Discovery Communications Inc (NASDAQ:DISCA) Q4 2017 Earnings Conference Call - Final Transcript

Feb 27, 2018 • 08:30 am ET

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Discovery Communications Inc (NASDAQ:DISCA) Q4 2017 Earnings Conference Call - Final Transcript

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Presentation
Executive
Gunnar Wiedenfels

in Q4 2017.

I will also again quantify the expected foreign exchange impact on our 2018 results. At current spot rates, FX is expected to be a nice tailwind and will positively impact revenues by approximately $120 million to $130 million, and positively impact adjusted OIBDA by approximately $45 million to $55 million versus our 2017 reported results.

Now, taking a look at our overall financial position, we bought back a total of $603 million worth of shares during 2017, as we suspended our buyback program after announcing the Scripps transaction. Please note that as it pertains to the collar associated with the Scripps acquisition, we will either use cash to satisfy the collar, or if we issue stock we will buy back a similar amount so we intend not to issue any additional shares on a net basis.

As we stated beyond that, until our gross leverage ratio is back within our target range of 3 times to 3.5 times, we will continue to allocate virtually all of our free cash flow towards paying down debt. And as David mentioned, our new real estate strategy, the Education sale further support our ability to bring leverage into our target range by the end of 2019 at the latest.

In closing, as we prepare to combine our companies, we are all increasingly confident that our original target of $350 million of cost synergies within two years of closing the deal will prove to be very conservative. We are extremely optimistic about this powerful combination, which will allow us to accelerate the transformation of our business, drive free cash flow and ultimately generate significant long-term value for our shareholders.

Thank you again for your time this morning, and now David and I will be happy to answer any questions that you may have.