DIRECTV 2004 Annual Report Download - page 103

THE DIRECTV GROUP, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS — (continued)
Note 15: Other, Net
The following table summarizes the components of “Other, net” for the years ended December 31:
2004
2003
2002
(Dollars in Millions)
Equity losses from unconsolidated affiliates
$
(0.2
)
$
(81.5
)
$
(70.1
)
EchoStar Merger termination payment
—
—
600.0
Net unrealized gain (loss) on investments
—
79.4
(180.6
)
Net gain from sale of investments
396.5
7.5
84.1
Net gain on exit of DIRECTV Japan business (Note 3)
—
—
41.1
Other
1.3
(5.4
)
(49.0
)
Total Other, net
$
397.6
$
—
$
425.5
On January 28, 2004, we sold 10,000,000 shares of XM Satellite Radio common stock for $254.4 million. On March 25, 2004,
we sold our remaining 9,014,843 shares of XM Satellite Radio common stock for $223.1 million. As a result of these
transactions, we recorded a pre-tax gain of $387.1 million in the first quarter of 2004 in “Other, net” in the Consolidated
Statements of Operations.
For the years ended December 31, 2003 and 2002, equity losses from unconsolidated affiliates are primarily comprised of losses
at the DTVLA LOCs. Also included in 2003 are equity losses from the XM Satellite Radio investment.
Net unrealized gain on investments for 2003 includes a $79.6 million gain resulting from an increase in the fair market value of
an investment in an XM Satellite Radio convertible note. Net unrealized loss on investments for 2002 is primarily comprised of
$148.9 million of other-than-temporary declines in fair value of our investment in XM Satellite Radio and Crown Media
Holdings.
In December 2002, we recognized a $600.0 million gain related to a termination agreement entered into by us, GM and
EchoStar Communications Corporation, or EchoStar. As a part of this agreement, the parties agreed to terminate the merger
agreement and certain related agreements due to the proposed merger’s failure to obtain regulatory approval. Under the terms of
the termination agreement, EchoStar paid us $600 million in cash.
On August 21, 2002, we sold about 8.8 million shares of Thomson multimedia S.A., or Thomson, common stock for
approximately $211.0 million in cash, resulting in a pre-tax gain of about $158.6 million.
In October 2002, we sold all of our interest in Sky Perfect for approximately $105 million in cash, resulting in a pre-tax loss of
about $24.5 million.
During 2002, we reversed $41.1 million of accrued liabilities related to the exit costs for DIRECTV Japan upon the resolution
of the remaining claims, resulting in a credit adjustment to “Other, net” in the Consolidated Statements of Operations.
Note 16: Severance, Retention and Pension Benefit Costs
During the first quarter of 2004, we announced the reduction of corporate office headcount by over half as a result of our plan to
consolidate corporate and DIRECTV U.S. support functions. There were also additional headcount reductions at DIRECTV
U.S. and at DTVLA. As a result of the completion of the News Corporation transactions on December 22, 2003, certain of our
employees earned retention benefits during the twelve month
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