Virgin Media 2007 Annual Report Download - page 67

The following table summarizes our historical restructuring accruals (in millions):
Involuntary
Employee
Termination Lease
and Related Exit
Historical Restructuring Accruals Costs Costs Total
Balance, January 1, 2006 ..................................... £ — £45.3 £ 45.3
Charged to expense ........................................ — 4.0 4.0
Utilized ................................................. — (5.9) (5.9)
Balance, December 31, 2006 .................................. £ — £43.4 £ 43.4
The following table summarizes our restructuring accruals resulting primarily from the reverse
acquisition of Telewest (in millions):
Involuntary
Employee
Termination Lease
and Related Exit
Acquisition Restructuring Accruals Costs Costs Total
Balance, January 1, 2006 ..................................... £ — £ — £ —
Accruals resulting from business acquisition recognized under EITF 95-3 . . 43.2 45.9 89.1
Charged to expense ........................................ 40.3 22.7 63.0
Utilized ................................................. (64.8) (3.9) (68.7)
Balance, December 31, 2006 .................................. £18.7 £64.7 £ 83.4
Depreciation expense
For the year ended December 31, 2006, depreciation expense increased to £799.1 million from
£541.7 million for the same period in 2005. This increase was primarily attributable to the reverse
acquisition of Telewest and related fair value adjustment to the property and equipment acquired, and
to the acquisition of Virgin Mobile. Excluding the impact of the reverse acquisition of Telewest and of
the acquisition of Virgin Mobile, depreciation expense decreased due to the absence of depreciation on
some assets that became fully depreciated in 2005.
Amortization expense
For the year ended December 31, 2006, amortization expense increased to £246.6 million from
£109.5 million for the same period in 2005. The increase in amortization expense related to additional
intangible assets arising from the reverse acquisition of Telewest and from the acquisition of Virgin
Mobile.
Interest income and other
For the year ended December 31, 2006, interest income and other increased to £34.7 million from
£29.4 million for the year ended December 31, 2005, primarily as a result of increased interest rates
and additional cash balances throughout the year.
Interest expense
For the year ended December 31, 2006, interest expense increased to £457.4 million from
£235.8 million for the same period in 2005, primarily as a result of the additional borrowings as a result
of the reverse acquisition of Telewest and the acquisition of Virgin Mobile.
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