Hertz 2014 Annual Report Download - page 72

Table of Contents
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 
(d) Adjusted pre-tax income is calculated as income before income taxes plus certain non-cash acquisition accounting charges, debt-related charges relating to the
amortization and write-off of debt financing costs and debt discounts and certain one-time charges and nonoperational items. Adjusted pre-tax income is important to
management because it allows management to assess operational performance of our business, exclusive of the items mentioned above. Management believes that
it is important to investors for the same reasons it is important to management and because it allows them to assess our operational performance on the same basis
that management uses internally. The contribution of our reportable segments to adjusted pre-tax income and reconciliation to consolidated amounts are presented
below ($ in millions):

 
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
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

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

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


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


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


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


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



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


Adjusted pre-tax income (loss):
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U.S. car rental $ (126)
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$ 209
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$ 184
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$ 119
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$ 132
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$ 379
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$ 289
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$ 232
International car rental (12)
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136

57

(39)

21

126

35

(47)
Worldwide equipment rental 60

79

67

52

93

89

73

45
All other operations 15

17

15

16

16

14

14

13
Total reportable segments (63)

441

323

148

262

608

411

243
Corporate (1) (98)

(119)
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(107)
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(124)
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(105)

(101)

(115)

(107)
Consolidated adjusted pre-tax income (loss) (161)

322

216

24

157

507

296

136
Adjustments:
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Acquisition accounting(2) (34)
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(32)
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(33)
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(33)
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(28)
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(35)

(35)

(35)
Debt-related charges(3) (14)
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(13)

(13)
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(12)
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(15)
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(17)
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(19)
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(17)
Restructuring charges (4) (10)
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(11)
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(19)
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(15)
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(19)
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(36)

(18)

(4)
Restructuring related charges(5) (23)
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(44)
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(12)
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(24)
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(7)
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(3)
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(8)
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(3)
Acquisition related costs and charges(6) —
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(1)
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(2)
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(7)
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(5)
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(3)
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(8)

(3)
Integration expenses(7) (1)
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(1)
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(3)
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(2)
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(14)
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(8)
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(9)
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(11)
Equipment rental spin-off costs(8) (12)
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(14)
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(12)
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—
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—

—

—

—
Relocation costs(9) (2)
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(3)
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(3)
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(2)
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(2)
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(4)
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(1)
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—
Premiums paid on debt —
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—
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—
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—
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(29)
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—
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—

—
Loss on extinguishment of debt —
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—
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(1)
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—
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(7)
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(28)
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—
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—
Impairment charges and asset write-downs(10) (24)
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—
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(10)
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—

—
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(40)
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—

—
Other(11) (3)
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—
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13

9

8

(21)

(6)
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(4)
Income (loss) before income taxes $ (284)
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$ 203

$ 121

$ (62)
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$ 39

$ 312

$ 192

$ 59
(1) Represents general corporate expenses, certain interest expense (including net interest on corporate debt), as well as other business activities.
(2) Represents the increase in amortization of other intangible assets, depreciation of property and equipment and accretion of revalued liabilities relating to
acquisition accounting.
(3) Represents debt-related charges relating to the amortization of deferred debt financing costs and debt discounts.
(4) Represents expenses incurred under restructuring actions as defined in U.S. GAAP. For further information on restructuring costs, see Note 15
"Restructuring," to the Notes to our consolidated financial statements included in this Annual Report under the caption Item 8, "Financial Statements and
Supplementary Data."
(5) Represents incremental costs incurred directly supporting our business transformation initiatives. Such costs include transition costs incurred in connection
with our business process outsourcing arrangements and incremental costs incurred to facilitate business process re-engineering initiatives that involve
significant organization redesign and extensive operational process changes. Amounts in 2014 also include consulting costs and legal fees related to the
accounting review and investigation, one-time costs to terminate certain marketing and co-branding agreements, and costs associated with the separation of
certain executives during the year.
(6) Acquisition related costs and charges during the period.
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Source: HERTZ GLOBAL HOLDINGS INC, 10-K, July 16, 2015 Powered by Morningstar® Document Research℠
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