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):
June 11, 1999
TV GUIDE, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-22662 73-129412
(State or Other (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
7140 South Lewis Avenue, Tulsa, Oklahoma 74136-5422
(Address of Principal Executive Office) (Zip code)
(918) 488-4000
(Registrant's telephone number, including area code)
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<PAGE>
ITEM5. OTHER EVENTS
In a Current Report on Form 8-K filed February 24, 1999, TV Guide presented
its unaudited pro forma combined statement of operations for the year ended
December 31, 1998, reflecting certain acquisitions and other transactions. The
following is TV Guide's unaudited pro forma combined statement of operations for
the quarter ended March 31, 1999.
TV Guide, Inc.
Unaudited Pro Forma Combined Statement of Operations
For the Quarter Ended March 31, 1999
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
TV Guide Publications Pro Forma TV Guide Unrestricted Restricted
Historical Historical Adjustments Pro Forma Eliminations Group Group
---------- ------------ ----------- ---------- ------------ ------------ ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues......... $201,842 $ 118,857 $ -- $320,699 $6,561 $116,062 $211,198
Operating
expenses:
Programming and
delivery....... 103,104 77,651 -- 180,755 6,561 73,735 113,581
Selling, general
and
administrative.. 51,657 13,261 -- 64,918 -- . 24,135 40,783
Depreciation and
amortization... 15,078 17,777 (2,509)(1) 30,346 -- 4,041 26,305
-------- --------- -------- ---------- ------- ------------ ----------
169,839 108,689 (2,509) 276,019 6,561 101,911 180,669
-------- --------- -------- ---------- ------- ------------ ----------
Operating
income.......... 32,003 10,168 2,509 44,680 -- 14,151 30,529
Interest
expense......... (6,035) (2,197) (8,356)(2) (14,391) -- -- (14,391)
2,197 (3)
Other income..... 307 -- -- 307 -- 169 138
-------- --------- -------- ---------- ------- ------------ ----------
Income
before income
taxes and
minority
interest........ 26,275 7,971 (3,650) 30,596 -- 14,320 16,276
(Provision)
benefit for
income taxes.... (9,778) 4,613 (6,905)(4) (12,070) -- (5,803) (6,267)
Minority interest
in earnings (3,736) -- -- (3,736) -- (3,936) 200
-------- --------- -------- ---------- ------- ------------ ----------
Net income
(loss).......... $ 12,761 $ 12,584 $(10,555) $ 14,790 $ -- $ 4,581 $ 10,209
======== ========= ======== ========== ======= ============ ==========
Earnings per
share:
Basic........... $ 0.12 $ 0.10
Diluted......... $ 0.12 $ 0.10
Number of shares:
Basic........... 107,605 151,961
Diluted......... 109,050 153,406
</TABLE>
See accompanying notes to unaudited pro forma combined financial statements.
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<PAGE>
Notes to Unaudited Pro Forma Combined Financial Statements
Basis of Presentation
On March 1, 1999, the Company acquired all of the outstanding stock of News
America Publications Inc. ("Publications") and TVSM, Inc. ("TVSM") which own and
publish TV Guide Magazine, publish cable-based television listing guides,
operate the web site now known as TV Guide Online and hold certain other assets,
in exchange for 22,503,412 shares of the Company's Class A common stock,
37,496,588 shares of the Company's Class B common stock and $800 million in cash
(the "TV Guide Acquisition"). The TV Guide Acquisition was accounted for as a
purchase.
The pro forma combined financial statement has been derived from the
historical financial statements of TV Guide, Inc. and the historical combined
financial information of Publications and are qualified in their entirety by
reference to, and should be read in conjunction with, such historical financial
statements and related notes thereto. The pro forma information has been
compiled as if the TV Guide Acquisition occurred on January 1, 1999 for income
statement purposes.
The pro forma combined financial statement may not be indicative of the
results that actually would have occurred if the TV Guide Acquisition had
occurred on the date indicated or which may be obtained in the future.
The pro forma adjustments are based on available financial information and
certain estimates and assumptions, therefore the actual adjustments could differ
from the pro forma adjustments. The Company has not yet completed its analysis
of the allocation of the purchase price in the TV Guide Acquisition among
identifiable intangible assets and goodwill. In the pro forma financial
information presented, the Company has allocated amounts to identifiable
intangible assets as follows:
Intangible Asset Life (in thousands)
---------------- -------- --------------
Publishing rights, trademarks and goodwill...... 40 years $2,813,584
Acquired subscriber accounts.................... 1-15 years 222,000
----------
$3,035,584
==========
Publishing rights include the rights associated with publishing TV Guide
Magazine, including the use of the TV Guide trademark. Acquired subscriber
accounts include the value attributable to the customer list of subscribers to
TV Guide Magazine.
The Company is in the process of obtaining an independent evaluation of the
assets acquired and the results of the final evaluation could differ
significantly from the amounts used in the pro forma combined financial
statements. Accordingly, the allocation of the purchase price and the lives of
the intangible assets, which are based on preliminary information, may differ
from the final purchase price allocation and the final lives assigned to the
assets.
The pro forma adjustments necessary to present the results of operations of
the Company are as follows:
(1) To adjust amortization of the intangible assets associated with the TV Guide
Acquisition. The Company currently expects to amortize these assets over
lives ranging from 1 to 40 years on a straight-line basis.
(2) To reflect interest, at the rate of 8.125% and 6.65% per annum, based on
current interest rates, on the senior subordinated notes and the debt
incurred under the bank credit facility, respectively, to fund the TV Guide
Acquisition and amortization of related costs.
(3) To eliminate intercompany interest expense.
(4) To reflect income taxes resulting from the above pro forma adjustments.
Earnings per Share
The following information reconciles the number of shares used to compute
historical basic and diluted earnings per share to pro forma basic and diluted
earnings per share (in thousands):
Basic Diluted
------- -------
Weighted average number of shares
of common stock and dilutive
potential shares of common
stock--historical............... 107,605 109,050
Additional common share
equivalents issued in
connection with the TV Guide
Acquisition, assuming a
January 1, 1999 transaction
date............................ 44,356 44,356
------- -------
Weighted average number of
shares of common stock and
dilutive potential shares
of common stock--pro forma--
TV Guide Acquisition............ 151,961 153,406
======= =======
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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.
TV Guide, Inc.
DATE: June 11, 1999 By: /s/ Peter C. Boylan III
------------------------------
Peter C. Boylan III
Executive Vice President;
Chairman and Chief Executive Officer -
TV Guide Entertainment Group and United
Video Group
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