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Financial Results for the Third Quarter & Nine Months Ended September 30, 2009
MOSCOW, Russia, November 5 /PRNewswire/ -- CTC Media, Inc. ("CTC Media" or the "Company") (NASDAQ: CTCM), Russia's
leading independent media company, today announced its unaudited consolidated
financial results for the third quarter and nine months ended
September 30, 2009.
Three Months Nine Months
Ended September 30, Ended September 30,
(US$ 000's except per 2008 2009 Change 2008 2009 Change
share data)
Total operating
revenues $143,307 $106,935 -25.4% $452,823 $325,607 -28.1%
Total operating
expenses (92,222) (71,592) -22.4% (278,671) (209,852) -24.7%
OIBDA(1) 55,030 38,201 -30.6% 183,706 123,874 -32.6%
OIBDA margin 38.4% 35.7% -2.7% 40.6% 38.0% -2.6%
Net income
attributable
to CTC Media, Inc.
stockholders 20,969 25,855 23.3% 111,498 79,502 -28.7%
Diluted
earnings
per share $0.13 $0.16 23.1% $0.70 $0.51 -27.1%
THIRD QUARTER FINANCIAL HIGHLIGHTS
- Total revenues down 4% year-on-year in ruble terms
- Russian advertising revenues down 4% year-on-year in ruble terms
- Total operating expenses flat year-on-year in ruble terms
- OIBDA of $38.2 million with an OIBDA margin of 35.7%
- Net income of $25.9 million and fully diluted earnings per
share of $0.16
- Net cash position of $55.9 million
THIRD QUARTER OPERATING HIGHLIGHTS
- Average combined 4+ audience share in Russia up year-on-year to 13.6%
from 13.2%
- Target audience shares up year-on-year for all three Russian networks
- CTC 6-54 audience share of 13.2% in September was at highest level
since 2006
Anton Kudryashov, Chief Executive Officer of CTC Media,
commented: "We continued to outperform the Russian television advertising
market in the third quarter, with our Russian advertising sales declining by
4% year-on-year in ruble terms. Video International has estimated that the
Russian television advertising market was down 21% year-on-year in the
quarter, due to the impact of the ongoing economic crisis on advertising
spending levels.
"Our increased investment in programming ahead of the highly
competitive fall season proved successful and resulted in higher ratings in
the third quarter for all three Russian networks. The CTC Network's target
audience share rose to 13.2% in September, which is the highest monthly
average since 2006. We were also able to effectively monetize this additional
inventory with a sell-out ratio of 97% in the quarter and increased
advertising market shares. Furthermore, we reduced our non-programming costs
further year-on-year and were therefore able to maintain a flat cost base and
deliver a healthy margin for the quarter.
"We have continued to build on these target audience share
gains in the fourth quarter, albeit not at the exceptional levels achieved in
the third quarter. We therefore currently expect that our Russian advertising
revenues will be down by between 4% and 6% year-on-year in ruble terms for
the full year 2009, compared to the estimated television advertising market
decline of over 20%. Furthermore, we still expect our organic costs to be
flat year-on-year for the full year. We have significantly enhanced our
competitive market position in the year to date, but visibility continues to
be limited moving forward and we expect overall market conditions to remain
challenging in 2010."
Operating Review
Revenues(1)
Three Months Nine Months
Ended September 30, Ended September 30,
(US$ 000's) 2008 2009 Change 2008 2009 Change
Operating
revenues:
CTC Network $ 89,372 $68,409 -23.5% $297,067 $210,618 -29.1%
Domashny Network 13,305 10,521 -20.9% 44,976 31,972 -28.9%
DTV Network 10,190 9,435 -7.4% 22,405 27,285 21.8%
CTC Television
Station Group 21,372 13,544 -36.6% 67,364 39,672 -41.1%
Domashny
Television
Station Group 3,783 1,703 -55.0% 11,348 5,660 -50.1%
DTV Station
Television Group 1,531 794 -48.1% 3,335 2,582 -22.6%
CIS Group 3,608 2,413 -33.1% 5,980 7,293 22.0%
Production Group 146 116 -20.5% 348 525 50.9%
Total operating
revenues $143,307 $106,935 -25.4% $452,823 $325,607 -28.1%
Total operating revenues for the three months ended September 30, 2009
were down by 25% year-on-year in US dollar terms. The third quarter results
in both 2008 and 2009 included full quarterly contributions from DTV Group in
Russia and Channel 31 Group in Kazakhstan, which were both acquired in the
first half of 2008.
The reported decline in revenues reflected the underlying weakness in the
advertising markets, as well as the year-on-year depreciation of the
Company's principal operating currency (the ruble) against the Company's
reporting currency (the US dollar). The depreciation had a negative impact of
approximately 22% on the Company's ruble-denominated sales. Advertising sales
in Russia, which accounted for 95% of total third quarter revenues in both
2009 and 2008, were down 4% year-on-year in the third quarter in ruble terms.
The year-on-year development in advertising revenues for the Russian
Television Station Groups once again reflected a sharp decline in the
regional Russian advertising markets and was due to the weighting of spending
by large advertisers towards national campaigns, resulting in significant
decreases in regional advertising rates compared with national rates.
CIS Group revenues were down by 33% year-on-year in the third
quarter of 2009 primarily due to the year-on-year depreciation of the Kazakh
tenge against the US dollar, lower sell-out ratios and decreased audience
shares, which were partially offset by increased advertising rates. Channel
31 generated over 90% of CIS Group revenues in the quarter.
Share of Viewing in Target Demographics
Average Audience Shares (%)
Q3 2008 Q2 2009 Q3 2009
CTC Network (all 6-54) 12.0 12.5 12.2
Domashny Network (females 25-60) 2.8 2.9 3.2
DTV Network (all 25-54) 2.1 2.4 2.3
Channel 31 (all 6-54) 16.6 11.7 11.6
Each of the Russian networks delivered higher target audience
shares in the third quarter and improvements year-on-year, which reflected a
successful beginning to the new Fall season.
The increased ratings for the flagship CTC Network reflected
the successful launch of the new Fall season programming. The target audience
share in September averaged 13.2%, which was the highest monthly average
since 2006. Major audience share drivers included the new seasons of the
'Daddy's Girls' sitcom and 'Ranetki' series, as well as the premier season of
the'Margosha' series, which is based on the Argentine 'LaLola' format. All of
these prime-time shows were produced in-house and gained audience shares
above the average audience share for the channel. The broader programming
schedule that included a number of locally produced premier shows and
infotainment programs also supported the positive viewing share development.
Domashny's audience share also increased year-on-year from
2.8% to 3.2% due to the continued strong performance of re-runs of CTC hit
series 'Born Not Pretty', which was supported by a successful line-up of
movies and documentaries and enhanced weekend programming. The recently
launched new season of 'Desperate Housewives' is also gradually increasing
its share of viewing.
DTV has been focused on the 25-54 year-old target group since
January 2009 and increased its viewing share in the third quarter following
the continued success of locally produced 'Marital Fiction', as well as the
late prime-time slots for Russian and foreign criminal investigation and
action series. DTV continues to work on refining its channel positioning and
introduced a number of locally produced short cycles of programs in various
genres oriented towards the target demographic.
Channel 31 maintained its position as the second-most watched
broadcaster in Kazakhstan in the third quarter, with a well-balanced mix of
CTC-branded, international and locally produced Kazakh content.
Expenses
Three Months Nine Months
Ended September 30, Ended September 30,
(US$ 000's) 2008 2009 Change 2008 2009 Change
Operating
expenses:
Direct operating
expenses $10,312 $7,866 -23.7% $27,308 $22,848 -16.3%
Selling, general &
administrative
expenses 28,492 17,686 -37.9% 70,463 52,936 -24.9%
Amortization of
programming rights 48,007 42,580 -11.3% 164,229 120,878 -26.4%
Amortization of
sublicensing
rights and own
production cost 1,466 602 -58.9% 7,117 5,071 -28.7%
Depreciation &
amortization 3,945 2,858 -27.6% 9,554 8,119 -15.0%
Total operating
expenses $92,222 $71,592 -22.4% $278,671 $209,852 -24.7%
Total operating expenses for the three months ended September 30, 2009
were down 22% year-on-year in US dollar terms and included full quarterly
contributions from DTV Group and Channel 31 Group in both 2008 and 2009. The
reported decrease in expenses reflected the year-on-year depreciation of the
Company's ruble and other operating currencies against the US dollar
reporting currency while, in ruble terms, total operating expenditure was
flat year-on-year.
Direct operating expenses were down 24% year-on-year in the third quarter
in US dollar terms, while selling, general and administrative expenses were
down 38%. Stock-based compensation expenses, most of which were allocated to
selling, general and administrative expenses, were down year-on-year to $3.4
million in the third quarter of 2009 from $5.2 million in the same period of
2008.
Programming expenses decreased by 11% year-on-year and represented 39.8%
of revenues, up from 33.5% in the third quarter of 2008. The year-on-year
increase in programming costs as a percentage of revenue reflected a
decreased top-line and a relatively more expensive programming mix in the
third quarter of 2009 compared to the third quarter of 2008, which were
partially offset by the effect of changes in certain content amortization
rates from the beginning of 2009. Increased investment in programming was
connected with the launch of the Fall season schedule, including new episodes
of successful in-house produced series and sitcoms on the CTC Network, new
local entertainment and infotainment shows and programs, and top quality
international movies.
The amortization rates for certain types of Russian-produced programming
were changed with effect from the beginning of 2009, in order better to
reflect expected revenue generation patterns. These changes in the
amortization policy resulted in a decrease in amortization expenses of $0.4
million during the third quarter of 2009 compared with the third quarter of
2008. Excluding the impact of these amortization policy changes, programming
expenses were down 10% year-on-year in the third quarter in US dollar terms.
The 59% year-on-year decline in sublicensing and own production costs
primarily reflected the lower cost of in-house produced series and sitcoms
that were sold to third-party broadcasters in Ukraine. The decrease in costs
was mainly due to the depreciation of the Russian ruble against the US
dollar.
Consolidated OIBDA was therefore lower year-on-year at $38.2
million (Q3 2008: $55.0 million) and the OIBDA margin declined to 35.7% (Q3
2008: 38.4%).
Group depreciation and amortization charges decreased by 27.6%
year-on-year to $2.9 million (Q3 2008: $3.9 million) in the third quarter,
and consolidated operating income totaled $35.3 million (Q3 2008: $51.1
million).
The net interest expenses were down year-on-year by 85.7% to
$0.6 million in the quarter (Q3 2008: $4.0 million) primarily due to partial
repayments of principal amount of the Company's syndicated loan in December
2008 and June 2009.
The Company's pre-tax income amounted to $35.2 million (Q3
2008: $34.2 million) in the quarter. The effective tax rate decreased
year-on-year in the third quarter to 26% (Q3 2008: 36%) mainly due to the
decrease in statutory income tax rates in Russia (from 24% to 20%) and
Kazakhstan (from 30% to 20%) from the beginning of 2009.
Consolidated net income attributable to CTC Media, Inc.
stockholders therefore totaled $25.9 million (Q3 2008: $21.0 million) in the
third quarter and fully diluted earnings per share amounted to $0.16 (Q3
2008: $0.13).
Cash Flow
The Company's net cash flow from operations
totaled $75.7 million in the first nine months of 2009 (first nine months of
2008: $94.1 million) and reflected the net effect of lower advertising sales
and lower spending for programming and sublicensing rights in the first half
of 2009.
Cash used in investing activities totaled
$23.9 million during the first nine months of 2009 (first nine months of
2008: $411.5 million) and included $11.0 million in payments related to the
acquisitions of Costafilm and Soho Media, as well as purchases of equipment
and software for the Company's new digital broadcasting center in Moscow. The
investments in the first nine months of 2008 included the acquisition of DTV
Group in Russia, Channel 31 Group in Kazakhstan, the Costafilm and Soho Media
production companies in Russia, and a number of local owned-and-operated
stations in Russia.
Cash used for financing activities amounted
to $36.5 million for the first nine months of the year (first nine months of
2008: $55.5 million). This included a $33.8 million part repayment of a
syndicated loan, which the Company drew down in July 2008 in order to finance
the acquisition of DTV Group.
The Company's cash and cash equivalents
amounted to $112.6 million at September 30, 2009, compared to $98.1 million
at the end of 2008 and $54.3 million at September 30, 2008.
Borrowings
The Company's total borrowings and accrued
interest amounted to $56.7 million (September 30, 2008: $124.6 million) at
the end of the reporting period, compared to $90.6 million at the end of
2008. The Company therefore had a net cash position, which is defined as cash
and cash equivalents less interest-bearing liabilities, of $55.9 million
(September 30, 2008: net debt of $70.3 million) at the end of the reporting
period, compared to a net cash position of $7.5 million at the end of 2008.
Conference Call
The Company will host a conference call to discuss its third
quarter financial results today, Thursday, November 5, 2009, at 9:00 a.m. ET
(5:00 p.m. Moscow time, 2:00 p.m. London time). To access the conference
call, please dial +1-718-247-0884 (US/International) or +44(0)20-7806-1966
(UK/International). The pass code for the call is 7619644. A live webcast of
the conference call will also be available via the investor relations section
of the Company's corporate web site - http://www.ctcmedia.ru/investors.
The webcast will also be archived on the Company's web site for two weeks.
Use of Non-GAAP Financial Measures
To supplement its consolidated financial statements, which are
prepared and presented in accordance with US GAAP, the Company uses the
following non-GAAP financial measures: OIBDA (on a consolidated and segment
basis) and OIBDA margin. The presentation of this financial information is
not intended to be considered in isolation or as a substitute for, or
superior to, financial information prepared and presented in accordance with
GAAP. For more information on these non-GAAP financial measures, please see
the accompanying financial tables included at the end of this release.
The Company uses these non-GAAP financial measures for
financial and operational decision making and as a means to evaluate
period-to-period comparisons. The Company believes that these non-GAAP
financial measures provide meaningful supplemental information regarding its
performance and liquidity by excluding certain expenses that may not be
indicative of its recurring core business operating results, meaning its
operating performance excluding certain non-cash charges. These metrics are
used by management to further its understanding of the Company's operating
performance in the ordinary, ongoing and customary course of operations. The
Company also believes that these metrics provide investors and equity
analysts with a useful basis for analyzing operating performance against
historical data and the results of comparable companies.
OIBDA and OIBDA margin. OIBDA is defined as operating income
before depreciation and amortization (exclusive of amortization of
programming rights and sublicensing rights). OIBDA margin is defined as OIBDA
divided by total operating revenues. The most directly comparable GAAP
measures to OIBDA and OIBDA margin are operating income and operating income
margin, respectively. Unlike operating income, OIBDA excludes depreciation
and amortization, other than amortization of programming rights and
sublicensing rights. The purchase of programming rights is the Company's most
significant expenditure that enables it to generate revenues, and OIBDA
includes the impact of the amortization of these rights. Expenditures for
capital items such as property, plant and equipment have a materially less
significant impact on the Company's ability to generate revenues. For this
reason, the Company excludes the related depreciation expense for these items
from OIBDA. Moreover, a significant portion of its intangible assets were
acquired in business acquisitions. The amortization of intangible assets is
therefore also excluded from OIBDA.
About CTC Media, Inc.
CTC Media is a leading independent media company in Russia,
with operations throughout Russia and elsewhere in the CIS. It operates three
free-to-air television networks in Russia - CTC, Domashny and DTV, Channel 31
in Kazakhstan and TV companies in Uzbekistan and Moldova. The combined
population of the countries in which CTC Media operates is over 180 million
people. CTC Media also owns two TV content production companies, Costafilm
and Soho Media. The Company's common stock is traded on The NASDAQ Global
Select Market under the symbol "CTCM". For more information on CTC Media,
please visit http://www.ctcmedia.ru.
Caution Concerning Forward Looking Statements
Certain statements in this press release that are not based on
historical information are "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements include, among others, statements regarding the potential impact
of the current unfavorable macroeconomic environment globally and in Russia
on the size of the Russian television advertising market, its impact on the
Company's revenues, and the split of advertising sales between national and
local markets. These statements reflect the Company's current expectations
concerning future results and events. These forward-looking statements
involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of CTC Media to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements.
The potential risks and uncertainties that could cause actual
future results to differ from those expressed by forward-looking statements
include, among others, further depreciation of the value of the Russian ruble
compared to the US dollar, changes in the size of the Russian television
advertising market, particularly in light of the current economic instability
in Russia and globally; the Company's ability to deliver audience share,
particularly in primetime, to its advertisers; free-to-air television
remaining a significant advertising forum in Russia; the Company's reliance
on a single television advertising sales house for substantially all of its
revenues; and restrictions on foreign involvement in the Russian television
business. These and other risks are described in the "Risk Factors" section
of CTC Media's quarterly report on Form 10-Q for the second quarter of 2009,
filed with the SEC on August 6, 2009, which will be updated in the company's
quarterly report on Form 10-Q for the third quarter of 2009, to be filed on
November 5, 2009.
Other unknown or unpredictable factors could have material
adverse effects on CTC Media's future results, performance or achievements.
In light of these risks, uncertainties, assumptions and factors, the
forward-looking events discussed herein may not occur. You are cautioned not
to place undue reliance on these forward-looking statements. CTC Media does
not undertake any obligation to publicly update or revise any forward-looking
statements because of new information, future events or otherwise.
CTC MEDIA, INC, AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME (LOSS)
(in thousands of US dollars, except share and per share data)
Three months ended Nine months ended
September 30, September 30,
2008 2009 2008 2009
REVENUES:
Advertising $ 139,469 $ 103,625 $ 440,245 $ 311,386
Sublicensing and own
production revenue 3,149 3,022 10,601 12,914
Other revenue 689 288 1,977 1,307
Total operating
revenues 143,307 106,935 452,823 325,607
EXPENSES:
Direct operating
expenses (exclusive
of amortization of
programming rights
and sublicensing
rights, shown below,
exclusive of
depreciation and
amortization of
$3,147 and $2,453
for the three months
and $7,179 and
$6,524 for the nine
months ended
September 30, 2008
and 2009
respectively; and
inclusive of
stock-based
compensation of $213
and $151 for the
three months and
$639 and $452 for
the nine months
ended September 30,
2008 and 2009,
respectively) (10,312) (7,866) (27,308) (22,848)
Selling, general and
administrative
(exclusive of
depreciation and
amortization of $799
and $406 for the
three months and
$2,375 and $1,596
for the nine months
ended September 30,
2008 and 2009,
respectively;
inclusive of
stock-based
compensation of
$4,959 and $3,228
for the three months
and $11,249 and
$11,699 for the nine
months ended
September 30, 2008
and 2009,
respectively) (28,492) (17,686) (70,463) (52,936)
Amortization of
programming rights (48,007) (42,580) (164,229) (120,878)
Amortization of
sublicensing rights
and own production
cost (1,466) (602) (7,117) (5,071)
Depreciation and
amortization
(exclusive of
amortization of
programming rights
and sublicensing
rights) (3,945) (2,858) (9,554) (8,119)
Total operating
expenses (92,222) (71,592) (278,671) (209,852)
OPERATING INCOME 51,085 35,343 174,152 115,755
FOREIGN CURRENCY
GAINS (LOSSES) (13,978) 274 (11,772) (4,462)
INTEREST INCOME 288 725 5,255 2,494
INTEREST EXPENSE (4,249) (1,290) (6,508) (5,704)
OTHER NON-OPERATING
INCOME (LOSSES), net 719 123 620 (5)
EQUITY IN INCOME OF
INVESTEE COMPANIES 319 74 1,064 309
Income before income
tax 34,184 35,249 162,811 108,387
INCOME TAX EXPENSE (12,322) (9,138) (48,552) (28,615)
CONSOLIDATED NET
INCOME $ 21,862 $ 26,111 $ 114,259 $ 79,772
LESS: INCOME (LOSS)
ATTRIBUTABLE TO
NONCONTROLLING
INTEREST $ (893) $ (256) $ (2,761) $ (270)
NET INCOME
ATTRIBUTABLE TO CTC
MEDIA, INC.
STOCKHOLDERS $ 20,969 $ 25,855 $ 111,498 $ 79,502
Net income per share
attributable to CTC
Media, Inc.
stockholders - basic $ 0.14 $ 0.17 $ 0.73 $ 0.52
Net income per share
attributable to CTC
Media, Inc.
stockholders -
diluted $ 0.13 $ 0.16 $ 0.70 $ 0.51
Weighted average
common shares
outstanding - basic 152,155,213 152,155,213 152,143,653 152,155,213
Weighted average
common shares
outstanding -
diluted 158,212,439 157,770,126 158,945,038 157,361,626
CTC MEDIA, INC, AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of US dollars)
Nine months ended June 30,
2008 2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Consolidated net income $ 114,259 $ 79,772
Adjustments to reconcile net
income to net cash provided by
operating activities:
Deferred tax benefit (12,504) (2,958)
Depreciation and amortization 9,554 8,120
Amortization of programming rights 164,229 120,878
Amortization of sublicensing rights
and own production cost 7,117 5,071
Stock based compensation expense 11,889 11,610
Equity in income of unconsolidated
investees (1,064) (309)
Foreign currency (gains) losses 11,772 4,462
Changes in operating assets and
liabilities:
Trade accounts receivable (16,357) 1,320
Prepayments (419) 151
Other assets (125) 3,352
Accounts payable and accrued
liabilities 7,336 4,169
Deferred revenue (1,568) (6,021)
Other liabilities 4,839 (13,713)
Dividends received from equity
investees 1,335 522
Acquisition of programming and
sublicensing rights (206,234) (140,715)
Net cash provided by operating
activities 94,059 75,711
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions of property and
equipment and intangible
assets (8,768) (10,653)
Acquisitions of businesses, net of
cash acquired (402,336) (12,145)
Other (431) (1,097)
Net cash used in investing activities (411,535) (23,895)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options 1,811 -
Proceeds from loans 135,000 -
Repayments of loans (76,443) (33,750)
(Incease) Decrease in restricted cash (50) 121
Dividends paid to minority interest (4,855) (2,832)
Net cash provided by financing activities 55,463 (36,461)
EFFECT OF EXCHANGE RATE CHANGES ON
CASH AND CASH
EQUIVALENTS 9,226 (799)
Net increase (decrease) in cash and
cash equivalents (252,787) 14,556
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 307,073 98,055
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 54,286 $ 112,611
CTC MEDIA, INC, AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands of US dollars, except share and per share data)
December September
31, 2008 30, 2009
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 98,055 $ 112,611
Trade accounts receivable, net of allowance for
doubtful accounts (December 31, 2008 - $1,355;
September 30, 2009 - $1,141) 33,670 31,728
Taxes reclaimable 8,171 10,971
Prepayments 29,005 29,183
Programming rights, net 71,976 74,872
Deferred tax assets 14,166 17,255
Other current assets 7,720 5,392
TOTAL CURRENT ASSETS 262,763 282,012
RESTRICTED CASH 210 89
PROPERTY AND EQUIPMENT, net 22,722 20,666
INTANGIBLE ASSETS, net:
Broadcasting Licenses 166,173 161,823
Cable Network Connection 25,205 28,863
Trade names 17,587 17,172
Network affiliation agreements 9,214 7,365
Other intangible assets 1,244 1,085
Net intangible assets 219,423 216,308
GOODWILL 223,027 216,181
PROGRAMMING RIGHTS, net 48,031 67,497
SUBLICENSING RIGHTS, net 1,221 625
INVESTMENTS IN AND ADVANCES TO INVESTEES 5,311 4,949
PREPAYMENTS 6,238 3,282
DEFERRED TAX ASSET 15,154 18,763
OTHER NON-CURRENT ASSETS 2,729 8,344
TOTAL ASSETS $ 806,829 $ 838,716
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable 41,025 56,485
Accrued liabilities 41,573 29,578
Taxes payable 30,154 13,880
Short-term loans and interest accrued 62,165 56,546
Deferred revenue 14,683 5,869
Deferred tax liability 2,778 2,916
TOTAL CURRENT LIABILITIES 192,378 165,274
LONG-TERM LOANS 28,438 186
DEFERRED TAX LIABILITY 38,943 36,024
STOCKHOLDERS' EQUITY:
Common stock; $0.01 par value; shares authorized
175,772,173;
shares issued and outstanding December 31, 2008
and September 30, 2009 - 152,155,213) 1,522 1,522
Additional paid-in capital 365,362 376,975
Retained earnings 232,321 311,823
Accumulated other comprehensive loss (54,615) (53,079)
Non-controlling interest 2,481 (9)
TOTAL STOCKHOLDERS' EQUITY 547,070 637,232
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 806,829 $ 838,716
CTC MEDIA, INC. AND SUBSIDIARIES
UNAUDITED SEGMENT FINANCIAL INFORMATION
(in thousands of US dollars)
Three months ended September 30, 2008
Operating
revenue
from Operating Depreciation
external Intersegment income/ and
customers revenue (loss) amortization OIBDA
CTC Network $89,372 $456 $44,610 $(243) $44,853
Domashny Network 13,305 2 3,136 (164) 3,300
DTV Network 10,190 3 4,123 (622) 4,745
CTC Television 21,372 433 10,438 (559) 10,997
Station Group
Domashny 3,783 290 784 (677) 1,461
Television
Station Group
DTV Television 1,531 170 (1,125) (1,016) (109)
Station Group
CIS Group 3,608 - (1,023) (268) (755)
Production Group 146 7,468 (410) (6) (404)
Corporate Office - - (9,812) (389) (9,423)
Business segment
results $143,307 $8,822 $50,721 $(3,944) $54,665
Eliminations and
other - (8,822) 364 (1) 365
Consolidated
results $143,307 - $51,085 $(3,945) $55,030
Three months ended September 30, 2009
Operating
revenue
from Operating Depreciation
external Intersegment income/ and
customers revenue (loss) amortization OIBDA
CTC Network $68,409 $490 $29,867 $(95) $29,962
Domashny 10,521 20 1,844 (72) 1,916
Network
DTV Network 9,435 - 3,014 (708) 3,722
CTC Television 13,544 317 8,086 (515) 8,601
Station Group
Domashny 1,703 360 (157) (348) 191
Television
Station Group
DTV Television 794 49 (972) (856) (116)
Station Group
CIS Group 2,413 - (1,067) (177) (890)
Production 116 12,338 1,247 (40) 1,287
Group
Corporate - - (6,534) (77) (6,457)
Office
Business $106,935 $13,574 $35,328 $(2,888) $38,216
segment
results
Eliminations - (13,574) 15 30 (15)
and other
Consolidated $106,935 - $35,343 $(2,858) $38,201
results
(Continued on the next page) CTC MEDIA, INC. AND SUBSIDIARIES
UNAUDITED SEGMENT FINANCIAL INFORMATION (continued)
(in thousands of US dollars)
Nine months ended September 30, 2008
Operating
revenue
from Operating Depreciation
external Intersegment income/ and
customers revenue (loss) amortization OIBDA
CTC Network $297,067 $4,081 $143,767 $(752) $144,519
Domashny Network 44,976 9 10,870 (509) 11,379
DTV Network 22,405 8 9,748 (897) 10,645
CTC Television 67,364 1,364 39,966 (1,590) 41,556
Station Group
Domashny 11,348 815 820 (1,960) 2,780
Television
Station Group
DTV Television 3,335 223 (1,755) (1,729) (26)
Station Group
CIS Group 5,980 - (2,896) (622) (2,274)
Production Group 348 22,096 253 (44) 297
Corporate Office - - (25,549) (1,451) (24,097)
Business segment $452,823 $28,596 $175,224 $(9,554) $184,779
results
Eliminations and
other - (28,596) (1,072) - (1,073)
Consolidated
results $452,823 - $174,152 $(9,554) $183,706
Nine months ended September 30, 2009
Operating
revenue
from Operating Depreciation
external Intersegment income/ and
customers revenue (loss) amortization OIBDA
CTC Network $210,618 $2,175 $99,560 $(318) $99,878
Domashny Network 31,972 30 7,780 (258) 8,038
DTV Network 27,285 - 10,181 (1,922) 12,103
CTC Television 39,672 921 23,707 (1,384) 25,091
Station Group
Domashny 5,660 970 286 (977) 1,263
Television
Station Group
DTV Television 2,582 116 (2,943) (2,390) (553)
Station Group
CIS Group 7,293 - (2,784) (608) (2,176)
Production Group 525 32,506 2,838 (94) 2,932
Corporate Office - - (21,610) (234) (21,376)
Business segment $325,607 $36,718 $117,015 $(8,185) $125,200
results
Eliminations and
other - (36,718) (1,260) 66 (1,326)
Consolidated
results $325,607 - $115,755 $(8,119) $123,874
CTC MEDIA, INC. AND SUBSIDIARIES
RECONCILIATION OF CONSOLIDATED OIBDA TO
CONSOLIDATED OPERATING INCOME
(in thousands of US dollars)
Three months ended Nine months ended
September 30, September 30,
2008 2009 2008 __2009_
OIBDA $55,030 $38,201 $183,706 $123,874
Depreciation and amortization
(exclusive of amortization of
programming rights and
sublicensing rights) __(3,945) __(2,858) __(9,554) __(8,119)
Operating income $51,085 $35,343 $174,152 $115,755
CTC MEDIA, INC. AND SUBSIDIARIES
RECONCILIATION OF CONSOLIDATED OIBDA MARGIN TO
CONSOLIDATED OPERATING INCOME MARGIN
Three months ended Nine months ended
September 30, September 30,
2008 2009 2008 2009
OIBDA margin 38.4% 35.7% 40.6% 38.0%
Depreciation and amortization
(exclusive of amortization of
programming rights and sublicensing
rights) as a percentage of total
operating revenues -2.8% -2.6% -2.1% -2.4%
Operating income margin 35.6% 33.1% 38.5% 35.6%
CTC MEDIA, INC. AND SUBSIDIARIES
RECONCILIATION OF SEGMENT OIBDA TO SEGMENT OPERATING INCOME
(in thousands of US dollars)
Three Months Ended September 30, 2008
Depreciation
and
amortization
(exclusive of
OIBDA amortization of Operating
programming income
rights,
sublicensing
rights and own
production
cost)
CTC Network $44,853 $(243) $44,610
Domashny Network 3,300 (164) 3,136
DTV Network 4,745 (622) 4,123
CTC Television 10,997 (559) 10,438
Station Group
Domashny Television 1,461 (677) 784
Station Group
DTV Television (109) (1,016) (1,125)
Station Group
CIS Group (755) (268) (1,023)
Production Group (404) (6) (410)
Corporate (9,423) (389) (9,812)
Business Segment $54,665 $(3,944) $50,721
Results
Eliminations and
Other 365 (1) 364
Consolidated Results $55,030 $(3,945) $51,085
Three Months Ended September 30, 2009
Depreciation
and
amortization
(exclusive of
OIBDA amortization of Operating
programming income
rights,
sublicensing
rights and own
production
cost)
CTC Network $29,962 $(95) $29,867
Domashny Network 1,916 (72) 1,844
DTV Network 3,722 (708) 3,014
CTC Television 8,601 (515) 8,086
Station Group
Domashny Television 191 (348) (157)
Station Group
DTV Television (116) (856) (972)
Station Group
CIS Group (890) (177) (1,067)
Production Group 1,287 (40) 1,247
Corporate (6,456) (78) (6,534)
Business Segment $38,216 $(2,888) $35,328
Results
Eliminations and
Other (15) 30 15
Consolidated Results $38,201 $(2,858) $35,343
CTC MEDIA, INC. AND SUBSIDIARIES
RECONCILIATION OF SEGMENT OIBDA TO SEGMENT OPERATING INCOME
(Continued)
(in thousands of US dollars)
Nine Months Ended September 30, 2008
Depreciation
and
amortization
(exclusive of
amortization
of programming
rights and
sublicensing
OIBDA rights) Operating income
CTC Network $144,519 $(752) $143,767
Domashny Network 11,379 (509) 10,870
DTV Network 10,645 (897) 9,748
CTC Television 41,556 (1,590) 39,966
Station Group
Domashny 2,780 (1,960) 820
Television Station
Group
DTV Television (26) (1,729) (1,755)
Station Group
CIS Group (2,274) (622) (2,896)
Production Group 297 (44) 253
Corporate (24,097) (1,451) (25,549)
Business Segment $184,779 $(9,554) $175,224
Results
Eliminations and
Other (1,073) - (1,072)
Consolidated $183,706 $(9,554) $174,152
Results
Nine Months Ended September 30, 2009
Depreciation
and
amortization
(exclusive of
OIBDA amortization Operating income
of programming
rights and
sublicensing
rights)
CTC Network $99,878 $(318) $99,560
Domashny Network 8,038 (258) 7,780
DTV Network 12,103 (1,922) 10,181
CTC Television 25,091 (1,384) 23,707
Station Group
Domashny 1,263 (977) 286
Television Station
Group
DTV Television (553) (2,390) (2,943)
Station Group
CIS Group (2,176) (608) (2,784)
Production Group 2,932 (94) 2,838
Corporate (21,376) (234) (21,610)
Business Segment $125,200 $(8,185) $117,015
Results
Eliminations and (1,326) 66 (1,260)
Other
Consolidated $123,874 $(8,119) $115,755
Results
---------------------------------
(1) OIBDA is defined as operating income before depreciation
and amortization (excluding the amortization of programming rights and
sublicensing rights). OIBDA margin is defined as OIBDA divided by total
operating revenues. Both OIBDA and OIBDA margin are non-GAAP financial
measures. Please see the accompanying financial tables at the end of this
release for a reconciliation of OIBDA to operating income and OIBDA margin to
operating margin.
(1) Segment revenues are shown from external customers only,
net of intercompany revenues of $8.8 million in the third quarter of 2008,
$13.6 million in the third quarter of 2009, $28.6 million in the first nine
months of 2008, and $36.7 million in the first nine months of 2009, most of
which related to revenues from the Production Group that have been eliminated
in the consolidation of the Company's revenues.
For further information, please visit http://www.ctcmedia.ru or contact:
CTC Media, Inc.
Investor Relations
Ekaterina Ostrova or Ekaterina Tsukanova
Tel: +7-495-783-3650
ir@ctcmedia.ru
Media Relations
Ekaterina Osadchaya or Angelika Larionova
Tel: +7-495-785-6333
pr@ctcmedia.ru
