Virgin Media 2006 Annual Report Download - page 129

VIRGIN MEDIA INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
20. Industry Segments (Continued)
programming to the U.K. pay−television broadcasting market including our televised shopping unit sit−up tv, which markets and
retails a wide variety of consumer products using an auction−based format. We operate a Mobile segment through our wholly−owned
subsidiary Virgin Mobile Limited, which consists of our mobile telephony business. Our segments operate entirely in the U.K. and no
one customer represents more than 5% of our overall revenue.
Segment operating income before depreciation, amortization and other charges, which we refer to as Segment OCF, is
management’s measure of segment profit as permitted under SFAS 131, “Disclosures about Segments of an Enterprise and Related
Information”. Our management, including our chief executive officer who is our chief operating decision maker, considers Segment
OCF as an important indicator of the operational strength and performance of our segments. Segment OCF excludes the impact of
costs and expenses that do not directly affect our cash flows. Other charges, including restructuring charges, are also excluded from
Segment OCF as management believes they are not characteristic of our underlying business operations. The business segments
disclosed in the consolidated financial statements are based on this organizational structure and information reviewed by our
management to evaluate the business segment results.
Segment information for the year ended December 31, 2006 is as follows (in millions):
Year ended December 31, 2006
Cable Content Mobile Elims. Total
Revenue £ 3,007.3 £ 302.8 £ 292.1 £ — £ 3,602.2
Inter segment revenue 2.8 19.2 (0.3) (21.7) —
Operating costs (1,165.0) (230.2) (196.6) 19.0 (1,572.8)
Selling, general and administrative
expenses (772.1) (72.5) (65.0) 2.7 (906.9)
Segment OCF 1,073.0 19.3 30.2 — 1,122.5
Depreciation, amortization and
other charges (1,057.8) (13.2) (41.7) — (1,112.7)
Operating income (loss) £ 15.2 £ 6.1 £ (11.5) £ — £ 9.8
Identifiable assets £ 9,269.9 £ 634.3 £ 1,339.3 £ — £ 11,243.5
In 2005, we did not have any operations in the Content or Mobile segments and all of our operations related to the Cable
segment. Included in identifiable assets at December 31, 2006 is £1,295.9 million, £85.6 million and £970.2 million of goodwill from
the acquisitions of Telewest and Virgin Mobile that has been allocated to the Cable, Content and Mobile segments, respectively.
F−50
Source: VIRGIN MEDIA INVESTM, 10−K, March 01, 2007