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Table of Contents
Interest Income and Other, net
Interest income and other, net was as follows:
The basis point decrease in the interest income and other, net as a percent of consolidated revenues during the twelve months ended
June 30, 2011 was primarily due to the foreign currency impact of the Company's investment in MY Style, $1.9 million received from the
purchaser of Trade Secret in the comparable prior period for administrative services, and $1.9 million in interest income recorded in the
comparable prior period on the outstanding note receivable due from the purchaser of Trade Secret.
Interest income and other, net as a percent of consolidated revenues during the twelve months ended June 30, 2010 was consistent with the
twelve months ended June 30, 2009. Interest income increased as a result of higher cash balances available to earn interest, partially offset by a
decline in rates.
The basis point improvement in interest income and other, net as a percent of consolidated revenues during the twelve months ended
June 30, 2009 was primarily due to the Company receiving $2.9 million for administrative services from the purchaser of Trade Secret and
foreign currency transaction gains. Partially offsetting the basis point improvement was a decrease in interest income due to a decline in interest
rates.
Income Taxes
Our reported effective tax rate was as follows:
For fiscal year 2011, the Company reported a $25.6 million loss from continuing operations before income taxes as compared to income
from continuing operations before income taxes of $53.2 and $78.8 million in fiscal years 2010 and 2009, respectively. The rate reconciliation
items have a greater impact on the annual effective income tax rate in fiscal year 2011 as the magnitude of the loss from continuing operations
before income taxes is less than the magnitude of income from continuing operations before income taxes in fiscal year 2010. The annual
effective tax rate was favorably impacted by the employment credits related to the Small Business and Work Opportunity Tax Act of 2007.
Based upon current legislation, these credits are scheduled to expire on December 31, 2011. Partially
53
(Decrease) Increase
Over Prior Fiscal Year
Years Ended June 30,
Interest
Income as %
of
Consolidated
Revenues Dollar
Percentage
Basis
Point
(1)
(Dollars in thousands)
2011
$
4,811
0.2
%
$
(5,599
)
(53.8
)%
(20
)
2010
10,410
0.4
949
10.0
—
2009
9,461
0.4
1,288
15.8
10
(1) Represents the basis point change in interest income and other, net as a percent of consolidated revenues as
compared to the corresponding period of the prior fiscal year.
Years Ended June 30,
Effective
Rate
Basis Point
(Decrease) Increase
2011
(37.1
)%
(8,520
)
2010
48.1
(520
)
2009
53.3
1,380
(1) Represents the basis point change in income tax expense as a percent of (loss) income from continuing
operations before income taxes and equity in income (loss) of affiliated companies as compared to the
corresponding periods of the prior fiscal year.