Hertz 2008 Annual Report Download - page 247

Non-GAAP Reconciliations
(In millions)
Condensed Consolidated Statements of Operations
Year Ended December 31, 2008 Year Ended December 31, 2007
As As As As
Reported Adjustments Adjusted Reported Adjustments Adjusted
Total revenues ................... $8,525.1 $ — $8,525.1 $8,685.6 $ — $8,685.6
Expenses:
Direct operating .................. 4,930.0 (263.5)(a) 4,666.5 4,644.1 (85.0)(a) 4,559.1
Depreciation of revenue earning equipment . 2,194.2 (22.6)(b) 2,171.6 2,003.4 (19.6)(b) 1,983.8
Selling, general and administrative ....... 769.6 (64.8)(c) 704.8 775.9 (63.4)(c) 712.5
Interest, net of interest income ......... 845.2 (100.2)(d) 745.0 875.4 (105.9)(d) 769.5
Impairment charges ................ 1,168.9 (1,168.9)(e) — — — —
Total expenses ................... 9,907.9 (1,620.0) 8,287.9 8,298.8 (273.9) 8,024.9
Income (loss) before income taxes and
minority interest ................. (1,382.8) 1,620.0 237.2 386.8 273.9 660.7
(Provision) benefit for taxes on income .... 196.9 (f) (277.6)(g) (80.7) (102.6) (128.6)(g) (231.2)
Minority interest .................. (20.8) — (20.8) (19.7) — (19.7)
Net income (loss) ................. $(1,206.7) $ 1,342.4 $ 135.7 $ 264.5 $ 145.3 $ 409.8
Year Ended December 31, 2006
As As
Reported Adjustments Adjusted
Total revenues ................... $8,058.4 $ — $8,058.4
Expenses:
Direct operating .................. 4,476.0 (75.9)(a) 4,400.1
Depreciation of revenue earning equipment . 1,757.2 (13.8)(b) 1,743.4
Selling, general and administrative ....... 723.9 (57.0)(c) 666.9
Interest, net of interest income ......... 900.7 (139.4)(d) 761.3
Total expenses ................... 7,857.8 (286.1) 7,571.7
Income before income taxes and minority
interest ...................... 200.6 286.1 486.7
Provision for taxes on income .......... (68.0) (102.3)(g) (170.3)
Minority interest .................. (16.7) — (16.7)
Net income ..................... $ 115.9 $ 183.8 $ 299.7
(a) Represents the increase in amortization of other intangible assets, depreciation of property and equipment and accretion of
certain revalued liabilities relating to purchase accounting. For the years ended December 31, 2008 and 2007, also includes
restructuring and restructuring related charges of $185.9 million and $41.2 million, respectively. For the year ended
December 31, 2007, also includes a vacation accrual adjustment of $29.8 million.
(b) Represents the increase in depreciation of revenue earning equipment based upon its revaluation relating to purchase
accounting.
(c) Represents an increase in depreciation of property and equipment relating to purchase accounting. For the years ended
December 31, 2008 and 2007, also includes restructuring and restructuring related charges of $56.6 million and
$55.2 million, respectively. For the year ended December 31, 2007, also includes a vacation accrual adjustment of
$6.5 million. For all periods presented, also includes other adjustments which are detailed in the Adjusted Pre-Tax Income
(Loss) and Adjusted Net Income (Loss) reconciliation.
(d) Represents non-cash debt charges relating to the amortization of deferred debt financing costs and debt discounts. For the
years ended December 31, 2008 and 2007, also includes $11.8 million and $20.4 million, respectively, associated with the
ineffectiveness of our interest rate swaps. For the year ended December 31, 2008, also includes $30.0 million related to the
write-off of deferred financing costs associated with those countries outside the United States as to which take-out asset-
based facilities were not entered into. For the year ended December 31, 2007, also includes the write-off of $16.2 million of
unamortized debt costs associated with a debt modification. For the year ended December 31, 2006, also includes interest
on the $1.0 billion HGH loan facility of $39.9 million and $1.0 million associated with the reversal of the ineffectiveness of our
interest rate swaps.
(e) Represents non-cash impairment charges related to our goodwill, other intangible assets and property and equipment.
(f) For the year ended December 31, 2008, includes valuation allowances for losses in certain non-U.S. jurisdictions and the
recording of valuation allowances on certain U.S. deferred tax assets that management believes may not be realized.
(g) Represents a provision for income taxes derived utilizing a normalized income tax rate (34% for 2008 and 35% for 2007 and
2006).