|
|
|
|
|
Delaware
|
001-09553
|
04-2949533
|
(State or other jurisdiction of
incorporation)
|
(Commission File Number)
|
(IRS Employer Identification
Number) |
1515 Broadway
|
|
|
|
New York,
|
New York
|
|
10036
|
(Address of principal executive offices)
|
|
(Zip Code)
|
☐
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
☐
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
☐
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
☐
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
|
Title of each class
|
|
Trading Symbols
|
|
Name of each exchange on which registered
|
||||
Class A Common Stock, $0.001 par value
|
|
|
VIACA
|
|
|
|
The Nasdaq Stock Market LLC
|
|
Class B Common Stock, $0.001 par value
|
|
|
VIAC
|
|
|
|
The Nasdaq Stock Market LLC
|
|
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
|
||
Emerging growth company
|
☐
|
|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
|
|
|
|
|
|
•
|
Unaudited pro forma condensed combined balance sheet at September 30, 2019.
|
•
|
Unaudited pro forma condensed combined statements of operations for the nine months ended September 30, 2019 and the years ended December 31, 2018, December 31, 2017 and December 31, 2016.
|
•
|
Notes to the unaudited pro forma condensed combined financial statements.
|
Exhibit Number
|
|
Description of Exhibit
|
|
|
|
99
|
|
|
104
|
|
Cover Page Interactive Data File (embedded within the Inline XBRL document).
|
|
|
|
VIACOMCBS INC.
|
||
|
|
|
By:
|
/s/ Christa A. D'Alimonte
|
|
|
Name:
|
Christa A. D'Alimonte
|
|
Title:
|
Executive Vice President,
|
|
|
General Counsel and Secretary
|
•
|
CBS’ unaudited consolidated financial statements and the notes thereto contained in CBS’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2019 and the audited consolidated financial statements and the notes thereto contained in CBS’ Annual Report on Form 10-K for the year ended December 31, 2018, and
|
•
|
Viacom’s unaudited consolidated financial statements and the notes thereto contained in Viacom’s Quarterly Reports on Form 10-Q for the quarters ended December 31, 2018, December 31, 2017 and December 31, 2016 and the audited consolidated financial statements and the notes thereto contained in Viacom’s Annual Reports on Form 10-K for the years ended September 30, 2019 and September 30, 2018.
|
|
|
Historical
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
CBS Corporation
|
|
Viacom Inc. (2)
|
|
Pro Forma Adjustments
|
|
Intercompany Eliminations (4)
|
ViacomCBS Pro Forma
|
||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
196
|
|
|
$
|
760
|
|
|
|
$
|
—
|
|
|
|
|
$
|
—
|
|
|
$
|
956
|
|
Receivables, net
|
|
3,685
|
|
|
3,299
|
|
|
|
—
|
|
|
|
|
(46
|
)
|
|
6,938
|
|
|||||
Programming and other inventory
|
|
1,964
|
|
|
775
|
|
|
|
—
|
|
|
|
|
—
|
|
|
2,739
|
|
|||||
Prepaid expenses and other current assets
|
|
428
|
|
|
460
|
|
|
|
—
|
|
|
|
|
—
|
|
|
888
|
|
|||||
Total current assets
|
|
6,273
|
|
|
5,294
|
|
|
|
—
|
|
|
|
|
(46
|
)
|
|
11,521
|
|
|||||
Property and equipment, net
|
|
1,171
|
|
|
922
|
|
|
|
—
|
|
|
|
|
—
|
|
|
2,093
|
|
|||||
Programming and other inventory
|
|
4,861
|
|
|
4,023
|
|
|
|
—
|
|
|
|
|
—
|
|
|
8,884
|
|
|||||
Goodwill
|
|
5,064
|
|
|
11,857
|
|
|
|
—
|
|
|
|
|
—
|
|
|
16,921
|
|
|||||
Intangible assets
|
|
2,655
|
|
|
354
|
|
|
|
—
|
|
|
|
|
—
|
|
|
3,009
|
|
|||||
Operating lease assets
|
|
1,001
|
|
|
—
|
|
|
|
910
|
|
(3)
|
|
|
—
|
|
|
1,911
|
|
|||||
Deferred income tax assets, net
|
|
779
|
|
|
194
|
|
|
|
—
|
|
|
|
|
—
|
|
|
973
|
|
|||||
Other assets
|
|
2,672
|
|
|
1,027
|
|
|
|
—
|
|
|
|
|
(16
|
)
|
|
3,683
|
|
|||||
Total Assets
|
|
$
|
24,476
|
|
|
$
|
23,671
|
|
|
|
$
|
910
|
|
|
|
|
$
|
(62
|
)
|
|
$
|
48,995
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
|
$
|
308
|
|
|
$
|
482
|
|
|
|
$
|
—
|
|
|
|
|
$
|
(4
|
)
|
|
$
|
786
|
|
Participants’ share and royalties payable
|
|
1,201
|
|
|
740
|
|
|
|
—
|
|
|
|
|
(14
|
)
|
|
1,927
|
|
|||||
Accrued programming and production costs
|
|
635
|
|
|
667
|
|
|
|
—
|
|
|
|
|
(26
|
)
|
|
1,276
|
|
|||||
Accrued expenses and other current liabilities
|
|
1,978
|
|
|
1,935
|
|
|
|
168
|
|
(3)
|
|
|
(2
|
)
|
|
4,176
|
|
|||||
|
|
|
|
|
|
|
(34
|
)
|
(3)
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
(15
|
)
|
(7)
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
124
|
|
(6a)
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
22
|
|
(6b)
|
|
|
|
|
|
|||||||||
Total current liabilities
|
|
4,122
|
|
|
3,824
|
|
|
|
265
|
|
|
|
|
(46
|
)
|
|
8,165
|
|
|||||
Long-term debt
|
|
9,359
|
|
|
8,640
|
|
|
|
—
|
|
|
|
|
—
|
|
|
17,999
|
|
|||||
Pension and postretirement benefit obligations
|
|
1,354
|
|
|
671
|
|
|
|
—
|
|
|
|
|
—
|
|
|
2,025
|
|
|||||
Deferred income tax liabilities, net
|
|
552
|
|
|
265
|
|
|
|
(1
|
)
|
(7)
|
|
|
—
|
|
|
816
|
|
|||||
Noncurrent operating lease liabilities
|
|
948
|
|
|
—
|
|
|
|
940
|
|
(3)
|
|
|
—
|
|
|
1,888
|
|
|||||
Other liabilities
|
|
3,089
|
|
|
1,510
|
|
|
|
(164
|
)
|
(3)
|
|
|
(16
|
)
|
|
4,436
|
|
|||||
|
|
|
|
|
|
|
17
|
|
(6b)
|
|
|
|
|
|
|||||||||
Redeemable noncontrolling interest
|
|
—
|
|
|
241
|
|
|
|
—
|
|
|
|
|
—
|
|
|
241
|
|
|||||
Stockholders’ equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Common stock
|
|
1
|
|
|
—
|
|
|
|
—
|
|
(5a)
|
|
|
—
|
|
|
1
|
|
|||||
Additional paid-in-capital
|
|
43,510
|
|
|
10,181
|
|
|
|
15
|
|
(6b)
|
|
|
—
|
|
|
33,165
|
|
|||||
|
|
|
|
|
|
|
(20,541
|
)
|
(5b)
|
|
|
|
|
|
|||||||||
Treasury stock
|
|
(22,858
|
)
|
|
(20,541
|
)
|
|
|
20,541
|
|
(5b)
|
|
|
—
|
|
|
(22,858
|
)
|
|||||
Retained earnings (accumulated deficit)
|
|
(14,683
|
)
|
|
19,887
|
|
|
|
(162
|
)
|
(6c)
|
|
|
—
|
|
|
5,042
|
|
|||||
Accumulated other comprehensive loss
|
|
(918
|
)
|
|
(1,073
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(1,991
|
)
|
|||||
Total ViacomCBS stockholders' equity
|
|
5,052
|
|
|
8,454
|
|
|
|
(147
|
)
|
|
|
|
—
|
|
|
13,359
|
|
|||||
Noncontrolling interests
|
|
—
|
|
|
66
|
|
|
|
—
|
|
|
|
|
—
|
|
|
66
|
|
|||||
Total Stockholders’ Equity
|
|
5,052
|
|
|
8,520
|
|
|
|
(147
|
)
|
|
|
|
—
|
|
|
13,425
|
|
|||||
Total Liabilities and Stockholders’ Equity
|
|
$
|
24,476
|
|
|
$
|
23,671
|
|
|
|
$
|
910
|
|
|
|
|
$
|
(62
|
)
|
|
$
|
48,995
|
|
|
|
Historical
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
CBS Corporation
|
|
Viacom
Inc. (2)
|
|
Pro Forma Adjustments
|
|
Intercompany Eliminations (4)
|
ViacomCBS Pro Forma
|
||||||||||||||
Revenues
|
|
$
|
11,271
|
|
|
$
|
9,748
|
|
|
|
$
|
—
|
|
|
|
|
$
|
(78
|
)
|
|
$
|
20,941
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating
|
|
7,335
|
|
|
5,155
|
|
|
|
—
|
|
|
|
|
(78
|
)
|
|
12,412
|
|
|||||
Selling, general and administrative
|
|
1,702
|
|
|
2,462
|
|
|
|
—
|
|
|
|
|
—
|
|
|
4,164
|
|
|||||
Depreciation and amortization
|
|
158
|
|
|
165
|
|
|
|
—
|
|
|
|
|
—
|
|
|
323
|
|
|||||
Restructuring and other corporate matters
|
|
201
|
|
|
106
|
|
|
|
(146
|
)
|
(6d)
|
|
|
—
|
|
|
161
|
|
|||||
Gain on sale of assets
|
|
(549
|
)
|
|
—
|
|
|
|
—
|
|
|
|
|
—
|
|
|
(549
|
)
|
|||||
Total costs and expenses
|
|
8,847
|
|
|
7,888
|
|
|
|
(146
|
)
|
|
|
|
(78
|
)
|
|
16,511
|
|
|||||
Operating income
|
|
2,424
|
|
|
1,860
|
|
|
|
146
|
|
|
|
|
—
|
|
|
4,430
|
|
|||||
Interest expense, net
|
|
(308
|
)
|
|
(362
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(670
|
)
|
|||||
Gain on marketable securities
|
|
—
|
|
|
78
|
|
|
|
—
|
|
|
|
|
—
|
|
|
78
|
|
|||||
Other items, net
|
|
(66
|
)
|
|
(19
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(85
|
)
|
|||||
Earnings from continuing operations before
income taxes and equity in earnings (loss) of
investee companies
|
|
2,050
|
|
|
1,557
|
|
|
|
146
|
|
|
|
|
—
|
|
|
3,753
|
|
|||||
Benefit (provision) for income taxes
|
|
344
|
|
|
(335
|
)
|
|
|
(6
|
)
|
(7)
|
|
|
—
|
|
|
3
|
|
|||||
Equity in earnings (loss) of investee companies,
net of tax |
|
(52
|
)
|
|
9
|
|
|
|
—
|
|
|
|
|
—
|
|
|
(43
|
)
|
|||||
Net earnings from continuing operations
|
|
2,342
|
|
|
1,231
|
|
|
|
140
|
|
|
|
|
—
|
|
|
3,713
|
|
|||||
Net earnings attributable to noncontrolling
interests
|
|
—
|
|
|
(27
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(27
|
)
|
|||||
Net earnings from continuing operations
attributable to ViacomCBS
|
|
$
|
2,342
|
|
|
$
|
1,204
|
|
|
|
$
|
140
|
|
|
|
|
$
|
—
|
|
|
$
|
3,686
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings from continuing operations per
common share attributable to CBS (Historical)
and ViacomCBS (Pro forma):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
6.26
|
|
|
|
|
|
|
|
|
|
|
|
$
|
5.99
|
|
||||||
Diluted
|
|
$
|
6.23
|
|
|
|
|
|
|
|
|
|
|
|
$
|
5.97
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average number of common shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
374
|
|
|
|
|
|
241
|
|
(5c)
|
|
|
|
|
615
|
|
|||||||
Diluted
|
|
376
|
|
|
|
|
|
241
|
|
(5c)
|
|
|
|
|
617
|
|
|
|
Historical
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
CBS Corporation
|
|
Viacom
Inc. (2)
|
|
Pro Forma Adjustments
|
|
Intercompany Eliminations (4)
|
ViacomCBS Pro Forma
|
||||||||||||||
Revenues
|
|
$
|
14,514
|
|
|
$
|
12,960
|
|
|
|
$
|
—
|
|
|
|
|
$
|
(118
|
)
|
|
$
|
27,356
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating
|
|
9,111
|
|
|
6,999
|
|
|
|
—
|
|
|
|
|
(118
|
)
|
|
15,992
|
|
|||||
Selling, general and administrative
|
|
2,217
|
|
|
2,999
|
|
|
|
—
|
|
|
|
|
—
|
|
|
5,216
|
|
|||||
Depreciation and amortization
|
|
223
|
|
|
210
|
|
|
|
—
|
|
|
|
|
—
|
|
|
433
|
|
|||||
Restructuring and other corporate matters
|
|
195
|
|
|
296
|
|
|
|
—
|
|
|
|
|
—
|
|
|
491
|
|
|||||
Total costs and expenses
|
|
11,746
|
|
|
10,504
|
|
|
|
—
|
|
|
|
|
(118
|
)
|
|
22,132
|
|
|||||
Operating income
|
|
2,768
|
|
|
2,456
|
|
|
|
—
|
|
|
|
|
—
|
|
|
5,224
|
|
|||||
Interest expense, net
|
|
(410
|
)
|
|
(540
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(950
|
)
|
|||||
Loss on marketable securities
|
|
—
|
|
|
(46
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(46
|
)
|
|||||
Gain on early extinguishment of debt
|
|
—
|
|
|
18
|
|
|
|
—
|
|
|
|
|
—
|
|
|
18
|
|
|||||
Other items, net
|
|
(69
|
)
|
|
(52
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(121
|
)
|
|||||
Earnings from continuing operations before
income taxes and equity in earnings (loss) of
investee companies
|
|
2,289
|
|
|
1,836
|
|
|
|
—
|
|
|
|
|
—
|
|
|
4,125
|
|
|||||
Provision for income taxes
|
|
(273
|
)
|
|
(337
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(610
|
)
|
|||||
Equity in earnings (loss) of investee companies,
net of tax
|
|
(56
|
)
|
|
9
|
|
|
|
—
|
|
|
|
|
—
|
|
|
(47
|
)
|
|||||
Net earnings from continuing operations
|
|
1,960
|
|
|
1,508
|
|
|
|
—
|
|
|
|
|
—
|
|
|
3,468
|
|
|||||
Net earnings attributable to noncontrolling
interests
|
|
—
|
|
|
(37
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(37
|
)
|
|||||
Net earnings from continuing operations
attributable to ViacomCBS
|
|
$
|
1,960
|
|
|
$
|
1,471
|
|
|
|
$
|
—
|
|
|
|
|
$
|
—
|
|
|
$
|
3,431
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings from continuing operations per
common share attributable to CBS (Historical) and ViacomCBS (Pro forma): |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
5.20
|
|
|
|
|
|
|
|
|
|
|
|
$
|
5.56
|
|
||||||
Diluted
|
|
$
|
5.14
|
|
|
|
|
|
|
|
|
|
|
|
$
|
5.52
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average number of common shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
377
|
|
|
|
|
|
240
|
|
(5c)
|
|
|
|
|
617
|
|
|||||||
Diluted
|
|
381
|
|
|
|
|
|
240
|
|
(5c)
|
|
|
|
|
621
|
|
|
|
Historical
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
CBS Corporation
|
|
Viacom
Inc. (2)
|
|
Pro Forma Adjustments
|
|
Intercompany Eliminations (4)
|
ViacomCBS Pro Forma
|
||||||||||||||
Revenues
|
|
$
|
13,692
|
|
|
$
|
13,012
|
|
|
|
$
|
—
|
|
|
|
|
$
|
(148
|
)
|
|
$
|
26,556
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating
|
|
8,438
|
|
|
7,180
|
|
|
|
—
|
|
|
|
|
(148
|
)
|
|
15,470
|
|
|||||
Selling, general and administrative
|
|
2,126
|
|
|
3,041
|
|
|
|
—
|
|
|
|
|
—
|
|
|
5,167
|
|
|||||
Depreciation and amortization
|
|
223
|
|
|
220
|
|
|
|
—
|
|
|
|
|
—
|
|
|
443
|
|
|||||
Restructuring and other corporate matters
|
|
63
|
|
|
195
|
|
|
|
—
|
|
|
|
|
—
|
|
|
258
|
|
|||||
Other operating items, net
|
|
(19
|
)
|
|
(127
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(146
|
)
|
|||||
Total costs and expenses
|
|
10,831
|
|
|
10,509
|
|
|
|
—
|
|
|
|
|
(148
|
)
|
|
21,192
|
|
|||||
Operating income
|
|
2,861
|
|
|
2,503
|
|
|
|
—
|
|
|
|
|
—
|
|
|
5,364
|
|
|||||
Interest expense, net
|
|
(393
|
)
|
|
(609
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(1,002
|
)
|
|||||
Gain (loss) on early extinguishment of debt
|
|
(49
|
)
|
|
11
|
|
|
|
—
|
|
|
|
|
—
|
|
|
(38
|
)
|
|||||
Gain on sale of EPIX
|
|
—
|
|
|
285
|
|
|
|
—
|
|
|
|
|
—
|
|
|
285
|
|
|||||
Pension settlement charges
|
|
(352
|
)
|
|
—
|
|
|
|
—
|
|
|
|
|
—
|
|
|
(352
|
)
|
|||||
Other items, net
|
|
(88
|
)
|
|
(20
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(108
|
)
|
|||||
Earnings from continuing operations before
income taxes and equity in earnings (loss)
of investee companies
|
|
1,979
|
|
|
2,170
|
|
|
|
—
|
|
|
|
|
—
|
|
|
4,149
|
|
|||||
Provision for income taxes
|
|
(633
|
)
|
|
(149
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(782
|
)
|
|||||
Equity in earnings (loss) of investee companies,
net of tax
|
|
(37
|
)
|
|
41
|
|
|
|
—
|
|
|
|
|
—
|
|
|
4
|
|
|||||
Net earnings from continuing operations
|
|
1,309
|
|
|
2,062
|
|
|
|
—
|
|
|
|
|
—
|
|
|
3,371
|
|
|||||
Net earnings attributable to noncontrolling
interests
|
|
—
|
|
|
(52
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(52
|
)
|
|||||
Net earnings from continuing operations
attributable to ViacomCBS
|
|
$
|
1,309
|
|
|
$
|
2,010
|
|
|
|
$
|
—
|
|
|
|
|
$
|
—
|
|
|
$
|
3,319
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings from continuing operations per
common share attributable to CBS (Historical) and ViacomCBS (Pro forma): |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
3.26
|
|
|
|
|
|
|
|
|
|
|
|
$
|
5.19
|
|
||||||
Diluted
|
|
$
|
3.22
|
|
|
|
|
|
|
|
|
|
|
|
$
|
5.13
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average number of common shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
401
|
|
|
|
|
|
239
|
|
(5c)
|
|
|
|
|
640
|
|
|||||||
Diluted
|
|
407
|
|
|
|
|
|
240
|
|
(5c)
|
|
|
|
|
647
|
|
|
|
Historical
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
CBS Corporation
|
|
Viacom
Inc. (2)
|
|
Pro Forma Adjustments
|
|
Intercompany Eliminations (4)
|
ViacomCBS Pro Forma
|
||||||||||||||
Revenues
|
|
$
|
13,166
|
|
|
$
|
12,658
|
|
|
|
$
|
—
|
|
|
|
|
$
|
(139
|
)
|
|
$
|
25,685
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating
|
|
7,956
|
|
|
6,910
|
|
|
|
—
|
|
|
|
|
(139
|
)
|
|
14,727
|
|
|||||
Selling, general and administrative
|
|
2,054
|
|
|
2,882
|
|
|
|
—
|
|
|
|
|
—
|
|
|
4,936
|
|
|||||
Depreciation and amortization
|
|
225
|
|
|
222
|
|
|
|
—
|
|
|
|
|
—
|
|
|
447
|
|
|||||
Restructuring and other corporate matters
|
|
38
|
|
|
248
|
|
|
|
—
|
|
|
|
|
—
|
|
|
286
|
|
|||||
Other operating items, net
|
|
(9
|
)
|
|
—
|
|
|
|
—
|
|
|
|
|
—
|
|
|
(9
|
)
|
|||||
Total costs and expenses
|
|
10,264
|
|
|
10,262
|
|
|
|
—
|
|
|
|
|
(139
|
)
|
|
20,387
|
|
|||||
Operating income
|
|
2,902
|
|
|
2,396
|
|
|
|
—
|
|
|
|
|
—
|
|
|
5,298
|
|
|||||
Interest expense, net
|
|
(379
|
)
|
|
(617
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(996
|
)
|
|||||
Pension settlement charges
|
|
(211
|
)
|
|
—
|
|
|
|
—
|
|
|
|
|
—
|
|
|
(211
|
)
|
|||||
Other items, net
|
|
(82
|
)
|
|
(9
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(91
|
)
|
|||||
Earnings from continuing operations before
income taxes and equity in earnings (loss)
of investee companies
|
|
2,230
|
|
|
1,770
|
|
|
|
—
|
|
|
|
|
—
|
|
|
4,000
|
|
|||||
Provision for income taxes
|
|
(628
|
)
|
|
(395
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(1,023
|
)
|
|||||
Equity in earnings (loss) of investee companies,
net of tax
|
|
(50
|
)
|
|
43
|
|
|
|
—
|
|
|
|
|
—
|
|
|
(7
|
)
|
|||||
Net earnings from continuing operations
|
|
1,552
|
|
|
1,418
|
|
|
|
—
|
|
|
|
|
—
|
|
|
2,970
|
|
|||||
Net earnings attributable to noncontrolling
interests
|
|
—
|
|
|
(35
|
)
|
|
|
—
|
|
|
|
|
—
|
|
|
(35
|
)
|
|||||
Net earnings from continuing operations
attributable to ViacomCBS
|
|
$
|
1,552
|
|
|
$
|
1,383
|
|
|
|
$
|
—
|
|
|
|
|
$
|
—
|
|
|
$
|
2,935
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings from continuing operations per
common share attributable to CBS (Historical) and ViacomCBS (Pro forma): |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
3.50
|
|
|
|
|
|
|
|
|
|
|
|
$
|
4.31
|
|
||||||
Diluted
|
|
$
|
3.46
|
|
|
|
|
|
|
|
|
|
|
|
$
|
4.28
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average number of common shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
444
|
|
|
|
|
|
237
|
|
(5c)
|
|
|
|
|
681
|
|
|||||||
Diluted
|
|
448
|
|
|
|
|
|
237
|
|
(5c)
|
|
|
|
|
685
|
|
•
|
For the unaudited pro forma condensed combined statement of operations for the nine months ended September 30, 2019, the consolidated statement of earnings for the year ended September 30, 2019 contained in Viacom’s Annual Report on Form 10-K for the year ended September 30, 2019, less the consolidated statement of earnings for the three months ended December 31, 2018 contained in Viacom’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2018;
|
•
|
For the unaudited pro forma condensed combined statements of operations for the years ended December 31, 2018, 2017 and 2016, the consolidated statements of earnings for the years ended September 30, 2018, 2017 and 2016, respectively, plus the consolidated statements of earnings for the three months ended December 31, 2018, 2017 and 2016, respectively, and less the consolidated statements of earnings for the three months ended December 31, 2017, 2016, and 2015, respectively. The above statements of earnings were derived from Viacom’s Annual Reports on Form 10-K for the years ended September 30, 2019 and 2018, and its Quarterly Reports on Form 10-Q for the applicable periods. The statements of earnings information for the year ended December 31, 2016 has been updated for the impact of the retrospective adoption of ASU 2017-07-Compensation-Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost, which resulted in the reclassification of $3 million from “Selling, general and administrative” to “Other items, net”.
|
(a)
|
As a result of the merger, at the effective time, (1) each share of Viacom Class A common stock issued and outstanding immediately prior to the effective time, other than shares held directly by Viacom as treasury shares or held by CBS, was converted automatically into 0.59625 shares of ViacomCBS Class A common stock and (2) each share of Viacom Class B common stock issued and outstanding immediately prior to the effective time, other than shares held directly by Viacom as treasury shares or held by CBS, was converted automatically into 0.59625 shares of ViacomCBS Class B common stock. Since the merger is being accounted for as a transaction between entities under common control, the shares of ViacomCBS common stock issued in connection with the conversion are recorded at par value, which is $0.001 per share. The following table details the calculations of the number of shares of ViacomCBS common stock issued in the merger and the par value of ViacomCBS shares outstanding after the merger, assuming the merger occurred on September 30, 2019. On a rounded basis, the par value of ViacomCBS common stock did not change as a result of the issuance, and therefore no pro forma adjustment was required to “Common stock” on the unaudited pro forma condensed combined balance sheet.
|
Shares of CBS common stock issued at September 30, 2019 (Class A and Class B)
|
|
|
|
875
|
|
||
Pro forma shares of ViacomCBS common stock issued in the merger:
|
|
|
|
|
|||
Shares of Viacom common stock outstanding at September 30, 2019
(Class A and Class B)
|
|
404
|
|
|
|
||
Exchange ratio
|
|
0.59625
|
|
|
|
||
Pro forma shares of ViacomCBS common stock issued in merger
(Class A and Class B)
|
|
|
|
241
|
|
||
Pro forma issued shares of ViacomCBS common stock after merger
|
|
|
|
1,116
|
|
||
|
|
|
|
|
|||
Par value of ViacomCBS common stock issued after merger
(1,116 shares x $0.001 per share)
|
|
|
|
$
|
1
|
|
|
Par value of CBS common stock issued prior to merger
|
|
|
|
1
|
|
||
Pro forma adjustment to common stock and additional paid-in-capital
|
|
|
|
$
|
—
|
|
(b)
|
Adjustments reflect the cancellation of all shares of Viacom common stock held as treasury shares in accordance with the merger agreement.
|
(c)
|
The pro forma weighted average basic and diluted shares outstanding of Viacom have been calculated by adjusting the historical weighted average share amounts by the exchange ratio as follows:
|
|
Nine Months Ended
|
|
Year Ended December 31,
|
||||||||||
|
September 30, 2019
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
|
|
|
|
|
|
|
|
||||
Viacom historical basic shares
outstanding
|
|
404
|
|
|
|
403
|
|
|
401
|
|
|
397
|
|
Exchange ratio
|
|
0.59625
|
|
|
|
0.59625
|
|
|
0.59625
|
|
|
0.59625
|
|
Viacom pro forma basic shares
outstanding
|
|
241
|
|
|
|
240
|
|
|
239
|
|
|
237
|
|
|
|
|
|
|
|
|
|
|
|
||||
Viacom historical diluted shares
outstanding
|
|
404
|
|
|
|
403
|
|
|
402
|
|
|
398
|
|
Exchange ratio
|
|
0.59625
|
|
|
|
0.59625
|
|
|
0.59625
|
|
|
0.59625
|
|
Viacom pro forma diluted shares
outstanding
|
|
241
|
|
|
|
240
|
|
|
240
|
|
|
237
|
|
(a)
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In connection with the merger, CBS and Viacom expect to incur approximately $124 million of additional transaction costs, consisting mainly of financial advisory, legal and other professional fees, after September 30, 2019. Such costs are reflected as an adjustment to “Accrued expenses and other current liabilities.”
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(b)
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CBS and Viacom incurred costs for contractual executive compensation triggered by the merger, which also includes the accelerated vesting of stock-based compensation awards. Also as a result of the merger,
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(c)
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The net reduction to “Retained earnings (accumulated deficit)” of $162 million reflects the net impact from the above-mentioned merger-related costs and the related tax benefit of $16 million.
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(d)
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Merger-related costs of $146 million incurred by CBS and Viacom during the nine months ended September 30, 2019 have been reversed in the pro forma statement of operations because they are non-recurring charges directly related to the merger.
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