Acquisition of EMP (Tables)

6 Months Ended

Mar. 31, 2019

Schedule of Estimated Fair Values of the Assets Acquired and Liabilities Assumed

The table below presents (i) the preliminary estimate of the Acquisition consideration as it relates to the acquisition of EMP by WMG Germany and (ii) the preliminary allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed on the closing date of October 10, 2018 (in millions):

Purchase Price	€	155
Preliminary Working Capital		11
Adjusted Preliminary Purchase Price	€	166
Foreign Currency Rate at October 10, 2018		1.15
Adjusted Preliminary Purchase Price in U.S. dollars	$	190
Fair value of assets acquired and liabilities assumed
Cash and equivalents	$	7
Accounts receivable		3
Inventories		37
Other current assets		5
Property plant and equipment		28
Intangible assets		57
Accounts payable		(18	)
Other current liabilities		(11	)
Deferred revenue		(7	)
Deferred tax liabilities		(18	)
Other noncurrent liabilities		(2	)
Fair value of assets acquired and liabilities assumed		81
Goodwill recorded		109
Total purchase price allocated	$	190

Schedule of Pro Forma Financial Information

The pro forma information as presented below is for informational purposes only and is not indicative of the results of operations that would have been achieved if the Acquisition had taken place at the beginning of fiscal 2017.

	Three Months Ended		Three Months Ended			Six Months Ended		Six Months Ended
	March 31, 2019		March 31, 2018			March 31, 2019		March 31, 2018
	(in millions)					(in millions)
Revenue	$	1,090	$	1,015		$	2,298	$	2,142
Operating income		122		80			269		172
Net income (loss) attributable to Warner Music Group	$	67	$	(6	)	$	153	$	(1	)

Actual results related to EMP included in the Consolidated Statements of Operations for the three months ended March 31, 2019 consist of revenues of $51 million and operating loss of $2 million. Actual results related to EMP included in the Consolidated Statements of Operations for the six months ended March 31, 2019 relate to the transition period from October 10, 2018 to March 31, 2019 and consist of revenues of $127 million and operating income of $4 million.