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ABS-CBN CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
SyCip Gorres Velayo & Co.
6760 Ayala Avenue
1226 Makati City
Philippines

Tel: (632) 891 0307
Fax: (632) 819 0872
ey.com/ph

BOA/PRC Reg. No. 0001,
December 28, 2012, valid until December 31, 2015
SEC Accreditation No. 0012-FR-3 (Group A),
November 15, 2012, valid until November 16, 2015

(Amounts in Thousands)

December 31,
2013

INDEPE NDE NT AUDITOR S’ R E POR T
The Stockholders and the Board of Directors
ABS-CBN Corporation
We have audited the accompanying consolidated financial statements of ABS-CBN Corporation and Subsidiaries, which comprise
the consolidated statements of financial position as at December 31, 2013 and 2012, and the consolidated statements of income,
statements of comprehensive income, statements of changes in equity and statements of cash flows for each of the three years in
the period ended December 31, 2013, and a summary of significant accounting policies and other explanatory information.

Management’s R esponsibility for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance
with Philippine Financial Reporting Standards, and for such internal control as management determines is necessary to enable the
preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ R esponsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our
audits in accordance with Philippine Standards on Auditing. Those standards require that we comply with ethical requirements
and plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial
statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material
misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial
statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing
an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall
presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of ABS-CBN
Corporation and Subsidiaries as at December 31, 2013 and 2012, and their financial performance and their cash flows for each of
the three years in the period ended December 31, 2013 in accordance with Philippine Financial Reporting Standards.
SYCIP GORRES VELAYO & CO.

Maria Vivian C. Ruiz
Partner
CPA Certificate No. 83687
SEC Accreditation No. 0073-AR-3 (Group A),
January 18, 2013, valid until January 17, 2016
Tax Identification No. 102-084-744
BIR Accreditation No. 08-001998-47-2012,
April 11, 2012, valid until April 10, 2015
PTR No. 4225211, January 2, 2014, Makati City
February 25, 2014

December 31,
2012
(As restated Note 2)

January 1,
2012
(As restated Note 2)

ASSETS
Current Assets
Cash and cash equivalents (Note 6)
Trade and other receivables (Notes 7 and 22)
Inventories (Note 8)
Program rights and other intangible assets (Note 12)
Other current assets (Note 9)
Total Current Assets
Noncurrent Assets
Property and equipment (Notes 10, 11, 18 and 30)
Program rights and other intangible assets - net
of current portion (Note 12)
Goodwill (Notes 4 and 16)
Available-for-sale investments (Note 13)
Investment properties (Notes 10, 11 and 18)
Investments in associates and joint ventures (Note 14)
Deferred tax assets - net (Note 28)
Other noncurrent assets (Note 15)
Total Noncurrent Assets

=
P10,616,855
8,333,761
265,221
1,385,972
2,781,665
23,383,474

7,854,907
218,120
834,716
2,780,139
18,082,820

7,020,593
134,867
576,699
2,507,895
18,875,107

18,535,905

17,669,713

15,242,115

5,429,192
5,288,350
219,191
196,916
166,591
2,192,429
2,580,033
34,608,607

5,424,711
5,291,873
224,101
53,073
41,026
2,146,119
2,460,705
33,311,321

4,061,504
3,279,686
264,892
57,796
41,084
1,509,498
2,677,307
27,133,882

=
P57,992,081

P51,394,141

=
P46,008,989

P11,332,006
1,345,471
448,861
193,216
13,319,554

3,534,027
362,232
84,741
14,038,166

663,101
356,981
171,086
9,864,305

13,334,579
276,344

12,251,478
123,804

11,848,780
347,424

4,191,082
299,798
245,195
402,772
18,749,770
32,069,324

4,599,072
323,126
227,674
408,990
17,934,144
31,972,310

4,066,009
576,326
211,389
471,844
17,521,772
27,386,077

LIABILITIES AND EQUITY
Current Liabilities
Trade and other payables (Notes 17, 22 and 29)
Interest-bearing loans and borrowings (Notes 10, 11 and 18)
Obligations for program rights (Note 19)
Income tax payable
Total Current Liabilities
Noncurrent Liabilities
Interest-bearing loans and borrowings - net of current portion
(Notes 10, 11 and 18)
Obligations for program rights - net of current portion (Note 19)
Accrued pension obligation and other employee benefits
(Note 29)
Deferred tax liabilities - net (Note 28)
Convertible note (Note 4)
Other noncurrent liabilities (Note 20)
Total Noncurrent Liabilities
Total Liabilities
(Forward)

A member firm of Ernst & Young Global Limited

74

ABS-CBN Annual Report 2013

ABS-CBN Annual Report 2013

75

823 – 16.105 (1.246 GENERAL AND ADMINISTRATIVE EXPENSES (Notes 7.576 86.164. 22.069.684) (9.387.950 253.108) (8.998 467. December 31.274 (358.672 177.579.711. 12. 2012 (As restated Note 2) January 1.471) (8.849 2.164.623 37.887) (233.039. 29 and 30) (9.817.421.580.622. 21.106.680.957 = P779.805.536) 119.140 179.028.784 (43. 11.811 13.477. 24.000 4.397) – (58) (24.807 18. 26.834.725 (117.676 28. Except Per Share Amounts) Years Ended December 31 2012 2011 (As restated (As restated 2013 Note 2) Note 2) REVENUES Airtime (Note 22) Sale of services (Note 30) Sale of goods (Note 22) Others PRODUCTION COSTS (Notes 10.712.821.907.936.922.069 (638.491) (7.289 25.488) (816.105 1. 27 and 30) INCOME BEFORE INCOME TAX PROVISION FOR INCOME TAX (Note 28) (12.079 123.681 (1. 15.289 684.793) GROSS PROFIT 13.031.468 (1.368 421. 25. 12.735.952 17.322) (8. 18 and 27) INTEREST INCOME (Note 6) FOREIGN EXCHANGE GAIN (LOSS) . 12.150 19.December 31.050 (270.781) (29) 1.983.050) (281.757 2. 22.716 459.904 12.971 94.495.834 = P779.164.124 P 200.843) (6.258. 29 and 30) COST OF SERVICES (Notes 10.332.533.289) 126.349 19. 29 and 30) COST OF SALES (Notes 8.043.145. 2012 (As restated Note 2) =872.276 = P2.658 2. 29 and 30) = P18.912 ABS-CBN CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Amounts in Thousands.919) (816.329 28.net EQUITY IN NET LOSSES OF ASSOCIATES AND JOINT VENTURES (Note 14) GAIN (LOSS) ON SALE OF INVESTMENTS (Notes 4 and 13) OTHER INCOME .766 34.382. 22.343.701) (726.640 10.365. 2013 Equity Attributable to Equity Holders of the Parent Company Capital stock (Note 21): Common Preferred Additional paid-in capital (Notes 2.585 – 679.387.180 NET INCOME Attributable to Equity holders of the Parent Company (Note 33) Noncontrolling interests = P2.162 2. 4 and 21) Cumulative translation adjustments Unrealized gain on available-for-sale investments (Note 13) Share-based payment plan (Note 21) Retained earnings (Note 21) Philippine depository receipts convertible to common shares (Note 21) Noncontrolling Interests (Notes 4 and 23) Total Equity See accompanying Notes to Consolidated Financial Statements.544 788.209 25.783) (10.055. 10.138 P1.347 Basic/Diluted Earnings per Share Attributable to Equity Holders of the Parent Company (Note 33) See accompanying Notes to Consolidated Financial Statements.311 413.199.871) 94. 10.342 579. 25.378) P2.146) 16.585 – 725.248 (11.788) (273.500) 111.570.377. 22.146) 24. 76 ABS-CBN Annual Report 2013 ABS-CBN Annual Report 2013 77 .438 119.net (Notes 15.611 33.061 (145.146.731.600 10.325 8.146) 17.099 687.508) FINANCE COSTS (Notes 4.632) 121.831 2.816.

553) 445.910) 362.412) .366 (1.074.433 (67.390 (130.039.352.484.187) Other comprehensive income (loss) to be reclassified to profit and loss in subsequent periods: Exchange differences on translation of foreign operations Unrealized fair value gain (loss) on available-for-sale investments (Note 13) 367.784) (4.ABS-CBN CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Amounts in Thousands) Years Ended December 31 2012 2011 (As restated (As restated 2013 Note 2) Note 2) NET INCOME OTHER COMPREHENSIVE INCOME (LOSS) Other comprehensive income (loss) not to be reclassified to profit and loss in subsequent periods: Remeasurement gain (loss) on defined benefit plan (Note 29) Income tax effect 639.276 (91.853 (272.129 (191.484 1.253.545) (1.900) 9.838. 78 ABS-CBN Annual Report 2013 2.137 (364.966) OTHER COMPREHENSIVE INCOME (LOSS) 810.354 (160.818 (34.153) TOTAL COMPREHENSIVE INCOME Attributable to: Equity holders of the Parent Company Noncontrolling interests See accompanying Notes to Consolidated Financial Statements.921) 39.838.657 (279.906.739) 447.747 6.484 2.600) 1.998 (42.645) (1.753) (44.949) 2.

132 (319.952 – – – – – – P779.146) (30.580.200.622.164.069 P126.274 (P358.164.623 (166.300.657 (4.910) 397.753) 6.146) P18.853 106.657 (4.028.585 P– P725.231) – – (1. 2011.435) 16.939.982) 2.676 P– P28.000 – 8.106.145. 2012.961) – – – – – – – – – – – – – – 92.125) 28.580.777.413.600) 18.952 – – (57.150 (117.378) 49.952 (P638.177.276 (197. as previously reported Effect of adoption of Revised PAS 19 (Notes 2 and 29) At December 31.872 (2.164.000) 8.164.000 – 9.755.164.6 76 P– P 28.495.657) 2.137 2. as restated Remeasurement Gain (Loss) on Defined Benefit Plan (Note 29) Share-based Payment Plan (Note 21) Philippine Depository Receipts (PDRs) Convertible to Common Shares (Note 21) Total (P1.545) 1.563) (8.681 2.349 – P 16.200. 2012 AND 2011 (Amounts in Thousands) Attributable to Equity Holders of the Parent Company Capital Stock (Note 21) Common Preferred At December 31.711 199.382.043.623 – – – – – – – – – – – – 28.777. 2013 At December 31.069 – – – 779.000 – – – – 126.853 106.518.125) 28.397 3.580.501 200.125) – – (1.000) – – – – – – – – 5.711 – – – – P– P679.893) P25.200.725 Retained Earnings (Note 21) UnAppropriated appropriated P779.004 – – – – (358.952 (101.105 1.922.164.846.501 200.669) 1.146) – (1.676 – – – 28.623 – (279.274 – – – – – (638.000 P 9.231 (593.831 2.961 – – – – 760.059) 397.397 3. 2012.039.755.231 – – – – – – (279.912 1.270.334.300.159.831 (P1.289) P126.000 – – – – – 5.962 – – – – – – – – – – – – – – P 872.981) P24.893 (1.681 P2.949) – – Total Equity P21.635) – (593.551) ABS-CBN Annual Report 2013 79 .397 – – 16.961 – – 2.617.124 – P200.000 – P– – P34.300.097.300.421.145.289) (106.289 (185.838.289 P 8.823 P– P– P 8.916) – – – – – – 11.539 – – – – 200.932.914.435) 106.347 810.359.041) 19.000 – – 3.757 P119.952 – 8.536) – 119.537.069 – – – – 367.202.823 – – – – – 8.231 – – 1.270.000 – (P270.834 P17.766 P779.354 – – – – (593.105 1.725 – 2.300.092) (43.579. 2013. as restated Net income Other comprehensive income (loss) Total comprehensive income (loss) Remeasurement gain on defined benefit plan transferred to retained earnings (Note 2) Cash dividends declared Share-based payment plan Acquisition of noncontrolling interests (Note 4) Effect of business combination under common control (Note 2) At December 31.725 (1.289) – P11.906.300.578 211.585 – – – 679.563) – – – (1.536) – – – 779.961 (296.708 – – – 367.952 P 8.981) P4.150 P19.585 – – – 725.047.145.300.429 (67.585 P– P679.899 (364.050 – – – – – – – (57.585 (30.433 – – – – – – – – – – (397.834 2.253.000 – – – (16.910) 397.939.753) 6.059) – (296.540 (P1. 2011.617.954 (158.740 Additional Paid-in Capital Cumulative Translation Adjustments Unrealized Gain on Availablefor-Sale Investments (Note 13) ( P638.876) (160.039.484 – (296.146) – 17.916) – – – 11.540 P2.000 – – – – – 5.632) – P121.957 – (P1.ABS-CBN CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEARS ENDED DECEMBER 31. as restated Net income Other comprehensive income (loss) Total comprehensive income (loss) Remeasurement loss on defined benefit plan transferred to retained earnings (Note 2) Cash dividends declared Reversal of appropriation of retained earnings Appropriation of retained earnings Share-based payment plan Issuance of common stock Issuance of preferred stock Decrease in noncontrolling interests (Note 2) At December 31. as previously reported Effect of adoption of Revised PAS 19 (Notes 2 and 29) At December 31.464 P 20.468 (154.816.563) Noncontrolling Interests P2.000 – P 3.146) – – – (1.146) P19.000 P 9. 2012.807 37.421.912) P1.382.

410 – (1. 80 ABS-CBN Annual Report 2013 ABS-CBN Annual Report 2013 81 .128) (10.332. as restated Remeasurement Gain (Loss) on Defined Benefit Plan (Note 29) Share-based Payment Plan (Note 21) Philippine Depository Receipts (PDRs) Convertible to Retained Earnings (Note 21) Common UnShares Appropriated appropriated (Note 21) Additional Paid-in Capital Cumulative Translation Adjustments Unrealized Gain on Availablefor-Sale Investments (Note 13) – – – – – – – – – 8.893) 119.739) 16.595) (1. as previously reported Effect of adoption of Revised PAS 19 (Notes 2 and 29) At December 31.180 16.784) 9.395.637.154.592) (1.082) – Total (765.595) – – – – – – – (44.637. as restated Net income Other comprehensive income (loss) Total comprehensive income (loss) Remeasurement loss on defined benefit plan transferred to retained earnings (Note 2) Cash dividends declared Acquisitions of PDRs Increase in noncontrolling interests At December 31. 2010.000 – 8.Attributable to Equity Holders of the Parent Company Capital Stock (Note 21) Common Preferred At December 31. 2010.971 – – – – – – – – – – – – – – – – 902.427.818 (902.830.005 – – – – (44.074.153) (42.585 – – – 725.082) 1.412) 1.511 1.151 (136.998 – – – – (1.966.511 See accompanying Notes to Consolidated Financial Statements.064) – – – (10.613 2.971 (937.332.128) – – – – – – – – – – – (1.383.637.154) Total Equity (794. 2011.708 94.128) (10.082) – Noncontrolling Interests (29.818 (902.300.595 – – – – – – – – (902.274 – (313.905 2.739) 779.971 – – – (765.352.784) 9.966.561) 1.595) – – 2.950.752) – 110.857 2.332.

688 5.249 – – 250.121) 25.000.836 – 7.277.781 6.283 – (5.885 58 (89.000 – (185.183 56.438) 20.821.719 CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 6.061 (13.256 (20.841) (78.904 (814.870 254.566 778.037.060 695.478.255 – (3.244) (88.239.432) (610.055.742) 111.521 (830.912 (97.985 (568.229) 3.594.727.969) (97.732.683 (1.985) – (43.894) 3.115 (94.196 2.588.Years Ended December 31 2012 2011 (As restated (As restated 2013 Note 2) Note 2) ABS-CBN CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in Thousands) Years Ended December 31 2012 2011 (As restated (As restated 2013 Note 2) Note 2) CASH FLOWS FROM OPERATING ACTIVITIES Income before income tax Adjustments for: Depreciation and amortization (Notes 10 and 11) Amortization of: Program rights and other intangibles (Note 12) Deferred charges (Note 25) Debt issue costs (Note 27) Interest expense (Note 27) Interest income (Note 6) Impairment loss (Note 16) Gain on settlement of liabilities (Note 27) Equity in net losses of associates and joint ventures (Note 14) Loss (gain) on sale of property and equipment Share-based payment expense (Note 21) Net unrealized foreign exchange loss (gain) Loss (gain) on sale of investments (Notes 4 and 13) Income before working capital changes Provisions for: Pension expense and other employee benefits (Note 29) Doubtful accounts (Note 26) Decrease (increase) in: Trade and other receivables Inventories Other current assets Increase (decrease) in: Trade and other payables Obligations for program rights Other noncurrent liabilities Contribution to pension plan (Note 29) Cash generated from operations Income taxes paid Net cash provided by operating activities (Forward) 2.850.770) 167.221.199 2.713) 14.551) – 961.969 1.938 8.670) ( 3.962) 97.714.237) 1.947 CASH FLOWS FROM INVESTING ACTIVITIES Additions to: Property and equipment (Notes 10 and 34) Program rights and other intangible assets (Notes 12 and 34) Decrease (increase) in other noncurrent assets Investments in joint ventures (Note 14) Interest received Proceeds from sale of: Property and equipment Available-for-sale investments Investments.495.000 – (10.000) (115.811 52.813.210 389.716) 5.332 – – – (101. net of cash of subsidiary disposed (Note 4) Acquisition of subsidiaries and business.000) 7.613.390) (46.006 (273.643 (119.772 973.720 (54.963) (136.427 (217.715) 19.551) (1.000 850.200 768.858) (1.732) 6.722) (744.712.432 4.910) 1.658 2.573.885. net of cash acquired (Note 4) Net cash used in investing activities ( 3.772. 82 ABS-CBN Annual Report 2013 ABS-CBN Annual Report 2013 83 .917 (2.831) 3.534) ( 1.461) 8.672) – (208.000.954) (818.840 – 124.146.871 22.501 200.601) 356.329) 24.629 – – 175.014) (352.240.628.296) (137.939.082) 957.053 5.616) 12.394.882 – 1.095 (626.021) (1.397 2.911 239.000.061) – (143.635.377 24.564) 1.461) (540) 8.775.363 (1.000) (112.177 (5.154.000 792.993.893) – 1.334 CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from: Long-term debt Bank loans Payments of: Bank loans Long-term debt Interest Dividends Obligations under finance lease Issuances of: Common shares (Note 21) Preferred shares (Note 21) Convertible note (Note 4) Decrease in noncontrolling interests (Note 4) Acquisition of Philippine depository receipts (Note 21) Net cash provided by financing activities EFFECTS OF EXCHANGE RATE CHANGES AND TRANSLATION ADJUSTMENTS ON CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT END OF YEAR (Note 6) See accompanying Notes to Consolidated Financial Statements.303 (933.461 (177.255.066) (37.426 29 (6.115) 2.397 5.267.271 16.295 – 217.937) (298.670 432.094 1.597 53.387) (4.952.638.510) (591.863) 480.320.597.571 22.200 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 4.166 18.733.917 (2.829) 2.969 698.861 22.279.777 843.881 (1.000) (1.807) (39.041.577) (9.252.430.320.000 3.546) 1.989) (51.802) (360.179) (132.541.945) (1.863 – 25.757.532) (1.825.