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Segment Information (Tables)

6 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

Segment Information

Segment information is presented in the table below:

	Three Months Ended								Six Months Ended
	September 30,								September 30,
	2019				2018				2019				2018
	(Amounts in millions)
Segment revenues
Motion Picture	$	405.8			$	379.0			$	803.6			$	744.3
Television Production	274.0				152.1				553.8				431.5
Media Networks	374.0				377.3				746.4				732.2
Intersegment eliminations	(70.3		)		(7.4		)		(156.7		)		(74.4		)
	$	983.5			$	901.0			$	1,947.1			$	1,833.6
Intersegment revenues
Motion Picture	$	5.7			$	2.2			$	10.1			$	4.3
Television Production	64.0				5.2				145.4				70.0
Media Networks	0.6				—				1.2				0.1
	$	70.3			$	7.4			$	156.7			$	74.4
Gross contribution
Motion Picture	$	76.8			$	38.9			$	109.7			$	117.7
Television Production	19.7				20.4				54.4				46.1
Media Networks	124.7				147.4				205.6				261.6
Intersegment eliminations	2.2				9.1				0.5				(2.3		)
	$	223.4			$	215.8			$	370.2			$	423.1
Segment general and administration
Motion Picture	$	25.8			$	26.0			$	51.1			$	52.8
Television Production	7.1				11.0				16.8				21.5
Media Networks	20.1				24.7				40.4				50.3
	$	53.0			$	61.7			$	108.3			$	124.6
Segment profit
Motion Picture	$	51.0			$	12.9			$	58.6			$	64.9
Television Production	12.6				9.4				37.6				24.6
Media Networks	104.6				122.7				165.2				211.3
Intersegment eliminations	2.2				9.1				0.5				(2.3		)
	$	170.4			$	154.1			$	261.9			$	298.5

Reconciliation Of Total Segment Profit To The Company's Income (Loss) Before Income Taxes

The reconciliation of total segment profit to the Company’s income (loss) before income taxes is as follows:

	Three Months Ended								Six Months Ended
	September 30,								September 30,
	2019				2018				2019				2018
	(Amounts in millions)
Company’s total segment profit	$	170.4			$	154.1			$	261.9			$	298.5
Corporate general and administrative expenses	(25.4		)		(25.3		)		(49.5		)		(52.8		)
Adjusted depreciation and amortization(1)	(10.2		)		(10.0		)		(21.1		)		(20.3		)
Restructuring and other(2)	(7.6		)		(15.0		)		(13.1		)		(25.6		)
Adjusted share-based compensation expense(3)	(14.5		)		(15.1		)		(23.8		)		(30.2		)
Purchase accounting and related adjustments(4)	(55.1		)		(49.6		)		(100.1		)		(92.4		)
Operating income	57.6				39.1				54.3				77.2
Interest expense	(48.0		)		(55.5		)		(97.0		)		(106.8		)
Shareholder litigation settlements(5)	—				(114.1		)		—				(114.1		)
Interest and other income	2.2				3.0				5.0				6.1
Other expense	(3.8		)		—				(6.1		)		—
Loss on investments	(0.4		)		(36.1		)		(0.3		)		(37.0		)
Equity interests loss	(3.2		)		(11.7		)		(11.1		)		(17.8		)
Income (loss) before income taxes	$	4.4			$	(175.3	)		$	(55.2	)		$	(192.4	)

___________________

(1) Adjusted depreciation and amortization represents depreciation and amortization as presented on our unaudited condensed consolidated statements of operations less the depreciation and amortization related to the non-cash fair value adjustments to property and equipment and intangible assets acquired in recent acquisitions which are included in the purchase accounting and related adjustments line item above, as shown in the table below:

	Three Months Ended								Six Months Ended
	September 30,								September 30,
	2019				2018				2019				2018
	(Amounts in millions)
Depreciation and amortization	$	50.9			$	40.8			$	91.2			$	81.1
Less: Amount included in purchase accounting and related adjustments	(40.7		)		(30.8		)		(70.1		)		(60.8		)
Adjusted depreciation and amortization	$	10.2			$	10.0			$	21.1			$	20.3

(2) Restructuring and other includes restructuring and severance costs, certain transaction and related costs, and certain unusual items, when applicable (see Note 14).

(3) The following table reconciles total share-based compensation expense to adjusted share-based compensation expense:

	Three Months Ended								Six Months Ended
	September 30,								September 30,
	2019				2018				2019				2018
									(Amounts in millions)
Total share-based compensation expense	$	14.5			$	15.1			$	24.1			$	30.2
Less:
Amount included in restructuring and other(i)	—				—				(0.3		)		—
Adjusted share-based compensation	$	14.5			$	15.1			$	23.8			$	30.2

(i) Represents share-based compensation expense included in restructuring and other expenses reflecting the impact of the acceleration of certain vesting schedules for equity awards pursuant to certain severance arrangements.

(4) Purchase accounting and related adjustments primarily represent the amortization of non-cash fair value adjustments to certain assets acquired in recent acquisitions. These adjustments include the accretion of the noncontrolling interest discount related to Pilgrim Media Group and 3 Arts Entertainment, the amortization of the recoupable portion of the purchase price and the expense associated with the earned distributions related to 3 Arts Entertainment, all of which are

accounted for as compensation and are included in general and administrative expense. The following sets forth the amounts included in each line item in the financial statements:

	Three Months Ended								Six Months Ended
	September 30,								September 30,
	2019				2018				2019				2018
	(Amounts in millions)
Purchase accounting and related adjustments:
Direct operating	$	1.0			$	5.6			$	2.5			$	13.6
General and administrative expense	13.4				13.2				27.5				18.0
Depreciation and amortization	40.7				30.8				70.1				60.8
	$	55.1			$	49.6			$	100.1			$	92.4

(5)

Shareholder litigation settlements of $114.1 million in the three and six months ended September 30, 2018 includes the following: (i) $54.8 million for the net expense recorded for the settlement of the Fiduciary Litigation (representing the settlement amount of $92.5 million, net of aggregate insurance reimbursement of $37.8 million (see Note 16) and (ii) $59.3 million related to the Appraisal Litigation, representing the amount by which the settlement amount of approximately $964 million exceeded the previously accrued (at date of acquisition) dissenting shareholders' liability plus interest through the date agreed in the settlement.

Adjusted Depreciation and Amortization

Adjusted depreciation and amortization represents depreciation and amortization as presented on our unaudited condensed consolidated statements of operations less the depreciation and amortization related to the non-cash fair value adjustments to property and equipment and intangible assets acquired in recent acquisitions which are included in the purchase accounting and related adjustments line item above, as shown in the table below:

	Three Months Ended								Six Months Ended
	September 30,								September 30,
	2019				2018				2019				2018
	(Amounts in millions)
Depreciation and amortization	$	50.9			$	40.8			$	91.2			$	81.1
Less: Amount included in purchase accounting and related adjustments	(40.7		)		(30.8		)		(70.1		)		(60.8		)
Adjusted depreciation and amortization	$	10.2			$	10.0			$	21.1			$	20.3

Adjusted Share-Based Compensation

The following table reconciles total share-based compensation expense to adjusted share-based compensation expense:

	Three Months Ended								Six Months Ended
	September 30,								September 30,
	2019				2018				2019				2018
									(Amounts in millions)
Total share-based compensation expense	$	14.5			$	15.1			$	24.1			$	30.2
Less:
Amount included in restructuring and other(i)	—				—				(0.3		)		—
Adjusted share-based compensation	$	14.5			$	15.1			$	23.8			$	30.2

(i)

Represents share-based compensation expense included in restructuring and other expenses reflecting the impact of the acceleration of certain vesting schedules for equity awards pursuant to certain severance arrangements.

Purchase Accounting and Related Adjustments

Purchase accounting and related adjustments primarily represent the amortization of non-cash fair value adjustments to certain assets acquired in recent acquisitions. These adjustments include the accretion of the noncontrolling interest discount related to Pilgrim Media Group and 3 Arts Entertainment, the amortization of the recoupable portion of the purchase price and the expense associated with the earned distributions related to 3 Arts Entertainment, all of which are

accounted for as compensation and are included in general and administrative expense. The following sets forth the amounts included in each line item in the financial statements:

	Three Months Ended								Six Months Ended
	September 30,								September 30,
	2019				2018				2019				2018
	(Amounts in millions)
Purchase accounting and related adjustments:
Direct operating	$	1.0			$	5.6			$	2.5			$	13.6
General and administrative expense	13.4				13.2				27.5				18.0
Depreciation and amortization	40.7				30.8				70.1				60.8
	$	55.1			$	49.6			$	100.1			$	92.4

Reconciliation of Segment General and Administrative Expense to Consolidated

The following table reconciles segment general and administration expense to the Company's total consolidated general and administration expense:

	Three Months Ended								Six Months Ended
	September 30,								September 30,
	2019				2018				2019				2018
	(Amounts in millions)
General and administration
Segment general and administrative expenses	$	53.0			$	61.7			$	108.3			$	124.6
Corporate general and administrative expenses	25.4				25.3				49.5				52.8
Share-based compensation expense included in general and administrative expense	14.1				14.8				23.2				29.7
Purchase accounting and related adjustments	13.4				13.2				27.5				18.0
	$	105.9			$	115.0			$	208.5			$	225.1

Reconciliation of Assets from Segment to Consolidated

The reconciliation of total segment assets to the Company’s total consolidated assets is as follows:

	September 30, 2019				March 31, 2019
	(Amounts in millions)
Assets
Motion Picture	$	1,596.6			$	1,694.5
Television Production	1,441.2				1,394.2
Media Networks	4,666.5				4,850.3
Other unallocated assets(1)	522.1				469.9
	$	8,226.4			$	8,408.9

_____________________

(1)

Other unallocated assets primarily consist of cash, other assets and investments.

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