here's why I believe TLC doesn't make any money, it's the hi returns,
you see $67m charged to cost&expses and more deducted as credits to receivables, from 10K/98:
Charged
Balance at to cost Charged Balance
beginning and to other at end
of period expenses accounts Deductions(1) of period
---------- ---------- -------- ------------- ---------
<S> <C> <C> <C> <C> <C>
YEAR ENDED DECEMBER 31, 1997
Allowance for returns and
doubtful accounts $15,191 $67,773 -- $(53,738) $29,226
(1) Deductions relate to credits issued for returns and allowances against
accounts receivable.
Then when you read the cashflow, you see that if it wasn't for the extra borrowings & financing ($37m) TLC would have had a cash position of about$55-60m as I posted last spring!
Years Ended December 31,
-------------------------------------------------
1997 1996 1995
--------- --------- ---------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(475,667) $(405,451) $ (65,960)
Adjustments to reconcile net loss to net cash provided
by operating activities:
Depreciation and amortization 531,206 451,133 29,802
Charge for incomplete technology 1,050 56,688 60,483
Provision for returns and doubtful accounts 67,773 38,112 22,358
Provision for income taxes 61,234 -- --
Change in assets and liabilities (net of acquired assets and
liabilities):
Accounts receivable (89,396) (91,413) (39,811)
Inventories (10,954) 3,332 (4,441)
Other current assets (2,035) 4,203 8,865
Other long-term assets (8,625) (4,308) 11,990
Accounts payable and accrued expenses 15,488 13,359 9,942
Other long-term obligations -- -- (2,294)
--------- --------- ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES 90,074 65,655 30,934
--------- --------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Businesses acquired, net of cash on-hand (55,592) 21,518 (547,889)
Purchases of property and equipment, net (4,685) (4,939) (7,811)
Software development costs (27,299) (12,344) (2,410)
Merger related accruals (53,021) (38,091) (7,341)
Payments to stockholders of The Former Learning Company -- (25,025) --
--------- --------- ---------
NET CASH USED FOR INVESTING ACTIVITIES (140,597) (58,881) (565,451)
--------- --------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from sale of stock, options and warrants 8,970 27,905 106,616
Borrowings under line of credit 10,150 25,000 3,150
Payments on term notes -- (4,832) (8,815)
Payments on capital lease obligations (2,676) (1,874) (1,008)
Sale (repurchase) of senior notes (28,000) (18,350) 500,000
Costs incurred to issue Series A Preferred Stock (10,701) -- --
Proceeds from issue of special warrants 57,462 -- --
Other 1,821 (1,092) --
--------- --------- ---------
NET CASH PROVIDED BY FINANCING ACTIVITIES 37,026 26,757 599,943
--------- --------- ---------
EFFECT OF EXCHANGE RATE CHANGES ON NET CASH (1,486) (1,243) 201
--------- --------- ---------
NET CHANGE IN CASH AND CASH EQUIVALENTS (14,983) 32,288 65,627
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 110,120 77,832 12,205
--------- --------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 95,137 $ 110,120 $ 77,832
========= ========= =========
</TABLE>
so all this analyst talk about TLC making money after ammortization charges stop is nonsense, because TLC used gross revenues in their eps
numbers. |
