Årsrapport29442789RedmarkDirch Passers Allé 762000 Frederiksberg2020-01-012020-12-312021-01-012021-12-3126404509TURNER BROADCASTING SYSTEM DENMARK ApSJens Kofods Gade 1,2.1268København KCopenhagenEY Godkendt Revisionspartnerselskab, 30700228Brian Skovhus Jakobsenstatsautorisert revisormne27701Dirch Passers Allé362000FrederiksbergDanmark2022-07-11Eleanor Caroline BrowneRegnskabsklasse C, mellemstor virksomhedRevisionspåtegningRevisorgruppen DanmarkkapitalejerneCopenhagen2022-07-11Copenhagen2022-07-11Grundlag for konklusionKonklusion138567395132692823113304458112226997252629372046582616796202159631380593548466735444333429563721485741547160860765665919081901596147225867060605119650670606051196505788975788975788975788975788975788972889359426917115366622796622893025627196777413966443806663870326900652634157090579765842312012500012500035874068291680093599906829293009434966186820743496618682070355600168856645923253061306321176939387840245678178229483105543447176334681096349067293654930370905797658423121506801814743789800037116660992814791110436291679620215963138162214777501477750147775014777505788975788975788971250001250001250001250002916800824048359670606051196503587406829168009Today, the Executive Board has approved the annual report of TURNER BROADCASTING SYSTEM DENMARK ApS for the financial year 1 January - 31 December 2021. The annual report has been prepared in accordance with the Danish Financial Statements Act. We consider the chosen accounting policy to be appropriate, and in our opinion, the financial statements give a true and fair view of the financial position of the Company at 31 December 2021 and of the results of the Company's operations for the financial year 1 January – 31 December 2021. Further, in our opinion, the Management's review gives a true and fair review of the matters discussed in the Management's review. We recommend that the annual report be approved at the Annual General Meeting. Christina SulebakkJesper SteenbergEleanor Caroline BrowneWe have audited the financial statements of TURNER BROADCASTING SYSTEM DENMARK ApS for the financial year 1 January - 31 December 2021, which comprise income statement, balance sheet, statement of changes in equity, notes and a summary of significant accounting policies, for the Company. The financial statements are prepared under the Danish Financial Statements Act. In our opinion, the financial statements give a true and fair view of the financial position of the Company at 31 December 2021, and of the results of the Company's operations for the financial year 1 January - 31 December 2021 in accordance with the Danish Financial Statements Act. Basis for Opinion We conducted our audit in accordance with International Standards on Auduting (ISAs) and the additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further described in the "Auditor's responsibilities for the audit of the financial statements" section of our report. We belive that the audit evidence we have obtained is sifficient and appropriate to provide a basis for our opinion. Independence We are independent of the Company in accordance with the International Ethics Standards Board for Accountants' Code of Ethics for Professional Accountants (IESBA Code) and the additional requirements applicable in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these rules and requirements. Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the Danish Financial Statements Act, and for such internal control as Management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, Management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting in preparing the financial statements unless Management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit 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 Company’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management. Conclude on the appropriateness of Management’s use of the going concern basis of accounting in preparing the financial statements and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern. Evaluate the overall presentation, structure and contents of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that gives a true and fair view. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Statement on Management’s Review Management is responsible for Management’s Review. Our opinion on the financial statements does not cover Management’s Review, and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read Management’s Review and, in doing so, consider whether Management’s Review is materially inconsistent with the financial statements or our knowledge obtained during the audit, or otherwise appears to be materially misstated. Moreover, it is our responsibility to consider whether Management’s Review provides the information required under the Danish Financial Statements Act. Based on the work we have performed, we conclude that Management’s Review is in accordance with the financial statements and has been prepared in accordance with the requirements of the Danish Financial Statement Act. We did not identify any material misstatement of Management’s Review. 1125440003761900047271000992000023730004228000-141000-2149000-4227000-1390002400043620001686000323000085535000249540002857700024173000198110001812500027242718.215.42644.452.56.13.38.86.38.950.844.528.379.463.420.519.219.88.919.6The key figures appearing from the survey have been calculated as follows: Gross margin ratio Gross profit x 100 / Revenue Profit margin (EBIT margin) Operating profit or loss (EBIT) x 100 / Revenue Solvency ratio Equity, closing balance x 100 / Total assets, closing balance Return on equity Net profit or loss for the year x 100 / Average equityThe principal activities of the company The main activity of the company is to distribute Cartoon Network, Boomerang, CNN, Toonix and TNT both digitally and linear. As part of the distribution business, is the sale of advertising on participating channels. Unusual events On 11 March 2020, the World Health Organisation Declared the Coronavirus (COVID-19) outbreak to be a pandemic in recognition of its rapid spread across the globe, with over 150 countries now affected. Many governments are taking increasingly stringent steps to help contain or delay the spread of the virus. Currently, there is a significant increase in economic uncertainty which is, for example, evidenced by more volatile asset prices and currency exchange rates. The company currently assesses that the virus will not have a significant effect on the company’s financial position, results of operations or cash flows in the future. The directors will however continue to monitor the possible impact of the Coronavirus on the activities of the company. Development in activities and financial matters The revenue for the year totals DKK 138.567.395 against DKK 132.692.823 last year. Income or loss from ordinary activities after tax totals DKK 6.706.060 against DKK 5.119.650 last year. Future developments The directors aim to maintain the management policies which have resulted in the company's substantial growth. Management consider that the next year will show a further growth in sales from continuing operations with an expected profit before tax of between 6 to 8 million DKK. Events occurring after the end of the financial year On 17th May 2021 the ultimate parent company, AT&T Inc. announced they will combine the WarnerMedia content unit with Discovery, Inc. Under the agreement, AT&T will form a new media company with Discovery, Inc., which would be separate from AT&T. Turner Broadcasting System Denmark ApS is part of the WarnerMedia Group which will form part of the new media company. On the 8th April 2022, the merger of WarnerMedia LLC and Discovery, Inc. closed and a new publicly listed company, Warner Bros Discovery, Inc. (WBD), was formed. This change in ultimate ownership has no impact on the 2021 results of Turner Broadcasting System Denmark ApS or any of the WarnerMedia LLC subsidiaries. No other events materially affecting the assessment of the Annual Report have occurred after the balance sheet date. 6. Deferred tax assets Deferred tax assets 1 January 2021 279.662 46.689 Deferred tax of the net profit or loss for the year -243.000 232.973 36.662 279.662 9. Contingencies Contingent liabilities DKK in thousands Rent obligations 524.900 Total contingent liabilities 524.900 Other contingent liabilities The group companies are jointly and severally liable for tax on the jointly taxed incomes etc of the Group. The Company is the management company of the joint taxation Group. Moreover, the group companies are jointly and severally liable for Danish withholding taxes by way of dividend tax and tax on royalty and interest payments. Any subsequent adjustments of corporation taxes and withholding taxes may increase the Company’s liability. 10. Related parties Controlling interest Turner Broadcasting System Europe Limited, United Kingdom Parent company Transactions The Company has chosen only to disclose transactions which have not been made on an arm’s length basis in accordance with section 98(c)(7) of the Danish Financial Statements Act. Consolidated financial statements The Company is included in the consolidated annual report of the Ultimate Parent Company AT&T Inc. The Group Annual Report of AT&T Inc may be obtained at the following adress: 208 South Akard Street Dallas TX 75202 The annual report for TURNER BROADCASTING SYSTEM DENMARK ApS has been presented in accordance with the Danish Financial Statements Act regulations concerning reporting class C enterprises (medium sized enterprises). The accounting policies are unchanged from last year, and the annual report is presented in DKK. Pursuant to section 86 (4) of the Danish Financial Statements Act, no statement of cash flows for the enterprise has been prepared, as the relevant information is included in the consolidated financial statements of AT&T Inc. Recognition and measurement in general Income is recognised in the income statement concurrently with its realisation, including the recognition of value adjustments of financial assets and liabilities. Likewise, all costs are recognised in the income statement, including depreciations amortisations, writedowns for impairment, provisions, and reversals due to changes in estimated amounts previously recognised in the income statement. Assets are recognised in the statement of financial position when it seems probable that future economic benefits will flow to the company and the value of the asset can be reliably measured. Liabilities are recognised in the statement of financial position when it is seems probable that future economic benefits will flow out of the company and the value of the liability can be reliably measured. Assets and liabilities are measured at cost at the initial recognition. Hereafter, assets and liabilities are measured as described below for each individual accounting item. Certain financial assets and liabilities are measured at amortised cost, allowing a constant effective interest rate to be recognised during the useful life of the asset or liability. Amortised cost is recognised as the original cost less any payments, plus/less accrued amortisations of the difference between cost and nominal amount. In this way, capital losses and gains are allocated over the useful life of the liability. Upon recognition and measurement, allowances are made for such predictable losses and risks which may arise prior to the presentation of the annual report and concern matters that exist on the reporting date. Revenue The enterprise will be applying IAS 11 and IAS 18 as its basis of interpretation for the recognition of revenue. Revenue is recognised in the income statement if delivery and passing of risk to the buyer have taken place before the end of the year and if the income can be determined reliably and inflow is anticipated. Recognition of revenue is exclusive of VAT and taxes and less any discounts relating directly to sales. Other external expenses Other external expenses comprise expenses incurred for distribution, sales, advertising, administration, premises, loss on receivables, and operational leasing costs. Staff costs Staff costs include salaries and wages, including holiday allowances, pensions, and other social security costs, etc., for staff members. Staff costs are less government reimbursements. Depreciation, amortisation, and writedown for impairment Depreciation, amortisation, and writedown for impairment comprise depreciation on, amortisation of, and writedown for impairment of intangible and tangible assets, respectively. Financial income and expenses Financial income and expenses are recognised in the income statement with the amounts concerning the financial year. Financial income and expenses comprise interest income and expenses, realised and unrealised capital gains and losses relating to debt and transactions in foreign currency as well as surcharges and reimbursements under the advance tax scheme, etc. Tax on net profit or loss for the year Tax for the year comprises the current income tax for the year and changes in deferred tax and is recognised in the income statement with the share attributable to the net profit or loss for the year and directly in equity with the share attributable to entries directly in equity. The company is subject to Danish rules on compulsory joint taxation of Danish group enterprises. The current Danish income tax is allocated among the jointly taxed companies proportional to their respective taxable income (full allocation with reimbursement of tax losses). Property, plant, and equipment Property, plant, and equipment are measured at cost less accrued depreciation and writedown for impairment. The depreciable amount is cost less any expected residual value after the end of the useful life of the asset. The amortisation period and the residual value are determined at the acquisition date and reassessed annually. If the residual value exceeds the carrying amount, the depreciation is discontinued. If the amortisation period or the residual value is changed, the effect on amortisation will, in future, be recognised as a change in the accounting estimates. The cost comprises acquisition cost and costs directly associated with the acquisition until the time when the asset is ready for use. The cost of a total asset is divided into separate components. These components are depreciated separately, the useful lives of each individual components differing, and the individual component representing a material part of the total cost. Depreciation is done on a straight-line basis according to an assessment of the expected useful life: Other fixtures and fittings, tools and equipment Useful life 3-5 years Minor assets with an expected useful life of less than 1 year are recognised as costs in the income statement in the year of acquisition. Profit or loss derived from the disposal of property, land, and equipment is measured as the difference between the sales price less selling costs and the carrying amount at the date of disposal. Profit or loss is recognised in the income statement as other operating income or other operating expenses. Property, plant, and equipment under construction Property, plant, and equipment under construction are measured and recognised as the total costs incurred. When the work has been completed, the total value is transferred to the relevant item under property, plant, and equipment and is amortised from the date of entry into service. Impairment loss relating to non-current assets The carrying amount of both intangible and tangible fixed assets as well as equity investments in subsidiaries are subject to annual impairment tests in order to disclose any indications of impairment beyond those expressed by amortisation and depreciation respectively. If indications of impairment are disclosed, impairment tests are carried out for each individual asset or group of assets, respectively. Writedown for impairment is done to the recoverable amount if this value is lower than the carrying amount. The recoverable amount is the higher value of value in use and selling price less expected selling cost. The value in use is calculated as the present value of the expected net cash flows from the use of the asset or the asset group and expected net cash flows from the sale of the asset or the asset group after the end of their useful life. Previously recognised impairment losses are reversed when conditions for impairment no longer exist. Impairment relating to goodwill is not reversed. Deposits Deposits are measured at amortised cost and represent lease deposits, etc. Receivables Receivables are measured at amortised cost, which usually corresponds to nominal value. In order to meet expected losses, impairment takes place at the net realisable value. The company has chosen to use IAS 39 as a basis for interpretation when recognising impairment of financial assets, which means that impairments must be made to offset losses where an objective indication is deemed to have occurred that an account receivable or a portfolio of accounts receivable is impaired.If an objective indication shows that an individual account receivable has been impaired, an impairment takes place at individual level. Cash and cash equivalents Cash and cash equivalents comprise cash at bank and on hand. Income tax and deferred tax Current tax liabilities and current tax receivable are recognised in the statement of financial position as calculated tax on the taxable income for the year, adjusted for tax of previous years' taxable income and for tax paid on account. Deferred tax is measured on the basis of temporary differences in assets and liabilities with a focus on the statement of financial position. Deferred tax is measured at net realisable value. Adjustments take place in relation to deferred tax concerning elimination of unrealised intercompany gains and losses. Deferred tax is measured based on the tax rules and tax rates applying under the legislation prevailing in the respective countries on the reporting date when the deferred tax is expected to be released as current tax. Changes in deferred tax due to changed tax rates are recognised in the income statement, except for items included directly in the equity. Deferred tax assets, including the tax value of tax losses allowed for carryforward, are recognised at the value at which they are expected to be realisable, either by settlement against tax of future earnings or by set-off in deferred tax liabilities within the same legal tax unit. Any deferred net tax assets are measured at net realisable value. Liabilities other than provisions Other liabilities concerning payables to suppliers, group enterprises, and other payables are measured at amortised cost which usually corresponds to the nominal value. 264045092021-01-012021-12-31264045092020-01-012020-12-31264045092020-12-31264045092021-12-31264045092021-01-012021-12-312264045092021-01-012021-12-311264045092021-01-012021-12-313264045092021-01-012021-12-311264045092021-01-012021-12-31e:RetainedEarningsMember264045092020-01-012020-12-31e:RetainedEarningsMember264045092021-01-01e:FixturesFittingsToolsAndEquipmentMember264045092021-12-31e:FixturesFittingsToolsAndEquipmentMember264045092021-01-01e:ContributedCapitalMember264045092021-12-31e:ContributedCapitalMember264045092021-01-01e:RetainedEarningsMember264045092021-01-012021-12-31e:RetainedEarningsMember264045092021-12-31e:RetainedEarningsMember264045092021-01-012021-12-31d:TwoYearsAgoMember264045092021-12-31d:TwoYearsAgoMember264045092021-01-012021-12-31d:ThreeYearsAgoMember264045092021-12-31d:ThreeYearsAgoMember264045092021-01-012021-12-31d:FourYearsAgoMember264045092021-12-31d:FourYearsAgoMember264045092020-01-01e:ContributedCapitalMember264045092020-12-31e:ContributedCapitalMember264045092020-01-01e:RetainedEarningsMember264045092020-01-012020-12-31e:RetainedEarningsMember264045092020-12-31e:RetainedEarningsMember264045092021-01-01e:DepositsLongtermInvestmentsAndReceivablesMember264045092021-12-31e:DepositsLongtermInvestmentsAndReceivablesMemberiso4217:DKKxbrli:pure