LensCrafters 2006 Annual Report Download - page 121

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NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS |121 <
(Euro/000) 2004 (1) 2005 2006 (2)
Revenues 75,687 236,478 157,110
Income from operations 13,315 21,153 3,250
Income before provision for income taxes 12,578 18,260 761
Income tax provision (4,813) (6,756) (45)
Gain/loss on sale n.a. n.a. 13,278
Income taxes on sale n.a. n.a. (20,413)
(Loss)/Gain on discontinued operations 7,765 11,504 (6,419)
(1) Since the acquisition date, October 4, 2004.
(2) From January 1, 2006 through September 29, 2006.
Listed below are the major classes of assets and liabilities as of December 31, 2005 that were
included as part of the assets and liabilities held for sale:
(Euro/000)
ASSETS
Cash and cash equivalents 4,795
Inventory 34,042
Prepaid expenses 5,559
Deferred tax assets 3,819
Property and equipment, including leasehold improvements 29,949
Goodwill 53,711
Intangible assets, net 39,006
Other assets 568
Total assets 171,449
LIABILITIES
Financial liabilities 165
Accounts payable 10,386
Accrued expenses 6,254
Deferred taxes payable 10,481
Other non-current liabilities 19,806
Total liabilities 47,092
The promissory note has a stated interest rate of 15.0%. Interest is “paid-in-kind” annually in the
form of an additional principal amount added to the outstanding principal balance. All unpaid
interest and outstanding principal is due in March 2013. The promissory note is subordinated to
certain other outstanding senior debt of the acquirer as defined in the promissory note. The
promissory note has been classified as an “available-for-sale” security and as such changes in its
fair value will be included in accumulated other comprehensive income and reclassified to
earnings when realized. For fiscal 2006 there were no amounts reclassified from other
comprehensive income into earnings.
5. ACQUISITIONS AND INVESTMENTS
a) OPSM
On November 26, 2004, the Company, through its wholly owned subsidiary, Luxottica South Pacific
Pty Limited, made an offer for all the un-owned remaining outstanding shares of OPSM.