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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
authorities and other customary closing conditions. We currently expect the transaction to close by the end of the third
quarter of 2007. It is possible that factors outside of our control could require us to complete the acquisition at a later date
or not to complete it at all. This transaction will be accounted for as a purchase in accordance with SFAS No. 141,
“Business Combinations.”
In February 2007, our Board of Directors authorized us to repurchase an increased number of shares of our common
stock. We announced our intention to repurchase approximately $700 million of the stock issued in the acquisition. We
expect to fi nance these share repurchases using cash provided by operating activities, as well as the issuance of new debt.
16.
QUARTERLY FINANCIAL DATA (UNAUDITED)
Quarterly fi nancial data for 2006 and 2005 were as follows:
Three Months Ended
2006 March 31, June 30, September 30, December 31,
(In millions, except per share data)
Operating revenue $374.0 $387.7 $394.6 $390.0
Operating income $109.2 $ 96.4 $ 120.6 $ 109.9
Net income $ 62.9 $ 69.6 $ 78.9 $ 63.1
Basic earnings per common share* $ 0.49 $ 0.54 $ 0.62 $ 0.50
Diluted earnings per common share* $ 0.48 $ 0.53 $ 0.61 $ 0.50
Three Months Ended
2005 March 31, June 30, September 30, December 31,
(In millions, except per share data)
Operating revenue $343.4 $363.4 $375.3 $361.3
Operating income $102.0 $ 106.7 $107.3 $106.0
Net income $ 58.6 $ 62.6 $ 62.5 $ 62.8
Basic earnings per common share* $ 0.45 $ 0.48 $ 0.48 $ 0.48
Diluted earnings per common share* $ 0.44 $ 0.47 $ 0.47 $ 0.48
* The sum of the quarterly EPS may not equal the annual EPS due to changes in the weighted-average shares between periods.
The comparability of our quarterly fi nancial results during 2006 and 2005 were impacted by certain events, as follows:
• During 2006 and 2005, we made several acquisitions, including Austin-Tetra in 2006 and APPRO and BeNow in 2005.
For additional information about these acquisitions, see Note 3 of the Notes to Consolidated Financial Statements.
• On January 1, 2006, we adopted SFAS 123R, which resulted in incremental stock-based compensation expense during
2006 when compared to 2005. The incremental impact on the 2006 Consolidated Statements of Income, by quarter, was:
$2.3 million ($1.6 million net of tax) in the fi rst quarter; $3.5 million ($2.3 million net of tax) in the second quarter; $0.8
million ($0.6 million net of tax) in the third quarter; and $1.0 million ($0.7 million net of tax) in the fourth quarter. For
additional information about the impact of SFAS 123R, see Note 2 of the Notes to Consolidated Financial Statements.
• During the second and third quarters of 2006, there were several litigation matters that had an impact on our Consolidated
Financial Statements. For additional information about these litigation matters, see Note 6 of the Notes to Consolidated
Financial Statements.
• During the fourth quarter of 2006, we recorded a severance charge of $6.4 million ($4.0 million, net of tax) related to
an organizational realignment. For additional information about this charge, see Note 11 of the Notes to Consolidated
Financial Statements.
EQUIFAX 2006 ANNUAL REPORT 83