DIRECTV 2005 Annual Report Download - page 137

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THE DIRECTV GROUP, INC.
SCHEDULE I—CONDENSED FINANCIAL INFORMATION OF THE REGISTRANT
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
Note 1: Basis of Presentation
As discussed in Note 9 of the Notes to the Consolidated Financial Statements, the terms of the
DIRECTV Holdings LLC credit facility limit DIRECTV Holdings LLC and its respective subsidiaries
from transferring funds to us in the form of cash dividends, loans or advances. In the parent company
only financial statements, we state our investments in subsidiaries at cost, net of equity in earnings
(losses) of subsidiaries, since the date of formation/acquisition. As a result, we include our interest in
the net assets of DIRECTV Holdings LLC, which total about $3.3 billion and $2.4 billion at
December 31, 2005 and 2004, respectively, in ‘‘Investments in Subsidiaries’’ in the accompanying
Condensed Balance Sheets of the parent company. The parent company only financial statements and
related notes should be read in conjunction with our consolidated financial statements and notes
thereto.
Note 2: Loss on Sale of PanAmSat
On August 20, 2004, we completed the sale of our approximately 80.4% interest in PanAmSat to
an affiliate of Kohlberg Kravis Roberts & Co. L.P for $2.64 billion in cash. We recorded a pre-tax loss
of $1,078.1 million in ‘‘Other, net’’ in 2004 in the accompanying Condensed Statements of Operations
as a result of this transaction. The $2.64 billion in cash received for this transaction is reflected in ‘‘Net
investment in subsidiaries’’ in the Condensed Statements of Cash Flows. See Note 3 of the Notes to the
Consolidated Financial Statements for more information.
Note 3: Loans Receivable from Subsidiaries
On August 27, 2004, in connection with the completion of the Pegasus and NRTC transactions
described in Note 3 of the Notes to the Consolidated Financial Statements, we provided DIRECTV
U.S. $875.0 million in the form a unsecured promissory note. DIRECTV U.S. repaid the $875.0 note in
full during the second quarter of 2005.
Note 4: Credit Facilities
See Note 9 of the Notes to the Consolidated Financial Statements.
Note 5: Contingencies
See Note 21 of the Notes to the Consolidated Financial Statements.
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