Guarantor Subsidiaries (Tables)

9 Months Ended

Sep. 30, 2014

Guarantor Subsidiaries Disclosure [Abstract]

Condensed Consolidating Balance Sheet [Table Text Block]

CONSOLIDATING BALANCE SHEETS
(unaudited)
	As of September 30, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Assets
Current Assets:
Cash and cash equivalents	$	130,943		$	13,127		$	40,831		$	—		$	184,901
Accounts receivable, net of allowances	1,633			29,515			1,639			—			32,787
Content library	—			147,708			3,360			—			151,068
Prepaid expenses and other current assets	38,342			26,526			1,023			(6,084		)	59,807
Intercompany receivables	33,298			385,821			—			(419,119		)	—
Total current assets	204,216			602,697			46,853			(425,203		)	428,563
Property and equipment, net	142,818			272,176			36,352			—			451,346
Deferred income taxes	—			4,722			9,289			(4,721		)	9,290
Goodwill and other intangible assets, net	249,720			377,604			—			—			627,324
Other long-term assets	6,801			4,335			374			—			11,510
Investment in related parties	877,715			3,841			—			(881,556		)	—
Total assets	$	1,481,270		$	1,265,375		$	92,868		$	(1,311,480	)	$	1,528,033
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	13,573		$	122,393		$	2,157		$	—		$	138,123
Accrued payable to retailers	59,908			33,123			12,958			—			105,989
Other accrued liabilities	55,472			71,347			3,054			—			129,873
Current portion of long-term debt and other long-term liabilities	20,186			(2		)	411			—			20,595
Deferred income taxes	—			39,238			—			(6,084		)	33,154
Intercompany payables	246,470			103,388			69,261			(419,119		)	—
Total current liabilities	395,609			369,487			87,841			(425,203		)	427,734
Long-term debt and other long-term liabilities	1,003,465			18,173			1,165			—			1,022,803
Deferred income taxes	34,069			—			22			(4,721		)	29,370
Total liabilities	1,433,143			387,660			89,028			(429,924		)	1,479,907
Commitments and contingencies
Stockholders’ Equity:
Preferred stock	—			—			—			—			—
Common stock	584,670			225,729			12,393			(352,635		)	470,157
Treasury stock	(997,697		)	—			—			—			(997,697		)
Retained earnings	462,965			651,986			(9,441		)	(528,921		)	576,589
Accumulated other comprehensive income (loss)	(1,811		)	—			888			—			(923		)
Total stockholders’ equity	48,127			877,715			3,840			(881,556		)	48,126
Total liabilities and stockholders’ equity	$	1,481,270		$	1,265,375		$	92,868		$	(1,311,480	)	$	1,528,033

CONSOLIDATING BALANCE SHEETS
(unaudited)
	As of December 31, 2013
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Assets
Current Assets:
Cash and cash equivalents	$	315,250		$	9,639	$	46,548		$	—		$	371,437
Accounts receivable, net of allowances	2,029			45,672		2,595			—			50,296
Content library	37			196,695		3,136			—			199,868
Prepaid expenses and other current assets	67,664			28,234		960			(12,149		)	84,709
Intercompany receivables	180,100			355,418		5,093			(540,611		)	—
Total current assets	565,080			635,658		58,332			(552,760		)	706,310
Property and equipment, net	163,747			320,296		36,822			—			520,865
Deferred income taxes	—			—		6,412			31			6,443
Goodwill and other intangible assets, net	251,150			387,540		—			—			638,690
Other long-term assets	7,156			11,499		420			—			19,075
Investment in related parties	815,243			4,825		—			(820,068		)	—
Total assets	$	1,802,376		$	1,359,818	$	101,986		$	(1,372,797	)	$	1,891,383
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	17,336		$	215,703	$	2,979		$	—		$	236,018
Accrued payable to retailers	71,085			48,126		14,929			—			134,140
Other accrued liabilities	59,444			71,607		3,076			—			134,127
Current portion of long-term debt and other long-term liabilities	103,519			3		367			—			103,889
Deferred income taxes	—			35,292		—			(12,149		)	23,143
Intercompany payables	315,615			154,565		70,432			(540,612		)	—
Total current liabilities	566,999			525,296		91,783			(552,761		)	631,317
Long-term debt and other long-term liabilities	661,627			18,748		1,028			—			681,403
Deferred income taxes	45,307			13,190		—			31			58,528
Total liabilities	1,273,933			557,234		92,811			(552,730		)	1,371,248
Commitments and contingencies
Debt conversion feature	1,446			—		—			—			1,446
Stockholders’ Equity:
Preferred stock	—			—		—			—			—
Common stock	596,995			225,016		12,393			(351,923		)	482,481
Treasury stock	(476,796		)	—		—			—			(476,796		)
Retained earnings	407,959			577,568		(3,612		)	(468,144		)	513,771
Accumulated other comprehensive income (loss)	(1,161		)	—		394			—			(767		)
Total stockholders’ equity	526,997			802,584		9,175			(820,067		)	518,689
Total liabilities and stockholders’ equity	$	1,802,376		$	1,359,818	$	101,986		$	(1,372,797	)	$	1,891,383

Condensed Consolidating Statement of Comprehensive Income [Table Text Block]

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
	Three Months Ended September 30, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	71,616		$	464,814		$	16,434		$	—		$	552,864
Expenses:
Direct operating	36,930			335,780			11,401			—			384,111
Marketing	1,945			7,059			758			—			9,762
Research and development	861			2,138			—			—			2,999
General and administrative	10,789			36,558			517			—			47,864
Depreciation and other	8,173			37,495			2,228			—			47,896
Amortization of intangible assets	358			3,313			—			—			3,671
Total expenses	59,056			422,343			14,904			—			496,303
Operating income	12,560			42,471			1,530			—			56,561
Other income (expense), net:
Loss from equity method investments, net	(224		)	(11,128		)	—			—			(11,352		)
Interest income (expense), net	(12,570		)	163			(56		)	—			(12,463		)
Other, net	1,941			573			(5,529		)	—			(3,015		)
Total other expense, net	(10,853		)	(10,392		)	(5,585		)	—			(26,830		)
Income (loss) from continuing operations before income taxes	1,707			32,079			(4,055		)	—			29,731
Income tax benefit (expense)	(1,915		)	(10,844		)	918			—			(11,841		)
Income (loss) from continuing operations	(208		)	21,235			(3,137		)	—			17,890
Loss from discontinued operations, net of tax	—			—			—			—			—
Equity in income (loss) of subsidiaries	18,098			(3,137		)	—			(14,961		)	—
Net Income (loss)	17,890			18,098			(3,137		)	(14,961		)	17,890
Foreign currency translation adjustment(1)	(680		)	—			(15		)	—			(695		)
Comprehensive income (loss)	$	17,210		$	18,098		$	(3,152	)	$	(14,961	)	$	17,195

(1) Foreign currency translation adjustment had no tax effect in 2014.

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
	Three Months Ended September 30, 2013
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	67,545		$	505,043		$	13,951		$	—		$	586,539
Expenses:
Direct operating	36,325			357,800			15,393			(3,545		)	405,973
Marketing	1,380			6,328			687			—			8,395
Research and development	1,794			1,716			—			—			3,510
General and administrative	11,608			45,337			533			3,553			61,031
Depreciation and other	7,028			40,867			1,350			—			49,245
Amortization of intangible assets	569			2,622			—			—			3,191
Total expenses	58,704			454,670			17,963			8			531,345
Operating income (loss)	8,841			50,373			(4,012		)	(8		)	55,194
Other income (expense), net:
Income (loss) from equity method investments, net	67,069			(9,135		)	—			—			57,934
Interest expense, net	(8,246		)	(115		)	(41		)	—			(8,402		)
Other, net	(2,352		)	8			(66		)	8			(2,402		)
Total other income (expense), net	56,471			(9,242		)	(107		)	8			47,130
Income (loss) from continuing operations before income taxes	65,312			41,131			(4,119		)	—			102,324
Income tax benefit (expense)	(1,819		)	(15,215		)	1,505			—			(15,529		)
Income (loss) from continuing operations	63,493			25,916			(2,614		)	—			86,795
Loss from discontinued operations, net of tax	(3,743		)	(396		)	—			—			(4,139		)
Equity in income (loss) of subsidiaries	22,906			(2,614		)	—			(20,292		)	—
Net income (loss)	82,656			22,906			(2,614		)	(20,292		)	82,656
Foreign currency translation adjustment(1)	63			—			1,789			—			1,852
Comprehensive income (loss)	$	82,719		$	22,906		$	(825	)	$	(20,292	)	$	84,508

(1) Foreign currency translation adjustment had no tax effect in 2013.

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
	Nine Months Ended September 30, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	197,878		$	1,460,447		$	44,078		$	—		$	1,702,403
Expenses:
Direct operating	105,399			1,057,882			31,534			—			1,194,815
Marketing	4,723			20,220			2,199			—			27,142
Research and development	2,589			7,296			—			—			9,885
General and administrative	31,429			116,974			1,426			—			149,829
Depreciation and other	26,744			113,407			6,020			—			146,171
Amortization of intangible assets	1,430			9,936			—			—			11,366
Total expenses	172,314			1,325,715			41,179			—			1,539,208
Operating income	25,564			134,732			2,899			—			163,195
Other income (expense), net:
Loss from equity method investments, net	(672		)	(30,589		)	—			—			(31,261		)
Interest income (expense), net	(35,172		)	286			(151		)	—			(35,037		)
Other, net	7,662			1,409			(10,928		)	—			(1,857		)
Total other expense, net	(28,182		)	(28,894		)	(11,079		)	—			(68,155		)
Income (loss) from continuing operations before income taxes	(2,618		)	105,838			(8,180		)	—			95,040
Income tax benefit (expense)	1,333			(35,139		)	2,352			—			(31,454		)
Income (loss) from continuing operations	(1,285		)	70,699			(5,828		)	—			63,586
Income (loss) from discontinued operations, net of tax	(803		)	35			—			—			(768		)
Equity in income (loss) of subsidiaries	64,906			(5,828		)	—			(59,078		)	—
Net income (loss)	62,818			64,906			(5,828		)	(59,078		)	62,818
Foreign currency translation adjustment(1)	(650		)	—			494			—			(156		)
Comprehensive income (loss)	$	62,168		$	64,906		$	(5,334	)	$	(59,078	)	$	62,662

(1) Foreign currency translation adjustment had no tax effect in 2014.

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)
	Nine Months Ended September 30, 2013
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	186,625		$	1,488,767		$	37,504		$	—		$	1,712,896
Expenses:
Direct operating	104,075			1,039,516			39,483			(8,256		)	1,174,818
Marketing	3,572			17,491			1,840			—			22,903
Research and development	6,452			1,719			—			—			8,171
General and administrative	28,410			130,863			1,249			8,264			168,786
Depreciation and other	21,072			118,440			3,644			—			143,156
Amortization of intangible assets	1,708			5,377			—			—			7,085
Total expenses	165,289			1,313,406			46,216			8			1,524,919
Operating income (loss)	21,336			175,361			(8,712		)	(8		)	187,977
Other income (expense), net:
Income (loss) from equity method investments, net	65,050			(23,770		)	—			—			41,280
Interest income (expense), net	(26,200		)	338			(91		)	—			(25,953		)
Other, net	(3,442		)	219			(108		)	8			(3,323		)
Total other income (expense), net	35,408			(23,213		)	(199		)	8			12,004
Income (loss) from continuing operations before income taxes	56,744			152,148			(8,911		)	—			199,981
Income tax benefit (expense)	19,744			(57,464		)	2,954			—			(34,766		)
Income (loss) from continuing operations	76,488			94,684			(5,957		)	—			165,215
Loss from discontinued operations, net of tax	(11,994		)	(1,104		)	—			—			(13,098		)
Equity in income (loss) of subsidiaries	87,623			(5,957		)	—			(81,666		)	—
Net income (loss)	152,117			87,623			(5,957		)	(81,666		)	152,117
Foreign currency translation adjustment(1)	84			—			(388		)	—			(304		)
Comprehensive income (loss)	$	152,201		$	87,623		$	(6,345	)	$	(81,666	)	$	151,813

(1) Foreign currency translation adjustment had no tax effect in 2013.

Condensed Consolidating Statement of Cash Flows [Table Text Block]

CONSOLIDATING STATEMENTS OF CASH FLOWS
(unaudited)
	Nine Months Ended September 30, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Operating Activities:
Net income (loss)	$	62,818		$	64,906		$	(5,828	)	$	(59,078	)	$	62,818
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	26,728			113,408			6,020			—			146,156
Amortization of intangible assets	1,430			9,936			—			—			11,366
Share-based payments expense	8,227			1,866			—			—			10,093
Windfall excess tax benefits related to share-based payments	(1,988		)	—			—			—			(1,988		)
Deferred income taxes	5,746			(13,965		)	(3,105		)	(6,084		)	(17,408		)
Loss from equity method investments, net	672			30,589			—			—			31,261
Amortization of deferred financing fees and debt discount	3,423			—			—			—			3,423
Loss from early extinguishment of debt	2,018			—			—			—			2,018
Other	(1,149		)	(368		)	40			—			(1,477		)
Equity in (income) losses of subsidiaries	(64,906		)	5,828			—			59,078			—
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	395			16,157			912			—			17,464
Content library	36			48,988			(224		)	—			48,800
Prepaid expenses and other current assets	16,024			1,026			(87		)	6,084			23,047
Other assets	55			1,546			46			—			1,647
Accounts payable	(2,427		)	(94,130		)	(449		)	—			(97,006		)
Accrued payable to retailers	(11,177		)	(15,003		)	(1,642		)	—			(27,822		)
Other accrued liabilities	(5,049		)	(331		)	35			—			(5,345		)
Net cash flows from (used in) operating activities(1)	40,876			170,453			(4,282		)	—			207,047
Investing Activities:
Purchases of property and equipment	(24,933		)	(41,663		)	(5,715		)	—			(72,311		)
Proceeds from sale of property and equipment	750			1,085			—			—			1,835
Cash paid for equity investments	—			(24,500		)	—			—			(24,500		)
Investments in and advances to affiliates	98,892			(101,884		)	2,992			—			—
Net cash flows from (used in) investing activities(1)	74,709			(166,962		)	(2,723		)	—			(94,976		)
Financing Activities:
Proceeds from issuance of senior unsecured notes	295,500			—			—			—			295,500
Proceeds from new borrowing of Credit Facility	635,000			—			—			—			635,000
Principal payments on Credit Facility	(621,250		)	—			—			—			(621,250		)
Financing costs associated with Credit Facility and senior unsecured notes	(2,906		)	—			—			—			(2,906		)
Conversion of convertible debt	(51,149		)	—			—			—			(51,149		)
Repurchases of common stock	(545,078		)	—			—			—			(545,078		)
Principal payments on capital lease obligations and other debt	(10,263		)	(3		)	(331		)	—			(10,597		)
Windfall excess tax benefits related to share-based payments	1,988			—			—			—			1,988
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	(1,084		)	—			—			—			(1,084		)
Net cash flows from (used in) financing activities(1)	(299,242		)	(3		)	(331		)	—			(299,576		)

	Nine Months Ended September 30, 2014
	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications		Total
Effect of exchange rate changes on cash	(650		)	—		1,619			—		969
Increase (decrease) in cash and cash equivalents	(184,307		)	3,488		(5,717		)	—		(186,536		)
Cash and cash equivalents:
Beginning of period	315,250			9,639		46,548			—		371,437
End of period	$	130,943		$	13,127	$	40,831		$	—	$	184,901

(1) During 2013, we discontinued four ventures previously included in our New Ventures operating segment, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented because they were not material.

CONSOLIDATING STATEMENTS OF CASH FLOWS
(unaudited)
	Nine Months Ended September 30, 2013
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Operating Activities:
Net income (loss)	$	152,117		$	87,623		$	(5,957	)	$	(81,666	)	$	152,117
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	22,089			118,440			3,644			—			144,173
Amortization of intangible assets	1,708			5,377			—			—			7,085
Share-based payments expense	7,206			4,248			—			—			11,454
Windfall excess tax benefits related to share-based payments	(3,347		)	—			—			—			(3,347		)
Deferred income taxes	17,698			(26,759		)	(3,037		)	—			(12,098		)
Impairment Expense	5,262			—			—			—			5,262
Loss (income) from equity method investments, net	(65,050		)	23,770			—			—			(41,280		)
Amortization of deferred financing fees and debt discount	5,205			—			—			—			5,205
Loss from early extinguishment of debt	5,950			—			—			—			5,950
Other	1,195			(175		)	—			—			1,020
Equity in (income) losses of subsidiaries	(87,623		)	5,957			—			81,666			—
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	(398		)	1,916			(1,824		)	—			(306		)
Content library	641			8,455			350			—			9,446
Prepaid expenses and other current assets	(22,600		)	(8,511		)	(414		)	69			(31,456		)
Other assets	163			91			15			—			269
Accounts payable	18			(69,415		)	(1,137		)	354			(70,180		)
Accrued payable to retailers	(7,963		)	(3,252		)	1,574			—			(9,641		)
Other accrued liabilities	(5,366		)	(21,857		)	740			(69		)	(26,552		)
Net cash flows from (used in) operating activities(1)	26,905			125,908			(6,046		)	354			147,121
Investing Activities:
Purchases of property and equipment	(46,496		)	(64,658		)	(12,192		)	—			(123,346		)
Proceeds from sale of property and equipment	12,078			803			7			—			12,888
Acquisition of ecoATM, net of cash acquired	(244,036		)	—			—			—			(244,036		)
Receipt of note receivable principal	95			—			—			—			95
Cash paid for equity investments	—			(28,000		)	—			—			(28,000		)
Investments in and advances to affiliates	4,031			(19,782		)	15,751			—			—
Net cash flows from (used in) investing activities(1)	(274,328		)	(111,637		)	3,566			—			(382,399		)
Financing Activities:
Proceeds from issuance of senior unsecured notes	343,769			—			—			—			343,769
Proceeds from new borrowing on Credit Facility	150,000			—			—			—			150,000
Principal payments on Credit Facility	(60,938		)	—			—			—			(60,938		)
Financing costs associated with Credit Facility and senior unsecured notes	(444		)	—			—			—			(444		)
Conversion of convertible debt	(169,664		)	—			—			—			(169,664		)
Repurchases of common stock	(95,004		)	—			—			—			(95,004		)
Principal payments on capital lease obligations and other debt	(10,300		)	(214		)	(310		)	—			(10,824		)
Windfall excess tax benefits related to share-based payments	3,347			—			—			—			3,347
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	7,763			—			—			—			7,763
Net cash flows from (used in) financing activities(1)	168,529			(214		)	(310		)	—			168,005

	Nine Months Ended September 30, 2013
	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Effect of exchange rate changes on cash	84			—		(475		)	—			(391		)
Increase (decrease) in cash and cash equivalents	(78,810		)	14,057		(3,265		)	354			(67,664		)
Cash and cash equivalents:
Beginning of period	242,489			—		40,759			(354		)	282,894
End of period	$	163,679		$	14,057	$	37,494		$	—		$	215,230

(1) During 2013, we discontinued four ventures previously included in our New Ventures operating segment, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented because they were not material.