Henry Schein 2009 Annual Report Download - page 12

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10
USE OF NON-GAAP MEASURES:
The above information includes financial measures that are not calculated and presented in accordance with accounting principles generally accepted in the United States (“GAAP”).
The above table reconciles operating income, income from continuing operations attributable to Henry Schein, Inc. and diluted earnings from continuing operations per share attributable to
Henry Schein, Inc., our most directly comparable measure calculated and presented in accordance with GAAP, to comparable amounts as adjusted to eliminate the effect of one-time items.
We eliminated the effect of such one-time items to assist in evaluating the underlying operational performance of our business, excluding such one-time items, over the periods presented.
We believe that this presentation is appropriate and facilitates such an evaluation by us, investors and analysts. These measures should be considered supplemental to, and not a substitute
for or superior to, financial measures calculated in accordance with GAAP.
NOTES:
(1) During 2009 and 2008, we recorded restructuring costs of $3.0 million pre-tax ($2.1 million post-tax) and $23.2 million pre-tax ($16.0 million post-tax), respectively.
The effect that these charges had on earnings per diluted share from continuing operations attributable to Henry Schein, Inc. for the years ended December 26, 2009 was ($0.02)
and December 27, 2008 was ($0.18), respectively.
(2) During 2009, we incurred professional fees of $1.6 million pre-tax ($1.1 million post-tax) related to a plan of reorganization outside the United States that will allow us to utilize
tax loss carryforwards beginning in 2010 in certain foreign tax jurisdictions. The effect that this charge had on earnings per diluted share from continuing operations attributable to
Henry Schein, Inc. for the year ended December 26, 2009 was ($0.01)
(3) During 2009, we completed a planned reorganization outside the United states that will allow us to utilize tax loss carryforwards to offset taxable income beginning in 2010 in certain
foreign tax jurisdictions. As a result of this reorganization we reduced our valuation allowance by $20.8 million during the year ended December 26, 2009.
The effect that this had on earnings per diluted share from continuing operations attributable to Henry Schein, Inc. for the year ended December 26, 2009 was $0.23.
(4) During 2009 and 2008, we recorded (credits)/charges related to the Lehman Brothers bankruptcy of ($0.5) million pre-tax (($0.3) million post-tax) and
$4.5 million pre-tax ($3.0 million post-tax), respectively. The effect that this charge had on earnings per diluted share from continuing operations attributable to Henry Schein, Inc.
for the years ended December 26, 2009 and December 27, 2008 was $0.00 and ($0.03), respectively.
(5) Other non-recurring income/expense, net consists of income of $2.4 million pre-tax ($1.6 million post-tax) relating to proceeds received from litigation settlements and a charge of
$0.9 million pre-tax ($0.6 million post-tax) relating to foreign exchange. The impact of the total after-tax income of $1.0 million on our earnings per diluted share of continuing operations
attributable to Henry Schein, Inc. for the year ended December 26, 2009 was $0.01.
Years ended
December 26, December 27, December 25, Dece
2009 2008 2004
(in thousands, except per share data)
Operating income, as reported $ 464,085 $ 419,286 $ 191,949 $
Adjustments:
Restructuring costs
(1)
3,020 23,240 -
Costs related to foreign tax benefit
(2)
1,600 - -
Adjusted operating income $ 468,705 $ 442,526 205,195
Adjusted operating margin 7.2% 6.9% 5.4%
Income from continuing operations attributable to attributable to Henry Schein, Inc.:
As reported $ 308,551 $ 247,347 114,129
Adjustments, net of tax:
Restructuring costs
(1)
2,058 15,991 -
Costs related to foreign tax benefit
(2)
1,080 - 8,358
Foreign tax benefit
(3)
(20,845) - 8,358
Adjustments related to the Lehman Brothers bankruptcy
(4)
(338) 3,045 -
Other non-recurring income/expense, net
(5)
(1,028) - -
Adjusted income from continuing operations attributable to Henry Schein, Inc.:
$ 289,478 $ 266,383 $ 122,487 $
Diluted earnings from continuing operations per share attributable to Henry Schein, Inc.:
As reported $ 3.41 $ 2.71 $ 1.29 $
Adjusted $ 3.20 $ 2.92 1.39
Diluted weighted-average common shares outstanding: 90,556 91,221 89,099 26,8
The following table sets forth, for the periods indicated, a reconciliation of operating income and income from continuing operations attributable to Henry Schein, Inc. adjusted to reflect the
effects of discontinued operations, as reported to adjusted operating income and adjusted income from continuing operations.
NON-GAAP DISCLOSURES