Dish Network 2004 Annual Report Download - page 46

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Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS - Continued
38
RESULTS OF OPERATIONS
Year Ended December 31, 2004 Compared to the Year Ended December 31, 2003.
For the Years Ended December 31, Variance
2004 2003 Amount %
Statements of Operations Data (In thousands)
Revenue:
Subscriber-related revenue..................................................................... 6,677,370$ 5,409,875$ 1,267,495$ 23.4%
Equipment sales...................................................................................... 373,253 295,409 77,844 26.4%
Other....................................................................................................... 100,593 34,012 66,581 195.8%
Total revenue............................................................................................. 7,151,216 5,739,296 1,411,920 24.6%
Costs and Expenses:
Subscriber-related expenses................................................................... 3,567,409 2,707,898 859,511 31.7%
% of Subscriber-related revenue................................................. 53.4% 50.1%
Satellite and transmission expenses........................................................ 112,239 79,322 32,917 41.5%
% of Subscriber-related revenue................................................. 1.7% 1.5%
Cost of sales - equipment....................................................................... 305,313 194,491 110,822 57.0%
% of Equipment sales.................................................................... 81.8% 65.8%
Cost of sales - other................................................................................ 33,265 3,496 29,769 851.5%
Subscriber acquisition costs................................................................... 1,527,886 1,312,068 215,818 16.4%
General and administrative..................................................................... 397,718 332,723 64,995 19.5%
% of Total revenue........................................................................ 5.6% 5.8%
Non-cash, stock-based compensation..................................................... 1,180 3,544 (2,364) (66.7%)
Depreciation and amortization............................................................... 502,901 398,206 104,695 26.3%
Total costs and expenses........................................................................... 6,447,911 5,031,748 1,416,163 28.1%
Operating income (loss)............................................................................ 703,305 707,548 (4,243) (0.6%)
Other income (expense):
Interest income....................................................................................... 42,287 65,058 (22,771) (35.0%)
Interest expense, net of amounts capitalized.......................................... (505,732) (552,490) 46,758 8.5%
Other....................................................................................................... (13,482) 18,766 (32,248) (171.8%)
Total other income (expense).................................................................... (476,927) (468,666) (8,261) (1.8%)
Income (loss) before income taxes............................................................ 226,378 238,882 (12,504) (5.2%)
Income tax benefit (provision), net............................................................ (11,609) (14,376) 2,767 19.2%
Net income (loss)...................................................................................... 214,769$ 224,506$ (9,737)$ (4.3%)
Other Data:
DISH Network subscribers, as of year end (in millions)........................... 10.905 9.425 1.480 15.7%
DISH Network subscriber additions, gross (in millions)........................... 3.441 2.894 0.547 18.9%
DISH Network subscriber additions, net (in millions).............................. 1.480 1.245 0.235 18.9%
Monthly churn percentage......................................................................... 1.62% 1.57% 0.05% 3.2%
Average revenue per subscriber ("ARPU").............................................. 54.87$ 51.21$ 3.66$ 7.1%
Average subscriber acquisition costs per subscriber ("SAC")................... 444$ 453$ (9)$ (2.0%)
Equivalent average subscriber acquition costs per
subscriber ("Equivalent SAC")............................................................. 593$ 480$ 113$ 23.5%
EBITDA.................................................................................................... 1,192,724$ 1,124,520$ 68,204$ 6.1%