Avis 2013 Annual Report Download - page 87

F-15
Income,” which requires companies to disclose additional information about amounts reclassified out of
accumulated other comprehensive income by component. The adoption of this pronouncement resulted in
incremental disclosure about activity and amounts reclassified out of accumulated other comprehensive
income.
Recently Issued Accounting Pronouncements
On January 1, 2014, as a result of the issuance of a new accounting pronouncement, the Company
adopted ASU No. 2013-11, “Income Taxes: Presentation of an Unrecognized Tax Benefit When a Net
Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists,” which requires tax
benefits to be presented in the financial statements as a reduction to a deferred tax asset for a net
operating loss carryforward or a tax credit carryforward. The adoption of this accounting pronouncement will
not have an impact on the Company’s financial statements.
3. Earnings Per Share
The following table sets forth the computation of basic and diluted earnings per share (“EPS”) (shares in
millions):
Year Ended December 31,
2013 2012 2011(a)
Net income (loss) for basic EPS $ 16 $ 290 $ (29)
Convertible debt interest, net of tax — 4 —
Net income (loss) for diluted EPS $ 16 $ 294 $ (29)
Basic weighted average shares outstanding 107.6 106.6 105.2
Options, warrants and non-vested stock 3.8 2.5 —
Convertible debt — 12.5 —
Diluted weighted average shares outstanding 111.4 121.6 105.2
Earnings (loss) per share:
Basic $ 0.15 $ 2.72 $ (0.28)
Diluted $ 0.15 $ 2.42 $ (0.28)
__________
(a) As the Company incurred a net loss in 2011, all outstanding stock options, restricted stock units, stock warrants
and issuable shares underlying the convertible debt have an anti-dilutive effect and therefore are excluded from
the computation of diluted weighted average shares outstanding. Accordingly, basic and diluted weighted average
shares outstanding are equal for such period.
The following table summarizes the Company’s outstanding common stock equivalents that were anti-
dilutive and therefore excluded from the computation of diluted EPS (shares in millions):
As of December 31,
2013 2012 2011
Options (a) —0.23.4
Warrants (b) — 7.9 21.2
Shares underlying convertible debt 4.0 — 21.2
__________
(a) The weighted average exercise price for anti-dilutive options for 2012 and 2011 was $17.12 and $7.90,
respectively.
(b) Represents all outstanding warrants for 2012 and 2011. The exercise price for the warrants was $22.50.
4. Restructuring
During fourth quarter 2012, the Company initiated a strategic restructuring initiative to better position the
business of its Truck Rental segment, in which it closed certain rental locations and decreased the size of
the rental fleet, with the intent to increase fleet utilization and reduce costs. During the year ended
December 31, 2013, the Company recorded restructuring expense of $21 million related to this initiative and
expects no further restructuring expenses to be incurred in 2014.