CONDENSED CONSOLIDATING FINANCIAL STATEMENTS: (Tables)

9 Months Ended

Sep. 30, 2014

CONDENSED CONSOLIDATING FINANCIAL STATEMENTS:

Schedule of condensed consolidating balance sheet

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF SEPTEMBER 30, 2014

(in thousands) (unaudited)

	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Cash	$	—	$	84,226	$	2,947	$	12,177		$	—		$	99,350
Accounts and other receivables	29		184		300,448		27,065			(83		)	327,643
Other current assets	5,723		22,129		144,931		23,774			(50,274		)	146,283
Total current assets	5,752		106,539		448,326		63,016			(50,357		)	573,276
Property and equipment, net	4,215		15,220		539,892		159,604			(6,254		)	712,677
Assets held for sale	—		—		40,848		—			—			40,848
Investment in consolidated subsidiaries	356,471		3,356,852		4,179		—			(3,717,502		)	—
Restricted cash — long-term	—		21,130		83,200		—			—			104,330
Other long-term assets	70,173		603,884		114,728		116,100			(639,766		)	265,119
Total other long-term assets	426,644		3,981,866		242,955		116,100			(4,357,268		)	410,297
Goodwill and other intangible assets	—		—		3,504,324		199,237			(105,555		)	3,598,006
Total assets	$	436,611	$	4,103,625	$	4,735,497	$	537,957		$	(4,519,434	)	$	5,294,256
Accounts payable and accrued liabilities	$	833	$	82,484	$	179,575	$	65,523		$	(45,765	)	$	282,650
Current portion of long-term debt	621		36,533		1,236		4,740			—			43,130
Current portion of affiliate long-term debt	1,420		—		1,256		1,041			(1,041		)	2,676
Other current liabilities	565		—		124,318		12,449			(2,761		)	134,571
Total current liabilities	3,439		119,017		306,385		83,753			(49,567		)	463,027
Liabilities held for sale	—		—		4,310		—			—			4,310
Long-term debt	55		3,555,553		34,735		134,842			—			3,725,185
Affiliate long-term debt	3,886		—		13,017		314,377			(314,379		)	16,901
Other liabilities	54,496		6,719		1,017,932		161,144			(509,901		)	730,390
Total liabilities	61,876		3,681,289		1,376,379		694,116			(873,847		)	4,939,813
Total Sinclair Broadcast Group equity (deficit)	374,735		422,336		3,359,118		(131,660		)	(3,649,794		)	374,735
Noncontrolling interests in consolidated subsidiaries	—		—		—		(24,499		)	4,207			(20,292		)
Total liabilities and equity (deficit)	$	436,611	$	4,103,625	$	4,735,497	$	537,957		$	(4,519,434	)	$	5,294,256

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF DECEMBER 31, 2013

(in thousands)

	Sinclair Broadcast Group, Inc.		Sinclair Television Group, Inc.		Guarantor Subsidiaries and KDSM, LLC		Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Cash	$	—	$	237,974	$	28,594	$	13,536		$	—		$	280,104
Accounts and other receivables	59		818		281,822		27,479			(1,022		)	309,156
Other current assets	5,500		25,887		67,279		16,391			(6,446		)	108,611
Total current assets	5,559		264,679		377,695		57,406			(7,468		)	697,871
Property and equipment, net	5,017		13,561		454,917		130,019			(7,443		)	596,071
Investment in consolidated subsidiaries	363,231		2,508,058		4,179		—			(2,875,468		)	—
Restricted cash — long term	—		11,524		223		—			—			11,747
Other long-term assets	78,849		503,674		62,435		132,840			(544,881		)	232,917
Total other long-term assets	442,080		3,023,256		66,837		132,840			(3,420,349		)	244,664
Goodwill and other intangible assets	—		—		2,486,794		214,325			(92,253		)	2,608,866
Total assets	$	452,656	$	3,301,496	$	3,386,243	$	534,590		$	(3,527,513	)	$	4,147,472
Accounts payable and accrued liabilities	$	234	$	51,781	$	126,245	$	17,914		$	—		$	196,174
Current portion of long-term debt	556		37,335		1,007		7,448			—			46,346
Current portion of affiliate long-term debt	1,294		—		1,073		1,003			(1,003		)	2,367
Other current liabilities	3,529		—		87,612		9,645			(2,292		)	98,494
Total current liabilities	5,613		89,116		215,937		36,010			(3,295		)	343,381
Long-term debt	529		2,793,334		35,709		136,830			—			2,966,402
Affiliate long-term debt	4,972		—		13,984		294,919			(294,950		)	18,925
Other liabilities	45,172		23,645		610,491		145,828			(412,076		)	413,060
Total liabilities	56,286		2,906,095		876,121		613,587			(710,321		)	3,741,768
Total Sinclair Broadcast Group equity (deficit)	396,370		395,401		2,510,122		(88,331		)	(2,817,192		)	396,370
Noncontrolling interests in consolidated subsidiaries	—		—		—		9,334			—			9,334
Total liabilities and equity (deficit)	$	452,656	$	3,301,496	$	3,386,243	$	534,590		$	(3,527,513	)	$	4,147,472

Schedule of condensed consolidating statement of operations and comprehensive income

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2014

(in thousands) (unaudited)

	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Net revenue	$	—		$	—		$	466,786		$	47,747		$	(19,577	)	$	494,956
Program and production	—			84			149,488			19,095			(18,404		)	150,263
Selling, general and administrative	1,129			13,474			94,218			5,973			(500		)	114,294
Depreciation, amortization and other operating expenses	267			1,187			104,580			23,009			(307		)	128,736
Total operating expenses	1,396			14,745			348,286			48,077			(19,211		)	393,293
Operating (loss) income	(1,396		)	(14,745		)	118,500			(330		)	(366		)	101,663
Equity in earnings of consolidated subsidiaries	47,744			84,122			—			—			(131,866		)	—
Interest expense	(138		)	(44,986		)	(1,209		)	(7,119		)	5,502			(47,950		)
Other income (expense)	2,449			(100		)	5			248			(23		)	2,579
Total other income (expense)	50,055			39,036			(1,204		)	(6,871		)	(126,387		)	(45,371		)
Income tax (provision) benefit	(318		)	21,961			(31,678		)	2,511			—			(7,524		)
Net income (loss)	48,341			46,252			85,618			(4,690		)	(126,753		)	48,768
Net (income) loss attributable to the noncontrolling interests	—			—			—			(447		)	20			(427		)
Net income (loss) attributable to Sinclair Broadcast Group	$	48,341		$	46,252		$	85,618		$	(5,137	)	$	(126,733	)	$	48,341
Comprehensive income (loss)	$	48,490		$	46,293		$	85,618		$	(5,456	)	$	(126,455	)	$	48,490

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2013

(in thousands) (unaudited)

	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Net revenue	$	—		$	—		$	319,767		$	32,970		$	(14,093	)	$	338,644
Program and production	—			112			99,186			13,870			(14,229		)	98,939
Selling, general and administrative	901			14,712			64,300			2,386			(75		)	82,224
Depreciation, amortization and other operating expenses	348			629			68,820			19,143			(4,307		)	84,633
Total operating expenses	1,249			15,453			232,306			35,399			(18,611		)	265,796
Operating (loss) income	(1,249		)	(15,453		)	87,461			(2,429		)	4,518			72,848
Equity in earnings of consolidated subsidiaries	40,547			55,128			60			—			(95,735		)	—
Interest expense	(203		)	(37,123		)	(1,269		)	(6,538		)	5,266			(39,867		)
Other income (expense)	996			6,772			(6,710		)	1,085			(84		)	2,059
Total other income (expense)	41,340			24,777			(7,919		)	(5,453		)	(90,553		)	(37,808		)
Income tax (provision) benefit	(3,749		)	16,667			(22,236		)	929			3,900			(4,489		)
Income from discontinued operations	—			6,108			(8		)	—			—			6,100
Net income (loss)	36,342			32,099			57,298			(6,953		)	(82,135		)	36,651
Net income attributable to the noncontrolling interests	—			—			—			(309		)	—			(309		)
Net income (loss) attributable to Sinclair Broadcast Group	$	36,342		$	32,099		$	57,298		$	(7,262	)	$	(82,135	)	$	36,342
Comprehensive income (loss)	$	36,613		$	32,061		$	57,298		$	(7,262	)	$	(82,097	)	$	36,613

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2014

(in thousands) (unaudited)

	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Net revenue	$	—		$	—		$	1,287,200		$	136,701		$	(61,161	)	$	1,362,740
Program and production	—			274			409,661			58,998			(57,328		)	411,605
Selling, general and administrative	3,169			42,019			255,044			13,467			(1,647		)	312,052
Depreciation, amortization and other operating expenses	801			3,432			284,859			65,391			(1,102		)	353,381
Total operating expenses	3,970			45,725			949,564			137,856			(60,077		)	1,077,038
Operating (loss) income	(3,970		)	(45,725		)	337,636			(1,155		)	(1,084		)	285,702
Equity in earnings of consolidated subsidiaries	117,093			221,774			—			—			(338,867		)	—
Interest expense	(446		)	(118,816		)	(3,675		)	(20,646		)	15,974			(127,609		)
Other income (expense)	4,036			282			563			533			(63		)	5,351
Total other income (expense)	120,683			103,240			(3,112		)	(20,113		)	(322,956		)	(122,258		)
Income tax benefit (provision)	121			58,437			(108,411		)	4,435			—			(45,418		)
Net income (loss)	116,834			115,952			226,113			(16,833		)	(324,040		)	118,026
Net income attributable to the noncontrolling interests	—			—			—			(1,245		)	53			(1,192		)
Net income (loss) attributable to Sinclair Broadcast Group	$	116,834		$	115,952		$	226,113		$	(18,078	)	$	(323,987	)	$	116,834
Comprehensive income (loss)	$	118,432		$	116,073		$	226,113		$	(17,793	)	$	(324,393	)	$	118,432

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2013

(in thousands) (unaudited)

	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
Net revenue	$	—		$	—		$	887,489		$	90,402		$	(42,475	)	$	935,416
Program and production	—			207			269,360			28,489			(32,990		)	265,066
Selling, general and administrative	2,679			34,840			167,654			14,627			(9,644		)	210,156
Depreciation, amortization and other operating expenses	1,038			1,558			186,926			50,691			(803		)	239,410
Total operating expenses	3,717			36,605			623,940			93,807			(43,437		)	714,632
Operating (loss) income	(3,717		)	(36,605		)	263,549			(3,405		)	962			220,784
Equity in earnings of consolidated subsidiaries	76,623			164,370			—			—			(240,993		)	—
Interest expense	(903		)	(115,115		)	(3,607		)	(19,027		)	15,623			(123,029		)
Other income (expense)	3,029			3,141			(19,433		)	4,990			(6,468		)	(14,741		)
Total other income (expense)	78,749			52,396			(23,040		)	(14,037		)	(231,838		)	(137,770		)
Income tax (provision) benefit	(3,867		)	47,645			(73,267		)	2,597			3,900			(22,992		)
Income from discontinued operations	—			11,063			495			—			—			11,558
Net income (loss)	71,165			74,499			167,737			(14,845		)	(226,976		)	71,580
Net income attributable to the noncontrolling interests	—			—			—			(415		)	—			(415		)
Net income (loss) attributable to Sinclair Broadcast Group	$	71,165		$	74,499		$	167,737		$	(15,260	)	$	(226,976	)	$	71,165
Comprehensive income (loss)	$	71,464		$	74,383		$	167,737		$	(15,260	)	$	(226,860	)	$	71,464

Schedule of condensed consolidating statement of cash flows

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2014

(in thousands) (unaudited)

	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
NET CASH FLOWS (USED IN) FROM OPERATING ACTIVITIES	$	(27,282	)	$	(77,257	)	$	426,702		$	22,125		$	14,109		$	358,397
CASH FLOWS (USED IN) FROM INVESTING ACTIVITIES:
Acquisition of property and equipment	—			(8,482		)	(47,961		)	(1,708		)	—			(58,151		)
Payments for acquisition of television stations	—			—			(1,071,428		)	—			—			(1,071,428		)
Purchase of alarm monitoring contracts	—			—			—			(15,647		)	—			(15,647		)
Proceeds from the sale of broadcast assets	—			—			83,200			—			—			83,200
Decrease in restricted cash	—			(9,600		)	(82,983		)	—			—			(92,583		)
Investments in equity and cost method investees	—			—			—			(7,958		)	—			(7,958		)
Payments for acquisition of assets in other operating divisions	—			—			—			(8,273		)	—			(8,273		)
Proceeds from termination of life insurance policies	—			17,042			—			—			—			17,042
Other, net	1,000			—			5,000			936			—			6,936
Net cash flows from (used in) investing activities	1,000			(1,040		)	(1,114,172		)	(32,650		)	—			(1,146,862		)
CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES:
Proceeds from notes payable, commercial bank financing and capital leases	—			1,040,796			—			20,694			—			1,061,490
Repayments of notes payable, commercial bank financing and capital leases	(408		)	(280,121		)	(743		)	(5,145		)	—			(286,417		)
Dividends paid on Class A and Class B Common Stock	(45,322		)	—			—			—			—			(45,322		)
Repurchase of outstanding Class A Common Stock	(108,438		)	—			—			—			—			(108,438		)
Increase (decrease) in intercompany payables	178,331			(821,116		)	663,350			(6,456		)	(14,109		)	—
Other, net	2,119			(15,010		)	(784		)	73			—			(13,602		)
Net cash flows from (used in) financing activities	26,282			(75,451		)	661,823			9,166			(14,109		)	607,711
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	—			(153,748		)	(25,647		)	(1,359		)	—			(180,754		)
CASH AND CASH EQUIVALENTS, beginning of period	—			237,974			28,594			13,536			—			280,104
CASH AND CASH EQUIVALENTS, end of period	$	—		$	84,226		$	2,947		$	12,177		$	—		$	99,350

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2013

(in thousands) (unaudited)

	Sinclair Broadcast Group, Inc.			Sinclair Television Group, Inc.			Guarantor Subsidiaries and KDSM, LLC			Non- Guarantor Subsidiaries			Eliminations			Sinclair Consolidated
NET CASH FLOWS (USED IN) FROM OPERATING ACTIVITIES	$	(3,042	)	$	(66,985	)	$	208,126		$	(816	)	$	13,356		$	150,639
CASH FLOWS (USED IN) FROM INVESTING ACTIVITIES:
Acquisition of property and equipment	—			(2,253		)	(21,109		)	(5,414		)	—			(28,776		)
Payments for acquisitions of television stations	—			—			(495,440		)	—			—			(495,440		)
Payments for acquisitions in other operating divisions	—			—			—			(4,650		)	—			(4,650		)
Purchase of alarm monitoring contracts	—			—			1,114			(13,042		)	—			(11,928		)
Proceeds from sale of broadcast assets	—			—			27,992			—			—			27,992
Decrease in restricted cash	—			(38,930		)	—			(2,102		)	—			(41,032		)
Other, net	1,648			—			4,454			1,898			(10,908		)	(2,908		)
Net cash flows from (used in) investing activities	1,648			(41,183		)	(482,989		)	(23,310		)	(10,908		)	(556,742		)
CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES:
Proceeds from notes payable, commercial bank financing and capital leases	—			1,146,789			—			52,026			—			1,198,815
Repayments of notes payable, commercial bank financing and capital leases	(234		)	(985,755		)	(802		)	(11,294		)	—			(998,085		)
Proceeds from the sale of common stock	472,400			—			—			—			—			472,400
Dividends paid on Class A and Class B Common Stock	(41,938		)	—			235			—			(235		)	(41,938		)
Increase (decrease) in intercompany payables	(429,664		)	154,648			292,696			(4,549		)	(13,131		)	—
Other, net	830			(20,205		)	(554		)	(9,949		)	10,918			(18,960		)
Net cash flows from (used in) financing activities	1,394			295,477			291,575			26,234			(2,448		)	612,232
NET INCREASE IN CASH AND CASH EQUIVALENTS	—			187,309			16,712			2,108			—			206,129
CASH AND CASH EQUIVALENTS, beginning of period	—			7,230			199			15,436			—			22,865
CASH AND CASH EQUIVALENTS, end of period	$	—		$	194,539		$	16,911		$	17,544		$	—		$	228,994