FORM 10-Q
WASHINGTON, D.C. 20549
(Mark One)
| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 30, 2004
or
| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission file number 1-13079
GAYLORD ENTERTAINMENT COMPANY
| Delaware | 73-0664379 | |
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
One Gaylord Drive
Nashville, Tennessee 37214
(Address of principal executive offices)
(Zip Code)
(615) 316-6000
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes x No o
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
| Class | Outstanding as of October 31, 2004 | |
| Common Stock, $.01 par value | 39,774,380 shares |
GAYLORD ENTERTAINMENT COMPANY
FORM 10-Q
For the Quarter Ended September 30, 2004
INDEX
2
Part I - Financial Information
Item 1. - Financial Statements
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| 2004 |
2003 |
|||||||
Revenues |
$ | 195,924 | $ | 98,101 | ||||
Operating expenses: |
||||||||
Operating costs |
130,458 | 63,527 | ||||||
Selling, general and administrative |
43,679 | 24,621 | ||||||
Preopening costs |
223 | 3,283 | ||||||
Impairment and other charges |
— | 856 | ||||||
Depreciation |
16,004 | 13,235 | ||||||
Amortization |
4,307 | 1,332 | ||||||
Operating income (loss) |
1,253 | (8,753 | ) | |||||
Interest expense, net of amounts capitalized |
(14,850 | ) | (10,476 | ) | ||||
Interest income |
371 | 742 | ||||||
Unrealized
gain (loss) on Viacom stock |
(23,766 | ) | (58,976 | ) | ||||
Unrealized
gain (loss) on derivatives |
26,317 | 32,976 | ||||||
Income (loss) from unconsolidated companies |
1,587 | 1,491 | ||||||
Other gains and (losses), net |
753 | 1,008 | ||||||
Income (loss) before provision (benefit) for income taxes and
discontinued operations |
(8,335 | ) | (41,988 | ) | ||||
Provision (benefit) for income taxes |
(4,524 | ) | (18,490 | ) | ||||
Income (loss) from continuing operations |
(3,811 | ) | (23,498 | ) | ||||
Income from discontinued operations, net of taxes |
619 | 35,150 | ||||||
Net income (loss) |
$ | (3,192 | ) | $ | 11,652 | |||
Income (loss) per share: |
||||||||
Income (loss) from continuing operations |
$ | (0.10 | ) | $ | (0.69 | ) | ||
Income from discontinued operations, net of taxes |
0.02 | 1.03 | ||||||
Net income (loss) |
$ | (0.08 | ) | $ | 0.34 | |||
Income (loss) per share - assuming dilution: |
||||||||
Income (loss) from continuing operations |
$ | (0.10 | ) | $ | (0.69 | ) | ||
Income from discontinued operations, net of taxes |
0.02 | 1.03 | ||||||
Net income (loss) |
$ | (0.08 | ) | $ | 0.34 | |||
The accompanying notes are an integral part of these condensed consolidated financial statements.
3
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| 2004 |
2003 |
|||||||
Revenues |
$ | 556,878 | $ | 317,951 | ||||
Operating expenses: |
||||||||
Operating costs |
354,847 | 191,933 | ||||||
Selling, general and administrative |
139,139 | 79,941 | ||||||
Preopening costs |
14,239 | 7,111 | ||||||
Impairment and other charges |
1,212 | 856 | ||||||
Restructuring charges |
78 | — | ||||||
Depreciation |
51,258 | 39,661 | ||||||
Amortization |
6,523 | 3,783 | ||||||
Operating
income (loss) |
(10,418 | ) | (5,334 | ) | ||||
Interest expense, net of amounts capitalized |
(39,011 | ) | (31,139 | ) | ||||
Interest income |
1,031 | 1,773 | ||||||
Unrealized
gain (loss) on Viacom stock |
(119,052 | ) | (27,067 | ) | ||||
Unrealized
gain (loss) on derivatives |
84,314 | 24,016 | ||||||
Income (loss) from unconsolidated companies |
3,383 | 1,806 | ||||||
Other gains and (losses), net |
2,390 | 1,291 | ||||||
Income (loss) before provision (benefit) for income taxes and
discontinued operations |
(77,363 | ) | (34,654 | ) | ||||
Provision (benefit) for income taxes |
(32,006 | ) | (15,269 | ) | ||||
Income (loss) from continuing operations |
(45,357 | ) | (19,385 | ) | ||||
Income from discontinued operations, net of taxes |
619 | 36,126 | ||||||
Net income (loss) |
$ | (44,738 | ) | $ | 16,741 | |||
Income (loss) per share: |
||||||||
Income (loss) from continuing operations |
$ | (1.15 | ) | $ | (0.57 | ) | ||
Income from discontinued operations, net of taxes |
0.02 | 1.07 | ||||||
Net income (loss) |
$ | (1.13 | ) | $ | 0.50 | |||
Income (loss) per share - assuming dilution: |
||||||||
Income (loss) from continuing operations |
$ | (1.15 | ) | $ | (0.57 | ) | ||
Income from discontinued operations, net of taxes |
0.02 | 1.07 | ||||||
Net income (loss) |
$ | (1.13 | ) | $ | 0.50 | |||
The accompanying notes are an integral part of these condensed consolidated financial statements.
4
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
| September 30, | December 31, | |||||||
| 2004 |
2003 |
|||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents - unrestricted |
$ | 36,026 | $ | 120,965 | ||||
Cash and cash equivalents - restricted |
37,048 | 37,723 | ||||||
Trade receivables, less allowance of $2,092 and $1,805, respectively |
36,093 | 26,101 | ||||||
Deferred financing costs |
26,865 | 26,865 | ||||||
Deferred income taxes |
11,584 | 8,753 | ||||||
Other current assets |
29,092 | 20,121 | ||||||
Current assets of discontinued operations |
— | 19 | ||||||
Total current assets |
176,708 | 240,547 | ||||||
Property and equipment, net of accumulated depreciation |
1,342,059 | 1,297,528 | ||||||
Intangible assets, net of accumulated amortization |
26,504 | 29,505 | ||||||
Goodwill |
168,227 | 169,642 | ||||||
Indefinite lived intangible assets |
40,591 | 40,591 | ||||||
Investments |
436,989 | 552,658 | ||||||
Estimated fair value of derivative assets |
214,328 | 146,278 | ||||||
Long-term deferred financing costs |
54,013 | 75,154 | ||||||
Other long term assets |
28,323 | 29,107 | ||||||
Total assets |
$ | 2,487,742 | $ | 2,581,010 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
||||||||
Current liabilities: |
||||||||
Current portion of long-term debt and capital lease obligations |
$ | 8,394 | $ | 8,584 | ||||
Accounts payable and accrued liabilities |
150,457 | 154,952 | ||||||
Current liabilities of discontinued operations |
1,687 | 2,930 | ||||||
Total current liabilities |
160,538 | 166,466 | ||||||
Secured forward exchange contract |
613,054 | 613,054 | ||||||
Long-term debt and capital lease obligations, net of current portion |
537,273 | 540,175 | ||||||
Deferred income taxes |
217,266 | 252,502 | ||||||
Estimated fair value of derivative liabilities |
2,625 | 21,969 | ||||||
Other long term liabilities |
82,613 | 79,226 | ||||||
Long-term liabilities of discontinued operations |
— | 825 | ||||||
Stockholders’ equity: |
||||||||
Preferred stock, $.01 par value, 100,000 shares authorized, no shares
issued or outstanding |
— | — | ||||||
Common stock, $.01 par value, 150,000 shares authorized,
39,767 and 39,403 shares issued and outstanding, respectively |
398 | 394 | ||||||
Additional paid-in capital |
651,259 | 639,839 | ||||||
Retained earnings |
241,170 | 285,908 | ||||||
Unearned compensation |
(1,834 | ) | (2,704 | ) | ||||
Accumulated other comprehensive loss |
(16,620 | ) | (16,644 | ) | ||||
Total stockholders’ equity |
874,373 | 906,793 | ||||||
Total liabilities and stockholders’ equity |
$ | 2,487,742 | $ | 2,581,010 | ||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
5
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
| 2004 |
2003 |
|||||||
Cash Flows from Operating Activities: |
||||||||
Net income (loss) |
$ | (44,738 | ) | $ | 16,741 | |||
Amounts to reconcile net income (loss) to net cash flows provided by
operating activities: |
||||||||
Loss (income) from discontinued operations, net of taxes |
(619 | ) | (36,126 | ) | ||||
Loss (income) from unconsolidated companies |
(3,383 | ) | (1,806 | ) | ||||
Unrealized
loss (gain) on Viacom stock and related derivatives |
34,738 | 3,051 | ||||||
Impairment and other charges |
1,212 | 856 | ||||||
Depreciation and amortization |
57,781 | 43,444 | ||||||
Provision
(benefit) for deferred income taxes |
(32,727 | ) | (20,416 | ) | ||||
Amortization of deferred financing costs |
22,121 | 28,154 | ||||||
Changes in (net of acquisitions and divestitures): |
||||||||
Trade receivables |
(9,992 | ) | 1,103 | |||||
Income tax refund received |
— | 1,450 | ||||||
Accounts payable and accrued liabilities |
5,281 | 4,693 | ||||||
Other assets and liabilities |
(4,625 | ) | 3,307 | |||||
Net cash
flows provided by (used in) operating activities - continuing operations |
25,049 | 44,451 | ||||||
Net cash flows provided by (used in) operating activities - discontinued operations |
(209 | ) | 2,524 | |||||
Net cash flows provided by (used in) operating activities |
24,840 | 46,975 | ||||||
Cash Flows from Investing Activities: |
||||||||
Purchases of property and equipment |
(107,498 | ) | (167,428 | ) | ||||
Other investing activities |
(2,688 | ) | (2,578 | ) | ||||
Net cash
flows provided by (used in) investing activities - continuing operations |
(110,186 | ) | (170,006 | ) | ||||
Net cash flows provided by (used in) investing activities - discontinued operations |
— | 59,485 | ||||||
Net cash
flows provided by (used in) investing activities |
(110,186 | ) | (110,521 | ) | ||||
Cash Flows from Financing Activities: |
||||||||
Repayment of long-term debt |
(6,003 | ) | (72,003 | ) | ||||
Proceeds from issuance of long-term debt |
— | 200,000 | ||||||
Deferred financing costs paid |
(909 | ) | (7,793 | ) | ||||
Decrease (increase) in restricted cash and cash equivalents |
675 | (131,220 | ) | |||||
Proceeds from exercise of stock option and purchase plans |
7,169 | 1,287 | ||||||
Other financing activities, net |
(525 | ) | (491 | ) | ||||
Net cash flows provided by (used in) financing activities - continuing operations |
407 | (10,220 | ) | |||||
Net cash
flows provided by (used in) financing activities - discontinued operations |
— | (94 | ) | |||||
Net cash flows provided by (used in) financing activities |
407 | (10,314 | ) | |||||
Net change in cash and cash equivalents |
(84,939 | ) | (73,860 | ) | ||||
Cash and cash equivalents - unrestricted, beginning of period |
120,965 | 98,632 | ||||||
Cash and cash equivalents - unrestricted, end of period |
$ | 36,026 | $ | 24,772 | ||||
The accompanying notes are an integral part of these condensed consolidated financial statements.
6
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION:
The condensed consolidated financial statements include the accounts of Gaylord Entertainment Company and subsidiaries (the “Company”) and have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the financial information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2003, filed with the Securities and Exchange Commission. In the opinion of management, all adjustments necessary for a fair statement of the results of operations for the interim period have been included. All adjustments are of a normal, recurring nature. The results of operations for such interim periods are not necessarily indicative of the results for the full year.
As more fully discussed in Note 4, the Company changed its method of accounting for its investment in Bass Pro Shops, L.P. (“Bass Pro”) from the cost method of accounting to the equity method of accounting in the third quarter of 2004. The equity method of accounting has been applied retroactively to all periods presented, and the Company has restated the condensed consolidated balance sheet as of December 31, 2003, the condensed consolidated statements of operations for the three months and nine months ended September 30, 2003, and the condensed consolidated statement of cash flows for the nine months ended September 30, 2003. This change in accounting principle resulted in an increase of $0.9 million in retained earnings as of January 1, 2003 and increased net income for the three months and nine months ended September 30, 2003 by $0.9 million and $1.1 million, respectively. This change in accounting principle had no impact on cash flows provided by operating activities – continuing operations for the nine months ended September 30, 2003.
2. INCOME (LOSS) PER SHARE:
The weighted average number of common shares outstanding is calculated as follows:
| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
| (in thousands) |
2004 |
2003 |
2004 |
2003 |
||||||||||||
Weighted average shares outstanding |
39,726 | 33,849 | 39,594 | 33,818 | ||||||||||||
Effect of dilutive stock options |
— | — | — | — | ||||||||||||
Weighted average shares outstanding -
assuming dilution |
39,726 | 33,849 | 39,594 | 33,818 | ||||||||||||
For the three months and nine months ended September 30, 2004, the effect of dilutive stock options was the equivalent of approximately 446,000 and 475,000 shares of common stock outstanding, respectively. For the three months and nine months ended September 30, 2003, the effect of dilutive stock options was the equivalent of approximately 36,000 and 22,000 shares of common stock outstanding, respectively. Because the Company had a loss from continuing operations in the three and nine months ended September 30, 2004 and 2003, these incremental shares were excluded from the computation of diluted earnings per share for those periods as the effect of their inclusion would have been anti-dilutive.
7
3. COMPREHENSIVE INCOME (LOSS):
Comprehensive income (loss) is as follows for the three and nine months of the respective periods:
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, |
September 30, |
|||||||||||||||
| (in thousands) |
2004 |
2003 |
2004 |
2003 |
||||||||||||
Net income (loss) |
$ | (3,192 | ) | $ | 11,652 | $ | (44,738 | ) | $ | 16,741 | ||||||
Unrealized gain (loss) on interest rate hedges |
(19 | ) | 77 | (73 | ) | 227 | ||||||||||
Foreign currency translation |
11 | — | 97 | — | ||||||||||||
Comprehensive income (loss) |
$ | (3,200 | ) | $ | 11,729 | $ | (44,714 | ) | $ | 16,968 | ||||||
4. INVESTMENTS
From January 1, 2000 to July 8, 2004, the Company accounted for its investment in Bass Pro under the cost method of accounting. On July 8, 2004, Bass Pro redeemed the approximate 28.5% interest held in Bass Pro by private equity investor, J.W. Childs Associates. As a result, the Company’s ownership interest in Bass Pro increased to 26.6% as of the redemption date. Because the Company’s ownership interest in Bass Pro increased to a level exceeding 20%, the Company was required by Accounting Principles Board Opinion No. 18, “The Equity Method of Accounting for Investments in Common Stock”, to begin accounting for its investment in Bass Pro under the equity method of accounting beginning in the third quarter of 2004. The equity method of accounting has been applied retroactively to all periods presented.
This change in accounting principle resulted in an increase of $858,000 in retained earnings as of January 1, 2003 and increased net income and net income per share for the three months and nine months ended September 30, 2004 and 2003 as follows:
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, |
September 30, |
|||||||||||||||
| (in thousands) |
2004 |
2003 |
2004 |
2003 |
||||||||||||
Net income |
$ | 1,246 | $ | 909 | $ | 2,389 | $ | 1,101 | ||||||||
Net income per share - fully diluted |
$ | 0.03 | $ | 0.03 | $ | 0.06 | $ | 0.03 | ||||||||
As of September 30, 2004, the recorded value of the Company’s investment in Bass Pro is $62.5 million greater than its equity in Bass Pro’s underlying net assets. This difference is being accounted for as equity method goodwill.
5. DISCONTINUED OPERATIONS:
The Company has reflected the following businesses as discontinued operations, consistent with the provisions of Statement of Financial Accounting Standards (“SFAS”) No. 144 and Accounting Principles Board (“APB”) No. 30. The results of operations, net of taxes, (prior to their disposal, where applicable) and the carrying value of the assets and liabilities of these businesses have been reflected in the accompanying condensed consolidated financial statements as discontinued operations in accordance with SFAS No. 144 for all periods presented.
8
WSM-FM and WWTN(FM)
During the first quarter of 2003, the Company committed to a plan of disposal of WSM-FM and WWTN(FM) (the “Radio Operations”). Subsequent to committing to a plan of disposal during the first quarter of 2003, the Company, through a wholly-owned subsidiary, entered into an agreement to sell the assets primarily used in the operations of WSM-FM and WWTN(FM) to Cumulus Broadcasting, Inc. (“Cumulus”) in exchange for approximately $62.5 million in cash. In connection with this agreement, the Company also entered into a local marketing agreement with Cumulus pursuant to which, from April 21, 2003 until the closing of the sale of the assets, the Company, for a fee, made available to Cumulus substantially all of the broadcast time on WSM-FM and WWTN(FM). In turn, Cumulus provided programming to be broadcast during such broadcast time and collected revenues from the advertising that it sold for broadcast during this programming time. On July 22, 2003, the Company finalized the sale of WSM-FM and WWTN(FM) for approximately $62.5 million. Concurrently, the Company also entered into a joint sales agreement with Cumulus for WSM-AM in exchange for $2.5 million in cash. The Company continues to own and operate WSM-AM, and under the terms of the joint sales agreement with Cumulus, Cumulus is responsible for all sales of commercial advertising on WSM-AM and provides certain sales promotion, billing and collection services relating to WSM-AM, all for a specified commission. The joint sales agreement has a term of five years.
Oklahoma RedHawks
During 2002, the Company committed to a plan of disposal of its approximately 78% ownership interest in the Oklahoma RedHawks, a minor league baseball team based in Oklahoma City, Oklahoma. During the fourth quarter of 2003, the Company sold its interests in the RedHawks and received cash proceeds of approximately $6.0 million.
Acuff-Rose Music Publishing
During the second quarter of 2002, the Company committed to a plan of disposal of its Acuff-Rose Music Publishing catalog entity. During the third quarter of 2002, the Company finalized the sale of the Acuff-Rose Music Publishing entity to Sony / ATV Music Publishing for approximately $157.0 million in cash. During the third quarter of 2004, due to the expiration of certain indemnification periods as specified in the sales contract, a previously established indemnification reserve of $1.0 million was reversed and is included in the condensed consolidated statement of operations.
Word Entertainment
During 2001, the Company committed to a plan to sell Word Entertainment. As a result of the decision to sell Word Entertainment, the Company reduced the carrying value of Word Entertainment to its estimated fair value by recognizing a pretax charge of $30.4 million in discontinued operations during 2001. Related to the decision to sell Word Entertainment, a pretax restructuring charge of $1.5 million was recorded in discontinued operations in 2001. The restructuring charge consisted of $0.9 million related to lease termination costs and $0.6 million related to severance costs. In addition, the Company recorded a reversal of $0.1 million of restructuring charges originally recorded during 2000. During the first quarter of 2002, the Company sold Word Entertainment’s domestic operations to an affiliate of Warner Music Group for $84.1 million in cash. The Company recognized a pretax gain of $0.5 million in discontinued operations during the first quarter of 2002 related to the sale of Word Entertainment. During the third quarter of 2003, due to the expiration of certain indemnification periods as specified in the sales contract, a previously established indemnification reserve of $1.5 million was reversed and is included in the condensed consolidated statement of operations.
Businesses Sold to Oklahoma Publishing Company
During 2001, the Company sold five businesses (Pandora Films, Gaylord Films, Gaylord Sports Management, Gaylord Event Television and Gaylord Production Company) to affiliates of the Oklahoma Publishing Company (“OPUBCO”) for $22.0 million in cash and the assumption of debt of $19.3 million. OPUBCO owns a minority interest in the Company.
9
Until their resignation from the board of directors in April 2004, two of the Company’s directors were also directors of OPUBCO and voting trustees of a voting trust that controls OPUBCO. Additionally, these two directors collectively beneficially owned a significant ownership interest in the Company prior to their sale of a substantial portion of this interest in April 2004.
International Cable Networks
During the second quarter of 2001, the Company adopted a formal plan to dispose of its international cable networks. As part of this plan, the Company hired investment bankers to facilitate the disposition process, and formal communications with potentially interested parties began in July 2001. In an attempt to simplify the disposition process, in July 2001, the Company acquired an additional 25% ownership interest in its music networks in Argentina, increasing its ownership interest from 50% to 75%. In August 2001, the partnerships in Argentina finalized a pending transaction in which a third party acquired a 10% ownership interest in the companies in exchange for satellite, distribution and sales services, bringing the Company’s interest to 67.5%.
In December 2001, the Company made the decision to cease funding of its cable networks in Asia and Brazil as well as its partnerships in Argentina if a sale had not been completed by February 28, 2002. At that time the Company recorded pretax restructuring charges of $1.9 million consisting of $1.0 million of severance and $0.9 million of contract termination costs related to the networks. Also during 2001, the Company negotiated reductions in the contract termination costs with several vendors that resulted in a reversal of $0.3 million of restructuring charges originally recorded during 2000. Based on the status of the Company’s efforts to sell its international cable networks at the end of 2001, the Company recorded pretax impairment and other charges of $23.3 million during 2001. Included in this charge are the impairment of an investment in the two Argentina-based music channels totaling $10.9 million, the impairment of fixed assets, including capital leases associated with certain transponders leased by the Company, of $6.9 million, the impairment of a receivable of $3.0 million from the Argentina-based channels, current assets of $1.5 million, and intangible assets of $1.0 million.
During the first quarter of 2002, the Company finalized a transaction to sell certain assets of its Asia and Brazil networks, including the assignment of certain transponder leases. Also during the first quarter of 2002, the Company ceased operations based in Argentina. The transponder lease assignment required the Company to guarantee lease payments in 2002 from the acquirer of these networks. As such, the Company recorded a lease liability for the amount of the assignee’s portion of the transponder lease.
10
The following table reflects the results of operations of businesses accounted for as discontinued operations for the three months and nine months ended September 30, 2004 and 2003:
| Three Months Ended | Nine Months Ended | |||||||||||||||
| September 30, |
September 30, |
|||||||||||||||
| (in thousands) |
2004 |
2003 |
2004 |
2003 |
||||||||||||
Revenues: |
||||||||||||||||
Radio Operations |
$ | — | $ | 360 | $ | — | $ | 3,703 | ||||||||
RedHawks |
— | 2,137 | — | 5,000 | ||||||||||||
Total revenues |
$ | — | $ | 2,497 | $ | — | $ | 8,703 | ||||||||
Operating
income (loss): |
||||||||||||||||
Radio Operations |
$ | — | $ | 89 | $ | — | $ | 613 | ||||||||
RedHawks |
— | 497 | — | 529 | ||||||||||||
Total operating income (loss) |
— | 586 | — | 1,142 | ||||||||||||
Interest expense |
— | (1 | ) | — | (1 | ) | ||||||||||
Interest income |
— | 2 | — | 7 | ||||||||||||
Other gains and (losses): |
||||||||||||||||
Radio Operations |
— | 54,555 | — | 54,555 | ||||||||||||
RedHawks |
— | (120 | ) | — | (134 | ) | ||||||||||
Acuff-Rose Music Publishing |
1,015 | 450 | 1,015 | 450 | ||||||||||||
Word Entertainment |
— | 1,503 | — | 1,503 | ||||||||||||
Businesses sold to OPUBCO |
— | — | — | 368 | ||||||||||||
International cable networks |
— | 497 | — | 497 | ||||||||||||
Total other gains and (losses) |
1,015 | 56,885 | 1,015 | 57,239 | ||||||||||||
Income before provision (benefit) for income taxes |
1,015 | 57,472 | 1,015 | 58,387 | ||||||||||||
Provision (benefit) for income taxes |
396 | 22,322 | 396 | 22,261 | ||||||||||||
Income (loss) from discontinued operations |
$ | 619 | $ | 35,150 | $ | 619 | $ | 36,126 | ||||||||
Included in other gains and (losses) during the three months and nine months ended September 30, 2003 is a gain of $54.6 million related to the sale of the Radio Operations. The remaining other gains and (losses) in 2004 and 2003 are primarily comprised of the reversal of certain previously established indemnification reserves and miscellaneous income and expenses.
11
The assets and liabilities of the discontinued operations presented in the accompanying condensed consolidated balance sheets are comprised of:
| September 30, | December 31, | |||||||
| (in thousands) |
2004 |
2003 |
||||||
Current assets: |
||||||||
Cash a | ||||||||