MoneyGram 2007 Annual Report Download - page 29

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Table of Contents
(3) Earnings per share for 2003 is based on outstanding shares of Viad common stock. On June 30, 2004, Viad effected a 1:1
distribution of MoneyGram common stock, for a total distribution of 88,556,077 shares.
(4) Unrestricted and restricted assets are comprised of cash and cash equivalents, receivables and investments. See Note 2 — Summary
of Significant Accounting Policies of the Notes to Consolidated Financial Statements for the determination of unrestricted assets.
(5) Long-term debt for 2003 represents Viad's long-term debt prior to the June 30, 2004 spin-off. In connection with the spin-off, Viad
repurchased $52.6 million of its medium-term notes and subordinated debt. In addition, Viad repaid $188.0 million of its
outstanding commercial paper and retired $9.0 million of industrial revenue bonds.
(6) Redeemable preferred stock relates solely to shares issued by Viad and redeemed in connection with the June 30, 2004 spin-off.
(7) Stockholders' equity for 2003 represents Viad's capital structure prior to the June 30, 2004 spin-off.
(8) Cash dividends declared per share for 2003 is based on dividends declared by Viad to holders of its common stock. Viad declared
dividends of $0.18 per share during the first half of 2004. MoneyGram declared dividends of $0.02 per share during the second half
of 2004.
(9) Investable balances are comprised of cash and cash equivalents and investments.
(10) Net investment margin is determined as net investment revenue (investment revenue less investment commissions) divided by daily
average investable balances.
(11) Includes 18,000, 16,000, 16,000, 15,000, and 12,000 locations in 2007, 2006, 2005, 2004, and 2003, respectively, that issue both
money orders and offer money transfers.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with MoneyGram International, Inc.'s Consolidated Financial Statements and
related notes. This discussion contains forward-looking statements that involve risks and uncertainties. MoneyGram's actual results could
differ materially from those anticipated due to various factors discussed under "Cautionary Statements Regarding Forward-Looking
Statements" and elsewhere in this Annual Report on Form 10-K.
Basis of Presentation
On December 18, 2003, MoneyGram International, Inc. ("MoneyGram") was incorporated in the state of Delaware as a subsidiary of
Viad Corp ("Viad") to effect the spin off of Viad's payment services business operated by Travelers Express Company, Inc. ("Travelers")
to its stockholders (the "spin-off"). On June 30, 2004, Travelers was merged with a subsidiary of MoneyGram and Viad then distributed
88,556,077 shares of MoneyGram common stock to Viad's stockholders in a tax-free distribution. Effective December 31, 2005, the
entity that was formerly Travelers was merged into MoneyGram Payment Systems, Inc. ("MPSI"), with MPSI remaining as the surviving
corporation. References to "MoneyGram," the "Company," "we," "us" and "our" are to MoneyGram International, Inc. and its
subsidiaries and consolidated entities. The financial statements in this Annual Report on Form 10-K are presented on a consolidated basis
and include the accounts of the Company and our majority-owned subsidiaries. Our Consolidated Financial Statements are prepared in
conformity with accounting principles generally accepted in the United States of America ("GAAP").
In 2005, we recorded a gain of $0.7 million (net of tax) due to the partial resolution of contingencies relating to the sale of Game
Financial Corporation, which was completed in 2004. During 2007, we paid $3.3 million in connection with the settlement of a
contingency arising from the Sale and Purchase Agreement related to the continued operations of Game Financial Corporation with one
casino. We recognized a gain from discontinued operations of $0.3 million in the Consolidated Statements of (Loss) Income in 2007. The
gain is comprised of the net of the reversal of the remaining liability and the recognition of a deferred tax asset valuation allowance. The
following discussion of our results of operations is focused on our continuing businesses.
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