American Home Shield 2007 Annual Report Download - page 20

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ITEM 6. SELECTED FINANCIAL DATA
Five-Year Financial Summary
(In thousands, except per share data) 2006 2005 2004 2003 2002
Operating Results:
Operating revenue $ 3,429,145 $ 3,239,478 $ 3,068,068 $ 2,895,028 $ 2,781,829
Operating income (1) 326,322 340,083 324,308 110,655 315,357
Percentage of operating revenue 9.5% 10.5% 10.6% 3.8% 11.3%
Non-operating expense 43,693 45,385 53,464 58,394 93,152
Provision (benefit) for income taxes (1), (2) 96,061 114,137 (45,779) 54,716 76,949
Income (loss) from continuing operations (1), (2) 186,568 180,561 316,623 (2,455) 145,256
Income (loss) from discontinued operations, net of
income taxes (1) (16,869) 18,364 14,604 (222,232) 11,738
Net income (loss) $ 169,699 $ 198,925 $ 331,227 $ (224,687) $ 156,994
Earnings (loss) per share:
Basic $ 0.59 $ 0.68 $ 1.14 $ (0.76) $ 0.52
Diluted:
Income (loss) from continuing operations (1), (2) $ 0.64 $ 0.61 $ 1.06 $ (0.01) $ 0.47
Income (loss) from discontinued operations (1) (0.06) 0.06 0.06 (0.75) 0.04
Diluted earnings (loss) per share $ 0.58 $ 0.67 $ 1.11 $ (0.76) $ 0.51
Shares used to compute basic earnings per share 289,765 291,251 290,514 295,610 300,383
Shares used to compute diluted earnings per share 299,362 296,807 303,568 295,610 305,912
Cash dividends per share $ 0.46 $ 0.44 $ 0.43 $ 0.42 $ 0.41
Share price range:
High price $ 13.62 $ 14.28 $ 13.87 $ 12.10 $ 15.50
Low price $ 9.66 $ 11.69 $ 10.65 $ 8.95 $ 8.89
Financial Position:
Total assets $ 3,117,463 $ 3,028,870 $ 3,140,202 $ 2,956,426 $ 3,414,938
Total liabilities 1,928,605 1,874,230 2,048,667 2,039,600 2,095,929
Total debt outstanding 690,422 658,150 805,088 819,271 835,475
Minority interest 100,000 100,000 100,000 100,309 100,309
Shareholders' equity (1), (2) 1,088,858 1,054,640 991,535 816,517 1,218,700
(1)
The 2006 results include restructuring charges for severance, as well as costs associated with Project Accelerate, the
Company's initiative to improve the effectiveness and efficiency of its functional support areas, and accruals for employee
retention and severance to be paid in future periods that are related to the Company's decision to consolidate its corporate
headquarters into its operations support center in Memphis, Tennessee and close its current headquarters in Downers Grove,
Illinois. The restructuring charges totaled $21.6 million pretax, $6.9 million after-tax and $0.02 per diluted share. The after-tax
impact of the restructuring charges includes approximately $6 million of non-recurring net operating loss carryforward
benefits which became realizable to the Company as a result of its decision to consolidate its corporate headquarters in
Memphis.
In accordance with SFAS 142, the Company's goodwill and intangible assets that are not amortized are subject to at least an
annual assessment for impairment by applying a fair-value based test. In the third quarter of 2003, the Company recorded a
non-cash impairment charge associated with the goodwill and intangible assets at its TruGreen LandCare business unit. This
charge, which is included in the results of continuing operations for 2003, totaled $189 million pre tax, $156 million after-tax,
and $0.53 per diluted share. Also in the third quarter of 2003, the Company recorded a non-cash impairment charge of $292
million pretax, $227 million after-tax, associated with the goodwill and intangible assets of certain sold operations and this
charge is classified within the financial statement caption "discontinued operations".
(2) In the fourth quarter of 2006, the Company recorded a reduction in income tax expense of $7 million ($0.02 per diluted share)
resulting from the favorable resolution of state tax items related to a prior non-recurring transaction.
Related to a comprehensive agreement with the Internal Revenue Service regarding its examination of the Company's federal
income taxes through the year 2002, the Company recorded a non-cash reduction in its 2004 tax provision, thereby increasing
net income by approximately $159 million. Approximately $150 million related to continuing operations ($.49 per diluted
share) and $9 million related to discontinued operations ($.03 per diluted share). See the "Income Taxes" note in the Notes to
the Consolidated Financial Statements.
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