MasterCard 2011 Annual Report Download - page 97

Download and view the complete annual report

Please find page 97 of the 2011 MasterCard annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 156

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156

MASTERCARD INCORPORATED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Intangible assets consist of developed technologies, customer relationships, tradenames and non-compete
agreements, which have useful lives ranging from 1 to 10 years. See Note 10 (Other Intangible Assets). The
following table summarizes the fair value of the acquired intangible assets:
Fair Value at
October 22,
2010
Weighted-Average
Useful Life
(in millions) (in years)
Customer relationships .................................... $ 74 7
Developed technologies .................................... 42 5
Tradenames ............................................. 11 5
Non-compete agreements .................................. 2 1
Total intangible assets ..................................... $129
In connection with the acquisition, the Company recognized $7 million of acquisition-related expenses
during the year ended December 31, 2010, which consisted primarily of professional fees related to closing the
transaction. These amounts were included in general and administrative expenses. The consolidated financial
statements include the operating results of DataCash from the date of the acquisition.
Note 3. Earnings Per Share
Earnings per share (“EPS”) is calculated including the effects of certain equity instruments granted in share-
based payment transactions under the two-class method. Unvested share-based payment awards which receive
non-forfeitable dividend rights, or dividend equivalents, are considered participating securities and are required
to be included in computing EPS under the two-class method. The Company declared non-forfeitable dividends
on unvested restricted stock units and contingently issuable performance stock units (“Unvested Units”) which
were granted prior to 2009.
The components of basic and diluted EPS for common shares under the two-class method for each of the
years ended December 31 were as follows:
2011 2010 2009
(in millions, except per share data)
Numerator:
Net income attributable to MasterCard .................... $1,906 $1,846 $1,463
Less: Net income allocated to Unvested Units .............. — 3 9
Net income attributable to MasterCard allocated to common
shares ........................................... $1,906 $1,843 $1,454
Denominator:
Basic EPS weighted average shares outstanding ............ 128 131 130
Dilutive stock options and stock units .................... — — —
Diluted EPS weighted average shares outstanding ** ........ 128 131 130
Earnings per Share
Total Basic ......................................... $14.90 $14.10 $11.19
Total Diluted ........................................ $14.85 $14.05 $11.16
** For the years presented, the calculation of diluted EPS excluded a minimal amount of antidilutive share-
based payment awards.
93