Cablevision 2012 Annual Report Download - page 164

COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Dollars in thousands, except per share amounts)
I-36
Year Ended
December 31, 2010
January 1, 2010
through
February 9, 2010
AMC
Networks
Madison Square
Garden Total
Revenues, net .....................................................
.
$1,053,674 $131,695 $1,185,369
Income before income taxes ...............................
.
$ 269,753 $ 7,090 $ 276,843
Income tax expense(a) ........................................
.
(111,783) (11,212) (122,995)
Income (loss) from discontinued operations,
net of income taxes ........................................
.
$ 157,970 $ (4,122) $ 153,848
________________
(a) Income tax expense includes $7,368 resulting from the non-deductibility of certain transaction costs associated with
the MSG Distribution.
AMC Networks' and Madison Square Garden's results of operations reported on a stand-alone basis differ
from results presented above due to certain reclassifications and adjustments made for purposes of
discontinued operations reporting.
NOTE 7. PROPERTY, PLANT AND EQUIPMENT
Costs incurred in the construction of the Company's cable television system, including line extensions to,
and upgrade of, the Company's hybrid fiber-coaxial infrastructure and headend facilities are capitalized.
These costs consist of materials, subcontractor labor, direct consulting fees, and internal labor and related
costs associated with the construction activities. The internal costs that are capitalized consist of salaries
and benefits of the Company's employees and the portion of facility costs, including rent, taxes, insurance
and utilities, that supports the construction activities. These costs are depreciated over the estimated life
of the plant (10 to 25 years), and headend facilities (4 to 25 years). Costs of operating the plant and the
technical facilities, including repairs and maintenance, are expensed as incurred.
Costs incurred to connect businesses or residences that have not been previously connected to the
infrastructure or digital platform are also capitalized. These costs include materials, subcontractor labor,
internal labor to connect, provision and provide on-site and remote technical assistance and other related
costs associated with the connection activities. In addition, on-site and remote technical assistance during
the provisioning process for new digital product offerings are capitalized. The departmental activities
supporting the connection process are tracked through specific metrics, and the portion of departmental
costs that is capitalized is determined through a time weighted activity allocation of costs incurred based
on time studies used to estimate the average time spent on each activity. New connections are amortized
over the estimated useful lives of 5 years or 12 years for residence wiring and feeder cable to the home,
respectively. The portion of departmental costs related to reconnection, programming service up-grade
and down-grade, repair and maintenance, and disconnection activities are expensed as incurred.