American Home Shield 2003 Annual Report Download - page 49

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ServiceMaster    47
In accordance with SFAS 142, the following table provides
summarized transitional information for the years ended
December 31, 2003, 2002 and 2001, with the 2001 informa-
tion presented on an adjusted basis to reflect the elimination
of amortization expense required under SFAS 142:
(In thousands, except per share data) 2003 2002 2001
Reported operating income (loss) $ (166,243) $ 335,393 $ (30,400)
Add back: Goodwill and trade name amortization ––60,453
Operating income (loss) as adjusted under SFAS 142 $ (166,243) $ 335,393 $ 30,053
Reported income (loss) from continuing operations $ (221,975) $ 157,303 $ (172,219)
Add back: Goodwill and trade name amortization, net of tax ––41,590
Income (loss) from continuing operations as adjusted under SFAS 142 (221,975) 157,303 (130,629)
Discontinued operations, net of taxes (2,712) (309) 288,603
Net income (loss) as adjusted under SFAS 142 $ (224,687) $ 156,994 $ 157,974
Reported basic earnings (loss) per share from continuing operations $ (0.75) $ 0.52 $ (0.58)
Add back: Goodwill and trade name amortization, net of tax ––0.14
Basic earnings (loss) per share from continuing operations
as adjusted under SFAS 142 (0.75) 0.52 (0.44)
Discontinued operations,net (0.01) –0.97
Basic earnings (loss) per share as adjusted under SFAS 142 $ (0.76) $ 0.52 $ 0.53
Reported diluted earnings (loss) per share from continuing operations $ (0.75) $ 0.51 $ (0.58)
Add back: Goodwill and trade name amortization, net of tax ––0.14
Diluted earnings (loss) per share from continuing operations
as adjusted under SFAS 142 (0.75) 0.51 (0.44)
Discontinued operations,net (0.01) - 0.97
Diluted earnings (loss) per share as adjusted under SFAS 142 $ (0.76) $ 0.51 $ 0.53
The following table summarizes goodwill and intangible asset balances:
(In thousands) 2003 2002 2001
Goodwill(1) $ 1,516,206 $ 1,919,780 $ 1,904,178
Trade names(1) 204,793 238,550 238,550
Other intangible assets(3) 35,432 78,284 74,197
Accumulated amortization(2,3) (23,772) (59,053) (51,611)
Net other intangibles 11,660 19,231 22,586
Total $ 1,732,659 $ 2,177,561 $ 2,165,314
(1) Not subject to amortization.
(2) Amortization expense of $6 million, $7 million and $71 million was recorded in 2003, 2002 and 2001,respectively. Annual amortization expense of approximately $6 million in
2003 is expected to decline over the next five years.
(3) In the first quarter of 2003, the Company reviewed its intangible balances and removed the fully amortized assets as well as the related accumulated amortized balance on the
financial statements. During this process certain reclassifications between categories were made.
Notes to Consolidated Financial Statements