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Financials : Banks | Large Cap ValueCompany profile

Bank of America Corporation is a bank holding company and a financial holding company. The Company is a financial institution, serving individual consumers and others with a range of banking, investing, asset management and other financial and risk management products and services. The Company, through its banking and various non-bank subsidiaries, throughout the United States and in international markets, provides a range of banking and non-bank financial services and products through four business segments: Consumer Banking, which comprises Deposits and Consumer Lending; Global Wealth & Investment Management, which consists of two primary businesses: Merrill Lynch Global Wealth Management and U.S. Trust, Bank of America Private Wealth Management; Global Banking, which provides a range of lending-related products and services; Global Markets, which offers sales and trading services, and All Other, which consists of equity investments, residual expense allocations and other.

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Viacom Reports Third Quarter Results

7:00 am ET August 8, 2019 (BusinessWire) Print

Viacom Inc. (NASDAQ: VIAB, VIA) today reported financial results for the quarter ended June 30th, 2019.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20190808005184/en/

Statement from Bob Bakish, President & CEO

"Viacom delivered another strong quarter, as our core businesses and investments in strategic priorities fuel our growth and evolution. Importantly, we returned Domestic Advertising Revenue to growth, which is a direct result of the strategy we have been executing for the last two years and the significant progress we have made in scaling Advanced Marketing Solutions. Paramount's momentum also continues, keeping us on track to deliver full year profitability. As this quarter shows, Viacom's brands are strong, our strategy is delivering, and our investments continue to position us well for the future."

Fiscal Year 2019 Results

                                                        Quarter Ended June 30                                                                                                                                         Quarter Ended June 30                                                                                                                                            Nine Months Ended June 30                                                                                                                                                 Nine Months Ended June 30
                                                                                             --------------------- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------                                   ------------------------- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                2019                            2019                                        2018                                       B/(W) %                                       FX                                       CONSTANT                                     2019                       2018                             B/(W)%                                        FX                                       CONSTANT
                                                                                                                                                                                                                                                                                                                                  IMPACT                                                        CURRENCY                                                                                                                                                                                                                                                                                                     Impact                                                        CURRENCY
                                                                                                                                                                                                                                                                                                                                     %                                                          BASIS %+                                                                                                                                                                                                                                                                                                        %                                                          BASIS %+
GAAP                                                                                                                                                                                   
----------------------------------------------------------------------- -------------------- --------------------- -------------------------------------------------------------- -------------------------------------------------------------- -------------------------------------------------------------- -------------------------------------------------------------- -------------------- ---------------------
Revenues                                                                                      $                    $                3,357                    $                    $                3,237                    4                    4                    %                   (2                   (2                   )%                    6                    6                     %                           $                    $                9,405                    $                    $                    $                9,458                   (1                   (1                   )%                   (3                   (3                   )%                    2                    2                    %
                                                                                                                                                                 
Operating income                                                                            757                  757                  757                  752                  752                  752                    1                    1                                                         1,932                1,932                1,932                1,926                1,926                1,926                1,926                    -                    -  
                                                                                                                                                                 
Net earnings from continuing operations attributable to Viacom                              538                  538                  538                  511                  511                  511                    5                    5                                                         1,219                1,219                1,219                1,302                1,302                1,302                1,302                   (6                   (6                    )
                                                                                                                                                                 
Diluted EPS from continuing operations                                                     1.33                 1.33                 1.33                 1.27                 1.27                 1.27                    5                    5                                                          3.02                 3.02                 3.02                 3.23                 3.23                 3.23                 3.23                   (7                   (7                    )
                                                                                                                                                                                                                                                                                                        
Non-GAAP+                                                                                                                                                                                                                                       
----------------------------------------------------------------------- -------------------- --------------------- ----------------------------------------  -------------------- ----------------------------------------  -------------------- ----------------------------------------  -------------------- ----------------------------------------  -------------------- -------------------- ---------------------                      ------------------------- ----------------------------------------  -------------------- -------------------- ----------------------------------------
Adjusted operating income                                                                     $                    $                  757                    $                    $                  767                   (1                   (1                   )%                   (1                   (1                   )%                    -                    -  %                           $                    $                2,144                    $                    $                    $                2,126                    1                    1                    %                   (1                   (1                   )%                    2                    2                    %
                                                                                                                             
Adjusted net earnings from continuing operations attributable to Viacom                     484                  484                  484                  475                  475                  475                    2                    2                     (1                   (1                    )                    3                    3                          1,320                1,320                1,320                1,259                1,259                1,259                1,259                    5                    5                     (2                   (2                    )                    7                    7  
                                                                                                                             
Adjusted diluted EPS from continuing operations                                            1.20                 1.20                 1.20                 1.18                 1.18                 1.18                    2                    2                     (1                   (1                    )                    3                    3                           3.27                 3.27                 3.27                 3.12                 3.12                 3.12                 3.12                    5                    5                     (1                   (1                    )                    6                    6  
+ Non-GAAP measures referenced in this release are detailed in the Supplemental Disclosures at the end of this release.

FILMED ENTERTAINMENT

Paramount delivered its tenth consecutive quarter of year-over-year adjusted operating income improvement. Revenue growth was driven by strong licensing and home entertainment results.

Quarterly Financial Results

FQ3'19                                                 TOTAL                                                   B/(W)%                                                 DOMESTIC                                                  B/(W)%                                                   INT'L                                                   B/(W)%
--------------------- -------------------- -------------------- ------------------------------------------------------------   -------------------- -------------------- ----------------------------------------  -------------------- -------------------- ------------------------------------------------------------   -------------------- -------------------- ----------------------------------------  -------------------- -------------------- ------------------------------------------------------------   -------------------- -------------------- ----------------------------------------
Revenues                                     $                  877                         14                    %                        $                  446                         (4                   )%                        $                  431                         40                    %
                                                        
   Theatrical                              152                  152                        (27                    )                       65                   65                        (51                    )                       87                   87                         18  
                                                        
   Home Entertainment                      161                  161                         35                        109                  109                         38                         52                   52                         30  
                                                        
   Licensing                               521                  521                         29                        240                  240                         10                        281                  281                         51  
                                                        
   Ancillary                                43                   43                          5                         32                   32                         (3                    )                       11                   11                         38  
                                                                                                               
Expenses                                   792                  792                         (9                    )                                                                                         
                                                                                                               
Adjusted OI                                  $                   85                         93                    %                                                                                         
                                                                                                                                                     
$ millions                                                                                                                                                            
All figures are presented on a reported segment basis as impact from foreign exchange is not material.

Adjusted OI increased by $41 million YOY - nearly doubling from the prior year quarter. Licensing revenue increased 29% driven by monetization of the library and growth in TV production. Home entertainment revenue grew 35%, primarily benefiting from last quarter's release of Bumblebee. Theatrical revenue reflected the strong performance of Rocketman and Pet Sematary, which was more than offset by the performance of A Quiet Place in the prior year quarter.

Operational Highlights

Paramount benefited from the successful releases of Rocketman and Pet Sematary in the fiscal third quarter.

a^' Rocketman was a global success, generating over $185 million at the global box office.

a^' Pet Sematary drove over $110 million at the global box office.

Current quarter releases include:

a^' Crawl, which received great reviews and is performing well in theaters.

a^' Dora and the Lost City of Gold, a live action film based on Nickelodeon's Dora the Explorer franchise, premieres in August, rekindling this beloved Nickelodeon franchise.

Paramount's fiscal 2020 film slate is now at 16 films, and includes Gemini Man, Terminator: Dark Fate, and the sequel to Top Gun. Paramount Television continues its momentum, with 26 shows ordered to or in production.

a^' Third season of 13 Reasons Why premiering on Netflix in the second half of 2019.

a^' New series ordered include Shantaram for Apple, Made for Love and Station Eleven for HBO Max, When the Street Lights Go On for Quibi and Sexy Beast for Paramount Network.

a^' Also producing The Angel of Darkness, the sequel series to the highly praised limited series The Alienist for TNT, as well as a second season of Boomerang for BET.

MEDIA NETWORKS

Viacom Media Networks benefited from strong advertising performance, as domestic ad sales returned to growth.

Quarterly Financial Results

FQ3'19                                                   TOTAL                                 B/(W)%                          B/(W)%                             FX                         FX                       Constant                   Constant                    DOMESTIC                   DOMESTIC                     B/(W)%                     B/(W)%                               INT'L                              B/(W)%                        FX                   FX                          Constant
                                                                                                                                                                                                                                            Impact                     Impact                                        Currency                   Currency                                                                                                                                                                                                                                                                                                                                                Impact               Impact                                                              Currency
                                                                                                                                                                                                                                               %                          %                                           Basis+                     Basis+                                                                                                                                                                                                                                                                                                                                                    %                    %                                                                 Basis+
---------------------------- -------------------- -------------------- --------------------------------------------------   -------------------- -------------------- ----------------------------------------  -------------------- -------------------- ------------------------------  -------------------- -------------------- ------------------------------  -------------------- -------------------- ------------------------------  -------------------- -------------------- ------------------------------  -------------------- -------------------- ------------------------------  -------------------- -------------------- ------------------------------  -------------------- -------------------- -------------------  -------------------- -------------------- ------------------------------
Revenues                                            $      2,504                          -                    %             (3                   )%              3                    %                        $      2,021              1                    %                        $        483             (5                   )%            (12        )%              7                    %
                                                                                                                                                                 
   Advertising                          1,226                          3               (4                    )              7                976              6                250             (7                    )            (16         )              9  
                                                                                                                                                                 
   Affiliate                            1,189                         (1                    )             (1                    )              -                988             (1                    )              201              -               (8         )              8  
                                                                                                                                                                 
   Consumer Products,                      89                        (18 )                                (2 )                               (16 )                                  57            (17 )                                  32            (18 )                                (5 )                    (13 )
                                                                                                                                                                 
   Recreation & Live Events*                                                                                                                                                        
                                                                                                                                                                 
Expenses                                1,756                         (3 )                                 3               (6 )                                                                                                              
                                                                                                                                                                 
Adjusted OI                                         $        748                         (6                   )%             (1                   )%             (5                   )%                                                                                           
$ millions
* Beginning Q1 2019, Media Networks revenue components previously reported as Ancillary were renamed to Consumer Products, Recreation and Live Events. Furthermore, certain components previously reported as Ancillary were reclassified to Affiliate. Prior period amounts have been recast to conform to the current presentation.
+ Non-GAAP measures referenced in this release are detailed in the Supplemental Disclosures at the end of this release.

Domestic advertising revenue rose 6% in the fiscal third quarter, driven by accelerating growth in Advanced Marketing Solutions (AMS). Domestic affiliate revenue declined 1%.

a^' Performance driven by subscriber declines, partially offset by higher contractual rates and OTT and studio production revenues.

a^' From a timing perspective, certain revenue shifted from FQ3 to FQ4.

Viacom International Media Networks delivered strong constant currency results + :

a^' International advertising revenue increased 9% driven by strong growth in Argentina and the U.K.

a^' Affiliate revenue increased 8% benefitting from growth in linear, as well as SVOD and other OTT deliveries.

Adjusted OI declined 6% impacted by marketing for current and upcoming original programming launches, as well as investments in key growth initiatives.

Operational Highlights

Domestic Media networks continued to grow audience share as total portfolio share increased by 1% YOY.

a^' Comedy Central delivered its ninth consecutive quarter of share growth - up 6% YOY.

a^' Paramount Network earned its third straight quarter of share growth - up 11% YOY - and its largest P18-49 share gain in 5 years.

a^' Viacom owned more top 20 original cable series in the quarter than any other cable family among key demos.

Internationally, Telefe remained #1 in ratings for 19 straight months, while Channel 5, Comedy Central and Paramount Network International all grew share YOY in the quarter. Studio production continued to expand worldwide with premieres of The Perfect Date and Trinkets on Netflix, and season 2 of Light as a Feather on Hulu in July. In June, Viacom announced a joint venture with Tyler Perry to launch BET+, a premier subscription video-on-demand service focused on the African American audience. Viacom Digital Studios extended its video consumption growth, placing 7th in Tubular's Media & Entertainment ranking in June, up from 13th a year ago.

a^' Video views grew 17% YOY to 5.9B and watch time increased by 85% YOY with 9.6B minutes viewed.

Viacom's live events drew close to a million fans in the fiscal quarter, with attendance at BETX up, sold out shows at JoJo Siwa's D.R.E.A.M Tour, Clusterfest, Slime City and several new Bellator events.

SPOTLIGHT ON DOMESTIC AD SALES, UPFRONT AND PLUTO TV

Viacom's return to growth in domestic advertising was a milestone achievement in the company's evolution.

DOMESTIC AD SALES

The return to growth in domestic ad sales is the result of the strategy Viacom began executing two years ago to launch AMS and help offset secular industry declines.

a^' Organically, the company introduced Vantage, one of the most sophisticated ad targeting platforms in the industry, and built key advanced marketing partnerships with MVPDs.

a^' Viacom also made strategic acquisitions, including AwesomenessTV, WhoSay and Pluto TV.

As a result, AMS now engages customers across linear and digital video, influencer and shopper marketing, branded content and Pluto TV. AMS continued to scale in the quarter, with revenue increasing 84% YOY, more than offsetting linear headwinds and fueling domestic ad sales growth.

UPFRONT

Viacom delivered strong Upfront results, with high-single to double-digit price increases - the highest rate of change in over a decade - and doubled agency commitments across its digital, social and advanced advertising portfolio. The strength of Viacom's brands and demand for its AMS portfolio, especially Pluto TV, drove significant shifts to Viacom's premium digital video inventory.

PLUTO TV

Pluto TV's leadership in free streaming TV continues to grow, with monthly active users (MAUs) up 50% this calendar year.

a^' Pluto TV is now integrated on Comcast's Xfinity X1 and launching on Cox Communications' Contour video and broadband platforms.

Pluto TV launched 28 new channels and continued to extend its international presence:

a^' In July, it launched Pluto TV Latino, a suite of 11 channels with 2,000-plus hours of programming in Spanish and Portuguese.

a^' Pluto TV was also added to UK on-demand platform My5.

BALANCE SHEET AND LIQUIDITY

Viacom continues to strengthen its balance sheet and improve free cash flow.

At June 30, 2019, gross debt outstanding was $8.96 billion. Adjusted gross debt was $8.31 billion. For the nine months ended June 30, 2019, net cash provided by operating activities increased 11% to $1.1 billion. For the nine months ended June 30, 2019, free cash flow increased 10% to $984 million, driven by an improvement in working capital management, partially offset by higher cash taxes.

About Viacom

Viacom creates entertainment experiences that drive conversation and culture around the world. Through television, film, digital media, live events, merchandise and solutions, our brands connect with diverse, young and young at heart audiences in more than 180 countries.

For more information about Viacom and its businesses, visit www.viacom.com. Viacom may also use social media channels to communicate with its investors and the public about the company, its brands and other matters, and those communications could be deemed to be material information. Investors and others are encouraged to review posts on Viacom's Twitter feed (twitter.com/viacom), Facebook page (facebook.com/viacom) and LinkedIn profile (linkedin.com/company/viacom).

Cautionary Statement Concerning Forward-Looking Statements

This news release contains both historical and forward-looking statements. All statements that are not statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements reflect our current expectations concerning future results, objectives, plans and goals, and involve known and unknown risks, uncertainties and other factors that are difficult to predict and which may cause future results, performance or achievements to differ. These risks, uncertainties and other factors include, among others: technological developments, alternative content offerings and their effects in our markets and on consumer behavior; competition for content, audiences, advertising and distribution in a swiftly consolidating industry; the public acceptance of our brands, programs, films and other entertainment content on the various platforms on which they are distributed; the impact on our advertising revenues of declines in linear television viewing, deficiencies in audience measurement and advertising market conditions; the potential for loss of carriage or other reduction in the distribution of our content; evolving cybersecurity and similar risks; the failure, destruction or breach of our critical satellites or facilities; content theft; increased costs for programming, films and other rights; the loss of key talent; domestic and global political, economic and/or regulatory factors affecting our businesses generally; volatility in capital markets or a decrease in our debt ratings; a potential inability to realize the anticipated goals underlying our ongoing investments in new businesses, products, services and technologies; fluctuations in our results due to the timing, mix, number and availability of our films and other programming; potential conflicts of interest arising from our ownership structure with a controlling stockholder; and other factors described in our news releases and filings with the Securities and Exchange Commission, including but not limited to our 2018 Annual Report on Form 10-K and reports on Form 10-Q and Form 8-K. The forward-looking statements included in this document are made only as of the date of this document, and we do not have any obligation to publicly update any forward-looking statements to reflect subsequent events or circumstances. If applicable, reconciliations for any non-GAAP financial information contained in this news release are included in this news release or available on our website at ir.viacom.com.

 
                                                                                                                                                                                                                   VIACOM INC.
                                                                                                                                                                                                       CONSOLIDATED STATEMENTS OF EARNINGS
                                                                                                                                                                                                                   (Unaudited)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                      Quarter Ended                                                                                                                                Nine Months Ended
                                                                                                                                                                                 June 30,                                                                                                                                                                             June 30,
                                                                                                                ----------------------------------------------------------------------------------------------------------------------------------                                                   ----------------------------------------------------------------------------------------------------------------------------------
(in millions, except per share amounts)                                                              2019                                                         2018                                                           2019                                                         2018
                                                                                                                -------------------------------------------------------                         -------------------------------------------------------                                              -------------------------------------------------------                         -------------------------------------------------------
                                                                                                                                                                                        
Revenues                                                                           $   3,357              $   3,237                $   9,405              $   9,458  
Expenses:                                                                                                                                                                                                  
                                                                                       1,717                  1,681                    4,924                  4,925  
   Operating
                                                                                         828                    738                    2,255                  2,248  
   Selling, general and administrative
                                                                                          55                     51                      159                    159  
   Depreciation and amortization
                                                                                                 --                     15                       95                    200  
   Restructuring and related costs
                                                                                                 --                            --                       40                            --  
   Legal settlement
                                                                                                                -----------------------------------   --------------------                      -----------------------------------   --------------------                                           ------------------------------  ----- --------------------                      -----------------------------------   --------------------
                                                                                       2,600                  2,485                    7,473                  7,532  
   Total expenses
Operating income                                                                         757                    752                    1,932                  1,926  
Interest expense, net                                                                   (119 )                                    (138 )                                      (364 )                                    (428 )
Equity in net earnings of investee companies                                                     --                      2                        1                      5  
Gain on marketable securities                                                             29                            --                       21                            --  
Gain on extinguishment of debt                                                                   --                            --                       18                     25  
Other items, net                                                                          (1 )                                      (9 )                                       (13 )                                     (41 )
                                                                                                                ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------                                           ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------
Earnings from continuing operations before provision for income taxes                    666                    607                    1,595                  1,487  
Provision for income taxes                                                              (122 )                                     (93 )                                      (352 )                                    (158 )
                                                                                                                ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------                                           ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------
Net earnings from continuing operations                                                  544                    514                    1,243                  1,329  
Discontinued operations, net of tax                                                        6                     11                       22                     23  
                                                                                                                ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------                                           ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------
Net earnings (Viacom and noncontrolling interests)                                       550                    525                    1,265                  1,352  
Net earnings attributable to noncontrolling interests                                     (6 )                                      (3 )                                       (24 )                                     (27 )
                                                                                                                ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------                                           ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------
Net earnings attributable to Viacom                                                $     544              $     522                $   1,241              $   1,325  
                                                                                                                ========== ==================== ===== ====================                      ========== ==================== ===== ====================                                           ========== ==================== ===== ====================                      ========== ==================== ===== ====================
Amounts attributable to Viacom:                                                                                                                                                                            
                                                                                   $     538              $     511                $   1,219              $   1,302  
   Net earnings from continuing operations
                                                                                           6                     11                       22                     23  
   Discontinued operations, net of tax
                                                                                                                ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------                                           ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------
                                                                                   $     544              $     522                $   1,241              $   1,325  
   Net earnings attributable to Viacom
                                                                                                                ========== ==================== ===== ====================                      ========== ==================== ===== ====================                                           ========== ==================== ===== ====================                      ========== ==================== ===== ====================
Basic earnings per share attributable to Viacom:                                                                                                                                                           
                                                                                   $    1.33              $    1.27                $    3.02              $    3.23  
   Continuing operations
                                                                                        0.02                   0.03                     0.06                   0.06  
   Discontinued operations
                                                                                                                ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------                                           ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------
                                                                                   $    1.35              $    1.30                $    3.08              $    3.29  
   Net earnings
                                                                                                                ========== ==================== ===== ====================                      ========== ==================== ===== ====================                                           ========== ==================== ===== ====================                      ========== ==================== ===== ====================
Diluted earnings per share attributable to Viacom:                                                                                                                                                         
                                                                                   $    1.33              $    1.27                $    3.02              $    3.23  
   Continuing operations
                                                                                        0.02                   0.02                     0.05                   0.06  
   Discontinued operations
                                                                                                                ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------                                           ------------------------------  ----- --------------------                      ------------------------------  ----- --------------------
                                                                                   $    1.35              $    1.29                $    3.07              $    3.29  
   Net earnings
                                                                                                                ========== ==================== ===== ====================                      ========== ==================== ===== ====================                                           ========== ==================== ===== ====================                      ========== ==================== ===== ====================
Weighted average number of common shares outstanding:                                                                                                                                                      
                                                                                       403.5                  402.8                    403.3                  402.6  
   Basic
                                                                                       404.0                  403.3                    403.7                  402.9  
   Diluted
                                                                                                                                                                                        
--------------------------------------------------------------------- -------------------- -------------------- -------------------------------------------------------    -------------------- -------------------------------------------------------    -------------------- -------------------- -------------------------------------------------------    -------------------- -------------------------------------------------------
                                                                                                                                                                                        
                                                                                                                                       VIACOM INC.
                                                                                                                               CONSOLIDATED BALANCE SHEETS
                                                                                                                                       (Unaudited)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
(in millions, except par value)                                                                                  June 30,                              June 30,                                        September 30,
                                                                                                                                      2019                                  2019                                                                                    2018
                                                                                                                              --------------------
                                                                                         
                                                                                                                                   
ASSETS                                                                                                                                                
Current assets:                                                                                                                                       
                                                                                                                              $     $      722             $   1,557  
   Cash and cash equivalents
                                                                                                                          3,386                             3,386                 3,141  
   Receivables, net
                                                                                                                            819                               819                   896  
   Inventory, net
                                                                                                                            515                               515                   482  
   Prepaid and other assets
                                                                                                                              -------------------- -------------------------------   --------------------                                           --------------  --------------------
                                                                                                                          5,442                             5,442                 6,076  
      Total current assets
Property and equipment, net                                                                                                 891                               891                   919  
Inventory, net                                                                                                            3,963                             3,963                 3,848  
Goodwill                                                                                                                 11,886                            11,886                11,609  
Intangibles, net                                                                                                            328                               328                   313  
Other assets                                                                                                              1,138                             1,138                 1,018  
                                                                                                                              -------------------- -------------------------------   --------------------                                           --------------  --------------------
Total assets                                                                                                                  $     $   23,648             $  23,783  
                                                                                                                              ==================== ===== ==================== ====== ====================                                           ======= ======= ====================
                                                                                                                                   
LIABILITIES AND EQUITY                                                                                                                                
Current liabilities:                                                                                                                                  
                                                                                                                              $     $      441             $     433  
   Accounts payable
                                                                                                                            837                               837                   848  
   Accrued expenses
                                                                                                                            711                               711                   719  
   Participants' share and residuals
                                                                                                                            730                               730                   662  
   Program obligations
                                                                                                                            474                               474                   398  
   Deferred revenue
                                                                                                                            320                               320                   567  
   Current portion of debt
                                                                                                                            490                               490                   427  
   Other liabilities
                                                                                                                              -------------------- -------------------------------   --------------------                                           --------------  --------------------
                                                                                                                          4,003                             4,003                 4,054  
      Total current liabilities
Noncurrent portion of debt                                                                                                8,638                             8,638                 9,515  
Participants' share and residuals                                                                430                               430                   523  
Program obligations                                                                                                         335                               335                   498  
Deferred tax liabilities, net                                                                                               318                               318                   296  
Other liabilities                                                                                                         1,191                             1,191                 1,186  
Redeemable noncontrolling interest                                                                                          250                               250                   246  
Commitments and contingencies                                                                                                                         
Viacom stockholders' equity:                                                                                               
                                                                                                                 --                    --        --  
   Class A common stock, par value $0.001, 375.0 authorized; 49.4 and 49.4 outstanding, respectively
                                                                                                                 --                    --        --  
   Class B common stock, par value $0.001, 5,000.0 authorized; 354.3 and 353.7 outstanding, respectively
                                                                                                                         10,157                            10,157                10,145  
   Additional paid-in capital
                                                                                                                        (20,541                           (20,541 )                                (20,562 )
   Treasury stock, 392.5 and 393.1 common shares held in treasury, respectively
                                                                                                                         19,656                            19,656                18,561  
   Retained earnings
                                                                                                                           (832                              (832 )                                   (737 )
   Accumulated other comprehensive loss
                                                                                                                              -------------------- -------------------------------   --------------------                                           --------------  --------------------
                                                                                                                          8,440                             8,440                 7,407  
      Total Viacom stockholders' equity
Noncontrolling interests                                                                                                     43                                43                    58  
                                                                                                                              -------------------- -------------------------------   --------------------                                           --------------  --------------------
Total equity                                                                                                              8,483                             8,483                 7,465  
                                                                                                                              -------------------- -------------------------------   --------------------                                           --------------  --------------------
Total liabilities and equity                                                                                                  $     $   23,648             $  23,783  
                                                                                                                              ==================== ===== ==================== ====== ====================                                           ======= ======= ====================
                                                                                                                                   
-------------------------------------------------------------------------------------------------------- -------------------- -------------------- ---------------------------------------------------    -------------------- -------------------- ----------------------------------
 
                                                                                                                                    VIACOM INC.
                                                                                                                       CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                                                                                                    (Unaudited)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                Nine Months Ended                                                                     Nine Months Ended
                                                                                                             June 30,                                                                              June 30,
                                                                                                       -------------------- --------------------------------------------------------------------------------------------------------------------------------------------
(in millions)                                                            2019                                  2019                                                      2018
                                                                                                       -------------------- --------------------------------------------------                                              --------------------------------------------------
OPERATING ACTIVITIES                                                                                       
Net earnings (Viacom and noncontrolling interests)                                  $     $   1,265           $   1,352  
Discontinued operations, net of tax                                               (22                              (22 )                                                     (23 )
                                                                                                       -------------------- ------------------------------   --------------------                                           ------------------------------   --------------------
Net earnings from continuing operations                                         1,243                            1,243                                  1,329  
Reconciling items:                                                                                         
                                                                                  159                              159                                    159  
   Depreciation and amortization
                                                                                3,234                            3,234                                  3,402  
   Feature film and program amortization
                                                                                   41                               41                                     45  
   Equity-based compensation
                                                                                   36                               36                                     27  
   Deferred income taxes
                                                                                  (21                              (21 )                                          --  
   Gain on marketable securities
                                                                                                           
   Operating assets and liabilities, net of acquisitions:
                                                                                 (232                             (232 )                                                    (211 )
      Receivables
                                                                               (3,320                           (3,320 )                                                  (3,373 )
      Production and programming
                                                                                    7                                7                                   (384 )
      Accounts payable and other current liabilities
                                                                                  (44                              (44 )                                                       3  
   Other, net
                                                                                                       -------------------- ------------------------------   --------------------                                           ------------------------------   --------------------
Net cash provided by operating activities                                       1,103                            1,103                                    997  
                                                                                                       -------------------- ------------------------------   --------------------                                           ------------------------------   --------------------
                                                                                        
INVESTING ACTIVITIES                                                                                       
                                                                                 (396                             (396 )                                                     (90 )
   Acquisitions and investments, net
                                                                                 (119                             (119 )                                                    (102 )
   Capital expenditures
                                                                                    5                                5                                     57  
   Proceeds received from asset sales
                                                                                    4                                4                                      7  
   Grantor trust proceeds
                                                                                                       -------------------- ------------------------------   --------------------                                           ------------------------------   --------------------
Net cash used in investing activities                                            (506                             (506 )                                                    (128 )
                                                                                                       -------------------- ------------------------------   --------------------                                           ------------------------------   --------------------
                                                                                        
FINANCING ACTIVITIES                                                                                       
                                                                               (1,100                           (1,100 )                                                  (1,000 )
   Debt repayments
                                                                                 (242                             (242 )                                                    (241 )
   Dividends paid
                                                                       --                   --                                      2  
   Exercise of stock options
                                                                                  (87                              (87 )                                                     (70 )
   Other, net
                                                                                                       -------------------- ------------------------------   --------------------                                           ------------------------------   --------------------
Net cash used in financing activities                                          (1,429                           (1,429 )                                                  (1,309 )
                                                                                                       -------------------- ------------------------------   --------------------                                           ------------------------------   --------------------
Effect of exchange rate changes on cash and cash equivalents                       (3                               (3 )                                                     (20 )
                                                                                                       -------------------- ------------------------------   --------------------                                           ------------------------------   --------------------
Net change in cash and cash equivalents                                          (835                             (835 )                                                    (460 )
Cash and cash equivalents at beginning of period                                1,557                            1,557                                  1,389  
                                                                                                       -------------------- ------------------------------   --------------------                                           ------------------------------   --------------------
Cash and cash equivalents at end of period                                          $     $     722           $     929  
                                                                                                       ==================== ===== ==================== ===== ====================                                           ===== ==================== ===== ====================
                                                                                        
------------------------------------------------------------ -------------------- -------------------- -------------------- --------------------------------------------------    -------------------- -------------------- --------------------------------------------------

SUPPLEMENTAL DISCLOSURES REGARDING NON-GAAP FINANCIAL MEASURES

We utilize certain financial measures that are not in accordance with accounting principles generally accepted in the United States of America ("GAAP"), including consolidated adjusted operating income, adjusted earnings from continuing operations before provision for income taxes, adjusted provision for income taxes, adjusted net earnings from continuing operations attributable to Viacom and adjusted diluted earnings per share ("EPS") from continuing operations, to evaluate our actual operating performance and for planning and forecasting of future periods.

We also utilize free cash flow, which is a non-GAAP financial measure, because we believe the use of this measure provides investors with an important perspective on our liquidity, including our ability to service debt and make investments in our business.

In addition, because foreign currency headwinds can be significant and unpredictable and are outside of our control, we provide certain financial information on a constant currency basis, excluding the impact of currency fluctuations, in order to provide a clearer view of our operating performance. This information compares results between periods as if exchange rates had remained constant period-over-period. We calculate this information by converting current-period local currency results using prior-year period average foreign currency exchange rates.

We believe that each of these adjusted measures provides relevant and useful information for investors because they clarify our actual operating performance, make it easier to compare our results with those of other companies, facilitate period-to-period comparisons of our business performance and allow investors to review performance in the same way as our management. Since these are not measures of performance calculated in accordance with GAAP, they should not be considered in isolation of, or as a substitute for, operating income, earnings from continuing operations before provision for income taxes, provision for income taxes, net earnings from continuing operations attributable to Viacom, diluted EPS from continuing operations and net cash provided by operating activities as indicators of operating performance and they may not be comparable to similarly titled measures employed by other companies.

The following tables reconcile our results of operations reported in accordance with GAAP for the quarter and nine months ended June 30, 2019 and 2018 to adjusted results that exclude the impact of certain items identified as affecting comparability (non-GAAP).

(in millions, except per share amounts)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                      Quarter Ended                                                                                                                                 Quarter Ended
                                         June 30, 2019                                                                                                                                 June 30, 2019
                                     -------------------- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                        Operating                    Operating                            Earnings from                         Provision for                        Net Earnings                          Diluted EPS
                                            Income                       Income                                                  Continuing                                            Income Taxes (1)                                         from Continuing                                         from Continuing
                                                                                                                                 Operations                                                                                                       Operations                                              Operations
                                                                                                                              Before Provision                                                                                                  Attributable to
                                                                                                                              for Income Taxes                                                                                                      Viacom
                                     -------------------- ----------------------------------                        ----------------------------------                        --------------------------------                        --------------------------------                        --------------------------------
Reported results (GAAP)                                 $       $     757           $     666          $    122          $    538          $   1.33  
Factors Affecting Comparability:                                                                                    
                                           --  --                 (29 )                                 (7 )                                (22 )                              (0.05 )
   Gain on marketable securities (2)
                                           --  --      --                32               (32 )                              (0.08 )
   Discrete tax benefit (3)
                                     -------------------- --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      ------------  --------------------                      ------------  --------------------
Adjusted results (Non-GAAP)                             $       $     757           $     637          $    147          $    484          $   1.20  
                                     ==================== ======= ======= ====================                      ======= ======= ====================                      ====== ====== ====================                      ====== ====== ====================                      ====== ====== ====================
                                                                                                 
------------------------------------ -------------------- ----------------------------------   -------------------- ----------------------------------   -------------------- --------------------------------   -------------------- --------------------------------   -------------------- --------------------------------
(in millions, except per share amounts)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                           Nine Months Ended                                                                                                                             Nine Months Ended
                                                                June 30, 2019                                                                                                                                 June 30, 2019
                                                            -------------------- ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                               Operating                    Operating                            Earnings from                         Provision for                        Net Earnings                          Diluted EPS
                                                                   Income                       Income                                                  Continuing                                            Income Taxes (1)                                         from Continuing                                         from Continuing
                                                                                                                                                        Operations                                                                                                       Operations                                              Operations
                                                                                                                                                     Before Provision                                                                                                  Attributable to
                                                                                                                                                     for Income Taxes                                                                                                      Viacom
                                                            -------------------- ----------------------------------                        ----------------------------------                        --------------------------------                        --------------------------------                        --------------------------------
Reported results (GAAP)                                                        $       $   1,932           $   1,595          $    352          $  1,219          $   3.02  
Factors Affecting Comparability:                                                                                                           
                                                                             172             172                 172                40               132              0.32  
   Restructuring, related costs and programming charges (4)
                                                                              40              40                  40                 9                31              0.08  
   Legal settlement (5)
                                                                  --  --                 (18 )                                 (4 )                                (14 )                              (0.03 )
   Gain on extinguishment of debt (6)
                                                                  --  --                 (21 )                                 (5 )                                (16 )                              (0.04 )
   Gain on marketable securities (2)
                                                                  --  --      --                32               (32 )                              (0.08 )
   Discrete tax benefit (3)
                                                            -------------------- --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      ------------  --------------------                      ------------  --------------------
Adjusted results (Non-GAAP)                                                    $       $   2,144           $   1,768          $    424          $  1,320          $   3.27  
                                                            ==================== ======= ======= ====================                      ======= ======= ====================                      ====== ====== ====================                      ====== ====== ====================                      ====== ====== ====================
                                                                                                                        
----------------------------------------------------------- -------------------- ----------------------------------   -------------------- ----------------------------------   -------------------- --------------------------------   -------------------- --------------------------------   -------------------- --------------------------------
(in millions, except per share amounts)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                   Quarter Ended
                                                                                                                                                                                         June 30, 2018
                                                            ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                    Operating                            Earnings from                         Provision for                        Net Earnings                          Diluted EPS
                                                                           Income                                                  Continuing                                            Income Taxes (1)                                         from Continuing                                         from Continuing
                                                                                                                                   Operations                                                                                                       Operations                                              Operations
                                                                                                                                Before Provision                                                                                                  Attributable to
                                                                                                                                for Income Taxes                                                                                                      Viacom
                                                            ----------------------------------                        ----------------------------------                        --------------------------------                        --------------------------------                        --------------------------------
Reported results (GAAP)                  $           752     $           607     $          93     $         511     $        1.27  
Factors Affecting Comparability:                                                                                      
                                                      15                  15                 4                11              0.03  
   Restructuring and related costs (4)
                                          --     --                 47               (47 )                              (0.12 )
   Discrete tax benefit (3)
                                                            --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      ------------  --------------------                      ------------  --------------------
Adjusted results (Non-GAAP)              $           767           $     622     $         144     $         475     $        1.18  
                                                            ======= ======= ====================                      ======= ======= ====================                      ====== ====== ====================                      ====== ====== ====================                      ====== ====== ====================
                                                                                                   
-------------------------------------- -------------------- ----------------------------------   -------------------- ----------------------------------   -------------------- --------------------------------   -------------------- --------------------------------   -------------------- --------------------------------
(in millions, except per share amounts)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                  Nine Months Ended
                                                                                                                                                                                          June 30, 2018
                                                            ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                    Operating                            Earnings from                          Provision for                         Net Earnings                          Diluted EPS
                                                                           Income                                                  Continuing                                             Income Taxes (1)                                          from Continuing                                         from Continuing
                                                                                                                                   Operations                                                                                                         Operations                                              Operations
                                                                                                                                Before Provision                                                                                                    Attributable to
                                                                                                                                for Income Taxes                                                                                                        Viacom
                                                            ----------------------------------                        ----------------------------------                        ----------------------------------                        --------------------------------                        --------------------------------
Reported results (GAAP)                        $   1,926           $   1,487           $     158          $  1,302          $   3.23  
Factors Affecting Comparability:                                                                                        
                                                     200                 200                  48               152              0.38  
   Restructuring and related costs (4)
                                          --                 (25 )                                   (6 )                                (19 )                              (0.05 )
   Gain on extinguishment of debt (6)
                                          --                 (16 )                       --               (16 )                              (0.04 )
   Gain on asset sale (7)
                                          --                  46                  10                36              0.09  
   Investment impairment (8)
                                          --     --                  196              (196 )                              (0.49 )
   Discrete tax benefit (3)
                                                            --------------  --------------------                      --------------  --------------------                      --------------  --------------------                      ------------  --------------------                      ------------  --------------------
Adjusted results (Non-GAAP)                    $   2,126           $   1,692           $     406          $  1,259          $   3.12  
                                                            ======= ======= ====================                      ======= ======= ====================                      ======= ======= ====================                      ====== ====== ====================                      ====== ====== ====================
                                                                                                     
-------------------------------------- -------------------- ----------------------------------   -------------------- ----------------------------------   -------------------- ----------------------------------   -------------------- --------------------------------   -------------------- --------------------------------

(1) The tax impact has been calculated by applying the tax rates applicable to the adjustments presented.

(2) Pursuant to our adoption of Accounting Standards Update 2016-01, which requires the changes in fair value measurement of marketable securities to be recognized in the Consolidated Statements of Earnings, we recorded a non-operating gain on marketable securities of $29 million and $21 million in the quarter and nine months ended June 30, 2019, respectively, in the Consolidated Statements of Earnings.

(3) The net discrete tax benefit in the quarter and nine months ended June 30, 2019 was principally related to the tax benefit triggered by the bankruptcy of an investee.

The net discrete tax benefit in the quarter ended June 30, 2018 was principally related to a tax accounting method change granted by the Internal Revenue Service and the release of tax reserves with respect to certain effectively settled tax positions. In addition to the items in the quarter, the net discrete tax benefit in the nine months ended June 30, 2018 was principally related to tax reform, as well as the measurement of the deferred tax balances from the retroactive reenactment of legislation allowing for accelerated tax deductions on certain qualified film and television productions.

(4) During fiscal 2018, we launched a program of cost transformation initiatives to improve our margins. We recognized pre-tax charges of $172 million in the nine months ended June 30, 2019, associated with continuing initiatives primarily related to recent management changes and reorganization at Media Networks, comprised of $95 million of restructuring and related costs and $77 million of programming charges. The programming charges resulted from decisions by management newly in place, as part of our 2018 restructuring activities, to cease the use of certain programming, and are included within Operating expenses in the Consolidated Statements of Earnings.

We recognized restructuring and related costs of $15 million and $200 million in the quarter and nine months ended June 30, 2018, respectively, resulting from the program of cost transformation initiatives described above.

(5) An expense of $40 million was recognized in connection with the settlement of a commercial dispute in the quarter ended March 31, 2019.

(6) We redeemed senior notes and debentures totaling $1.128 billion in the nine months ended June 30, 2019. As a result, we recognized a pre-tax extinguishment gain of $18 million in the Consolidated Statements of Earnings.

We redeemed senior notes and debentures totaling $1.039 billion in the nine months ended June 30, 2018. As a result of these transactions, we recognized a pre-tax extinguishment gain of $25 million in the Consolidated Statements of Earnings.

(7) We completed the sale of a 1% equity interest in Viacom18 to our joint venture partner for $20 million, resulting in a gain of $16 million in the nine months ended June 30, 2018, included within Other items, net in the Consolidated Statements of Earnings.

(8) We recognized a $46 million impairment loss in the nine months ended June 30, 2018, included within Other items, net in the Consolidated Statements of Earnings, in connection with the write off of certain cost method investments.

The following table reconciles our net cash provided by operating activities (GAAP) for the quarter and nine months ended June 30, 2019 and 2018 to free cash flow (non-GAAP). We define free cash flow as net cash provided by operating activities minus capital expenditures.

Reconciliation of net cash provided by operating activities       Quarter Ended                                                      Quarter Ended                                                                   Better/                                                                  Nine Months Ended                                                                 Better/
to free cash flow                                                                      June 30,                                                           June 30,                                                                                                            (Worse)                                                                                                            June 30,                                                                                                            (Worse)
(in millions)
                                                                                 -------------------- --------------------------------------------------------------------------------------------------------                                                  --------------------------------                                             --------------------------------------------------------------------------------------------------------                                                  --------------------------------
                                                                    2019                        2019                                   2018                                     $                                    2019                                   2018                                     $
                                                            -------------------- --------------------------------                                             --------------------------------                                             --------------------------------                                             --------------------------------                                             --------------------------------                                             --------------------------------
Net cash provided by operating activities (GAAP)                                 $      $    384            $    698            $   (314 )                             $  1,103            $    997            $    106  
Capital expenditures                                                           (42           (42 )                                  (38 )                                   (4 )                                 (119 )                                 (102 )                                  (17 )
                                                                                 -------------------- ------------  --------------------                                           ------------  --------------------                                           ------------  --------------------                                           ------------  --------------------                                           ------------  --------------------                                           ------------  --------------------
Free cash flow (Non-GAAP)                                                        $      $    342            $    660            $   (318 )                             $    984            $    895            $     89  
                                                                                 ==================== ====== ====== ====================                                           ====== ====== ====================                                           ====== ====== ====================                                           ====== ====== ====================                                           ====== ====== ====================                                           ====== ====== ====================
                                                                                                                                                  
----------------------------------------------------------- -------------------- -------------------- --------------------------------   -------------------- -------------------- --------------------------------   -------------------- -------------------- --------------------------------   -------------------- -------------------- --------------------------------   -------------------- -------------------- --------------------------------   -------------------- -------------------- --------------------------------

View source version on businesswire.com: https://www.businesswire.com/news/home/20190808005184/en/

SOURCE: Viacom Inc.

Press: 
Justin Dini
Senior Vice President, Corporate Communications
(212) 846-2724
justin.dini@viacom.com 

Justin Blaber 
Senior Director, Corporate Communications
(212) 846-3139
justin.blaber@viacom.com 

Pranita Sookai 
Director, Corporate Communications
(212) 846-7553
pranita.sookai@viacom.com 

Investors: 
James Bombassei
Senior Vice President, Investor Relations and Treasurer
(212) 258-6377
james.bombassei@viacom.com 

Jaime Morris 
Vice President, Investor Relations
(212) 846-5237
jaime.morris@viacom.com

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