Xerox 2006 Annual Report Download - page 30

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Total 2006 Revenue of $15,895 million increased
1% from the prior year comparable period. There was a
negligible impact from currency on total revenue for the
year ended December 31, 2006 as compared to the prior
year. Total revenue included the following:
• 1% decline in equipment sales, including a benefit
from currency of 1-percentage point, primarily
reflecting revenue declines in Office and
Production black-and-white products, which were
partially offset by revenue growth from color
products and growth in DMO.
• 3% growth in post sale and other revenue, including
a benefit from currency of 1-percentage point,
primarily reflecting growth in digital Office and
Production products and DMO, offset by declines
in light lens and licensing revenue.
• 13% growth in color revenue. Color revenue of
$5,578 million comprised 35% of total revenue for
the year ended December 31, 2006 compared to
31% for the year ended December 31, 2005.
• 4% decline in Finance income, including a benefit
from currency of 1-percentage point, reflecting
lower average finance receivables.
• Overall our 2006 post-sale annuity revenue,
including Post sale and other revenue and Finance
income, increased 2% and comprised 72% of total
revenue.
Total 2005 Revenue of $15,701 million was
comparable to the prior year period. Currency impacts on
total revenue were negligible for the year. Total 2005
revenue included the following:
• 1% growth in Equipment sales, including a
negligible impact from currency, primarily
reflecting revenue growth from color in Office and
Production, low-end black-and-white office
products as well as growth in DMO. These growth
areas were partially offset by revenue declines in
higher-end office black-and-white products, and
black-and-white production products.
• Comparable Post sale and other revenues, including
a negligible impact from currency, primarily
reflecting revenue growth from digital products and
in DMO which were partially offset by declines in
light lens.
• 6% decline in Finance income, including benefits
from currency of 1-percentage points, which
reflects lower finance receivables.
Net income and diluted earnings per share for the three years ended December 31, 2006 were as follows:
(in millions, except share amounts)
Year Ended December 31,
2006 2005 2004
Net income ............................................................. $1,210 $ 978 $ 859
Diluted earnings per share ................................................. $ 1.22 $0.94 $0.86
2006 Net income of $1,210 million, or $1.22 per
diluted share, included the following:
• $472 million income tax benefit related to the
favorable resolution of certain tax matters from the
1999-2003 IRS audit.
• $68 million (pre-tax and after-tax) for litigation
matters related to probable losses on Brazilian
labor-related contingencies.
• $46 million tax benefit resulting from the resolution
of certain tax matters associated with foreign tax
audits.
• $9 million after-tax ($13 million pre-tax) charge
from the write-off of the remaining unamortized
deferred debt issuance costs as a result of the
termination of our 2003 Credit Facility.
• $257 million after-tax ($385 million pre-tax)
restructuring and asset impairment charges.
2005 Net income of $978 million, or $0.94 per
diluted share, included the following:
• $343 million after-tax benefit related to the
finalization of the 1996-1998 IRS audit.
• $84 million after-tax ($115 million pre-tax) charge
for litigation matters relating to the MPI arbitration
panel decision and probable losses for other legal
matters.
• $58 million after-tax ($93 million pre-tax) gain
related to the sale of our entire equity interest in
Integic Corporation (“Integic”).
• $247 million after-tax ($366 million pre-tax)
restructuring and asset impairment charges.
2004 Net income of $859 million, or $0.86 per
diluted share, included the following:
• $83 million after-tax ($109 million pre-tax) gain
related to the sale of substantially all of our
investment in ContentGuard Holdings, Inc.
(“ContentGuard”).
28