Hertz 2009 Annual Report Download - page 224

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DEFINITIONS AND NON-GAAP RECONCILIATIONS
Definitions of Non-GAAP Measures
EBITDA
Earnings before net interest expense, income taxes, depreciation, amortization and non-cash
impairment charges.
Corporate EBITDA
Corporate EBITDA is calculated as earnings before net interest expense (other than interest expense
relating to certain car rental fleet financing), income taxes, depreciation (other than depreciation related
to the car rental fleet), amortization and certain other items specified in the credit agreements governing
Hertz’s senior credit facilities.
Adjusted Pre-Tax Income
Adjusted pre-tax income is calculated as income before income taxes and noncontrolling interest plus
non-cash purchase accounting charges, non-cash debt charges and certain one-time charges and
non-operational items.
Adjusted Net Income
Adjusted net income is calculated as adjusted pre-tax income less a provision for income taxes utilizing a
normalized income tax rate (34% in 2009 and 2008, 35% in 2007 and 2006) and noncontrolling interest.
The normalized income tax rate is management’s estimate of our long-term tax rate.
Adjusted Diluted Earnings Per Share
Adjusted diluted earnings per share is calculated as adjusted net income divided by, for 2009,
407.7 million shares which represents the actual diluted weighted average number of shares
outstanding for the year ended December 31, 2008 plus 85 million shares offered in the 2009 common
stock offerings; for 2008, the actual diluted weighted average number of shares outstanding for the year
ended December 31, 2007 of 325.5 million; and for 2007 and 2006, the pro forma diluted number of
shares outstanding of 324.8 million.
Total Net Cash Flow
Total net cash flow is calculated as the change in the cash and cash equivalents, restricted cash and
cash equivalents and debt balances, adjusted for the effects of foreign currency.