AutoNation 2006 Annual Report Download - page 64
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Table of Contents
Liabilities at December 31, 2006 and 2005 are $58.7 million and $54.5 million, respectively, provided by the Company for these
matters.
The computation of weighted average common and common equivalent shares used in the calculation of basic and diluted earnings
per share is as follows for the years ended December 31:
Weighted average shares outstanding used to calculate basic earnings per share 225.2 262.7 266.7
Effect of dilutive options 4.1 5.3 5.8
Weighted average common and common equivalent shares used to calculate diluted earnings per
share 229.3 268.0 272.5
As discussed in Note 7 of the Notes to Consolidated Financial Statements, in April 2006 the Company repurchased 50 million
shares of its common stock pursuant to an equity tender offer. As of December 31, 2006, the Company had employee stock options
outstanding of 22.5 million of which 5.5 million have been excluded from the computation of diluted earnings per share since they are
anti-dilutive. As of December 31, 2005 and 2004, outstanding employee stock options totaling 7.2 million and 9.3 million, respectively,
have been excluded since they were anti-dilutive.
Discontinued operations are related to stores that were sold, that the Company has entered into an agreement to sell, or for which the
Company otherwise deems a proposed sales transaction to be probable, with no material changes expected. Generally, the sale of a store is
completed within 60 to 90 days after the date of a sale agreement. The accompanying Consolidated Financial Statements for all the
periods presented have been adjusted to classify these stores as discontinued operations. Also included in results from discontinued
operations in 2005 and 2004 is income from an income tax adjustment related to items previously reported in discontinued operations.
Selected income statement data for the Company’s discontinued operations is as follows:
Total revenue $325.8 $738.5 $ 1,333.6
Pre-tax loss from discontinued operations $ (10.4) $ (14.2) $ (4.8)
Pre-tax loss on disposal of discontinued operations (6.6) (6.3) (7.5)
(17.0) (20.5) (12.3)
Income tax benefit (2.5) (10.1) (0.8)
(14.5) (10.4) (11.5)
Income tax adjustment (see Note 11) — 110.0 52.2
Income (loss) from discontinued operations, net of income taxes $ (14.5) $ 99.6 $ 40.7
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