UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(Mark One)
ý 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
For the transition period from to .
Commission File Number: 000-30700
Crown Media Holdings, Inc.
(Exact Name of Registrant as Specified in Its Charter)
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Delaware |
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84-1524410 |
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(State or Other Jurisdiction of |
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(I.R.S. Employer Identification No.) |
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Incorporation or Organization) |
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6430 S. Fiddlers Green Circle, |
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Suite 225, |
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Greenwood Village, Colorado 80111 |
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(Address of Principal Executive Offices and Zip Code) |
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(303) 220-7990 |
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(Registrant’s Telephone Number, Including Area Code) |
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(Former Name, Former Address, and Former Fiscal Year, |
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if Changed Since Last Report.) |
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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 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 ý No o
Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes ý No o
As of November 12, 2004, the number of shares of Class A Common Stock, $.01 par value outstanding was 73,863,037, and the number of shares of Class B Common Stock, $.01 par value, outstanding was 30,670,422.
TABLE OF CONTENTS
3
In this Form 10-Q the terms “Crown Media Holdings” or the “Company,” refer to Crown Media Holdings, Inc. and, unless the context requires otherwise, subsidiaries of Crown Media Holdings that operate or have operated our businesses, Crown Media International, LLC (“Crown Media International”), Crown Media United States, LLC (“Crown Media United States”), Crown Media Distribution, LLC (“Crown Media Distribution”), Crown Entertainment Limited (“Crown Entertainment”), and Crown Media Trust (“Crown Media Trust”). The term “common stock” refers to our Class A common stock and Class B common stock, unless the context requires otherwise.
The names Hallmark, Hallmark Entertainment and other product or service names are trademarks or registered trademarks of their owners.
Item 1. Financial Statements (Unaudited)
CROWN MEDIA HOLDINGS, INC. AND SUBSIDIARIES
(In thousands, except share and per share amounts)
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As of |
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As of |
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(Unaudited) |
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ASSETS |
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Cash and cash equivalents |
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$ |
4,306 |
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$ |
7,569 |
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Accounts receivable, less allowance for doubtful accounts of $6,703 and $5,845, respectively |
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57,905 |
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57,045 |
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Program license fees — affiliates, net |
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27,127 |
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31,961 |
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Program license fees — non-affiliates, net |
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65,571 |
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70,617 |
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Subtitling and dubbing, net |
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2,827 |
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2,611 |
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Receivable from affiliate |
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12,083 |
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14,087 |
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Prepaid and other assets |
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15,143 |
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15,528 |
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Total current assets |
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184,962 |
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199,418 |
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Accounts receivable, net of current portion |
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5,891 |
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8,653 |
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Program license fees — affiliates, net of current portion |
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47,748 |
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42,645 |
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Program license fees — non-affiliates, net of current portion |
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106,047 |
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94,522 |
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Subtitling and dubbing, net of current portion |
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2,020 |
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1,461 |
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Film assets, net |
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750,737 |
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672,073 |
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Subscriber acquisition fees, net |
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113,196 |
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108,972 |
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Property and equipment, net |
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29,235 |
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22,574 |
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Goodwill |
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314,033 |
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314,033 |
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Debt issuance costs, net |
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6,478 |
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5,268 |
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Prepaid and other assets, net of current portion |
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1,363 |
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1,172 |
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Total assets |
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$ |
1,561,710 |
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$ |
1,470,791 |
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4
CROWN MEDIA HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
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As of |
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As of |
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(Unaudited) |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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LIABILITIES: |
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Accounts payable and accrued liabilities |
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$ |
34,417 |
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$ |
34,402 |
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Subscriber acquisition fees payable |
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9,119 |
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17,987 |
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License fees payable to affiliates |
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30,671 |
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106,872 |
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License fees payable to non-affiliates |
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87,720 |
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76,486 |
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Payables to affiliates |
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7,827 |
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12,465 |
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Payable to Hallmark Entertainment Holdings, Inc. |
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— |
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52,052 |
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Payable to Hallmark Entertainment, Inc. |
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— |
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47,948 |
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Interest payable to HC Crown |
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2,655 |
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5,105 |
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Credit facility and interest payable |
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510 |
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310,548 |
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Capital lease obligation |
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1,559 |
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1,661 |
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Deferred revenue |
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2,163 |
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2,488 |
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Total current liabilities |
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176,641 |
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668,014 |
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Accrued liabilities, net of current portion |
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18,906 |
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20,796 |
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Subscriber acquisition fees payable, net of current portion |
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1,500 |
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915 |
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License fees payable to affiliates, net of current portion |
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60,229 |
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2,764 |
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License fees payable to non-affiliates, net of current portion |
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82,090 |
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71,029 |
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Line of credit payable to HC Crown |
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75,000 |
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75,000 |
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Payable to Hallmark Entertainment Holdings, Inc. |
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52,052 |
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— |
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Payable to Hallmark Entertainment, Inc. |
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47,948 |
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— |
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Senior unsecured note to HC Crown, including accrued interest. |
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417,083 |
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449,603 |
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Credit facility, net of current portion |
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300,000 |
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— |
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Capital lease obligation, net of current portion |
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7,731 |
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6,472 |
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Company obligated mandatorily redeemable preferred interest, including accretion |
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9,079 |
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10,802 |
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Total liabilities |
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1,248,259 |
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1,305,395 |
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Commitments and contingencies |
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STOCKHOLDERS’ EQUITY: |
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