American Home Shield 2010 Annual Report Download - page 118

Table of Contents
Quarterly Operating Results (Unaudited)
Quarterly operating results for the last two years in revenue, gross profit, (loss) income from continuing operations, (loss) income from discontinued
operations and net (loss) income are shown in the table below. As discussed in the "Interim Reporting" section in the Significant Accounting Policies, for
interim accounting purposes, TruGreen LawnCare and other business segments of the Company incur pre-season advertising costs. In addition, TruGreen
LawnCare incurs costs related to annual repairs and maintenance procedures that are performed in the first quarter. These costs are deferred and recognized as
expense in proportion to revenue over the balance of the year. Full year results are not affected.
2010
($ in thousands)
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter Year
Operating Revenue $ 639,408 $ 1,003,062 $ 977,260 $ 746,172 $ 3,365,902
Gross Profit 236,888 429,481 416,024 292,377 1,374,770
(Loss) Income from Continuing Operations(1)(2) (32,283) 12,649 5,395 208 (14,031)
(Loss) Income from Discontinued Operations, net of income taxes (377) (205) (105) 159 (528)
Net (Loss) Income(1)(2) (32,660) 12,444 5,290 367 (14,559)
2009
($ in thousands)
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter Year
Operating Revenue $ 645,927 $ 957,292 $ 920,514 $ 716,346 $ 3,240,079
Gross Profit 251,527 403,919 393,069 278,235 1,326,750
Income (Loss) from Continuing Operations(1)(2)(3) 712 22,392 20,904 (29,401) 14,607
Loss from Discontinued Operations, net of income taxes (163) (107) (396) (446) (1,112)
Net Income (Loss)(1)(2)(3) 549 22,285 20,508 (29,847) 13,495
The results include (i) restructuring charges related to a reorganization of field leadership and a restructuring of branch operations at TruGreen LawnCare, a branch
optimization project at Terminix and information technology outsourcing at Other Operations and Headquarters and (ii) Merger related charges.
(1)
2010
($ in thousands)
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter Year
Pre-tax $ (3,924) $ (4,167) $ (1,690) $ (2,445) $ (12,226)
After-tax $ (2,413) $ (2,578) $ (1,040) $ (1,468) $ (7,499)
2009
($ in thousands)
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter Year
Pre-tax $ (8,777) $ (5,584) $ (8,498) $ (4,017) $ (26,876)
After-tax $ (5,397) $ (3,447) $ (4,964) $ (2,749) $ (16,557)
During the second quarter of 2010 and the fourth quarter of 2009, the Company recorded non-cash impairment charges of $46.9 million ($28.7 million, net of tax)
and $28.0 million ($17.3 million, net of tax), respectively, to reduce the carrying value of goodwill and trade names as a result of the Company's interim and annual
impairment testing of goodwill and indefinite-lived intangible assets. See Note 1 to the Consolidated Financial Statements for further information.
During the first quarter of 2009, the Company recorded a $46.1 million ($29.6 million, net of tax) gain on extinguishment of debt related to the completion of open
market purchases of $89.0 million in face value of the Company's Permanent Notes.
(2)
(3)
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