AutoNation 2005 Annual Report Download - page 66

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Table of Contents
AUTONATION, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
discontinued operations. Selected income statement data for the Company’s discontinued operations is as follows:
2005 2004 2003
Total revenue $214.6 $689.5 $829.1
Pre-tax loss from discontinued operations $(11.8) $(11.3) $(3.4)
Pre-tax loss on disposal from discontinued operations (6.3) (7.5) (17.1)
(18.1) (18.8) (20.5)
Income tax benefit (9.1) (3.1) (7.9)
(9.0) (15.7) (12.6)
Income tax adjustment (see Note 11) 110.0 52.2 —
Loss from discontinued operations, net income taxes, related to ANC Rental (see
below) — — (12.3)
Income (loss) from discontinued operations, net of income taxes $101.0 $36.5 $(24.9)
A summary of the total assets and liabilities of discontinued operations included in Other Current Assets and Other Current Liabilities is
as follows:
December 31, December 31,
2005 2004
Inventory $11.4 $86.3
Other current assets 11.8 16.0
Property and equipment, net 17.5 45.6
Goodwill 6.5 38.6
Other non-current assets .7 1.4
Total assets $47.9 $187.9
Vehicle floorplan payable-trade $9.8 $78.6
Vehicle floorplan payable-non-trade — 1.2
Other current liabilities 3.9 12.2
Total liabilities $13.7 $92.0
Responsibility for the Company’s vehicle floorplan payable at the time of divestiture is assumed by the buyer. Cash received from
business divestitures is net of vehicle floorplan payable assumed by the buyer.
On June 30, 2000, the Company completed the tax-free spin-off of ANC Rental Corporation (“ANC Rental”), which operated its former
rental business. In connection with the spin-off, the Company agreed to provide certain guarantees on behalf of ANC Rental. In 2001, ANC
Rental filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code. In 2003, the bankruptcy court approved a
settlement agreement among AutoNation, ANC Rental and the Committee of Unsecured Creditors in the bankruptcy.
Pursuant to the Settlement Agreement, the Company continued to guarantee $29.5 million, and committed guarantee up to an additional
$10.5 million, in surety bonds supporting obligations of the rental business until December 2006. In 2004, the Company was released from
its $29.5 million guarantee obligation and its remaining $10.5 million surety bond guarantee obligation. This triggered an obligation under
the Settlement Agreement for the Company to pay $20 million (one-half of the permanent reduction of the surety bond guarantee obligation),
to a trust established for the benefit of the unsecured creditors in the bankruptcy,
64