DIRECTV 2008 Annual Report Download - page 114

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THE DIRECTV GROUP, INC.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS—(continued)
they necessarily indicative of the results of future operations. The pro forma information excludes the
effect of non-recurring charges.
Years Ended
December 31, 2006
(Dollars in Millions,
Except
Per Share Amounts)
Revenues ............................................ $15,077
Operating profit ....................................... 2,375
Income from continuing operations before income taxes and minority
interests ............................................ 2,307
Net income ........................................... 1,425
Basic earnings per common share ........................... 1.13
Diluted earnings per common share ......................... 1.12
Mexico. In Mexico, also as part of the Sky Transactions, DTVLA’s local operating company,
DIRECTV Mexico, sold its subscriber list to Sky Mexico and, after completing the transfer of its
subscribers to Sky Mexico, ceased providing services in 2005. In 2006, upon completion of the
transaction, we recorded a gain of $57 million in ‘‘Gain from disposition of businesses’’ in our
Consolidated Statements of Operations when DLA LLC received an equity interest in Sky Mexico
resulting from the sale of DIRECTV Mexico’s subscriber list and transfer of subscribers to Sky Mexico.
Also in February 2006, we acquired News Corporation’s and Liberty Media International’s equity
interests in Sky Mexico for $373 million in cash. On April 27, 2006, we sold a portion of our equity
interest to Televisa for $59 million in cash, which reduced our equity interest in Sky Mexico to 41%.
We account for our investment in Sky Mexico using the equity method of accounting. See Note 6 for
additional information regarding this investment.
Other. In 2004, we acquired Sky Multi-Country Partners and related entities for $30 million in
cash. As part of this transaction, News Corporation agreed to reimburse us $127 million for the Sky
entities’ net liabilities we assumed, which we received from News Corporation in August 2006.
Note 18: Segment Reporting
Our two reportable segments, DIRECTV U.S. and DIRECTV Latin America, acquire, promote,
sell and distribute digital entertainment programming via satellite to residential and commercial
subscribers. Corporate and Other includes the corporate office, eliminations and other entities.
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