Annual report pursuant to Section 13 and 15(d)

Consolidating Guarantor Financial Information

v3.8.0.1
Consolidating Guarantor Financial Information
12 Months Ended
Dec. 31, 2017
Condensed Financial Information of Parent Company Only Disclosure [Abstract]  
Consolidating Guarantor Financial Information
Consolidating Guarantor Financial Information

The Senior Notes were issued by MONI (the "Parent Issuer") and are fully and unconditionally guaranteed, on a joint and several basis, by all of the Company's existing domestic subsidiaries ("Subsidiary Guarantors"). Ascent Capital has not guaranteed any of the Company's obligations under the Senior Notes. The condensed consolidating financial information for the Parent Issuer, the Subsidiary Guarantors and the non-guarantors are as follows:
MONITRONICS INTERNATIONAL, INC. AND SUBSIDIARIES
Condensed Consolidating Balance Sheet
Amounts in thousands

 
As of December 31, 2017
 
Parent Issuer
 
Subsidiary Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Assets
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
2,705

 
597

 

 

 
3,302

Trade receivables, net
12,082

 
563

 

 

 
12,645

Prepaid and other current assets
74,613

 
2,396

 

 
(66,341
)
 
10,668

Total current assets
89,400

 
3,556

 

 
(66,341
)
 
26,615

 
 
 
 
 
 
 
 
 
 
Investment in subsidiaries
4,554

 

 

 
(4,554
)
 

Property and equipment, net
30,727

 
2,062

 

 

 
32,789

Subscriber accounts, net
1,265,519

 
36,509

 

 

 
1,302,028

Dealer network and other intangible assets, net
6,063

 
931

 

 

 
6,994

Goodwill
527,191

 
36,358

 

 

 
563,549

Other assets, net
9,311

 
29

 

 

 
9,340

Total assets
$
1,932,765

 
79,445

 

 
(70,895
)
 
1,941,315

 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholder's Equity
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
Accounts payable
$
9,705

 
1,368

 

 

 
11,073

Accrued payroll and related liabilities
2,648

 
810

 

 

 
3,458

Other accrued liabilities
47,800

 
68,567

 

 
(66,341
)
 
50,026

Deferred revenue
12,332

 
1,539

 

 

 
13,871

Holdback liability
9,035

 
274

 

 

 
9,309

Current portion of long-term debt
11,000

 

 

 

 
11,000

Total current liabilities
92,520

 
72,558

 

 
(66,341
)
 
98,737

 
 
 
 
 
 
 
 
 
 
Non-current liabilities:
 
 
 
 
 
 
 
 
 
Long-term debt
1,707,297

 

 

 

 
1,707,297

Long-term holdback instruments
2,658

 

 

 

 
2,658

Derivative financial instruments
13,491

 

 

 

 
13,491

Deferred income tax liability, net
11,684

 
1,620

 

 

 
13,304

Other liabilities
2,379

 
713

 

 

 
3,092

Total liabilities
1,830,029

 
74,891

 

 
(66,341
)
 
1,838,579

 
 
 
 
 
 
 
 
 
 
Total stockholder's equity
102,736

 
4,554

 

 
(4,554
)
 
102,736

Total liabilities and stockholder's equity
$
1,932,765

 
79,445

 

 
(70,895
)
 
1,941,315


MONITRONICS INTERNATIONAL, INC. AND SUBSIDIARIES
Condensed Consolidating Balance Sheet
Amounts in thousands

 
As of December 31, 2016
 
Parent Issuer
 
Subsidiary Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Assets
 
 
 
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$
1,739

 
1,438

 

 

 
3,177

Trade receivables, net
13,265

 
604

 

 

 
13,869

Prepaid and other current assets
51,251

 
2,171

 

 
(44,062
)
 
9,360

Total current assets
66,255

 
4,213

 

 
(44,062
)
 
26,406

 
 
 
 
 
 
 
 
 
 
Investment in subsidiaries
22,533

 

 

 
(22,533
)
 

Property and equipment, net
26,652

 
1,618

 

 

 
28,270

Subscriber accounts, net
1,349,285

 
37,475

 

 

 
1,386,760

Dealer network and other intangible assets, net
15,762

 
1,062

 

 

 
16,824

Goodwill
527,191

 
36,358

 

 

 
563,549

Other assets, net
11,889

 
19

 

 

 
11,908

Total assets
$
2,019,567

 
80,745

 

 
(66,595
)
 
2,033,717

 
 
 
 
 
 
 
 
 
 
Liabilities and Stockholder's Equity
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
Accounts payable
$
9,919

 
1,542

 

 

 
11,461

Accrued payroll and related liabilities
3,731

 
337

 

 

 
4,068

Other accrued liabilities
25,951

 
49,690

 

 
(44,062
)
 
31,579

Deferred revenue
13,807

 
1,340

 

 

 
15,147

Holdback liability
13,434

 
482

 

 

 
13,916

Current portion of long-term debt
11,000

 

 

 

 
11,000

Total current liabilities
77,842

 
53,391

 

 
(44,062
)
 
87,171

 
 
 
 
 
 
 
 
 
 
Non-current liabilities:
 
 
 
 
 
 
 
 
 
Long-term debt
1,687,778

 

 

 

 
1,687,778

Long-term holdback instruments
2,645

 

 

 

 
2,645

Derivative financial instruments
16,948

 

 

 

 
16,948

Deferred income tax liability, net
15,649

 
1,681

 

 

 
17,330

Other liabilities
3,760

 
3,140

 

 

 
6,900

Total liabilities
1,804,622

 
58,212

 

 
(44,062
)
 
1,818,772

 
 
 
 
 
 
 
 
 
 
Total stockholder's equity
214,945

 
22,533

 

 
(22,533
)
 
214,945

Total liabilities and stockholder's equity
$
2,019,567

 
80,745

 

 
(66,595
)
 
2,033,717



MONITRONICS INTERNATIONAL, INC. AND SUBSIDIARIES
Condensed Consolidating Statement of Operations and Comprehensive Income (Loss)
Amounts in thousands

 
Year Ended December 31, 2017
 
Parent Issuer
 
Subsidiary Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
 
 
 
 
 
 
 
 
 
Net revenue
$
519,293

 
34,162

 

 

 
553,455

 
 
 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
 
 
Cost of services
104,103

 
15,090

 

 

 
119,193

Selling, general and administrative, including stock-based and long-term incentive compensation
126,201

 
29,701

 

 

 
155,902

Radio conversion costs
391

 
59

 

 

 
450

Amortization of subscriber accounts, dealer network and other intangible assets
230,313

 
6,475

 

 

 
236,788

Depreciation
8,101

 
717

 

 

 
8,818

 
469,109

 
52,042

 

 

 
521,151

Operating income (loss)
50,184

 
(17,880
)
 

 

 
32,304

Other expense:
 
 
 
 
 
 
 
 
 
Equity in loss of subsidiaries
17,978

 

 

 
(17,978
)
 

Interest expense
145,487

 
5

 

 

 
145,492

 
163,465

 
5

 

 
(17,978
)
 
145,492

Loss before income taxes
(113,281
)
 
(17,885
)
 

 
17,978

 
(113,188
)
Income tax expense (benefit)
(1,986
)
 
93

 

 

 
(1,893
)
Net loss
(111,295
)
 
(17,978
)
 

 
17,978

 
(111,295
)
Other comprehensive income (loss):
 
 
 
 
 
 
 
 
 
Unrealized gain on derivative contracts
1,582

 

 

 

 
1,582

Total other comprehensive income
1,582

 

 

 

 
1,582

Comprehensive loss
$
(109,713
)
 
(17,978
)
 

 
17,978

 
(109,713
)





MONITRONICS INTERNATIONAL, INC. AND SUBSIDIARIES
Condensed Consolidating Statement of Operations and Comprehensive Income (Loss)
Amounts in thousands

 
Year Ended December 31, 2016
 
Parent Issuer
 
Subsidiary Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
 
 
 
 
 
 
 
 
 
Net revenue
$
543,181

 
27,191

 

 

 
570,372

 
 
 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
 
 
Cost of services
101,940

 
13,296

 

 

 
115,236

Selling, general and administrative, including stock-based compensation
86,670

 
27,482

 

 

 
114,152

Radio conversion costs
18,204

 
218

 

 

 
18,422

Amortization of subscriber accounts, dealer network and other intangible assets
240,568

 
6,185

 

 

 
246,753

Depreciation
7,784

 
376

 

 

 
8,160

 
455,166

 
47,557

 

 

 
502,723

Operating income (loss)
88,015

 
(20,366
)
 

 

 
67,649

Other expense:
 
 
 
 
 
 
 
 
 
Equity in loss of subsidiaries
21,387

 

 

 
(21,387
)
 

Interest expense
127,290

 
18

 

 

 
127,308

Refinancing expense
9,500

 

 

 

 
9,500

 
158,177

 
18

 

 
(21,387
)
 
136,808

Loss before income taxes
(70,162
)
 
(20,384
)
 

 
21,387

 
(69,159
)
Income tax expense
6,145

 
1,003

 

 

 
7,148

Net loss
(76,307
)
 
(21,387
)
 

 
21,387

 
(76,307
)
Other comprehensive income (loss):
 
 
 
 
 
 
 
 
 
Unrealized gain on derivative contracts
4,589

 

 

 

 
4,589

Total other comprehensive income
4,589

 

 

 

 
4,589

Comprehensive loss
$
(71,718
)
 
(21,387
)
 

 
21,387

 
(71,718
)

MONITRONICS INTERNATIONAL, INC. AND SUBSIDIARIES
Condensed Consolidating Statement of Operations and Comprehensive Income (Loss)
Amounts in thousands

 
Year Ended December 31, 2015
 
Parent Issuer
 
Subsidiary Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
 
 
 
 
 
 
 
 
 
 
Net revenue
$
546,597

 
16,759

 

 

 
563,356

 
 
 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
 
 
Cost of services
100,233

 
10,013

 

 

 
110,246

Selling, general and administrative, including stock-based compensation
86,683

 
19,604

 

 

 
106,287

Radio conversion costs
14,369

 

 

 

 
14,369

Amortization of subscriber accounts, dealer network and other intangible assets
253,773

 
4,895

 

 

 
258,668

Depreciation
9,960

 
106

 

 

 
10,066

Gain on disposal of operating assets
(5
)
 

 

 

 
(5
)
 
465,013

 
34,618

 

 

 
499,631

Operating income (loss)
81,584

 
(17,859
)
 

 

 
63,725

Other expense:
 
 
 
 
 
 
 
 
 
Equity in loss of subsidiaries
18,689

 

 

 
(18,689
)
 

Interest expense
125,394

 
21

 

 

 
125,415

Refinancing expense
4,468

 

 

 

 
4,468

 
148,551

 
21

 

 
(18,689
)
 
129,883

Loss before income taxes
(66,967
)
 
(17,880
)
 

 
18,689

 
(66,158
)
Income tax expense
5,481

 
809

 

 

 
6,290

Net loss
(72,448
)
 
(18,689
)
 

 
18,689

 
(72,448
)
Other comprehensive loss:
 
 
 
 
 
 
 
 
 
Unrealized loss on derivative contracts
(8,741
)
 

 

 

 
(8,741
)
Total other comprehensive loss
(8,741
)
 

 

 

 
(8,741
)
Comprehensive loss
$
(81,189
)
 
(18,689
)
 

 
18,689

 
(81,189
)

MONITRONICS INTERNATIONAL, INC. AND SUBSIDIARIES
Condensed Consolidating Statements of Cash Flows
Amounts in thousands

 
Year Ended December 31, 2017
 
Parent Issuer
 
Subsidiary Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Net cash provided by operating activities
$
147,350

 
2,854

 

 

 
150,204

Investing activities:
 
 
 
 
 
 
 
 
 
Capital expenditures
(13,213
)
 
(1,180
)
 

 

 
(14,393
)
Cost of subscriber accounts acquired
(140,394
)
 
(2,515
)
 

 

 
(142,909
)
Net cash used in investing activities
(153,607
)
 
(3,695
)
 

 

 
(157,302
)
Financing activities:
 
 
 
 
 
 
 
 
 
Proceeds from long-term debt
187,950

 

 

 

 
187,950

Payments on long-term debt
(175,250
)
 

 

 

 
(175,250
)
Value of shares withheld for share-based compensation
(477
)
 

 

 

 
(477
)
Dividend to Ascent Capital
(5,000
)
 

 

 

 
(5,000
)
Net cash provided by financing activities
7,223

 

 

 

 
7,223

Net increase (decrease) in cash and cash equivalents
966

 
(841
)
 

 

 
125

Cash and cash equivalents at beginning of period
1,739

 
1,438

 

 

 
3,177

Cash and cash equivalents at end of period
$
2,705

 
597

 

 

 
3,302


 
Year Ended December 31, 2016
 
Parent Issuer
 
Subsidiary Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Net cash provided by operating activities
$
181,384

 
9,143

 

 

 
190,527

Investing activities:
 
 
 
 
 
 
 
 
 
Capital expenditures
(7,997
)
 
(1,181
)
 

 

 
(9,178
)
Cost of subscriber accounts acquired
(193,790
)
 
(7,591
)
 

 

 
(201,381
)
Increase in restricted cash
55

 

 

 

 
55

Net cash used in investing activities
(201,732
)
 
(8,772
)
 

 

 
(210,504
)
Financing activities:
 
 
 
 
 
 
 
 
 
Proceeds from long-term debt
1,280,700

 

 

 

 
1,280,700

Payments on long-term debt
(1,238,059
)
 

 

 

 
(1,238,059
)
Refinance costs
(16,946
)
 

 

 

 
(16,946
)
Value of shares withheld for share-based compensation
(121
)
 

 

 

 
(121
)
Dividend to Ascent Capital
(5,000
)
 

 

 

 
(5,000
)
Net cash provided by financing activities
20,574

 

 

 

 
20,574

Net increase in cash and cash equivalents
226

 
371

 

 

 
597

Cash and cash equivalents at beginning of period
1,513

 
1,067

 

 

 
2,580

Cash and cash equivalents at end of period
$
1,739

 
1,438

 

 

 
3,177


MONITRONICS INTERNATIONAL, INC. AND SUBSIDIARIES
Condensed Consolidating Statements of Cash Flows
Amounts in thousands

 
Year Ended December 31, 2015
 
Parent Issuer
 
Subsidiary Guarantors
 
Non-Guarantors
 
Eliminations
 
Consolidated
Net cash provided by operating activities
$
201,477

 
7,685

 

 

 
209,162

Investing activities:
 
 
 
 
 
 
 
 
 
Capital expenditures
(11,866
)
 
(556
)
 

 

 
(12,422
)
Cost of subscriber accounts acquired
(260,256
)
 
(6,302
)
 

 

 
(266,558
)
Cash paid for acquisition, net of cash acquired
(56,778
)
 

 

 

 
(56,778
)
Increased in restricted cash
(37
)
 

 

 

 
(37
)
Proceeds from sale of assets
5

 

 

 

 
5

Net cash used in investing activities
(328,932
)
 
(6,858
)
 

 

 
(335,790
)
Financing activities:
 
 
 
 
 
 
 
 
 
Proceeds from long-term debt
778,000

 

 

 

 
778,000

Payments on long-term debt
(666,640
)
 

 

 

 
(666,640
)
Refinance costs
(6,477
)
 

 

 

 
(6,477
)
Value of shares withheld for share-based compensation
(318
)
 

 

 

 
(318
)
Contributions from Ascent Capital
22,690

 

 

 

 
22,690

Net cash provided by financing activities
127,255

 

 

 

 
127,255

Net increase (decrease) in cash and cash equivalents
(200
)
 
827

 

 

 
627

Cash and cash equivalents at beginning of period
1,713

 
240

 

 

 
1,953

Cash and cash equivalents at end of period
$
1,513

 
1,067

 

 

 
2,580