Business Services Industry
PolyGram Reports Record Third Quarter; Music Operating Income Up 44%
Business Wire, Oct 21, 1998
CONSOLIDATED STATEMENTS OF INCOME OF THE POLYGRAM GROUP
(In millions of Netherlands Guilders, except per share data
and share amounts)
Three months ended Nine months ended
September 30, (a) September 30, (a)
1998 1997 1998 1997
---- ---- ---- ----
Net sales 2,668 2,675 7,318 7,201
Direct cost of sales (1,446) (1,534) (3,991) (3,813)
Gross income 1,222 1,141 3,327 3,388
SG&A expenses (1,051) (1,011) (3,047) (2,828)
Income from operations 171 130 280 560
Financial expenses (20) (3) (36) (7)
Income before taxes 151 127 244 553
Income taxes 11 (36) (18) (160)
Income after taxes 162 91 226 393
Equity in net loss of
non-consolidated
companies (1) (2) (14) (22)
Group income 161 89 212 371
Third party interests 5 (4) (8) (16)
Net income 166 85 204 355
Average number of shares
outstanding (millions) 180 180 180 180
Net income per share NLG 0.92 NLG 0.47 NLG 1.13 NLG 1.97
Segmental Information (b):
Music
Net sales 2,170 2,270 6,181 6,326
Net sales (c) 2,170 2,086 6,181 6,142
Income from
operations 248 172 522 710
Film
Net sales 498 405 1,137 875
Income from
operations (77) (42) (242) (150)
(a) Unaudited.
(b) Both the 1998 and 1997 figures are based on a split between music
and film reflecting the film activities that have been offered
for sale, thus restating the 1997 figures.
(c) Excluding NLG 184 million in sales from commemorative recordings
for the late Diana, Princess of Wales in the periods ended
September 30, 1997.
CONSOLIDATED BALANCE SHEETS OF THE POLYGRAM GROUP
(In millions of Netherlands guilders)
As of As of
Assets September 30, 1998 (a) December 31, 1997
Fixed assets
Intangible fixed assets 3,391 3,036
Tangible fixed assets 762 819
Non-consolidated companies 338 298
Other non-current financial assets 120 106
Total fixed assets 4,611 4,259
Current assets
Inventories 1,438 1,455
Receivables and prepaid expenses 4,360 4,904
Cash 185 694
Total current assets 5,983 7,053
Total 10,594 11,312
Group Equity and Liabilities
Group equity
Shareholders' equity 3,982 4,143
Other group equity 67 79
Total group equity 4,049 4,222
Long-term provisions 1,001 1,117
Long-term liabilities 227 260
Short-term provisions 456 502
Current liabilities 4,861 5,211
Total 10,594 11,312
(a) Unaudited. The financial information as per September 30,
1998 does not reflect the financial effects, if any, from the proposed
sale of PolyGram to Seagram.
CONSOLIDATED STATEMENTS OF INCOME OF THE POLYGRAM GROUP
(In millions of United States Dollars, except per share data and
share amounts)
Three months ended Nine Months Ended
September 30,(a) September 30,(a)
1998 1997 1998 1997
----- ----- ----- -----
Net sales 1,314 1,379 3,593 3,792
Direct cost of sales (712) (791) (1,960) (2,006)
Gross income 602 588 1,633 1,786
SG&A expenses (518) (521) (1,496) (1,490)
Income from operations 84 67 137 296
Financial expenses (10) (2) (18) (4)
Income before taxes 74 65 119 292
Income taxes 5 (19) (9) (85)
Income after taxes 79 46 110 207
Equity in net loss of
non-consolidated companies 0 (1) (6) (11)
Group income 79 45 104 196
Third party interests 2 (2) (4) (8)
Net income 81 43 100 188
Average number of shares
outstanding (millions) 180.0 180.0 180.0 180.0
Net income per share 0.45 0.24 0.56 1.04
Segmental Information:
Music (b)
Net sales 1,069 1,170 3,035 3,332
Net sales (c) 1,069 1,075 3,035 3,237
Income from operations 122 89 256 376
Film (b)
Net sales 245 209 558 460
Income from operations (38) (22) (119) (80)
(a) Unaudited.
(b) Both the 1998 and 1997 figures are based on a split between music
and film reflecting the film activities that have been offered
for sale, thus restating the 1997 figures.
(c) Excluding US$ 95 million in sales from commemorative recordings
for the late Diana, Princess of Wales in the periods ended
September 30, 1997.
NOTE: The Netherlands guilder amounts have been converted to
U.S. dollars using the weighted average exchange rates as
follows: US$ = NLG 2.03 for the quarter ended September 30, 1998
and US$ = NLG 1.94 for the quarter ended September 30, 1997. For
the first and second quarters, rates used are US$ = NLG 2.02 and
US$ = 2.06 for 1998 and US$ = NLG 1.85 and US$ = NLG 1.90 for
1997, respectively.
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