American Home Shield 2015 Annual Report Download - page 54

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36
Results of Operations
Year Ended December 31, Increase (Decrease) % of Revenue
(In millions) 2015 2014 2013
2015 vs.
2014
2014 vs.
2013 2015 2014 2013
Revenue $ 2,594 $ 2,457 $ 2,293 6 % 7 % 100 % 100 % 100 %
Cost of services rendered and products sold 1,375 1,298 1,220 6 6 53 53 53
Selling and administrative expenses 666 669 691 — (3) 26 27 30
Amortization expense 38 52 51 (27) 2 1 2 2
401(k) Plan corrective contribution 23 — — * * 1 — —
Impairment of software and other related costs — 47 — * * — 2 —
Consulting agreement termination fees — 21 — * * — 1 —
Restructuring charges 5 11 6 (55) 76 — — —
Gain on sale of Merry Maids branches (7) (1) — * * — — —
Interest expense 167 219 247 (24) (11) 6 9 11
Interest and net investment income (9) (7) (8) 29 (9) — — —
Loss on extinguishment of debt 58 65 — (11) * 2 3 —
Other expense 9 — — * * — — —
Income from Continuing Operations before
Income Taxes 270 84 86 221 (2) 10 3 4
Provision for income taxes 107 40 43 166 (6) 4 2 2
Equity in losses of joint venture — — (1) * * — — —
Income from Continuing Operations 162 43 42 277 2 6 2 2
Loss from discontinued operations, net of
income taxes (2) (100) (549) * * — (4) (24)
N
et Income (Loss) $ 160 $ (57) $ (507) * * 6 % (2) % (22)%
___________________________________
* not meaningful
Revenue
We reported revenue of $2,594 million, $2,457 million and $2,293 million for the years ended December 31, 2015, 2014 and
2013, respectively. A summary of changes in revenue for each of our reportable segments and Corporate is included in the table
below. See “—Segment Review” for a discussion of the drivers of the year-over-year changes.
American Franchise
Home Services
(In millions) Terminix Shield Group Corporate Total
Year Ended December 31, 2013 $ 1,309 $ 740 $ 236 $ 8 $ 2,293
Pest Control 27 — — — 27
Termite and Other Services(1) 34 — — — 34
Home Warranties(2) — 88 — — 88
Franchise-Related Revenue — — 17 — 17
Other — — — (1) (2)
Year Ended December 31, 2014 $ 1,370 $ 828 $ 253 $ 7 $ 2,457
Pest Control(3) 54
—
—
—
54
Termite and Other Services(1)(3) 17 — — — 17
Home Warranties(2) — 89 — — 89
Franchise-Related Revenue — — (5) — (5)
Sale of Merry Maids branches(4) — — (16) — (16)
Other 3 — — (5) (2)
Year Ended December 31, 2015 $ 1,444 $ 917 $ 232 $ 2 $ 2,594
___________________________________
(1) Includes wildlife exclusion, crawl space encapsulation and attic insulation products which are managed as a component of
our termite line of business.
(2) Includes approximately $10 million and $56 million for the years ended December 31, 2015 and 2014, respectively, as a
result of the acquisition of Home Security of America, Inc., based in Madison, Wisconsin, (“HSA”) on February 28, 2014.
52 2015 Annual Report