Frontier Communications 2006 Annual Report Download - page 69

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CITIZENS COMMUNICATIONS COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements
Summarized financial information for CCUSA (discontinued operations) is set forth below:
($ in thousands) For the years ended December 31,
2006 2005 2004
Revenue ...................................... (Sold) $ 4,607 $ 24,558
Operating income .............................. $ 1,489 $ 8,188
Income taxes .................................. $ 449 $ 2,957
Net income ................................... $ 1,040 $ 5,231
Gain on disposal of CCUSA, net of tax ............. $ 1,167 $ —
There was no balance sheet data to report for CCUSA as of December 31, 2006 or 2005.
(c) Public Utilities
On April 1, 2004, we completed the sale of our Vermont electric distribution operations for approximately
$13,992,000 in cash, net of selling expenses. With that transaction, we completed the divestiture of our public
utilities services business pursuant to plans announced in 1999.
(9) Investments:
The components of investments at December 31, 2006 and 2005 are as follows:
($ in thousands) 2006 2005
Marketable equity securities ..................... $ 30 $ 122
Equity method investments ...................... 16,444 15,877
$ 16,474 $ 15,999
Marketable Securities
As of December 31, 2006 and 2005, we owned 3,059,000 shares of Adelphia Communications Corp.
(Adelphia) common stock. As a result of write downs recorded in 2002 and 2001, our “book cost basis” was
reduced to zero and subsequent increases and decreases, except for those deemed other than temporary, are
included in accumulated other comprehensive income (loss). Unrealized holding gains at December 31, 2006 and
2005 were $30,000 and $122,000 respectively which approximates the fair market value.
During 2004, we sold our investments in D & E Communications, Inc. (D & E) and Hungarian Telephone
and Cable Corp. (HTCC) for approximately $13,300,000 and $13,200,000 in cash, respectively. We recorded net
realized gains of $12,066,000 in our statement of operations for the sale of these marketable securities.
At December 31, 2006 and 2005, we did not have any investments that have been in a continuous unrealized
loss position deemed to be temporary for more than 12 months. We determined that market fluctuations during
the period are not other than temporary because the severity and duration of the unrealized losses were not
significant.
Equity Method Investments
Our investments in entities that are accounted for under the equity method of accounting consist of the
following: (1) a 16.8% interest in the Fairmount Cellular Limited Partnership which is engaged in cellular mobile
telephone service in the Rural Service Area (RSA) designated by the FCC as Georgia RSA No. 3; and (2) our
investments in CU Capital and CU Trust with relation to our convertible preferred securities. The investments in
these entities amounted to $16,444,000 and $15,877,000 at December 31, 2006 and 2005, respectively.
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