NET INCOME, EXCLUDING UNUSUAL ITEMS (b) $ 73,389 $ 73,389 $ 61,390 $ 82,063 ========= ========= ========= ========= Weighted average basic shares 373,762 373,762 363,582 361,977 ========= ========= ========= ========= Cash net income per share $ .19 $ .19 $ .16 $ .21 ========= ========= ========= ========= Cash net income per share, excluding unusual items (b) $ .20 $ .20 $ .17 $ .23 ========= ========= ========= ========= ============================================================================================================================ FULLY CONVERTED NET EARNINGS: Net loss $ (10,278) $ (10,278) $ (31,571) $ (13,320) Impact of minority interest, net of tax 30,328 30,328 17,869 27,998 --------- --------- --------- --------- FULLY CONVERTED NET EARNINGS 20,050 20,050 (13,702) 14,678 Impact of unusual items, net of tax and minority interest (b) 7,630 7,630 6,728 6,728 --------- --------- --------- --------- FULLY CONVERTED NET EARNINGS, EXCLUDING UNUSUAL ITEMS (b) $ 27,680 $ 27,680 $ (6,974) $ 21,406 ========= ========= ========= ========= Weighted average fully converted shares 763,378 763,378 724,735 748,548 ========= ========= ========= ========= Fully converted earnings per share $ .03 $ .03 $ (.02) $ .02 ========= ========= ========= ========= Fully converted earnings per share, excluding unusual items (b) $ .04 $ .04 $ (.01) $ .03 ========= ========= ========= ========= ============================================================================================================================ FULLY CONVERTED CASH NET INCOME: Net loss $ (10,278) $ (10,278) $ (31,571) $ (13,320) Impact of minority interest, net of tax 30,328 30,328 17,869 27,998 Impact of goodwill amortization, net of tax and minority interest 80,933 80,933 88,254 90,676 --------- --------- --------- --------- FULLY CONVERTED CASH NET INCOME 100,983 100,983 74,552 105,354 Impact of unusual items, net of tax and minority interest (b) 7,630 7,630 6,728 6,728 --------- --------- --------- --------- FULLY CONVERTED CASH NET INCOME, EXCLUDING UNUSUAL ITEMS (b) $ 108,613 $ 108,613 $ 81,280 $ 112,082 ========= ========= ========= ========= Weighted average fully converted shares 763,378 763,378 750,153 748,548 ========= ========= ========= ========= Fully converted cash net income per share $ .13 $ .13 $ .10 $ .14 ========= ========= ========= ========= Fully converted cash net income per share, excluding unusual items (b) $ .14 $ .14 $ .11 $ .15 ========= ========= ========= ========= (a) Presented as if the acquisition of Styleclick had occurred at the beginning of the period presented. (b) Excludes one time charges and non-operating gains.
USA NETWORKS, INC. AND SUBSIDIARIES EPS AND CASH NET INCOME RECONCILIATION INFORMATION - CONTINUING OPERATIONS, BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE UNAUDITED ( $ IN THOUSANDS, EXCEPT PER SHARE DATA ) SIX MONTHS ENDED JUNE 30, PRO FORMA (a) ACTUAL PRO FORMA (a)(b) ACTUAL ------------- --------- ---------------- --------- 2001 2001 2000 2000 ------------- --------- ---------------- --------- BASIC LOSS PER SHARE: Net loss $ (29,804) $(27,661) $ (67,161) $ (20,419) Impact of unusual items, net of tax and minority interest (c) 2,734 2,734 3,848 3,848 --------- --------- --------------- --------- BASIC LOSS, EXCLUDING UNUSUAL ITEMS (c) $ (27,070) $ (24,927) $ (63,313) $ (16,571) ========= ========= =============== ========= Weighted average basic shares 372,085 372,085 362,732 349,757 ========= ========= =============== ========= Basic loss per share: $ (.08) $ (.07) $ (.19) $ (.06) ========= ========= =============== ========= Basic loss per share excluding unusual items (c) $ (.07) $ (.07) $ (.17) $ (.05) ========= ========= =============== ========= ============================================================================================================================ FULLY CONVERTED NET EARNINGS: Net loss $ (29,804) $ (27,661) $ (67,161) $ (20,419) Impact of minority interest, net of tax 60,666 60,666 39,236 57,766 --------- --------- --------------- --------- FULLY CONVERTED NET EARNINGS 30,862 33,005 (27,925) 37,347 Impact of unusual items, net of tax and minority interest (c) 7,630 7,630 2,891 2,891 --------- --------- --------------- --------- FULLY CONVERTED NET EARNINGS, EXCLUDING UNUSUAL ITEMS (c) $ 38,492 $ 40,635 $ (25,034) $ 40,238 ========= ========= =============== ========= Weighted average fully converted shares 762,463 762,463 723,885 740,224 ========= ========= =============== ========= Fully converted earnings per share $ .04 $ .04 $ (.04) $ .05 ========= ========= =============== ========= Fully converted earnings per share, excluding unusual items (c) $ .05 $ .05 $ (.03) $ .05 ========= ========= =============== ========= ============================================================================================================================ (a) Presented as if the merger of Ticketmaster and TMCS had occurred at the beginning of the period presented. The merger has no impact on revenues or EBITDA. Pro forma results reflect the impact of the merger on minority interest and income taxes. (b) Presented as if the acquisitions of Styleclick and Precision Response Corp. had occurred at the beginning of the period presented. (c) Excludes one time charges and non-operating gains.
Exhibit 99.2 USA NETWORKS, INC. PRO FORMA SEGMENT RESULTS $ IN MILLIONS; ROUNDING DIFFERENCES MAY EXIST. UNAUDITED. REVENUE 1999 2000 -------- --------------------------------------------------------- YE 12/31 Q1 Q2 Q3 Q4 YE 12/31 -------- ------- ----- ----- ----- -------- OPERATING BUSINESSES Cable and studios 1,304.7 379.0 390.7 336.0 424.8 1,530.5 Electronic retailing - U.S. 1,332.9 358.5 344.0 368.8 462.1 1,533.3 Electronic retailing - Germany 166.7 65.8 57.1 62.7 74.0 259.6 Ticketing 442.7 128.0 143.0 124.9 122.7 518.6 Hotel reservations 161.8 55.3 78.1 94.6 100.0 328.0 Teleservices 215.9 69.6 70.2 70.2 72.1 282.1 Other 6.9 0.0 0.0 0.0 0.0 0.0 Intersegment Elimination ------- ------- ----- ----- ----- ------- SUB-TOTAL 3,631.7 1,056.1 1,083.1 1,057.3 1,255.6 4,452.0 German DM exchange rate fluctuation (7.9) (6.7) (8.9) (11.8) (35.3) EMERGING BUSINESSES Citysearch, Match.com and related 36.3 17.0 20.2 21.6 21.2 80.0 Styleclick 35.1 7.9 6.3 5.3 4.8 24.2 Electronic Commerce Solutions 20.2 4.7 3.8 7.2 8.7 24.3 HSN - international and other 8.9 3.8 3.6 4.4 9.4 21.3 USA Films 82.1 30.3 20.8 14.5 20.5 86.1 Trio, NWI, Crime, other emerging media 1.2 0.6 3.7 8.6 7.5 20.3 ------- ------- ----- ----- ----- ------- SUB-TOTAL 183.9 64.2 58.4 61.5 72.1 256.3 ------- ------- ----- ----- ----- ------- TOTAL 3,815.6 1,112.4 1,134.9 1,109.9 1,315.9 4,673.0 ------- ------- ----- ----- ----- ------- USA Network 757.7 196.9 208.9 200.5 201.4 807.8 SCI FI 198.5 62.4 71.3 64.6 78.4 276.7 Studios, net 348.6 119.6 110.5 71.0 144.9 446.0 ------- ------- ----- ----- ----- ------- Cable and studios 1,304.7 379.0 390.7 336.0 424.8 1,530.5 ------- ------- ----- ----- ----- ------- OPERATING BUSINESSES Entertainment 1,304.7 379.0 390.7 336.0 424.8 1,530.5 Electronic retailing 1,499.6 424.3 401.1 431.5 536.0 1,792.9 Information and services 820.5 252.9 291.3 289.7 294.8 1,128.7 Intersegment Elimination 6.9 0.0 0.0 0.0 0.0 0.0 ------- ------- ----- ----- ----- ------- SUB-TOTAL 3,631.7 1,056.1 1,083.1 1,057.3 1,255.6 4,452.0 ------- ------- ------- ------- ------- ------- REVENUE 2001 --------------------------------------------------------------------- Q1 Q2 Q3 Q4 YTD 6/30 ----- ---- ---- ----- -------- OPERATING BUSINESSES Cable and studios 437.7 444.2 881.9 Electronic retailing - U.S. 385.4 381.8 767.2 Electronic retailing - Germany 78.9 80.2 159.1 Ticketing 150.1 163.9 314.0 Hotel reservations 105.3 138.3 243.6 Teleservices 80.7 75.6 156.3 Other 0.0 0.0 0.0 Intersegment Elimination (6.5) (6.5) ------- ------- ------- ------- ------- SUB-TOTAL 1,238.0 1,277.5 2,515.5 German DM exchange rate fluctuation (13.7) (13.8) (27.5) EMERGING BUSINESSES Citysearch, Match.com and related 20.9 23.1 44.0 Styleclick 4.0 2.4 6.5 Electronic Commerce Solutions 4.7 6.0 10.7 HSN - international and other 4.5 7.5 12.0 USA Films 51.0 62.6 113.6 Trio, NWI, Crime, other emerging media 6.2 6.2 12.3 ------- ------- ------- ------- ------- SUB-TOTAL 91.4 107.7 199.1 ------- ------- ------- ------- ------- TOTAL 1,315.7 1,371.4 2,687.1 ------- ------- ------- ------- ------- USA Network 216.8 221.4 438.2 SCI FI 69.3 70.3 139.7 Studios, net 151.5 152.5 304.0 ------- ------- ------- ------- ------- Cable and studios 437.7 444.2 881.9 ------- ------- ------- ------- ------- OPERATING BUSINESSES Entertainment 437.7 444.2 881.9 Electronic retailing 464.2 462.0 926.2 Information and services 336.1 377.8 713.9 Intersegment Elimination 0.0 (6.5) (6.5) ------- ------- ------- ------- ------- SUB-TOTAL 1,238.0 1,277.5 2,515.5 ------- ------- ------- ------- ------- THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on July 25, 2001.
USA NETWORKS, INC. PRO FORMA SEGMENT RESULTS $ IN MILLIONS; ROUNDING DIFFERENCES MAY EXIST. UNAUDITED. EBITDA 1999 2000 -------- --------------------------------------------------- YE 12/31 Q1 Q2 Q3 Q4 YTD 12/31 -------- ---- ---- ---- ---- --------- OPERATING BUSINESSES Cable and studios 433.9 138.8 139.4 118.5 151.1 547.7 Electronic retailing - U.S. 214.7 49.4 52.6 53.8 74.5 230.3 Electronic retailing - Germany 16.3 8.7 4.7 5.8 9.0 28.2 Ticketing 93.3 27.4 31.6 16.7 24.4 100.0 Hotel reservations 24.2 8.2 12.9 13.9 17.6 52.6 Teleservices 30.4 9.5 11.9 11.1 11.0 43.6 Corporate and other (36.1) (9.6) (6.8) (7.1) (10.0) (33.5) --------- -------- ------- -------- ------- -------- SUB-TOTAL 776.6 232.2 246.3 212.6 277.7 968.9 German DM exchange rate fluctuation (1.0) (0.6) (0.9) (1.5) (3.9) Nonrecurring credits (charges) 6.3 (7.8) (4.1) (5.6) EMERGING BUSINESSES Citysearch, Match.com and related (60.8) (17.4) (15.3) (14.3) (11.4) (58.3) Styleclick (53.6) (10.7) (15.2) (8.7) (8.2) (42.8) Electronic Commerce Solutions (2.4) (5.6) (6.3) (8.0) (8.5) (28.4) HSN - international and other (4.5) (1.5) (2.5) (4.6) (5.0) (13.5) USA Films 6.4 2.2 (2.3) (5.8) (0.6) (6.6) Trio, NWI, Crime, other emerging media (3.0) (2.3) (2.0) (0.3) (2.5) (7.1) Intersegment Elimination --------- -------- ------- -------- ------- -------- SUB-TOTAL (117.9) (35.2) (43.5) (41.8) (36.2) (156.7) Styleclick restructuring charge --------- -------- ------- -------- ------- -------- TOTAL 658.7 202.3 194.4 169.9 236.0 802.6 --------- -------- ------- -------- ------- -------- --------- -------- ------- -------- ------- -------- USA Network 312.1 97.1 105.4 87.2 105.6 395.2 SCI FI 68.9 24.2 24.9 22.4 30.2 101.7 Studios, net 52.9 17.5 9.1 8.8 15.4 50.8 --------- -------- ------- -------- ------- -------- Cable and studios 433.9 138.8 139.4 118.5 151.1 547.7 --------- -------- ------- -------- ------- -------- OPERATING BUSINESSES Entertainment 433.9 138.8 139.4 118.5 151.1 547.7 Electronic retailing 230.9 58.1 57.3 59.6 83.5 258.5 Information and services 147.9 45.0 56.4 41.7 53.1 196.2 Corporate and other (36.1) (9.6) (6.8) (7.1) (10.0) (33.5) --------- -------- ------- -------- ------- -------- TOTAL 776.6 232.2 246.3 212.6 277.7 968.9 --------- -------- ------- -------- ------- -------- EBITDA 2001 -------------------------------------------------------------------- Q1 Q2 Q3 Q4 YTD 6/30 ---- ---- ---- ---- -------- OPERATING BUSINESSES Cable and studios 163.4 171.3 334.7 Electronic retailing - U.S. 51.7 55.2 106.9 Electronic retailing - Germany 5.6 5.9 11.5 Ticketing 30.2 35.5 65.8 Hotel reservations 15.8 21.0 36.8 Teleservices 10.0 10.2 20.2 Corporate and other (7.9) (8.2) (16.1) -------- -------- -------- -------- -------- SUB-TOTAL 268.9 290.9 559.8 German DM exchange rate fluctuation (0.9) (1.0) (1.9) Nonrecurring credits (charges) 0.0 EMERGING BUSINESSES Citysearch, Match.com and related (11.5) (8.2) (19.7) Styleclick (10.4) (5.8) (16.3) Electronic Commerce Solutions (6.5) (8.6) (15.1) HSN - international and other (6.4) (7.5) (13.9) USA Films (1.0) 0.6 (0.4) Trio, NWI, Crime, other emerging media (1.7) (2.4) (4.1) Intersegment Elimination (3.9) (3.9) -------- -------- -------- -------- -------- SUB-TOTAL (37.6) (35.8) (73.4) Styleclick restructuring charge (4.8) (4.8) -------- -------- -------- -------- -------- TOTAL 230.4 249.3 479.7 -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- USA Network 112.2 123.3 235.5 SCI FI 29.7 27.8 57.5 Studios, net 21.5 20.2 41.7 -------- -------- -------- -------- -------- Cable and studios 163.4 171.3 334.7 -------- -------- -------- -------- -------- OPERATING BUSINESSES Entertainment 163.4 171.3 334.7 Electronic retailing 57.4 61.1 118.5 Information and services 56.1 66.7 122.8 Corporate and other (7.9) (8.2) (16.1) -------- -------- -------- -------- -------- TOTAL 268.9 290.9 559.8 -------- -------- -------- -------- -------- THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on July 25, 2001.
USA NETWORKS, INC. PRO FORMA RESULTS OF OPERATIONS (AS REPORTED) $ IN MILLIONS; ROUNDING DIFFERENCES MAY EXIST. UNAUDITED. P&L 1999 2000 --------- ------------------------------------------------------------- YE 12/31* Q1* Q2 Q3 * Q4 * YE 12/31 * --------- -------- -------- -------- -------- --------- Date Reported: 02/01/01 04/25/01 07/25/01 10/26/00 02/01/01 02/01/01 Revenues, net 3,815.6 1,112.4 1,134.9 1,115.2 1,315.9 4,673.0 Operating costs and expenses: Costs related to revenues 2,301.7 665.6 676.3 673.6 801.3 2,812.4 Other costs and expenses 855.1 244.9 264.1 281.8 278.6 1,064.4 Amort. of non-cash distribution and marketing expense 0.0 1.6 1.3 2.7 7.1 11.5 Depreciation 119.2 36.5 44.6 46.3 54.0 166.1 Amortization of goodwill 374.0 108.0 110.5 108.9 135.1 467.3 ------- ------- ------- ------- ------- ------- Total operating costs 3,650.1 1,056.5 1,096.8 1,113.3 1,276.1 4,521.7 ------- ------- ------- ------- ------- ------- Operating income 165.4 55.9 38.0 1.9 39.8 151.3 Interest expense, net (50.2) (8.6) (7.9) (9.6) (10.3) (35.0) Gain on disposition of television station 0.0 0.0 0.0 0.0 0.0 0.0 Gain on sale of securities 89.7 0.0 0.0 0.0 0.0 0.0 Other, net (4.9) (0.6) (1.9) 69.9 (18.1) 49.3 ------- ------- ------- ------- ------- ------- 34.6 (9.2) (9.8) 60.3 (28.3) 14.3 ------- ------- ------- ------- ------- ------- Earnings before income taxes and minority interest 200.1 46.7 28.2 62.2 11.5 165.7 Income tax expense (83.9) (30.3) (29.6) (23.0) (26.3) (113.0) Minority interest (136.7) (40.4) (30.2) (58.6) (14.4) (128.5) ------- ------- ------- ------- ------- ------- Loss before cumulative effect of accounting change (20.5) (23.9) (31.6) (19.5) (29.2) (75.9) Cumulative effect of accounting change, net of tax 0.0 0.0 0.0 0.0 0.0 0.0 ------- ------- ------- ------- ------- ------- Net loss from continuing operations (20.5) (23.9) (31.6) (19.5) (29.2) (75.9) ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Weighted average diluted shares 352.6 361.9 363.6 367.8 368.3 366.0 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Weighted average fully converted shares 745.8 752.5 724.7 754.8 752.6 747.4 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Basic earnings per share $ (.06) $ .07 $ (.09) $ (.05) $ (.08) $ (.21) ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Diluted earnings per share $ (.06) $ .07 $ (.09) $ (.05) $ (.08) $ (.21) ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Fully converted earnings per share $ .12 $ .01 $ (.02) $ .04 $ (.00) $ .05 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- EBITDA 658.7 201.9 194.4 159.8 236.0 796.3 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Excluding one-time charges and non-operating gains: Basic and diluted earnings per share $ (.11) $ (.07) $ (.07) $ (.10) $ (.03) $ (.19) ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Cash net income earnings per share $ .11 $ .17 $ .07 $ .21 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Fully converted earnings per share $ .05 $ (.01) $ (.01) $ (.02) $ .03 $ .03 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Fully converted cash net income earnings per share $ .09 $ .11 $ .10 $ .15 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- P&L 2001 ---------------------------------------------------------------------- Q1* Q2 Q3 Q4 YE 12/31 -------- -------- ------ ------- -------- Date Reported: 04/25/01 07/25/01 Revenues, net 1,315.7 1,371.4 Operating costs and expenses: Costs related to revenues 800.2 831.7 Other costs and expenses 285.4 290.5 Amort. of non-cash distribution and marketing expense 8.0 6.6 Depreciation 48.7 57.6 Amortization of goodwill 100.2 100.8 ------- ------- ------- ------- ------- Total operating costs 1,242.5 1,287.3 ------- ------- ------- ------- ------- Operating income 73.2 84.2 Interest expense, net (11.4) (12.9) Gain on disposition of television station 0.0 0.0 Gain on sale of securities 0.0 0.0 Other, net (6.5) (13.7) ------- ------- ------- ------- ------- (17.9) (26.6) ------- ------- ------- ------- ------- Earnings before income taxes and minority interest 55.3 57.5 Income tax expense (25.5) (22.8) Minority interest (49.3) (45.0) ------- ------- ------- ------- ------- Loss before cumulative effect of accounting change (19.5) (10.3) Cumulative effect of accounting change, net of tax (9.2) 0.0 ------- ------- ------- ------- ------- Net loss from continuing operations (28.7) (10.3) ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Weighted average diluted shares 370.2 373.8 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Weighted average fully converted shares 758.0 763.4 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Basic earnings per share $ (.05) $ (.03) ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Diluted earnings per share $ (.05) $ (.03) ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Fully converted earnings per share $ .02 $ .03 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- EBITDA 230.1 249.3 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Excluding one-time charges and non-operating gains: Basic and diluted earnings per share $ (.05) $ (.02) ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Cash net income earnings per share $ .16 $ .20 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Fully converted earnings per share $ .02 $ .04 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- Fully converted cash net income earnings per share $ .12 $ .14 ------- ------- ------- ------- ------- ------- ------- ------- ------- ------- * AS REPORTED. MAY NOT AGREE WITH PROFORMA REVENUE AND EBITDA RESULTS ABOVE. THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on July 25, 2001.
USA NETWORKS, INC. OPERATING METRICS IN MILLIONS EXCEPT PERCENTAGES AND RATINGS. 1999 2000 2001 -------- ----------------------------------------------------------- --------------- YE Q1 Q2 Q3 Q4 YE Q1 Q2 -------- ----------------------------------------------------------- --------------- USA NETWORK Advertising and other revenue 57% 57% 59% 58% 57% 58% 58% 59% Affiliate revenue 43% 43% 41% 42% 43% 42% 42% 41% Average primetime rating 2.4 2.4 2.2 2.0 1.7 2.1 1.9 1.8 Households (end of period) 77.2 77.4 78.2 79.4 79.9 79.9 81.3 81.9 1999 2000 2001 -------- ----------------------------------------------------------- --------------- YE Q1 Q2 Q3 Q4 YE Q1 Q2 -------- ----------------------------------------------------------- --------------- SCI FI CHANNEL Advertising and other revenue 60% 65% 66% 63% 67% 65% 63% 66% Affiliate revenue 40% 35% 34% 37% 33% 35% 37% 34% Average primetime rating 0.8 0.9 0.8 0.9 0.9 0.9 0.8 0.8 Households (end of period) 59.7 60.5 62.7 65.1 66.7 66.7 69.4 70.9 2000 2001 ------------------------------------------------------------- ------------------- Q1 Q2 Q3 Q4 YE Q1 Q2 ------------------------------------------------------------- ------------------- TRIO Households (end of period) 6.9 7.3 7.3 8.8 11.3 NWI Households (end of period) 6.5 6.7 6.7 8.0 10.3 USA NETWORK AND SCI FI RATINGS AND HOUSEHOLD DELIVERY DATA ARE SOURCED FROM NMR GALAXY EXPLORER. SUBSCRIBER COUNTS ARE BASED ON NIELSEN PEOPLE METER INSTALLED SAMPLES. THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on July 25, 2001.
USA NETWORKS, INC. OPERATING METRICS IN MILLIONS EXCEPT PERCENTAGES. 1999 2000 2001 ------ -------------------------------------------------------- ---------------- YE Q1 Q2 Q3 Q4 YE Q1 Q2 ------ -------------------------------------------------------- ---------------- HSN - DOMESTIC U.S. units shipped 32.1 8.4 8.1 8.6 10.0 35.1 8.6 9.1 On air gross profit % 34.3% 33.6% 34.7% 34.7% 32.7% 33.8% 32.3% 33.3% On air return rate 20.3% 20.9% 19.6% 20.2% 19.2% 19.9% 20.0% 20.0% On air product mix: Homegoods 49% 50% 46% 49% 55% 51% 49% 48% Jewelry 27% 25% 28% 27% 25% 26% 26% 27% Heath / Beauty 11% 11% 13% 9% 8% 10% 10% 12% Apparel / Accessories 13% 14% 13% 15% 12% 13% 15% 13% HSN cable / DBS HH (end of period) 60.6 62.0 63.2 64.6 65.6 65.6 68.1 69.2 HSN total HH (end of period) 73.7 75.2 76.4 75.9 76.8 76.8 79.9 80.8 America's Store FTE's (end of period) 8.3 8.8 8.8 9.0 8.6 8.6 8.3 10.6 THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on July 25, 2001.
USA NETWORKS, INC. OPERATING METRICS IN MILLIONS EXCEPT REVENUE PER TICKET AND PERCENTAGES. 1999 2000 2001 ---------- ----------------------------------------------------- ------------------ YE Q1 Q2 Q3 Q4 YE Q1 Q2 ---------- ----------------------------------------------------- ------------------ TICKETMASTER Number of tickets sold (mm) 75.0 21.8 22.3 20.2 18.7 83.0 23.6 23.5 Gross value of tickets sold (mm) $2,781 $812 $881 $782 $781 $3,256 $937 $1,016 Share of tickets sold online 13.4% 19.6% 25.5% 25.6% 27.9% 24.5% 29.5% 33.2% Revenue per ticket $5.25 $5.44 $5.89 $5.67 $5.87 $ 5.71 $5.96 $6.29 THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on July 25, 2001.
USA NETWORKS, INC. OPERATING METRICS 1999 2000 2001 ----------- ------------------------------------------------ ------------------ YE Q1 Q2 Q3 Q4 YE Q1 Q2 ----------- ------------------------------------------------ ------------------ HOTEL RESERVATIONS NETWORK Hotel room nights sold (thousands) 1,229 429 587 717 700 2,433 799 1,030 Affiliates (including TravelNow) 6,000 10,500 18,649 20,857 Properties 1,500 1,750 1,925 2,150 2,700 2,700 3,084 3,374 Cities served 40 49 60 83 97 97 135 146 THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on July 25, 2001.
USA NETWORKS, INC. OPERATING METRICS IN MILLIONS CAPITALIZATION (AS OF 7/20/01) Ticker (NASDAQ) USAI USAi Common Stock 312.6 USAi Class B 63.0 USAi Exchangeable Common Stock 213.0 USAi Exchangeable Class B 148.2 --------------- Total Shares Outstanding 736.8 Estimated dilutive options (treasury method)* 47.0 --------------- Fully diluted shares 783.8 =============== Outstanding equity cap $19.9 billion Fully diluted equity cap $21.1 billion * Does not include assumed tax savings. - ---------------------------------------------------------------------------------- BUSINESS MIX Revenue sources (Q2 '01): Merchandise 33% Ticketing 12% Hotel rooms 10% Teleservices / ECS 6% Personals 1% --------------- Commerce 62% =============== Advertising 14% Production and distribution 15% Affiliate fees and subscriptions 9% --------------- Media 38% =============== Online (% of total) 18% International (% of total) 12% THE FINANCIAL, STATISTICAL AND OTHER INFORMATION CONTAINED HEREIN IS UNAUDITED. As filed with the Securities and Exchange Commission on July 25, 2001.