Warner Music Group

Warner Music Group is one of the four major record labels.

Reporting briefs

S-1 amended 2005-04-07

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• Page 11 - Income - Revenue for "Twelve Months Ended September 30, 2004" is in line with "Fiscal Years Ended November 30, 2000" revenue.
• 12 - Balance sheet - "Total debt (including current portion of long-term debt)" increased from $120 million at the end of 2003 to $2,262 million at the end of 2004. (see page F-4 "Consolidated and Combined Balance Sheets" for a detailed balance sheet).
• 36 - The transacations - The Acquisition - On March 1, 2004, Acquisition Corp., an indirect subsidiary of Warner Music Group, acquired substantially all of Time Warner's music division. The initial purchase price for the Acquisition was $2.595 billion (subject to customary post-closing adjustments), consisting of $2.560 billion in cash and $35 million in non-cash consideration in the form of warrants issued to Historic TW.
• 36 - The transacations - The Original Financing and the Acquisition Corp. Refinancing - We financed the Acquisition, related fees and expenses and a portion of our identified restructuring costs through our Original Financing of (i) $1.15 billion of borrowings under the term loan portion of Acquisition Corp.'s senior secured credit facility, which, in addition to the term loan facility, includes a $250 million revolving credit facility, (ii) borrowings under a $500 million senior subordinated bridge loan facility and (iii) a $1.25 billion aggregate initial capital investment by the Investors. See "Description of Indebtedness."
• 104 - Industry overivew - Recorded Music - Recorded music is one of the primary mediums of entertainment for consumers worldwide and in 2004, generated $32.1 billion in retail sales.
• 107 - Industry overivew - Music Publishing - The worldwide music publishing market was estimated in a report published by Enders Analysis in April 2004 to have generated approximately $3.7 billion in revenues in 2003.
• F-4 - Consolidated and Combined Balance Sheets - A comparison between November 30, 2003 and September 30, 2004 - Current liabilities increased from $1,645 million to $2,180 million largely due to a "Note payable to shareholders" on $342 million. Total long term liabilities increased from $1,252 million (2,897-1,645) to $2,630 million (4,810-2,180). Shareholders' equity decreased from $1,587 million to $280 million.