|
|
|
|
|
|
|
|
BERMUDA
|
|
98-0438382
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
|
|
|
O'Hara House, 3 Bermudiana Road, Hamilton, Bermuda
|
|
HM 08
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Large accelerated filer
£
|
Accelerated filer
T
|
Non-accelerated filer
£
|
Smaller reporting company
£
|
|
|
|
Emerging growth company
£
|
Class
|
Outstanding as of April 23, 2018
|
Class A Common Stock, par value $0.08
|
148,721,537
|
|
|
|
|
|
Page
|
||
Part I Financial Information
|
|
||
|
|||
|
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||
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||
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||
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|
|||
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|||
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|||
Part II Other Information
|
|
||
|
|||
|
|||
|
|||
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
ASSETS
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
74,264
|
|
|
$
|
54,903
|
|
Accounts receivable, net (Note 7)
|
139,976
|
|
|
158,903
|
|
||
Program rights, net (Note 6)
|
76,193
|
|
|
69,706
|
|
||
Other current assets (Note 8)
|
34,809
|
|
|
33,106
|
|
||
Assets held for sale (Note 3)
|
143,481
|
|
|
148,156
|
|
||
Total current assets
|
468,723
|
|
|
464,774
|
|
||
Non-current assets
|
|
|
|
|
|
||
Property, plant and equipment, net (Note 9)
|
105,850
|
|
|
103,648
|
|
||
Program rights, net (Note 6)
|
175,061
|
|
|
182,170
|
|
||
Goodwill (Note 4)
|
734,222
|
|
|
712,359
|
|
||
Other intangible assets, net (Note 4)
|
150,293
|
|
|
148,235
|
|
||
Other non-current assets (Note 8)
|
15,777
|
|
|
16,869
|
|
||
Total non-current assets
|
1,181,203
|
|
|
1,163,281
|
|
||
Total assets
|
$
|
1,649,926
|
|
|
$
|
1,628,055
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable and accrued liabilities (Note 10)
|
$
|
147,213
|
|
|
$
|
143,893
|
|
Current portion of long-term debt and other financing arrangements (Note 5)
|
3,439
|
|
|
2,960
|
|
||
Other current liabilities (Note 11)
|
33,322
|
|
|
9,280
|
|
||
Liabilities held for sale (Note 3)
|
33,361
|
|
|
32,131
|
|
||
Total current liabilities
|
217,335
|
|
|
188,264
|
|
||
Non-current liabilities
|
|
|
|
|
|
||
Long-term debt and other financing arrangements (Note 5)
|
1,054,322
|
|
|
1,085,714
|
|
||
Other non-current liabilities (Note 11)
|
97,542
|
|
|
95,254
|
|
||
Total non-current liabilities
|
1,151,864
|
|
|
1,180,968
|
|
||
Commitments and contingencies (Note 20)
|
|
|
|
|
|
||
TEMPORARY EQUITY
|
|
|
|
||||
200,000 shares of Series B Convertible Redeemable Preferred Stock of $0.08 each (December 31, 2017 - 200,000) (Note 13)
|
267,040
|
|
|
264,593
|
|
||
EQUITY
|
|
|
|
|
|||
CME Ltd. shareholders’ equity (Note 14):
|
|
|
|
|
|||
One share of Series A Convertible Preferred Stock of $0.08 each (December 31, 2017 – one)
|
—
|
|
|
—
|
|
||
148,235,428 shares of Class A Common Stock of $0.08 each (December 31, 2017 – 145,486,497)
|
11,858
|
|
|
11,639
|
|
||
Nil shares of Class B Common Stock of $0.08 each (December 31, 2017 – nil)
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
1,905,969
|
|
|
1,905,779
|
|
||
Accumulated deficit
|
(1,728,518
|
)
|
|
(1,735,768
|
)
|
||
Accumulated other comprehensive loss
|
(175,254
|
)
|
|
(187,438
|
)
|
||
Total CME Ltd. shareholders’ equity / (deficit)
|
14,055
|
|
|
(5,788
|
)
|
||
Noncontrolling interests
|
(368
|
)
|
|
18
|
|
||
Total equity / (deficit)
|
13,687
|
|
|
(5,770
|
)
|
||
Total liabilities and equity
|
$
|
1,649,926
|
|
|
$
|
1,628,055
|
|
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Net revenues
|
$
|
139,182
|
|
|
$
|
111,732
|
|
Operating expenses:
|
|
|
|
||||
Content costs
|
69,806
|
|
|
58,645
|
|
||
Other operating costs
|
12,687
|
|
|
11,255
|
|
||
Depreciation of property, plant and equipment
|
7,366
|
|
|
5,959
|
|
||
Amortization of broadcast licenses and other intangibles
|
2,356
|
|
|
2,109
|
|
||
Cost of revenues
|
92,215
|
|
|
77,968
|
|
||
Selling, general and administrative expenses
|
26,022
|
|
|
20,740
|
|
||
Operating income
|
20,945
|
|
|
13,024
|
|
||
Interest expense (Note 15)
|
(15,012
|
)
|
|
(18,993
|
)
|
||
Loss on extinguishment of debt (Note 5)
|
(109
|
)
|
|
—
|
|
||
Other non-operating income, net (Note 16)
|
4,157
|
|
|
2,232
|
|
||
Income / (loss) before tax
|
9,981
|
|
|
(3,737
|
)
|
||
Provision for income taxes
|
(3,897
|
)
|
|
(2,245
|
)
|
||
Income / (loss) from continuing operations
|
6,084
|
|
|
(5,982
|
)
|
||
Income / (loss) from discontinued operations, net of tax (Note 3)
|
988
|
|
|
(5,292
|
)
|
||
Net income / (loss)
|
7,072
|
|
|
(11,274
|
)
|
||
Net loss attributable to noncontrolling interests
|
178
|
|
|
209
|
|
||
Net income / (loss) attributable to CME Ltd.
|
$
|
7,250
|
|
|
$
|
(11,065
|
)
|
|
|
|
|
||||
Net income / (loss)
|
$
|
7,072
|
|
|
$
|
(11,274
|
)
|
Other comprehensive income
|
|
|
|
||||
Currency translation adjustment
|
11,785
|
|
|
2,072
|
|
||
Unrealized gain on derivative instruments (Note 12)
|
191
|
|
|
1,258
|
|
||
Total other comprehensive income
|
11,976
|
|
|
3,330
|
|
||
Comprehensive income / (loss)
|
19,048
|
|
|
(7,944
|
)
|
||
Comprehensive loss attributable to noncontrolling interests
|
386
|
|
|
301
|
|
||
Comprehensive income / (loss) attributable to CME Ltd.
|
$
|
19,434
|
|
|
$
|
(7,643
|
)
|
PER SHARE DATA (Note 18):
|
|
|
|
||||
Net income / (loss) per share:
|
|
|
|
||||
Continuing operations — basic
|
$
|
0.01
|
|
|
$
|
(0.05
|
)
|
Continuing operations — diluted
|
0.01
|
|
|
(0.05
|
)
|
||
Discontinued operations — basic
|
0.01
|
|
|
(0.04
|
)
|
||
Discontinued operations — diluted
|
0.00
|
|
|
(0.04
|
)
|
||
Net income / (loss) attributable to CME Ltd. — basic
|
0.02
|
|
|
(0.09
|
)
|
||
Net income / (loss) attributable to CME Ltd. — diluted
|
0.01
|
|
|
(0.09
|
)
|
||
|
|
|
|
||||
Weighted average common shares used in computing per share amounts (000’s):
|
|
|
|
||||
Basic
|
158,039
|
|
|
154,795
|
|
||
Diluted
|
241,905
|
|
|
154,795
|
|
|
CME Ltd.
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
|
Series A Convertible Preferred Stock
|
|
Class A
Common Stock
|
|
Class B
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Number of shares
|
Par value
|
|
Number
of shares |
Par value
|
|
Number of shares
|
Par value
|
Additional Paid-In Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Loss
|
|
|
Noncontrolling Interest
|
|
|
Total (Deficit) / Equity
|
|
||||||||||||||
BALANCE
December 31, 2017
|
1
|
|
$
|
—
|
|
|
145,486,497
|
|
$
|
11,639
|
|
|
—
|
|
$
|
—
|
|
$
|
1,905,779
|
|
$
|
(1,735,768
|
)
|
$
|
(187,438
|
)
|
|
$
|
18
|
|
|
$
|
(5,770
|
)
|
Stock-based compensation
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
1,112
|
|
—
|
|
—
|
|
|
—
|
|
|
1,112
|
|
||||||||
Exercise of warrants (Note 14)
|
—
|
|
—
|
|
|
2,280,936
|
|
182
|
|
|
—
|
|
—
|
|
2,099
|
|
—
|
|
—
|
|
|
—
|
|
|
2,281
|
|
||||||||
Share issuance, stock-based compensation
|
—
|
|
—
|
|
|
467,995
|
|
37
|
|
|
—
|
|
—
|
|
(37
|
)
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Withholding tax on net share settlement of stock-based compensation
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
(537
|
)
|
—
|
|
—
|
|
|
—
|
|
|
(537
|
)
|
||||||||
Preferred dividend paid in kind
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
(2,447
|
)
|
—
|
|
—
|
|
|
—
|
|
|
(2,447
|
)
|
||||||||
Net income / (loss)
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
7,250
|
|
—
|
|
|
(178
|
)
|
|
7,072
|
|
||||||||
Unrealized gain on derivative instruments
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
191
|
|
|
—
|
|
|
191
|
|
||||||||
Currency translation adjustment
|
—
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
11,993
|
|
|
(208
|
)
|
|
11,785
|
|
||||||||
BALANCE
March 31, 2018
|
1
|
|
$
|
—
|
|
|
148,235,428
|
|
$
|
11,858
|
|
|
—
|
|
$
|
—
|
|
$
|
1,905,969
|
|
$
|
(1,728,518
|
)
|
$
|
(175,254
|
)
|
|
$
|
(368
|
)
|
|
$
|
13,687
|
|
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net income / (loss)
|
$
|
7,072
|
|
|
$
|
(11,274
|
)
|
Adjustments to reconcile net income / (loss) to net cash generated from continuing operating activities:
|
|
|
|
|
|||
(Income) / loss from discontinued operations, net of tax (Note 3)
|
(988
|
)
|
|
5,292
|
|
||
Amortization of program rights
|
69,806
|
|
|
58,645
|
|
||
Depreciation and other amortization
|
11,279
|
|
|
9,432
|
|
||
Loss on extinguishment of debt (Note 5)
|
109
|
|
|
—
|
|
||
Gain on disposal of fixed assets
|
(1
|
)
|
|
(23
|
)
|
||
Deferred income taxes
|
(90
|
)
|
|
(598
|
)
|
||
Stock-based compensation (Note 17)
|
1,074
|
|
|
767
|
|
||
Change in fair value of derivatives
|
162
|
|
|
(265
|
)
|
||
Foreign currency exchange gain, net
|
(3,729
|
)
|
|
(2,044
|
)
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
23,452
|
|
|
26,525
|
|
||
Accounts payable and accrued liabilities
|
(8,365
|
)
|
|
(12,080
|
)
|
||
Program rights
|
(66,038
|
)
|
|
(54,208
|
)
|
||
Other assets and liabilities
|
(550
|
)
|
|
860
|
|
||
Accrued interest
|
8,810
|
|
|
13,102
|
|
||
Income taxes payable
|
(40
|
)
|
|
(34
|
)
|
||
Deferred revenue
|
23,691
|
|
|
18,414
|
|
||
VAT and other taxes payable
|
871
|
|
|
(2,091
|
)
|
||
Net cash generated from continuing operating activities
|
$
|
66,525
|
|
|
$
|
50,420
|
|
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
||
Purchase of property, plant and equipment
|
$
|
(4,098
|
)
|
|
$
|
(6,034
|
)
|
Disposal of property, plant and equipment
|
13
|
|
|
101
|
|
||
Net cash used in continuing investing activities
|
$
|
(4,085
|
)
|
|
$
|
(5,933
|
)
|
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
||
Repayment of debt
|
$
|
(61,645
|
)
|
|
$
|
—
|
|
Debt transaction costs
|
(173
|
)
|
|
—
|
|
||
Payment of credit facilities and capital leases
|
(910
|
)
|
|
(327
|
)
|
||
Proceeds from exercise of warrants
|
2,281
|
|
|
301
|
|
||
Net cash used in continuing financing activities
|
$
|
(60,447
|
)
|
|
$
|
(26
|
)
|
|
|
|
|
||||
Net cash provided by discontinued operations - operating activities
|
16,561
|
|
|
2,684
|
|
||
Net cash used in discontinued operations - investing activities
|
(1,645
|
)
|
|
(1,508
|
)
|
||
Net cash used in discontinued operations - financing activities
|
(79
|
)
|
|
(67
|
)
|
||
|
|
|
|
||||
Impact of exchange rate fluctuations on cash and cash equivalents
|
2,531
|
|
|
(152
|
)
|
||
Net increase in cash and cash equivalents
|
$
|
19,361
|
|
|
$
|
45,418
|
|
CASH AND CASH EQUIVALENTS, beginning of period
|
54,903
|
|
|
40,606
|
|
||
CASH AND CASH EQUIVALENTS, end of period
|
$
|
74,264
|
|
|
$
|
86,024
|
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
|
|
|
||||
Cash paid for interest (including mandatory cash-pay Guarantee Fees)
|
$
|
4,232
|
|
|
$
|
4,133
|
|
Cash paid for income taxes, net of refunds
|
4,027
|
|
|
2,121
|
|
||
|
|
|
|
||||
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:
|
|
|
|
||||
Accretion on Series B Convertible Redeemable Preferred Stock
|
$
|
2,447
|
|
|
$
|
2,357
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Assets held for sale
|
|
|
|
||||
Cash and cash equivalents
|
$
|
6,033
|
|
|
$
|
8,784
|
|
Accounts receivable, net
|
35,364
|
|
|
43,540
|
|
||
Program rights, net
|
68,210
|
|
|
62,017
|
|
||
Property, plant and equipment, net
|
22,610
|
|
|
22,870
|
|
||
Other assets
|
11,264
|
|
|
10,945
|
|
||
Total assets held for sale
|
$
|
143,481
|
|
|
$
|
148,156
|
|
|
|
|
|
||||
Liabilities held for sale
|
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
28,006
|
|
|
$
|
30,073
|
|
Other liabilities
|
5,355
|
|
|
2,058
|
|
||
Total liabilities held for sale
|
$
|
33,361
|
|
|
$
|
32,131
|
|
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Net revenues
|
$
|
31,814
|
|
|
$
|
23,270
|
|
Cost of revenues
|
21,277
|
|
|
19,858
|
|
||
Selling, general and administrative expenses
|
5,052
|
|
|
4,168
|
|
||
Operating income / (loss)
|
5,485
|
|
|
(756
|
)
|
||
Interest expense
(1)
|
(4,207
|
)
|
|
(4,762
|
)
|
||
Other non-operating income, net
|
333
|
|
|
93
|
|
||
Income / (loss) from discontinued operations, before tax
|
1,611
|
|
|
(5,425
|
)
|
||
(Provision) / credit for income taxes
|
(623
|
)
|
|
133
|
|
||
Income / (loss) from discontinued operations, net of tax
|
$
|
988
|
|
|
$
|
(5,292
|
)
|
(1)
|
For the
three months
ended
March 31, 2018
and
2017
, we paid US$
0.9 million
and US$
0.8 million
, respectively, of interest and Guarantee Fees associated with the 2018 Euro Term Loan and 2019 Euro Term Loan (as defined in
Note 5, "Long-term Debt and Other Financing Arrangements"
). These payments were allocated to
Net cash provided by discontinued operations - operating activities
in our Condensed Consolidated Statements of Cash Flows as we are required to apply the expected proceeds from the Divestment Transaction towards the repayment of the remaining principal amounts owing in respect of the 2018 Euro Term Loan as well as to the fees related to the 2019 Euro Term Loan, including Guarantee Fees and the Commitment Fee which we have previously paid in kind pursuant to the Reimbursement Agreement. To the extent excess funds are available thereafter, the remaining proceeds are required to be applied to the principal amounts owing in respect of the 2019 Euro Term Loan.
|
|
Bulgaria
|
|
Czech Republic
|
|
Romania
|
|
Slovak Republic
|
|
Total
|
||||||||||
Gross Balance, December 31, 2017
|
$
|
175,071
|
|
|
$
|
837,732
|
|
|
$
|
90,305
|
|
|
$
|
52,463
|
|
|
$
|
1,155,571
|
|
Accumulated impairment losses
|
(144,639
|
)
|
|
(287,545
|
)
|
|
(11,028
|
)
|
|
—
|
|
|
(443,212
|
)
|
|||||
Balance, December 31, 2017
|
30,432
|
|
|
550,187
|
|
|
79,277
|
|
|
52,463
|
|
|
712,359
|
|
|||||
Foreign currency
|
832
|
|
|
17,321
|
|
|
2,271
|
|
|
1,439
|
|
|
21,863
|
|
|||||
Balance, March 31, 2018
|
31,264
|
|
|
567,508
|
|
|
81,548
|
|
|
53,902
|
|
|
734,222
|
|
|||||
Accumulated impairment losses
|
(144,639
|
)
|
|
(287,545
|
)
|
|
(11,028
|
)
|
|
—
|
|
|
(443,212
|
)
|
|||||
Gross Balance, March 31, 2018
|
$
|
175,903
|
|
|
$
|
855,053
|
|
|
$
|
92,576
|
|
|
$
|
53,902
|
|
|
$
|
1,177,434
|
|
|
March 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
Gross
|
|
Accumulated Amortization
|
|
Net
|
|
Gross
|
|
Accumulated Amortization
|
|
Net
|
||||||||||||
Indefinite-lived:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trademarks
|
$
|
90,422
|
|
|
$
|
—
|
|
|
$
|
90,422
|
|
|
$
|
87,900
|
|
|
$
|
—
|
|
|
$
|
87,900
|
|
Amortized:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Broadcast licenses
|
227,013
|
|
|
(168,926
|
)
|
|
58,087
|
|
|
220,194
|
|
|
(161,820
|
)
|
|
58,374
|
|
||||||
Trademarks
|
433
|
|
|
(433
|
)
|
|
—
|
|
|
421
|
|
|
(421
|
)
|
|
—
|
|
||||||
Customer relationships
|
60,455
|
|
|
(58,849
|
)
|
|
1,606
|
|
|
58,771
|
|
|
(56,996
|
)
|
|
1,775
|
|
||||||
Other
|
1,802
|
|
|
(1,624
|
)
|
|
178
|
|
|
1,753
|
|
|
(1,567
|
)
|
|
186
|
|
||||||
Total
|
$
|
380,125
|
|
|
$
|
(229,832
|
)
|
|
$
|
150,293
|
|
|
$
|
369,039
|
|
|
$
|
(220,804
|
)
|
|
$
|
148,235
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Long-term debt
|
$
|
1,047,600
|
|
|
$
|
1,079,187
|
|
Other credit facilities and capital leases
|
10,161
|
|
|
9,487
|
|
||
Total long-term debt and other financing arrangements
|
1,057,761
|
|
|
1,088,674
|
|
||
Less: current maturities
|
(3,439
|
)
|
|
(2,960
|
)
|
||
Total non-current long-term debt and other financing arrangements
|
$
|
1,054,322
|
|
|
$
|
1,085,714
|
|
|
Principal Amount of Liability Component
|
|
|
Debt Issuance
Costs
(1)
|
|
|
Net Carrying Amount
|
|
|||
2018 Euro Term Loan
|
$
|
185,801
|
|
|
$
|
(278
|
)
|
|
$
|
185,523
|
|
2019 Euro Term Loan
|
289,956
|
|
|
(325
|
)
|
|
289,631
|
|
|||
2021 Euro Term Loan
|
577,608
|
|
|
(5,162
|
)
|
|
572,446
|
|
|||
2021 Revolving Credit Facility
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total long-term debt and credit facilities
|
$
|
1,053,365
|
|
|
$
|
(5,765
|
)
|
|
$
|
1,047,600
|
|
(1)
|
Debt issuance costs related to the 2018 Euro Term Loan, 2019 Euro Term Loan and 2021 Euro Term Loan are being amortized on a straight-line basis, which approximates the effective interest method, over the life of the respective instruments. Debt issuance costs related to the 2021 Revolving Credit Facility are classified as non-current assets in our condensed consolidated balance sheet and are being amortized on a straight-line basis over the life of the 2021 Revolving Credit Facility.
|
|
Carrying Amount
|
|
Fair Value
|
||||||||||||
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||||
2018 Euro Term Loan
|
$
|
185,523
|
|
|
$
|
240,545
|
|
|
$
|
180,486
|
|
|
$
|
236,337
|
|
2019 Euro Term Loan
|
289,631
|
|
|
281,871
|
|
|
276,968
|
|
|
268,858
|
|
||||
2021 Euro Term Loan
|
572,446
|
|
|
556,771
|
|
|
525,017
|
|
|
510,882
|
|
||||
|
$
|
1,047,600
|
|
|
$
|
1,079,187
|
|
|
$
|
982,471
|
|
|
$
|
1,016,077
|
|
Consolidated Net Leverage
|
Cash Rate
(1)
|
|
|
PIK Fee Rate
|
|
|
Total Rate
(2)
|
|
||||
≥
|
7.0x
|
|
|
|
5.00
|
%
|
|
3.50
|
%
|
|
8.50
|
%
|
<
|
7.0x
|
-
|
6.0x
|
|
5.00
|
%
|
|
2.25
|
%
|
|
7.25
|
%
|
<
|
6.0x
|
-
|
5.0x
|
|
5.00
|
%
|
|
1.00
|
%
|
|
6.00
|
%
|
<
|
5.0x
|
|
|
|
5.00
|
%
|
|
—
|
%
|
|
5.00
|
%
|
(1)
|
Includes cash paid for interest for the Euro Term Loans and the related customary hedging arrangements.
|
(2)
|
If we reduce our long-term debt to less than EUR
815.0 million
, subject to certain adjustments in respect of specified debt repayments, prior to September 30, 2018, a
50
basis point reduction in the all-in rate would be applied.
|
|
Base Rate
|
|
|
Rate Fixed Pursuant to Interest Rate Hedges
|
|
|
Guarantee Fee Rate
|
|
|
All-in Borrowing Rate
|
|
2018 Euro Term Loan
|
1.50
|
%
|
|
0.14
|
%
|
|
4.36
|
%
|
|
6.00
|
%
|
2019 Euro Term Loan
|
1.50
|
%
|
|
0.31
|
%
|
|
4.19
|
%
|
|
6.00
|
%
|
2021 Euro Term Loan
|
1.50
|
%
|
|
0.28
|
%
|
|
4.22
|
%
|
|
6.00
|
%
|
2021 Revolving Credit Facility
(1)
|
9.31
|
%
|
(2)
|
—
|
%
|
|
—
|
%
|
|
9.31
|
%
|
(1)
|
As at
March 31, 2018
, the 2021 Revolving Credit Facility was undrawn.
|
(2)
|
Based on the three month LIBOR of
2.31%
as at
March 31, 2018
.
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Credit facilities
(1) – (3)
|
$
|
—
|
|
|
$
|
—
|
|
Capital leases
|
10,161
|
|
|
9,487
|
|
||
Total credit facilities and capital leases
|
10,161
|
|
|
9,487
|
|
||
Less: current maturities
|
(3,439
|
)
|
|
(2,960
|
)
|
||
Total non-current credit facilities and capital leases
|
$
|
6,722
|
|
|
$
|
6,527
|
|
(1)
|
We have a cash pooling arrangement with Bank Mendes Gans (“BMG”), a subsidiary of ING Bank N.V. (“ING”), which enables us to receive credit throughout the group in respect of cash balances which our subsidiaries deposit with BMG. Cash deposited by our subsidiaries with BMG is pledged as security against the drawings of other subsidiaries up to the amount deposited.
|
(2)
|
As at
March 31, 2018
there were
no
drawings outstanding under a CZK
575.0 million
(approximately US$
27.9 million
) factoring framework agreement with Factoring Česka spořitelna ("FCS"), a.s. As at
December 31, 2017
, approximately CZK
127.2 million
(approximately US$
6.2 million
at March 31, 2018 rates) of receivables were factored on a non-recourse basis and derecognized from the condensed consolidated balance sheet. Under this facility, receivables from certain customers in the Czech Republic may be factored on a recourse or non-recourse basis. The facility has a factoring fee of
0.19%
of any factored receivable and bears interest at one-month PRIBOR plus
0.95%
per annum for the period that receivables are factored and outstanding.
|
(3)
|
As at
March 31, 2018
and
December 31, 2017
, there were RON
136.1 million
(approximately US$
36.0 million
) and RON
99.8 million
(approximately US$
26.4 million
), respectively, of receivables factored under a factoring framework agreement with Global Funds IFN S.A. that were derecognized from the condensed consolidated balance sheet. Under this facility, receivables from certain customers in Romania may be factored on a non-recourse basis. The facility has a factoring fee of
4.0%
of any factored receivable and bears interest at
6.0%
per annum from the date the receivables are factored to the due date of the factored receivable.
|
2018
|
$
|
—
|
|
2019
|
475,757
|
|
|
2020
|
—
|
|
|
2021
|
577,608
|
|
|
2022
|
—
|
|
|
2023 and thereafter
|
—
|
|
|
Total long-term debt and credit facilities
|
1,053,365
|
|
|
Debt issuance costs
|
(5,765
|
)
|
|
Carrying amount of long-term debt and credit facilities
|
$
|
1,047,600
|
|
2018
|
$
|
2,717
|
|
2019
|
3,229
|
|
|
2020
|
2,899
|
|
|
2021
|
1,648
|
|
|
2022
|
58
|
|
|
2023 and thereafter
|
—
|
|
|
Total undiscounted payments
|
10,551
|
|
|
Less: amount representing interest
|
(390
|
)
|
|
Present value of net minimum lease payments
|
$
|
10,161
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Program rights:
|
|
|
|
||||
Acquired program rights, net of amortization
|
$
|
163,649
|
|
|
$
|
161,929
|
|
Less: current portion of acquired program rights
|
(76,193
|
)
|
|
(69,706
|
)
|
||
Total non-current acquired program rights
|
87,456
|
|
|
92,223
|
|
||
Produced program rights – Feature Films:
|
|
|
|
|
|||
Released, net of amortization
|
930
|
|
|
939
|
|
||
Produced program rights – Television Programs:
|
|
|
|
|
|
||
Released, net of amortization
|
57,402
|
|
|
49,888
|
|
||
Completed and not released
|
7,341
|
|
|
9,987
|
|
||
In production
|
21,538
|
|
|
28,971
|
|
||
Development and pre-production
|
394
|
|
|
162
|
|
||
Total produced program rights
|
87,605
|
|
|
89,947
|
|
||
Total non-current acquired program rights and produced program rights
|
$
|
175,061
|
|
|
$
|
182,170
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Third-party customers
|
$
|
150,179
|
|
|
$
|
168,805
|
|
Less: allowance for bad debts and credit notes
|
(10,203
|
)
|
|
(9,902
|
)
|
||
Total accounts receivable
|
$
|
139,976
|
|
|
$
|
158,903
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Current:
|
|
|
|
||||
Prepaid acquired programming
|
$
|
24,326
|
|
|
$
|
22,579
|
|
Other prepaid expenses
|
7,389
|
|
|
7,616
|
|
||
VAT recoverable
|
793
|
|
|
650
|
|
||
Income taxes recoverable
|
180
|
|
|
109
|
|
||
Other
|
2,121
|
|
|
2,152
|
|
||
Total other current assets
|
$
|
34,809
|
|
|
$
|
33,106
|
|
|
|
|
|
||||
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Non-current:
|
|
|
|
|
|
||
Capitalized debt costs
|
$
|
12,237
|
|
|
$
|
12,947
|
|
Deferred tax
|
2,922
|
|
|
2,964
|
|
||
Other
|
618
|
|
|
958
|
|
||
Total other non-current assets
|
$
|
15,777
|
|
|
$
|
16,869
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Land and buildings
|
$
|
89,490
|
|
|
$
|
86,480
|
|
Machinery, fixtures and equipment
|
205,061
|
|
|
195,682
|
|
||
Other equipment
|
16,545
|
|
|
16,121
|
|
||
Software
|
55,862
|
|
|
53,143
|
|
||
Construction in progress
|
1,816
|
|
|
3,026
|
|
||
Total cost
|
368,774
|
|
|
354,452
|
|
||
Less: accumulated depreciation
|
(262,924
|
)
|
|
(250,804
|
)
|
||
Total net book value
|
$
|
105,850
|
|
|
$
|
103,648
|
|
|
|
|
|
||||
Assets held under capital leases (included in the above)
|
|
|
|
|
|
||
Machinery, fixtures and equipment
|
$
|
16,944
|
|
|
$
|
14,193
|
|
Total cost
|
16,944
|
|
|
14,193
|
|
||
Less: accumulated depreciation
|
(6,105
|
)
|
|
(5,151
|
)
|
||
Total net book value
|
$
|
10,839
|
|
|
$
|
9,042
|
|
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Opening balance
|
$
|
103,648
|
|
|
$
|
89,080
|
|
Additions
(1)
|
6,493
|
|
|
5,133
|
|
||
Disposals
|
(12
|
)
|
|
(77
|
)
|
||
Depreciation
|
(7,366
|
)
|
|
(5,959
|
)
|
||
Foreign currency movements
|
3,087
|
|
|
1,156
|
|
||
Ending balance
|
$
|
105,850
|
|
|
$
|
89,333
|
|
(1)
|
Includes assets acquired under capital leases of US$
1.9 million
and US$
0.5 million
for the
three months
ended
March 31, 2018
and
2017
, respectively.
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Accounts payable and accrued expenses
|
$
|
50,054
|
|
|
$
|
53,408
|
|
Related party accounts payable
|
211
|
|
|
252
|
|
||
Programming liabilities
|
20,252
|
|
|
16,923
|
|
||
Related party programming liabilities
|
17,065
|
|
|
20,027
|
|
||
Duties and other taxes payable
|
10,065
|
|
|
8,769
|
|
||
Accrued staff costs
|
11,108
|
|
|
18,430
|
|
||
Accrued interest payable
|
3,243
|
|
|
3,326
|
|
||
Related party accrued interest payable (including Guarantee Fees)
|
18,518
|
|
|
6,273
|
|
||
Income taxes payable
|
14,777
|
|
|
14,018
|
|
||
Other accrued liabilities
|
1,920
|
|
|
2,467
|
|
||
Total accounts payable and accrued liabilities
|
$
|
147,213
|
|
|
$
|
143,893
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Current:
|
|
|
|
||||
Deferred revenue
|
$
|
29,685
|
|
|
$
|
5,675
|
|
Legal provisions
|
3,066
|
|
|
2,907
|
|
||
Other
|
571
|
|
|
698
|
|
||
Total other current liabilities
|
$
|
33,322
|
|
|
$
|
9,280
|
|
|
|
|
|
||||
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Non-current:
|
|
|
|
|
|
||
Deferred tax
|
$
|
20,989
|
|
|
$
|
20,569
|
|
Related party commitment fee payable
(1)
|
10,765
|
|
|
10,765
|
|
||
Related party Guarantee Fee payable (Note 5)
|
58,855
|
|
|
58,855
|
|
||
Other
|
6,933
|
|
|
5,065
|
|
||
Total other non-current liabilities
|
$
|
97,542
|
|
|
$
|
95,254
|
|
(1)
|
Represents the commitment fee ("Commitment Fee") payable to Time Warner, including accrued interest, in respect of its obligation under a commitment letter dated November 14, 2014 between Time Warner and us whereby Time Warner agreed to provide or assist with arranging a loan facility to repay our
5.0%
senior convertible notes at maturity in November 2015. The Commitment Fee is payable by November 1, 2019, the maturity date of the 2019 Euro Term Loan, or earlier if the repayment of the 2019 Euro Term Loan is accelerated. The Commitment Fee bears interest at
8.5%
per annum and such interest is payable in arrears on each May 1 and November 1, and may be paid in cash or in kind, at our election.
|
Level 1
|
Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted instruments.
|
Level 2
|
Quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly.
|
Level 3
|
Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.
|
Trade Date
|
|
Number of Contracts
|
|
|
Description
|
|
Aggregate Notional Amount
|
|
|
Maturity Date
|
|
Objective
|
|
Fair Value as at March 31, 2018
|
|
||
April 5, 2016
|
|
5
|
|
|
Interest rate swap
|
|
EUR
|
468,800
|
|
|
February 21, 2021
|
|
Interest rate hedge underlying 2021 Euro Term Loan
|
|
$
|
(2,101
|
)
|
April 5, 2016
|
|
4
|
|
|
Interest rate swap
|
|
EUR
|
150,800
|
|
|
November 1, 2018
|
|
Interest rate hedge underlying 2018 Euro Term Loan
|
|
$
|
(160
|
)
|
November 10, 2015
|
|
3
|
|
|
Interest rate swap
|
|
EUR
|
235,335
|
|
|
November 1, 2019
|
|
Interest rate hedge underlying 2019 Euro Term Loan
|
|
$
|
(1,403
|
)
|
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Gain on currency swaps
|
$
|
—
|
|
|
$
|
368
|
|
Loss on interest rate swaps
|
(228
|
)
|
|
—
|
|
||
Change in fair value of derivatives
|
$
|
(228
|
)
|
|
$
|
368
|
|
|
Currency translation adjustment, net
|
|
|
Unrealized (loss) / gain on derivative instruments designated as hedging instruments
|
|
|
TOTAL
Accumulated Other Comprehensive Loss
|
|
|||
BALANCE December 31, 2017
|
$
|
(184,256
|
)
|
|
$
|
(3,182
|
)
|
|
$
|
(187,438
|
)
|
Other comprehensive income / (loss) before reclassifications:
|
|
|
|
|
|
||||||
Foreign exchange gain on intercompany loans
(1)
|
1,531
|
|
|
—
|
|
|
1,531
|
|
|||
Foreign exchange gain on the Series B Preferred Shares
|
7,151
|
|
|
—
|
|
|
7,151
|
|
|||
Currency translation adjustment
|
3,311
|
|
|
—
|
|
|
3,311
|
|
|||
Change in the fair value of hedging instruments
|
—
|
|
|
(731
|
)
|
|
(731
|
)
|
|||
Amounts reclassified from accumulated other comprehensive loss:
|
|
|
|
|
|
|
|||||
Changes in fair value reclassified to interest expense
|
—
|
|
|
621
|
|
|
621
|
|
|||
Changes in fair value reclassified to other non-operating income, net
(2)
|
—
|
|
|
301
|
|
|
301
|
|
|||
Net other comprehensive income
|
11,993
|
|
|
191
|
|
|
12,184
|
|
|||
BALANCE March 31, 2018
|
$
|
(172,263
|
)
|
|
$
|
(2,991
|
)
|
|
$
|
(175,254
|
)
|
(1)
|
Represents foreign exchange gains on intercompany loans that are of a long-term investment nature which are reported in the same manner as translation adjustments.
|
(2)
|
We expect to repay a portion of the 2019 Euro Term Loan with the expected proceeds from the Divestment Transaction (see
Note 5, "Long-term Debt and Other Financing Arrangements"
). This anticipated reduction of principal amounts owing in respect of the 2019 Euro Term Loan will reduce future interest payments that the interest rate swap maturing on November 1, 2019 is designed to hedge. To maintain the effectiveness of the interest rate swap, we have dedesignated a portion to align the notional amount of the instrument with the 2019 Euro Term Loan principal we expect to remain after the application of Divestment Transaction proceeds. For the dedesignated portion, all changes in fair value and those previously recognized in accumulated other comprehensive income / loss are recognized in other non-operating income, net in our condensed consolidated statements of operations and comprehensive income / loss (see
Note 12, "Financial Instruments and Fair Value Measurements"
).
|
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Interest on long-term debt and other financing arrangements
|
$
|
13,455
|
|
|
$
|
17,629
|
|
Amortization of capitalized debt issuance costs
|
1,557
|
|
|
1,364
|
|
||
Total interest expense
|
$
|
15,012
|
|
|
$
|
18,993
|
|
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Interest income
|
$
|
142
|
|
|
$
|
77
|
|
Foreign currency exchange gain, net
|
4,266
|
|
|
1,612
|
|
||
Change in fair value of derivatives (Note 12)
|
(228
|
)
|
|
368
|
|
||
Other (expense) / income, net
|
(23
|
)
|
|
175
|
|
||
Total other non-operating income
|
$
|
4,157
|
|
|
$
|
2,232
|
|
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Stock-based compensation expense from continuing operations
|
$
|
1,074
|
|
|
$
|
767
|
|
Stock-based compensation expense from discontinued operations
|
38
|
|
|
29
|
|
|
Shares
|
|
|
Weighted Average Exercise Price per Share
|
|
|
Weighted Average Remaining Contractual Term (years)
|
|
Aggregate Intrinsic Value
|
|
||
Outstanding at December 31, 2017
|
2,011,392
|
|
|
$
|
2.32
|
|
|
7.58
|
|
$
|
4,677
|
|
Outstanding at March 31, 2018
|
2,011,392
|
|
|
2.32
|
|
|
7.33
|
|
3,772
|
|
||
Vested and expected to vest
|
2,011,392
|
|
|
2.32
|
|
|
7.33
|
|
3,772
|
|
||
Exercisable at March 31, 2018
|
1,005,696
|
|
|
$
|
2.32
|
|
|
7.33
|
|
$
|
1,886
|
|
|
Number of
Shares / Units
|
|
|
Weighted Average
Grant Date
Fair Value
|
|
|
Unvested at December 31, 2017
|
2,694,063
|
|
|
$
|
3.07
|
|
Granted
|
759,120
|
|
|
4.40
|
|
|
Vested
|
(601,697
|
)
|
|
2.83
|
|
|
Unvested at March 31, 2018
|
2,851,486
|
|
|
$
|
3.47
|
|
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Income / (loss) from continuing operations
|
$
|
6,084
|
|
|
$
|
(5,982
|
)
|
Net loss attributable to noncontrolling interests
|
178
|
|
|
209
|
|
||
Less: preferred share accretion paid in kind (Note 13)
|
(2,447
|
)
|
|
(2,357
|
)
|
||
Less: income allocated to Series B Preferred Shares
|
(1,563
|
)
|
|
—
|
|
||
Income / (loss) from continuing operations available to common shareholders, net of noncontrolling interest
|
2,252
|
|
|
(8,130
|
)
|
||
Income / (loss) from discontinued operations, net of tax (Note 3)
|
988
|
|
|
(5,292
|
)
|
||
Net income / (loss) attributable to CME Ltd. available to common shareholders — basic
|
3,240
|
|
|
(13,422
|
)
|
||
|
|
|
|
||||
Effect of dilutive securities
|
|
|
|
||||
Dilutive effect of Series B Preferred Shares
|
65
|
|
|
—
|
|
||
Net income / (loss) attributable to CME Ltd. available to common shareholders — diluted
|
$
|
3,305
|
|
|
$
|
(13,422
|
)
|
|
|
|
|
||||
Weighted average outstanding shares of common stock — basic
(1)
|
158,039
|
|
|
154,795
|
|
||
Dilutive effect of common stock warrants, employee stock options and RSUs
|
83,866
|
|
|
—
|
|
||
Weighted average outstanding shares of common stock — diluted
|
241,905
|
|
|
154,795
|
|
||
|
|
|
|
||||
Net income / (loss) per share:
|
|
|
|
||||
Continuing operations — basic
|
$
|
0.01
|
|
|
$
|
(0.05
|
)
|
Continuing operations — diluted
|
0.01
|
|
|
(0.05
|
)
|
||
Discontinued operations — basic
|
0.01
|
|
|
(0.04
|
)
|
||
Discontinued operations — diluted
|
0.00
|
|
|
(0.04
|
)
|
||
Net income / (loss) attributable to CME Ltd. — basic
|
0.02
|
|
|
(0.09
|
)
|
||
Net income / (loss) attributable to CME Ltd. — diluted
|
0.01
|
|
|
(0.09
|
)
|
(1)
|
For the purpose of computing basic earnings per share, the
11,211,449
shares of Class A common stock underlying the Series A Preferred Share are included in the weighted average outstanding shares of common stock - basic, because the holder of the Series A Preferred Share is entitled to receive any dividends payable when dividends are declared by the Board of Directors with respect to any shares of the common stock.
|
|
For the Three Months Ended March 31,
|
||||
|
2018
|
|
|
2017
|
|
Employee stock options
|
—
|
|
|
2,011
|
|
RSUs
|
903
|
|
|
1,176
|
|
Series B Preferred Shares
|
—
|
|
|
105,658
|
|
Total
|
903
|
|
|
108,845
|
|
Net revenues:
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Bulgaria
|
$
|
19,433
|
|
|
$
|
15,305
|
|
Czech Republic
|
51,534
|
|
|
39,474
|
|
||
Romania
|
45,961
|
|
|
38,944
|
|
||
Slovak Republic
|
22,953
|
|
|
18,340
|
|
||
Intersegment revenues
(1)
|
(699
|
)
|
|
(331
|
)
|
||
Total net revenues
|
$
|
139,182
|
|
|
$
|
111,732
|
|
(1)
|
Reflects revenues earned from the sale of content to other country segments in CME Ltd. All other revenues are third party revenues.
|
OIBDA:
|
For the Three Months Ended March 31,
|
||||||
2018
|
|
|
2017
|
|
|||
Bulgaria
|
$
|
2,981
|
|
|
$
|
1,258
|
|
Czech Republic
|
15,370
|
|
|
10,747
|
|
||
Romania
|
18,893
|
|
|
14,460
|
|
||
Slovak Republic
|
1,103
|
|
|
748
|
|
||
Elimination
|
12
|
|
|
(8
|
)
|
||
Total operating segments
|
38,359
|
|
|
27,205
|
|
||
Corporate
|
(7,692
|
)
|
|
(6,113
|
)
|
||
Total OIBDA
|
30,667
|
|
|
21,092
|
|
||
Depreciation of property, plant and equipment
|
(7,366
|
)
|
|
(5,959
|
)
|
||
Amortization of broadcast licenses and other intangibles
|
(2,356
|
)
|
|
(2,109
|
)
|
||
Operating income
|
20,945
|
|
|
13,024
|
|
||
Interest expense (Note 15)
|
(15,012
|
)
|
|
(18,993
|
)
|
||
Loss on extinguishment of debt (Note 5)
|
(109
|
)
|
|
—
|
|
||
Other non-operating income, net (Note 16)
|
4,157
|
|
|
2,232
|
|
||
Income / (loss) before tax
|
$
|
9,981
|
|
|
$
|
(3,737
|
)
|
Total assets:
(1)
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Bulgaria
|
$
|
150,696
|
|
|
$
|
155,885
|
|
Czech Republic
|
841,942
|
|
|
842,716
|
|
||
Romania
|
303,362
|
|
|
307,286
|
|
||
Slovak Republic
|
159,121
|
|
|
149,866
|
|
||
Total operating segments
|
1,455,121
|
|
|
1,455,753
|
|
||
Corporate
|
51,324
|
|
|
24,146
|
|
||
Assets held for sale
|
143,481
|
|
|
148,156
|
|
||
Total assets
|
$
|
1,649,926
|
|
|
$
|
1,628,055
|
|
(1)
|
Segment assets exclude any intercompany balances.
|
Capital expenditures:
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Bulgaria
|
$
|
451
|
|
|
$
|
133
|
|
Czech Republic
|
2,507
|
|
|
3,198
|
|
||
Romania
|
576
|
|
|
1,709
|
|
||
Slovak Republic
|
411
|
|
|
465
|
|
||
Total operating segments
|
3,945
|
|
|
5,505
|
|
||
Corporate
|
153
|
|
|
529
|
|
||
Total capital expenditures
|
$
|
4,098
|
|
|
$
|
6,034
|
|
Long-lived assets:
(1)
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Bulgaria
|
$
|
8,930
|
|
|
$
|
7,863
|
|
Czech Republic
|
45,213
|
|
|
46,146
|
|
||
Romania
|
29,723
|
|
|
28,515
|
|
||
Slovak Republic
|
18,606
|
|
|
17,450
|
|
||
Total operating segments
|
102,472
|
|
|
99,974
|
|
||
Corporate
|
3,378
|
|
|
3,674
|
|
||
Total long-lived assets
|
$
|
105,850
|
|
|
$
|
103,648
|
|
(1)
|
Reflects property, plant and equipment, net.
|
Consolidated revenue by type:
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Television advertising
|
$
|
111,796
|
|
|
$
|
89,053
|
|
Carriage fees and subscriptions
|
23,297
|
|
|
18,886
|
|
||
Other
|
4,089
|
|
|
3,793
|
|
||
Total net revenues
|
$
|
139,182
|
|
|
$
|
111,732
|
|
|
Programming purchase obligations
|
|
|
Other commitments
(1)
|
|
|
Operating leases
|
|
|
Capital expenditures
|
|
||||
2018
|
$
|
24,663
|
|
|
$
|
13,232
|
|
|
$
|
2,264
|
|
|
$
|
1,411
|
|
2019
|
24,536
|
|
|
12,049
|
|
|
848
|
|
|
218
|
|
||||
2020
|
18,530
|
|
|
2,224
|
|
|
443
|
|
|
—
|
|
||||
2021
|
12,984
|
|
|
148
|
|
|
365
|
|
|
—
|
|
||||
2022
|
3,312
|
|
|
125
|
|
|
356
|
|
|
—
|
|
||||
2023 and thereafter
|
3,773
|
|
|
42
|
|
|
1,782
|
|
|
—
|
|
||||
Total
|
$
|
87,798
|
|
|
$
|
27,820
|
|
|
$
|
6,058
|
|
|
$
|
1,629
|
|
(1)
|
Other commitments are primarily comprised of digital transmission commitments.
|
|
For the Three Months Ended March 31,
|
||||||
|
2018
|
|
|
2017
|
|
||
Cost of revenues
|
$
|
5,318
|
|
|
$
|
3,476
|
|
Interest expense
|
10,473
|
|
|
14,375
|
|
|
March 31, 2018
|
|
|
December 31, 2017
|
|
||
Programming liabilities
|
$
|
17,065
|
|
|
$
|
20,027
|
|
Other accounts payable and accrued liabilities
|
211
|
|
|
252
|
|
||
Accrued interest payable
(1)
|
18,518
|
|
|
6,273
|
|
||
Other non-current liabilities
(2)
|
69,620
|
|
|
69,620
|
|
(1)
|
Amount represents accrued Guarantee Fees for which we have not yet paid in cash or made an election to pay in kind. See
Note 5, "Long-term Debt and Other Financing Arrangements"
.
|
(2)
|
Amount represents the Commitment Fee, as well as the Guarantee Fees for which we have made an election to pay in kind. See
Note 5, "Long-term Debt and Other Financing Arrangements"
.
|
Consolidated Net Leverage
|
Alternate Base Rate Loans
|
|
|
Eurodollar Loans
|
|
||||
≥
|
7.0x
|
|
|
|
5.25
|
%
|
|
6.25
|
%
|
<
|
7.0x
|
-
|
6.0x
|
|
4.25
|
%
|
|
5.25
|
%
|
<
|
6.0x
|
-
|
5.0x
|
|
3.50
|
%
|
|
4.50
|
%
|
<
|
5.0x
|
-
|
4.0x
|
|
3.00
|
%
|
|
4.00
|
%
|
<
|
4.0x
|
-
|
3.0x
|
|
2.50
|
%
|
|
3.50
|
%
|
<
|
3.0x
|
|
|
|
2.25
|
%
|
|
3.25
|
%
|
Consolidated Net Leverage
|
2018 Euro Term Loan
|
|
|
2019 Euro Term Loan
|
|
|
2021 Euro Term Loan
|
|
||||
≥
|
7.0x
|
|
|
|
6.00
|
%
|
|
6.00
|
%
|
|
6.50
|
%
|
<
|
7.0x
|
-
|
6.0x
|
|
5.00
|
%
|
|
5.00
|
%
|
|
5.50
|
%
|
<
|
6.0x
|
-
|
5.0x
|
|
4.25
|
%
|
|
4.25
|
%
|
|
4.75
|
%
|
<
|
5.0x
|
-
|
4.0x
|
|
3.75
|
%
|
|
3.75
|
%
|
|
4.25
|
%
|
<
|
4.0x
|
-
|
3.0x
|
|
3.25
|
%
|
|
3.25
|
%
|
|
3.75
|
%
|
<
|
3.0x
|
|
|
|
3.25
|
%
|
|
3.25
|
%
|
|
3.50
|
%
|
•
|
"
2018 Euro Term Loan
" refers to our floating rate senior unsecured term credit facility due May 1, 2019, guaranteed by Time Warner, dated as of November 14, 2014, as amended on March 9, 2015, February 19, 2016, June 22, 2017, and February 5, 2018;
|
•
|
"
2019 Euro Term Loan
" refers to our floating rate senior unsecured term credit facility due November 1, 2021, guaranteed by Time Warner, dated as of September 30, 2015, as amended on February 19, 2016, June 22, 2017 and April 25, 2018;
|
•
|
"
2021 Euro Term Loan
" refers to our floating rate senior unsecured term credit facility due April 26, 2023, entered into by CME BV (as defined below), guaranteed by Time Warner and CME Ltd., dated as of February 19, 2016, as amended on June 22, 2017 and April 25, 2018;
|
•
|
"
Euro Term Loans
" refers collectively to the 2018 Euro Term Loan, 2019 Euro Term Loan and 2021 Euro Term Loan;
|
•
|
"
2021 Revolving Credit Facility
" refers to our second amended and restated revolving credit facility due April 26, 2023, dated as of May 2, 2014, as amended and restated as of February 19, 2016, and as further amended and restated on April 25, 2018;
|
•
|
"
Divestment Transaction
" refers to the framework agreement dated July 9, 2017 with Slovenia Broadband S.à r.l., as amended on April 10, 2018, for the sale of our Croatia and Slovenia operations (see Item 1,
Note 3, "Discontinued Operations and Assets Held for Sale"
for further information);
|
•
|
"
Guarantee Fees
" refers to amounts accrued and payable to Time Warner as consideration for Time Warner's guarantees of the Euro Term Loans;
|
•
|
"
Reimbursement Agreement
" refers to our second amended and restated reimbursement agreement with Time Warner which provides that we will reimburse Time Warner for any amounts paid by them under any guarantee or through any loan purchase right exercised by Time Warner, dated as of November 14, 2014, amended and restated on February 19, 2016, and as further amended and restated on April 25, 2018;
|
•
|
"
CME BV
" refers to CME Media Enterprises B.V., our 100% owned subsidiary;
|
•
|
"
CME NV
" refers to Central European Media Enterprises N.V., our 100% owned subsidiary;
|
•
|
"
Time Warner
" refers to Time Warner Inc.; and
|
•
|
"
TW Investor
" refers to Time Warner Media Holdings B.V.
|
|
For the Three Months Ended March 31, (US$ 000's)
|
|||||||||
|
2018
|
|
|
2017
|
|
|
Movement
|
|
||
Net cash generated from continuing operating activities
|
$
|
66,525
|
|
|
$
|
50,420
|
|
|
31.9
|
%
|
Capital expenditures, net
|
(4,085
|
)
|
|
(5,933
|
)
|
|
31.1
|
%
|
||
Free cash flow
|
62,440
|
|
|
44,487
|
|
|
40.4
|
%
|
||
Cash paid for interest (including mandatory cash-pay Guarantee Fees)
|
4,232
|
|
|
4,133
|
|
|
2.4
|
%
|
||
Unlevered free cash flow
|
$
|
66,672
|
|
|
$
|
48,620
|
|
|
37.1
|
%
|
(US$ 000's)
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
Movement
|
|
||
Cash and cash equivalents
|
$
|
74,264
|
|
|
$
|
54,903
|
|
|
35.3
|
%
|
|
For the Three Months Ended March 31, 2018
|
|||||||
Country
|
Real GDP Growth
|
|
|
Real Private Consumption Growth
|
|
|
Net TV Ad Market Growth
|
|
Bulgaria
|
3.9
|
%
|
|
4.1
|
%
|
|
10.3
|
%
|
Czech Republic
|
4.3
|
%
|
|
4.3
|
%
|
|
6.3
|
%
|
Romania*
|
5.6
|
%
|
|
6.1
|
%
|
|
10.6
|
%
|
Slovak Republic
|
3.9
|
%
|
|
3.8
|
%
|
|
11.6
|
%
|
Total CME Ltd. Markets
|
4.6
|
%
|
|
4.8
|
%
|
|
9.0
|
%
|
|
NET REVENUES
|
||||||||||||
|
For the Three Months Ended March 31, (US$ 000's)
|
||||||||||||
|
|
|
|
|
Movement
|
||||||||
|
2018
|
|
|
2017
|
|
|
% Act
|
|
|
% Lfl
|
|
||
Bulgaria
|
$
|
19,433
|
|
|
$
|
15,305
|
|
|
27.0
|
%
|
|
10.2
|
%
|
Czech Republic
|
51,534
|
|
|
39,474
|
|
|
30.6
|
%
|
|
6.5
|
%
|
||
Romania
|
45,961
|
|
|
38,944
|
|
|
18.0
|
%
|
|
5.4
|
%
|
||
Slovak Republic
|
22,953
|
|
|
18,340
|
|
|
25.2
|
%
|
|
8.6
|
%
|
||
Intersegment revenues
|
(699
|
)
|
|
(331
|
)
|
|
NM
(1)
|
|
|
NM
(1)
|
|
||
Total net revenues
|
$
|
139,182
|
|
|
$
|
111,732
|
|
|
24.6
|
%
|
|
6.8
|
%
|
|
Three Months Ended March 31, (US$ 000's)
|
||||||||||||
|
|
|
|
|
Movement
|
||||||||
|
2018
|
|
|
2017
|
|
|
% Act
|
|
|
% Lfl
|
|
||
Television advertising
|
$
|
13,132
|
|
|
$
|
9,769
|
|
|
34.4
|
%
|
|
16.6
|
%
|
Carriage fees and subscriptions
|
5,307
|
|
|
4,673
|
|
|
13.6
|
%
|
|
(1.4
|
)%
|
||
Other
|
994
|
|
|
863
|
|
|
15.2
|
%
|
|
0.0
|
%
|
||
Net revenues
|
19,433
|
|
|
15,305
|
|
|
27.0
|
%
|
|
10.2
|
%
|
||
Costs charged in arriving at OIBDA
|
16,452
|
|
|
14,047
|
|
|
17.1
|
%
|
|
1.6
|
%
|
||
OIBDA
|
$
|
2,981
|
|
|
$
|
1,258
|
|
|
137.0
|
%
|
|
105.4
|
%
|
|
|
|
|
|
|
|
|
||||||
OIBDA margin
|
15.3
|
%
|
|
8.2
|
%
|
|
7.1 p.p.
|
|
|
7.1 p.p.
|
|
|
Three Months Ended March 31, (US$ 000's)
|
||||||||||||
|
|
|
|
|
Movement
|
||||||||
|
2018
|
|
|
2017
|
|
|
% Act
|
|
|
% Lfl
|
|
||
Television advertising
|
$
|
45,394
|
|
|
$
|
35,107
|
|
|
29.3
|
%
|
|
5.5
|
%
|
Carriage fees and subscriptions
|
3,920
|
|
|
2,639
|
|
|
48.5
|
%
|
|
21.2
|
%
|
||
Other
|
2,220
|
|
|
1,728
|
|
|
28.5
|
%
|
|
4.8
|
%
|
||
Net revenues
|
51,534
|
|
|
39,474
|
|
|
30.6
|
%
|
|
6.5
|
%
|
||
Costs charged in arriving at OIBDA
|
36,164
|
|
|
28,727
|
|
|
25.9
|
%
|
|
2.7
|
%
|
||
OIBDA
|
$
|
15,370
|
|
|
$
|
10,747
|
|
|
43.0
|
%
|
|
16.6
|
%
|
|
|
|
|
|
|
|
|
||||||
OIBDA margin
|
29.8
|
%
|
|
27.2
|
%
|
|
2.6 p.p.
|
|
|
2.6 p.p.
|
|
|
Three Months Ended March 31, (US$ 000's)
|
||||||||||||
|
|
|
|
|
Movement
|
||||||||
|
2018
|
|
|
2017
|
|
|
% Act
|
|
|
% Lfl
|
|
||
Television advertising
|
$
|
33,430
|
|
|
$
|
28,124
|
|
|
18.9
|
%
|
|
6.1
|
%
|
Carriage fees and subscriptions
|
11,827
|
|
|
10,063
|
|
|
17.5
|
%
|
|
5.0
|
%
|
||
Other
|
704
|
|
|
757
|
|
|
(7.0
|
)%
|
|
(17.1
|
)%
|
||
Net revenues
|
45,961
|
|
|
38,944
|
|
|
18.0
|
%
|
|
5.4
|
%
|
||
Costs charged in arriving at OIBDA
|
27,068
|
|
|
24,484
|
|
|
10.6
|
%
|
|
(1.3
|
)%
|
||
OIBDA
|
$
|
18,893
|
|
|
$
|
14,460
|
|
|
30.7
|
%
|
|
16.7
|
%
|
|
|
|
|
|
|
|
|
||||||
OIBDA margin
|
41.1
|
%
|
|
37.1
|
%
|
|
4.0 p.p.
|
|
|
4.0 p.p.
|
|
|
Three Months Ended March 31, (US$ 000's)
|
||||||||||||
|
|
|
|
|
Movement
|
||||||||
|
2018
|
|
|
2017
|
|
|
% Act
|
|
|
% Lfl
|
|
||
Television advertising
|
$
|
19,840
|
|
|
$
|
16,053
|
|
|
23.6
|
%
|
|
7.5
|
%
|
Carriage fees and subscriptions
|
2,243
|
|
|
1,511
|
|
|
48.4
|
%
|
|
28.8
|
%
|
||
Other
|
870
|
|
|
776
|
|
|
12.1
|
%
|
|
(7.1
|
)%
|
||
Net revenues
|
22,953
|
|
|
18,340
|
|
|
25.2
|
%
|
|
8.6
|
%
|
||
Costs charged in arriving at OIBDA
|
21,850
|
|
|
17,592
|
|
|
24.2
|
%
|
|
7.8
|
%
|
||
OIBDA
|
$
|
1,103
|
|
|
$
|
748
|
|
|
47.5
|
%
|
|
27.2
|
%
|
|
|
|
|
|
|
|
|
||||||
OIBDA margin
|
4.8
|
%
|
|
4.1
|
%
|
|
0.7 p.p.
|
|
|
0.7 p.p.
|
|
|
For the Three Months Ended March 31, (US$ 000's)
|
||||||||||||
|
|
|
|
|
Movement
|
||||||||
|
2018
|
|
|
2017
|
|
|
% Act
|
|
|
% Lfl
|
|
||
Revenue:
|
|
|
|
|
|
|
|
||||||
Television advertising
|
$
|
111,796
|
|
|
$
|
89,053
|
|
|
25.5
|
%
|
|
7.2
|
%
|
Carriage fees and subscriptions
|
23,297
|
|
|
18,886
|
|
|
23.4
|
%
|
|
7.8
|
%
|
||
Other revenue
|
4,089
|
|
|
3,793
|
|
|
7.8
|
%
|
|
(9.1
|
)%
|
||
Net Revenues
|
139,182
|
|
|
111,732
|
|
|
24.6
|
%
|
|
6.8
|
%
|
||
Operating expenses:
|
|
|
|
|
|
|
|
||||||
Content costs
|
69,806
|
|
|
58,645
|
|
|
19.0
|
%
|
|
2.3
|
%
|
||
Other operating costs
|
12,687
|
|
|
11,255
|
|
|
12.7
|
%
|
|
(4.5
|
)%
|
||
Depreciation of property, plant and equipment
|
7,366
|
|
|
5,959
|
|
|
23.6
|
%
|
|
4.3
|
%
|
||
Amortization of broadcast licenses and other intangibles
|
2,356
|
|
|
2,109
|
|
|
11.7
|
%
|
|
(8.5
|
)%
|
||
Cost of revenues
|
92,215
|
|
|
77,968
|
|
|
18.3
|
%
|
|
1.1
|
%
|
||
Selling, general and administrative expenses
|
26,022
|
|
|
20,740
|
|
|
25.5
|
%
|
|
5.9
|
%
|
||
Operating income
|
$
|
20,945
|
|
|
$
|
13,024
|
|
|
60.8
|
%
|
|
43.3
|
%
|
|
For the Three Months Ended March 31, (US$ 000's)
|
|||||||||
|
2018
|
|
|
2017
|
|
|
% Act
|
|
||
Interest expense
|
$
|
(15,012
|
)
|
|
$
|
(18,993
|
)
|
|
21.0
|
%
|
Loss on extinguishment of debt
|
(109
|
)
|
|
—
|
|
|
NM
(1)
|
|
||
Non-operating income / (expense):
|
|
|
|
|
|
|||||
Interest income
|
142
|
|
|
77
|
|
|
84.4
|
%
|
||
Foreign currency exchange gain, net
|
4,266
|
|
|
1,612
|
|
|
164.6
|
%
|
||
Change in fair value of derivatives
|
(228
|
)
|
|
368
|
|
|
NM
(1)
|
|
||
Other (expense) / income, net
|
(23
|
)
|
|
175
|
|
|
NM
(1)
|
|
||
Provision for income taxes
|
(3,897
|
)
|
|
(2,245
|
)
|
|
(73.6
|
)%
|
||
Income / (loss) from discontinued operations, net of tax
|
988
|
|
|
(5,292
|
)
|
|
NM
(1)
|
|
||
Net loss attributable to noncontrolling interests
|
178
|
|
|
209
|
|
|
(14.8
|
)%
|
(1)
|
Number is not meaningful.
|
|
For the Three Months Ended March 31, (US$ 000's)
|
|||||||||
|
2018
|
|
|
2017
|
|
|
% Act
|
|
||
Currency translation adjustment, net
|
$
|
11,785
|
|
|
$
|
2,072
|
|
|
NM
(1)
|
|
Unrealized gain on derivative instruments
|
191
|
|
|
1,258
|
|
|
(84.8
|
)%
|
(1)
|
Number is not meaningful.
|
|
For the Three Months Ended March 31, (US$ 000's)
|
|||||||||
|
2018
|
|
|
2017
|
|
|
% Act
|
|
||
Foreign exchange gain on intercompany transactions
|
$
|
1,531
|
|
|
$
|
786
|
|
|
94.8
|
%
|
Foreign exchange gain on the Series B Preferred Shares
|
7,151
|
|
|
4,966
|
|
|
44.0
|
%
|
||
Currency translation adjustment
|
3,103
|
|
|
(3,680
|
)
|
|
NM
(1)
|
|
||
Currency translation adjustment, net
|
$
|
11,785
|
|
|
$
|
2,072
|
|
|
NM
(1)
|
|
(1)
|
Number is not meaningful.
|
|
Condensed Consolidated Balance Sheet (US$ 000’s)
|
||||||||||||
|
March 31, 2018
|
|
|
December 31, 2017
|
|
|
% Act
|
|
|
% Lfl
|
|
||
Current assets
|
$
|
468,723
|
|
|
$
|
464,774
|
|
|
0.8
|
%
|
|
(2.3
|
)%
|
Non-current assets
|
1,181,203
|
|
|
1,163,281
|
|
|
1.5
|
%
|
|
(1.4
|
)%
|
||
Current liabilities
|
217,335
|
|
|
188,264
|
|
|
15.4
|
%
|
|
12.0
|
%
|
||
Non-current liabilities
|
1,151,864
|
|
|
1,180,968
|
|
|
(2.5
|
)%
|
|
(4.9
|
)%
|
||
Temporary equity
|
267,040
|
|
|
264,593
|
|
|
0.9
|
%
|
|
0.9
|
%
|
||
CME Ltd. shareholders’ equity / (deficit)
|
14,055
|
|
|
(5,788
|
)
|
|
NM
(1)
|
|
|
NM
(1)
|
|
||
Noncontrolling interests in consolidated subsidiaries
|
(368
|
)
|
|
18
|
|
|
NM
(1)
|
|
|
NM
(1)
|
|
(1)
|
Number is not meaningful.
|
|
For the Three Months Ended March 31, (US$ 000's)
|
||||||
|
2018
|
|
|
2017
|
|
||
Net cash generated from continuing operating activities
|
$
|
66,525
|
|
|
$
|
50,420
|
|
Net cash used in continuing investing activities
|
(4,085
|
)
|
|
(5,933
|
)
|
||
Net cash used in continuing financing activities
|
(60,447
|
)
|
|
(26
|
)
|
||
Net cash generated from discontinued operations
|
14,837
|
|
|
1,109
|
|
||
Impact of exchange rate fluctuations on cash and cash equivalents
|
2,531
|
|
|
(152
|
)
|
||
Net increase in cash and cash equivalents
|
$
|
19,361
|
|
|
$
|
45,418
|
|
|
Payments due by period (US$ 000’s)
|
||||||||||||||||||
|
Total
|
|
|
Less than 1 year
|
|
|
1-3 years
|
|
|
3-5 years
|
|
|
More than 5 years
|
|
|||||
Long-term debt – principal
(1)
|
$
|
1,053,365
|
|
|
$
|
—
|
|
|
$
|
1,053,365
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Long-term debt – interest
|
206,625
|
|
|
60,789
|
|
|
145,836
|
|
|
—
|
|
|
—
|
|
|||||
Unconditional purchase obligations
|
89,427
|
|
|
33,682
|
|
|
39,476
|
|
|
12,605
|
|
|
3,664
|
|
|||||
Operating leases
|
6,058
|
|
|
2,488
|
|
|
1,076
|
|
|
712
|
|
|
1,782
|
|
|||||
Capital lease obligations
|
10,551
|
|
|
3,581
|
|
|
5,869
|
|
|
1,101
|
|
|
—
|
|
|||||
Other long-term obligations
|
27,820
|
|
|
14,050
|
|
|
13,509
|
|
|
250
|
|
|
11
|
|
|||||
Total contractual obligations
|
$
|
1,393,846
|
|
|
$
|
114,590
|
|
|
$
|
1,259,131
|
|
|
$
|
14,668
|
|
|
$
|
5,457
|
|
Expected Maturity Dates
|
|
2018
|
|
|
2019
|
|
|
2020
|
|
|
2021
|
|
|
2022
|
|
|
Thereafter
|
|
Long-term Debt (000's):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Variable rate (EUR)
|
|
—
|
|
|
386,135
|
|
|
—
|
|
|
468,800
|
|
|
—
|
|
|
—
|
|
Average interest rate
(1)
|
|
—
|
|
|
1.50
|
%
|
|
—
|
|
|
1.50
|
%
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest Rate Swaps (000's):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Variable to fixed (EUR)
|
|
—
|
|
|
386,135
|
|
|
—
|
|
|
468,800
|
|
|
—
|
|
|
—
|
|
Average pay rate
|
|
—
|
|
|
0.25
|
%
|
|
—
|
|
|
0.28
|
%
|
|
—
|
|
|
—
|
|
Average receive rate
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
(1)
|
As discussed in Item 1,
Note 5, "Long-term Debt and Other Financing Arrangements"
, as consideration for Time Warner's guarantee of the Euro Term Loans, we pay Guarantee Fees to Time Warner based on the amounts outstanding on the Euro Term Loans, each calculated such that the all-in borrowing rate on each of the Euro Term Loans was 6.0% per annum during the three months ended
March 31, 2018
.
|
Expected Maturity Dates
|
|
2018
|
|
|
2019
|
|
|
2020
|
|
|
2021
|
|
|
2022
|
|
|
Thereafter
|
|
Long-term Debt (000's):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Variable rate (EUR)
|
|
200,800
|
|
|
235,335
|
|
|
—
|
|
|
468,800
|
|
|
—
|
|
|
—
|
|
Average interest rate
(1)
|
|
1.50
|
%
|
|
1.50
|
%
|
|
—
|
|
|
1.50
|
%
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest Rate Swaps (000's):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Variable to fixed (EUR)
|
|
200,800
|
|
|
235,335
|
|
|
—
|
|
|
468,800
|
|
|
—
|
|
|
—
|
|
Average pay rate
|
|
0.14
|
%
|
|
0.31
|
%
|
|
—
|
|
|
0.28
|
%
|
|
—
|
|
|
—
|
|
Average receive rate
|
|
—
|
%
|
|
—
|
%
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
(1)
|
As discussed in Item 1,
Note 5, "Long-term Debt and Other Financing Arrangements"
, as consideration for Time Warner's guarantee of the Euro Term Loans, we pay Guarantee Fees to Time Warner based on the amounts outstanding on the Euro Term Loans. As of December 31, 2017, the all-in borrowing rate on each of the Euro Term Loans was 6.0% per annum.
|
Exhibit Number
|
|
Description
|
10.01*
|
|
|
|
|
|
10.02*
|
|
|
|
|
|
10.03*
|
|
|
|
|
|
10.04*
|
|
|
|
|
|
10.05*
|
|
|
|
|
|
10.06*
|
|
|
|
|
|
10.07*
|
|
|
|
|
|
31.01
|
|
|
|
|
|
31.02
|
|
|
|
|
|
31.03
|
|
|
|
|
|
32.01
|
|
|
|
|
|
99.1
|
|
|
|
|
|
99.2
|
|
|
|
|
|
99.3
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Schema Document
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Calculation Linkbase Document
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Definition Linkbase Document
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Label Linkbase Document
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Presentation Linkbase Document
|
|
|
Central European Media Enterprises Ltd.
|
Date:
|
April 26, 2018
|
/s/ David Sturgeon
David Sturgeon
Executive Vice President and Chief Financial Officer
Principal Financial Officer and Principal Accounting Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Central European Media Enterprises Ltd.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report), that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ Michael Del Nin
|
|
Michael Del Nin
|
|
co-Chief Executive Officer
|
|
(co-Principal Executive Officer)
|
|
April 26, 2018
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Central European Media Enterprises Ltd.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report), that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ Christoph Mainusch
|
|
Christoph Mainusch
|
|
co-Chief Executive Officer
|
|
(co-Principal Executive Officer)
|
|
April 26, 2018
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Central European Media Enterprises Ltd.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report), that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ David Sturgeon
|
|
David Sturgeon
|
|
Chief Financial Officer
|
|
(Principal Financial Officer)
|
|
April 26, 2018
|
1
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2
|
the information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company as of the dates and for the periods explained in the Report.
|
|
/s/ Michael Del Nin
|
|
/s/ Christoph Mainusch
|
|
/s/ David Sturgeon
|
|
Michael Del Nin
|
|
Christoph Mainusch
|
|
David Sturgeon
|
|
co-Chief Executive Officer
|
|
co-Chief Executive Officer
|
|
Chief Financial Officer
|
|
(co-Principal Executive Officer)
|
|
(co-Principal Executive Officer)
|
|
(Principal Financial Officer)
|
|
April 26, 2018
|
|
April 26, 2018
|
|
April 26, 2018
|
Dated
|
April 25, 2018_________________________
|
[Print Name of Grantor]
|
Time Warner Inc. ____________________
|
[Print Name and Title of Signatory]
|
Priya Dogra, Senior Vice President, Mergers & Acquisitions________________________
|
Signature
|
/s/ Priya Dogra
|
BY THIS POWER OF ATTORNEY
dated
|
20
|
(A)
|
By virtue of the Proxy, I am entitled to exercise certain rights and powers in connection with the Shares, as more fully set out therein.
|
(B)
|
I now wish to appoint the Attorney to assist me in exercising the powers conferred by the Proxy in the manner set out herein.
|
1.
|
INTERPRETATION
|
2.
|
EFFECTIVE DATE FOR POWER OF ATTORNEY
|
3.
|
POWERS OF ATTORNEY
|
4.
|
ACTIONS OF ATTORNEY TO BE VALID
|
5.
|
EXCLUSION OF LIABILITY
|
6.
|
REVOCATION OF POWER OF ATTORNEY
|
6.1
|
It shall be lawful for me at any time to revoke this Power of Attorney by notice in writing to my Attorney delivered to the last known address of my Attorney.
|
6.2
|
Forthwith upon delivery in manner aforesaid of such notice in writing the powers granted herein shall cease to be exercisable by my Attorney.
|
7.
|
MASCULINE INCLUDES FEMININE
|
8.
|
GOVERNING LAW
|
SIGNED
as a deed by
[NAME]
in the presence of:
_____________________________
|
)
)
)
|
|
__________________________
|
|
)
)
|
|
|
||
Witness signature
|
|
|||
Name:
|
|
|||
Address:
|
|
|||
Occupation:
|
|
Dated
|
April 25, 2018_________________________
|
[Print Name of Grantor]
|
Time Warner Media Holdings B.V.__________
|
[Print Name and Title of Signatory]
|
Stephen N. Kapner, Managing Director_____
|
Signature
|
/s/ Stephen N. Kapner
|
BY THIS POWER OF ATTORNEY
dated
|
20
|
(A)
|
By virtue of the Proxy, I am entitled to exercise certain rights and powers in connection with the Shares, as more fully set out therein.
|
(B)
|
I now wish to appoint the Attorney to assist me in exercising the powers conferred by the Proxy in the manner set out herein.
|
1.
|
INTERPRETATION
|
2.
|
EFFECTIVE DATE FOR POWER OF ATTORNEY
|
3.
|
POWERS OF ATTORNEY
|
4.
|
ACTIONS OF ATTORNEY TO BE VALID
|
5.
|
EXCLUSION OF LIABILITY
|
6.
|
REVOCATION OF POWER OF ATTORNEY
|
6.1
|
It shall be lawful for me at any time to revoke this Power of Attorney by notice in writing to my Attorney delivered to the last known address of my Attorney.
|
6.2
|
Forthwith upon delivery in manner aforesaid of such notice in writing the powers granted herein shall cease to be exercisable by my Attorney.
|
7.
|
MASCULINE INCLUDES FEMININE
|
8.
|
GOVERNING LAW
|
SIGNED
as a deed by
[NAME]
in the presence of:
_____________________________
|
)
)
)
|
|
__________________________
|
|
)
)
|
|
|
||
Witness signature
|
|
|||
Name:
|
|
|||
Address:
|
|
|||
Occupation:
|
|
1.
|
Reference is made to (i) that certain Standing Proxy/Authorization, dated as of the date hereof (the “Initial TWX Proxy”), pursuant to which Time Warner Inc. (“TWX”) grants to certain directors of Central European Media Enterprises Ltd. (“CME”) the right to vote shares of Class A Common Stock of CME under certain circumstances, and (ii) that certain Standing Proxy/Authorization, dated as of the date hereof (the “Initial TWBV Proxy”), pursuant to which Time Warner Media Holdings B.V. (“TWBV”) grants to the directors of CME the right to vote shares of Class A Common Stock of CME under certain circumstances. Copies of the Initial TWX Proxy and Initial TWBV Proxy are attached hereto and are referred to as the “Initial Proxies.”
|
2.
|
On or before the expiration date of the Initial Proxies, both TWX and TWBV will deliver to CME a new proxy (the “First Replacement Proxies”), in substantially the same form as the Initial Proxies, and with a term beginning on the expiration date of the Initial Proxies and lasting for twelve (12) months. In addition, each of TWX and TWBV will have the unilateral option to deliver to CME a proxy (the “Second Replacement Proxies”), in substantially the same form as the Initial Proxies and with a term beginning on the expiration date of the First Replacement Proxies and lasting for twelve (12) months. The Initial Proxies, First Replacement Proxies and Second Replacement Proxies are referred to collectively herein as the “Proxies.”
|
3.
|
If, during the term of a Proxy, a General Meeting of the Company is convened to vote in respect of a “Change of Control Event” (as defined in the Proxies), then with respect to any matters at such meeting that do not relate to the Change of Control Event, TWX and TWBV will ensure so far as is possible that the votes of the Class A Common Stock that are subject to a Proxy are cast to reflect the proportions of votes cast excluding those that are subject to the Proxies.
|
4.
|
TWX and TWBV will not revoke any of the Proxies prior to the date of expiration of those Proxies.
|
5.
|
Except as otherwise agreed with you in writing, this agreement shall automatically terminate with respect to any Proxy on such date as the proxy terminates by its terms.
|
6.
|
TWX shall indemnify CME, its subsidiaries and their respective officers, directors, employees and agents (collectively, the “Indemnified Parties”) from and against all third-party claims and all damages, losses, liabilities, reasonable expenses and settlement amounts (including reasonable legal fees and costs) (collectively, “Indemnified Amounts”) to the extent primarily arising out of or in connection with this agreement, except to the extent that any such Indemnified Amounts arise out of or are in connection with the failure of an Indemnified Party to comply with the terms hereof or in the Proxies. In the case of any claim asserted by CME under this Agreement, notice shall be given by CME to TWX promptly after CME has actual knowledge of any claim as to which indemnity may be sought, and CME shall permit TWX (at the expense of TWX) to assume the defense of any claim or any litigation resulting therefrom,
provided
that
(i) counsel for TWX who shall conduct the defense of such claim or litigation shall be reasonably satisfactory to CME, and CME may participate in such defense at CME’s expense and (ii) the failure of CME to give notice as provided herein shall not relieve TWX of its indemnification obligation under this agreement, except to the extent that such failure results in a lack of actual notice to TWX and TWX is materially prejudiced as a result of such failure to give notice. Any settlement or compromise of such asserted claim by TWX shall require the prior written consent of CME, which consent shall not be unreasonably withheld, conditioned or delayed,
provided
that
no such consent shall be required as long as it is solely a monetary settlement (that will be paid entirely by or on behalf of TWX) that provides a full release of CME with respect to such matter and does not contain an admission of liability on the part of CME and will not have an ongoing adverse effect on the business or operations of CME.
|
7.
|
TWX and TWBV acknowledge and agree that CME and its subsidiaries may be irreparably harmed by the breach of the terms of this agreement and damages may not be an adequate remedy, and CME may therefore seek an injunction or specific performance for any threatened or actual breach of the provisions of this agreement by TWX or TWBV.
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8.
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No failure or delay in exercising any right, power or privilege under this agreement will operate as a waiver thereof nor will any single or partial exercise of any right, power or privilege preclude any further exercise thereof or the exercise of any other right, power or privilege under this agreement. The terms of this agreement and our obligations under this agreement may only be amended by a written instrument signed by you and us.
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9.
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Except as expressly provided herein, this agreement is for the sole benefit of the parties hereto and their heirs, beneficiaries, successors and permitted assignees and nothing herein expressed or implied will give or be construed to give any person or entity, other than the parties hereto and such successors and permitted assignees, any other right, benefit or remedy of any nature whatsoever under or by reason of this agreement.
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10.
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This agreement shall be governed by and construed in accordance with the laws of the State of New York. Any dispute, controversy or claim arising out of or relating to this agreement, or the breach, termination or invalidity hereof, shall be subject to the exclusive jurisdiction of the courts of the State of New York or federal courts based in New York, New York.
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11.
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If any provision of this agreement shall be held to be illegal or unenforceable, the enforceability of the reminder of this agreement shall not be affected.
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12.
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This agreement shall be binding upon and for the benefit of the undersigned parties, their successors and assigns.
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13.
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Neither party (without the prior written consent of the other party) can assign this agreement. If either TWX or TWBV transfers shares that are subject to a Proxy to an Affiliate (as defined in the Proxy), then such transferor will ensure that the transferee complies with all obligations hereunder, including delivery of a new proxy on substantially the same terms as those of the Proxies.
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14.
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This agreement may be executed in two counterparts each of which when executed and delivered is an original, but the counterparts together constitute the same document.
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15.
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Both parties warrant that they are entitled to enter this agreement and perform their obligations herein.
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TIME WARNER INC.
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/s/ Priya Dogra
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Name: Priya Dogra
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Title: Senior Vice President, Mergers & Acquisitions
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TIME WARNER MEDIA HOLDINGS B.V.
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/s/ Stephen N. Kapner
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Name: Stephen N. Kapner
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Title: Managing Director
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CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.
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/s/ David Sturgeon
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Name: David Sturgeon
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Title: Chief Financial Officer
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