Lexmark 2011 Annual Report Download - page 126

Company’s Class A Common Stock over the agreement’s trading period, a discount and the initial
number of shares delivered. Under the terms of the ASR Agreement, the Company would either
receive additional shares from the counterparty or be required to deliver additional shares or cash to
the counterparty. The Company controlled its election to either deliver additional shares or cash to the
counterparty. On September 23, 2011, the Company took delivery of the remaining 1.0 million shares
in final settlement of the ASR Agreement.
On October 27, 2011, the Company entered into an ASR Agreement with a financial institution
counterparty. Under the terms of the ASR Agreement, the Company paid $125.0 million targeting
4.0 million shares based on an initial price of $31.43. On November 1, 2011, the Company took
delivery of 85% of the shares, or 3.4 million shares. The final number of shares delivered by the
counterparty under the ASR Agreement was dependent on the average, volume weighted average
price of the Company’s Class A Common Stock over the agreement’s trading period, a discount and
the initial number of shares delivered. Under the terms of the ASR Agreement, the Company would
either receive additional shares from the counterparty or be required to deliver additional shares or
cash to the counterparty. The Company controlled its election to either deliver additional shares or
cash to the counterparty. On December 21, 2011, the Company took delivery of the remaining
0.4 million shares in final settlement of the ASR Agreement.
The ASR Agreements discussed in the preceding paragraphs were accounted for as initial treasury
stock transactions and forward stock purchase contracts. The initial repurchase of shares resulted in
an immediate reduction of the outstanding shares used to calculate the weighted-average common
shares outstanding for basic and diluted net income per share. The forward stock purchase contract
(settlement provision) was considered indexed to the Company’s own stock and was classified as an
equity instrument under accounting guidance applicable to contracts in an entity’s own equity.
Other Comprehensive Earnings (Loss)
Comprehensive earnings (loss) for the years ended December 31, net of taxes, consists of the
following:
2011 2010 2009
Net earnings ................................................... $320.9 $340.0 $145.9
Other comprehensive earnings (loss):
Foreign currency translation adjustment, net of reclassification (net of
tax benefit (liability) of $5.8 in 2011, $(0.9) in 2010, and $(5.5) in
2009) ...................................................... (29.6) 15.2 27.8
Pension or other postretirement benefits, net of reclassifications (net of
tax benefit (liability) of $29.1 in 2011, $(7.5) in 2010, and $(14.6) in
2009) ...................................................... (49.5) 2.6 8.7
Net unrealized gain (loss) on OTTI marketable securities, net of
reclassifications (net of tax (liability) of $(0.0) in 2011, $(0.4) in 2010,
and $(0.3) in 2009) ........................................... 0.1 1.2 1.1
Net unrealized gain (loss) on marketable securities, net of
reclassifications (net of tax benefit of $0.1 in 2011, $0.1 in 2010, and
$0.2 in 2009) ................................................ (1.2) 0.1 1.8
Comprehensive earnings ......................................... $240.7 $359.1 $185.3
Changes in the Company’s foreign currency translation adjustments were due to a number of factors
as the Company operates in various currencies throughout the world. The primary drivers of the
unfavorable change in 2011 were decreases in the exchange rate values of 11.4% in the Mexican
peso, 11.0% in the Brazilian real, 3.2% in the Euro and 18.1% in the South African rand. The primary
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