Xerox 2005 Annual Report Download - page 109

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Xerox Corporation
101
First Second Third Fourth Full
(in millions, except per-share data) Quarter Quarter Quarter Quarter Year
2005
Revenues $ 3,771 $ 3,921 $ 3,759 $ 4,250 $15,701
Costs and Expenses(1) 3,482 3,804 3,682 3,903 14,871
Income from Continuing Operations before Income Taxes,
Equity Income, Discontinued Operations and Cumulative Effect
of Change in Accounting Principle 289 117 77 347 830
Income tax expenses (benefits)(2) 116 (233) 29 83 (5)
Equity in net income of unconsolidated affiliates 37 20 23 18 98
Income from discontinued operations, net – 53 – – 53
Cumulative effect of change in accounting principle, net – – (8) – (8)
Net Income $ 210 $ 423 $ 63 $ 282 $ 978
Basic Earnings per Share(3) $ 0.20 $ 0.43 $ 0.05 $ 0.28 $ 0.96
Diluted Earnings per Share(3) $ 0.20 $ 0.40 $ 0.05 $ 0.27 $ 0.94
2004
Revenues $ 3,827 $ 3,853 $ 3,716 $ 4,326 $15,722
Costs and Expenses(1) 3,625 3,581 3,553 3,998 14,757
Income from Continuing Operations before Income Taxes,
Equity Income, Discontinued Operations and Cumulative Effect
of Change in Accounting Principle 202 272 163 328 965
Income tax expenses 67 91 62 120 340
Equity in net income of unconsolidated affiliates(4) 30 27 62 32 151
Income from discontinued operations, net 83 – – – 83
Cumulative effect of change in accounting principle, net – – – – –
Net Income $ 248 $ 208 $ 163 $ 240 $ 859
Basic Earnings per Share(3) $ 0.28 $ 0.23 $ 0.18 $ 0.26 $ 0.94
Diluted Earnings per Share(3) $ 0.25 $ 0.21 $ 0.17 $ 0.24 $ 0.86
(1) Costs and expenses include restructuring and asset impairment charges of $85, $194, $17 and $70 for the first, second, third and fourth quarters of 2005, respectively, and
$6, $33, $23 and $24 for the first, second, third and fourth quarters of 2004, respectively. Also included are $93 from the 2005 first-quarter sale of our entire equity interest
in Integic (see Note 21) and $115 from the MPI arbitration panel ruling and probable losses for other legal matters incurred in the thirdquarter of 2005 (see Note 16). In
addition, a gain of $38 from the sale of our investment in ScanSoft was included in the second quarter of 2004.
(2) The 2005 second quarter included $343 of net income tax benefits related to the finalization of the 1996-1998 IRS audit, of which $233 was included in income taxes, $57
was included in other expenses, net and $53 was included in discontinued operations (see Note 15).
(3) The sum of quarterly earnings per share may differ from the full-year amounts due to rounding, or in the case of diluted earnings per share, because securities that are anti-
dilutive in certain quarters may not be anti-dilutive on a full-year basis.
(4) Equity in net income of unconsolidated affiliates for the third quarter of 2004 includes an after-tax $38 pension settlement benefit from Fuji Xerox.
QUARTERLY RESULTS OF OPERATIONS
(UNAUDITED)
Xerox Annual Report 2005