American Home Shield 2002 Annual Report Download - page 48

The following table summarizes the previously amortized goodwill and trade names by segment at December 31 that,
beginning on January 1, 2002 are no longer amortized. See the “Acquisition” and “Dispositions” Notes to the Consolidated
Financial Statements for information relating to goodwill acquired and amounts impaired or part of a discontinued operation.
(In thousands) 2002 % Change 2001 % Change 2000
TruGreen $ 916,216 1% $ 910,573 (3%) $ 934,318
Terminix 709,955 1 705,608 25 563,943
American Home Shield 72,085 - 72,085 (3) 74,277
ARS/AMS 347,968 - 347,863 4 334,857
Other Operations 112,106 5 106,599 N/A 382,073
Total $ 2,158,330 1% $ 2,142,728 (6%) $2,289,468
Restatement
The Company has restated its consolidated financial statements for the years ended December 31, 2001 and 2000.
Subsequent to the issuance of the Company's 2001 consolidated financial statements, management determined that
the historical accounting treatment relating to the items below required revision. The table below presents the net
income and equity impacts from the restatement.
Net Net Beginning
Income Income Equity
( In millions, except per share data) 2001 2000 2000
Continuing Operations:
AHS deferred acquisition costs $ (8.5) $ (6.1) $ (30.0)
Trade name license fee 9.0 - -
Insurance (TruGreen) 3.7 (3.7) -
Other, net (0.6) (5.8) (20.7)
Tax adjustment from reincorporation (0.8) (0.8) 35.0
Income/Equity Impact $ 2.8 $ (16.4) $ (15.7)
EPS Impact $ 0.01 $ (0.05)
Discontinued Operations:
Income/Equity Impact * $ (41.5) $ (3.7) $ 59.4
EPS Impact $ (0.14) $ (0.01)
* Primarily represents the tax adjustment from reincorporation
A summary of the significant effects of the restatement is as follows: 2001 2000
As Previously As Previously
(In thousands, except per share data) Reported (1) As Restated Reported (1) As Restated
For the year ended December 31
Operating revenue $3,539,187 $3,561,445 $3,420,371 $3,421,802
Operating income (38,336) (23,177) 340,354 320,851
Income from continuing operations before income taxes (152,264) (144,895) 241,762 217,118
Income from continuing operations before extraordinary
items and cumulative effect of accounting change (167,313) (164,464) 140,690 124,274
Discontinued operations, net 325,768 284,270 44,298 40,568
Extraordinary loss, net (3,422) (3,422) - -
Cumulative effect of accounting change, net - - (11,161) (11,161)
Net income $ 155,033 $ 116,384 $ 173,827 $ 153,681
Diluted earnings per share:
Income from continuing operations before
extraordinary items $ (0.52) $ (0.55) $ 0.46 $ 0.41
Discontinued operations, net 1.05 0.95 0.15 0.13
Extraordinary loss, net (0.01) (0.01) - -
Cumulative effect of accounting change, net - - (0.04) (0.04)
Diluted earnings per share $ 0.51 $ 0.39 $ 0.57 $ 0.50
As of December 31
Current assets $1,131,824 $1,119,050
Net property, plant, and equipment 180,937 196,210
Other long-term assets 2,361,978 2,305,985
Total assets $3,674,739 $3,621,245
Current liabilities $ 796,113 $ 805,298
Long-term debt 1,105,518 1,120,249
Long-term liabilities 449,470 385,834
Minority interest 102,677 102,677
Total shareholders’ equity 1,220,961 1,207,187
Total liabilities and shareholders’ equity $3,674,739 $3,621,245
(1) During the third quarter of 2002, the Company sold its Terminix operations in the United Kingdom. The financial results from these opera-
tions have been reclassified from “Continuing Operations” to “Discontinued Operations” for all periods presented. Amounts as restated
include this reclassification in order to conform with the 2002 presentation.
44 ServiceMaster
Notes to Consolidated Financial Statements