Hertz 2008 Annual Report Download - page 108

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
management determined the likelihood exists the assets may not be realized as well as goodwill
impairment charges, mentioned above, for which no benefit can be realized. See Note 7 to the Notes to
our consolidated financial statements included in this Annual Report under the caption ‘‘Item 8—
Financial Statements and Supplementary Data.’’
Minority interest increased 5.6% primarily due to an increase in our majority-owned subsidiary
Navigation Solutions, L.L.C.’s net income in 2008 as compared to 2007.
Net income decreased 556.1% primarily due to the impairment of our goodwill, other intangible assets
and property and equipment, lower rental volume and pricing in our worldwide car and equipment rental
operations, increased restructuring and restructuring related charges and higher fleet related costs, as
well as the net effect of other contributing factors noted above. The impact of changes in exchange rates
on net income (loss) was mitigated by the fact that not only revenues but also most expenses outside of
the United States were incurred in local currencies.
Effects of Acquisition
The following table summarizes the purchase accounting effects of the Acquisition on our results of
operations for the year ended December 31, 2008 (in millions of dollars):
Depreciation and amortization of tangible and intangible assets:
Other intangible assets ................................................ $ 61.2
Revenue earning equipment ............................................ 22.7
Property and equipment ............................................... 7.0
Accretion of revalued liabilities:
Discount on debt .................................................... 4.4
Workers’ compensation and public liability and property damage ................. 5.5
$100.8
Year Ended December 31, 2007 Compared with Year Ended December 31, 2006
Revenues
Years Ended
December 31,
2007 2006 $ Change % Change
Revenues
Car rental ................................ $6,800.7 $6,273.6 $527.1 8.4%
Equipment rental ........................... 1,755.3 1,672.1 83.2 5.0%
Other ................................... 129.6 112.7 16.9 15.0%
Total revenues ........................... $8,685.6 $8,058.4 $627.2 7.8%
Total revenues increased 7.8% for the year ended December 31, 2007 compared to the year ended
December 31, 2006.
Revenues from our car rental operations increased 8.4%, primarily as a result of a 5.0% increase in car
rental volume worldwide, the effects of foreign currency translation of approximately $179.7 million and
an increase in airport concession recovery fees of $67.1 million.
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