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Table of Contents
ECHOSTAR COMMUNICATIONS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — Continued
ended December 31, 2006, 2005 and 2004, respectively. Revenues from these customers are included within the EchoStar Technologies
Corporation operating segment.
11. Valuation and Qualifying Accounts
Our valuation and qualifying accounts as of December 31, 2006, 2005 and 2004 are as follows:
12. Quarterly Financial Data (Unaudited)
Our quarterly results of operations are summarized as follows:
13. Related Party Transactions
We own 50% of NagraStar L.L.C. (“NagraStar”), a joint venture that is our exclusive provider of encryption and related security systems
intended to assure that only paying customers have access to our programming. Because we are not required to consolidate NagraStar, but we
do have the ability to significantly influence its operating policies, we accounted for our investment in NagraStar under the equity method of
accounting for all periods
F
-
44
Balance at
Beginning of
Charged to Costs
Balance at End
Year
and Expenses
Deductions
of Year
(In thousands)
Year ended December 31, 2006:
Assets:
Allowance for doubtful accounts
$
11,523
$
68,911
$
(65,428
)
$
15,006
Reserve for inventory
10,185
10,123
(7,430
)
12,878
Year ended December 31, 2005:
Assets:
Allowance for doubtful accounts
$
9,542
$
57,351
$
(55,370
)
$
11,523
Reserve for inventory
10,389
3,980
(4,184
)
10,185
Year ended December 31, 2004:
Assets:
Allowance for doubtful accounts
$
12,185
$
66,289
$
(68,932
)
$
9,542
Reserve for inventory
6,770
8,428
(4,809
)
10,389
For the Three Months Ended
March 31
June 30
September 30
December 31
(In thousands, except per share data)
(Unaudited)
Year ended December 31, 2006:
Total revenue(1)
$
2,299,391
$
2,466,155
$
2,475,291
$
2,577,649
(2)
Operating income (loss)
274,196
349,641
281,810
311,724
(2)
Net income (loss)
147,281
168,779
139,616
152,596
(2)
Basic income per share
$
0.33
$
0.38
$
0.31
$
0.35
Diluted income per share
$
0.33
$
0.38
$
0.31
$
0.35
Year ended December 31, 2005:
Total revenue
$
2,024,000
$
2,095,486
$
2,128,221
$
2,199,468
Operating income (loss)
290,234
333,394
291,884
251,736
Net income (loss)
317,524
855,527
208,864
132,625
Basic income per share
$
0.70
$
1.89
$
0.46
$
0.30
Diluted income per share
$
0.69
$
1.79
$
0.46
$
0.28
(1)
Effective the fourth quarter of 2006 we reclassified certain amounts for the three months ended March 31, June 30 and September 30, 2006 resulting in an increase of
$9.7 million, $7.5 million and $3.9 million, respectively, in “Total revenue” in our Consolidated Statements of Operations and Comprehensive Income (Loss). Net Income for
the periods was not affected.
(2)
“Total revenue” in our Consolidated Statements of Operations and Comprehensive Income (Loss) for the three months ended December 31, 2006 reflects a $13.8 million out
of period pre-tax adjustment for payments received from subscribers during the first nine months of the year. This adjustment was not material to all prior periods presented
and did not impact our Consolidated Statements of Operations and Comprehensive Income (Loss) for the year ended December 31, 2006.