Blizzard 2009 Annual Report Download - page 31
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Restructuring(amountsinmillions)
Year
ended
December31,
2009
%of
total
consolidated
netrevs.
Year
ended
December31,
2008
%of
total
consolidated
netrevs.
Year
ended
December31,
2007
%of
total
consolidated
netrevs.
Increase/
(decrease)
2009v
2008
Increase/
(decrease)
2008v
2007
Restructuring.............
$23
1%
$93
3%
$(1)
—%
$(70)
$94
Inthethirdquarterof2008,weimplementedanorganizationalrestructuringasaresultofthe
BusinessCombination.Thisorganizationalrestructuringwastointegratedifferentoperationsandto
streamlinethecombinedActivisionBlizzardorganization.Theimplementationoftheorganizational
restructuringresultedinthefollowingrestructuringcharges:severancecosts;contractterminationcosts;
fixedassetwriteoffondisposals;impairmentchargesonacquiredtradenames,prepaidroyalties,
intellectualpropertylicenses;impairmentchargesongoodwill;andlossondisposalofassets/liabilities.At
June30,2009,wehadcompletedthemajorityofourorganizationalrestructuringactivitiesasaresultofthe
BusinessCombination.SeeNote8oftheNotestoConsolidatedFinancialStatementsincludedinthis
AnnualReportformoredetailandarollforwardoftherestructuringliabilitythatincludesthebeginning
andendingliability,costsincurred,cashpaymentsandnoncashwritedowns.
InvestmentandOtherIncome(Loss),Net(amountsinmillions)
Year
ended
December31,
2009
%of
total
consolidated
netrevs.
Year
ended
December31,
2008
%of
total
consolidated
netrevs.
Year
ended
December31,
2007
%of
total
consolidated
netrevs.
Increase/
(decrease)
2009v
2008
Increase/
(decrease)
2008v
2007
Investmentand
otherincome
(loss),net...............
$18
1%
$46
2%
$(4)
—%
$(28)
$50
Investmentandotherincome(loss),netdecreasedfortheyearendedDecember31,2009as
comparedto2008primarilyasaresultoflowerinterestrates,lossesonforeignexchangederivative
contractsin2009ascomparedwithgainsin2008,andcertaininvestmentrelatedgainsin2008.Partially
offsettingthesedecreaseswasan$8millionincreaseduetothereductioninfairvalueofourotherfinancial
liabilityfortheyearendedDecember31,2009.
Ourcash,cashequivalents,andshortterminvestments,comprisedprimarilyofcashandcash
equivalents,was$3.2billionand$3billionatDecember31,2009and2008,respectively.VivendiGames
maintainedanetpayablebalancewithVivendiatDecember31,2007.Investmentincomefortheyear
endedDecember31,2008wasprimarilyderivedfromtheinterestincomefrominvestmentsinmoney
marketfunds,marktomarketgainsonouroutstandingcurrencyforwardcontracts,andanunrealizedgain
onauctionratesecuritiesrightsfromUBSAG(“UBS”),comparedwithnetinterestexpensefortheyear
endedDecember31,2007.
IncomeTaxBenefit(amountsinmillions)
Year
ended
December31,
2009
%of
Pretax
income
Year
ended
December31,
2008
%of
Pretax
income
Year
ended
December31,
2007
%of
Pretax
income
Increase/
(decrease)
2009v
2008
Increase/
(decrease)
2008v
2007
IncomeTaxBenefit.........
$(121)
NM
$(80)
(43)%
$(52)
(30)%
$41
$28
FortheyearendedDecember31,2009,thelossfromtheimpairmentofintangibleassetsresulted
inabooktaxbenefitattheU.S.statutoryrate,whileforeignincometaxesatlowerrates,thereleaseof
valuationallowancesonnetoperatinglosses,therecognitionofresearchanddevelopmentcreditsandIRC
199domesticproductiondeductionsprovidedadditionalbenefitonbothabookandtaxableincomebasis.
Thesecollectivefactorsresultedinanaggregatedbooktaxbenefitof$121millionforcalendaryear2009.
FortheyearsendedDecember31,2008and2007,thetaxbenefitasaresultofnetincome(loss)before
incometaxeswasoffsetbytaxbenefitsfromnetoperatinglossessurrenderedandthereleaseofvaluation
allowances.