Estee Lauder 2007 Annual Report Download - page 34

The table below summarizes selected fi nancial information. For further information
,
refer to the audited consolidated
fi
nancial statements and the notes thereto beginning on page 55 of this report
.
YEAR ENDED OR AT
J
UNE
30
2
006
(
a
)
2
005
(
b
)2
00
4 2
003
(
c
)
(
In millions, except per s
h
are
d
ata)
S
TATEMENT
O
F EARNIN
GS
DATA
:
Ne
t
sa
l
es
$6
,
463.8 $6
,
280.0 $5
,
741.5 $5
,
049.8
Gross
p
rofi t 4
,
777.2 4
,
677.2 4
,
277.2 3
,
736.5
O
perating income 6
1
9.6 726.8 648.9 508.8
Interest ex
p
ense, net
(d)
23.8 13.
9
27.1 8.1
Earnings before income taxes, minorit
y
interest,
d
iscontinue
d
operations an
d
accounting c
h
ange 595.8 7
1
2.9 62
1
.8 500.
7
Pr
o
vi
s
i
o
n f
o
r in
co
m
e
t
a
x
es
25
9
.7 2
9
3.7 234.4 164.
9
Minorit
y
interest, net of tax
(
11.6
)
(
9.3
)
(
8.9
)
(
6.7
)
Net earnings
f
rom continuing operations 324.5 409.9 378.5 329.
1
Discontinued o
p
erations, net of tax
(
e
)
(
80.3
)
(
3.8
)
(
36.4
)
(
9.3
)
Net earnin
g
s 244.2 406.1 342.1 31
9
.8
Pre
f
erred stock dividends
(
d
)
— — —
23
.
4
Net earnin
g
s attributable to common stock 244.2 406.1 342.1 2
9
6.
4
C
A
S
H FL
O
W DATA:
Net cash fl ows provided b
y
operating activities
$
709.8
$
478.1
$
673.0
$
558.
6
Net cash
fl
ows used for investing activities
(
303.2
)
(
237.0
)
(
213.7
)
(
198.0
)
Net cash
fl
ows used for
fi
nancing activities
(
594.6
)
(
300.4
)
(
216.0
)
(
555.0
)
PER
S
HARE DATA:
Net earnings per common share from
c
ontinuin
g
operation
s
(
e)
:
Bas
i
c
$
1.51
$
1.82
$
1.66
$
1.31
Diluted
$
1.49
$
1.80
$
1.64
$
1.3
0
Net earnin
g
s per common share:
Bas
i
c
$
1.14
$
1.80
$
1.50
$
1.2
7
Dilute
d
$
1.12
$
1.78
$
1.48
$
1.2
6
Wei
g
hted avera
g
e common shares outstandin
g
(
g)
:
Bas
i
c2
1
5.0 225.3 228.2 232.
6
Dilute
d
2
1
7.4 228.6 23
1
.6 234.
7
Cash dividends declared
p
er common share
$
.40
$
.40
$
.30
$
.2
0
BALAN
C
E
S
HEET DATA:
Workin
g
capital
$
738.7
$
804.9
$
877.2
$
791.3
Tota
l
assets 3,784.
1
3,885.8 3,708.
1
3,349.9
Total
d
e
b
t(d), (f) 52
1
.5 7
1
4.7 535.3 29
1
.
4
Redeemable
p
referred stock
(d)
— — —
360
.
0
Stoc
kh
ol
d
ers’ equity
(
g)
1
,622.3
1
,692.8
1
,733.5
1
,423.
6
2
007
$7
,
037.
5
5
,
262.
7
74
9
.
9
38.
9
7
11
.
0
2
55
.
2
(
7.1
)
44
8
.
7
0
.
5
44
9
.
2
—
44
9
.
2
$
661.
6
(
373.8
)
(
411.6
)
$
2.2
0
$
2.1
6
$
2.2
0
$
2.1
6
20
4.
3
207.
8
$
.5
0
$
738.
7
4,
1
25.
7
1
,088.
5
—
1
,
1
99.
0
(a) Fiscal 2006 results included $93.0 million, a
f
ter-tax, or $.43 per diluted share in special charges related to our cost savings initiative and tax-related matters. Included in the
char
g
es was an operatin
g
expense char
g
e o
f
$92.1 million, equal to $.27 per diluted common share related to the cost savin
g
s initiative. The results also included a special tax
charge related to a settlement with the Internal Revenue Service regarding an examination of our consolidated Federal income tax returns for
fi
scal
y
ears 1998 through 2001, and
represents the aggregate earnings impact of the settlement through fi scal 2006. The settlement resulted in an increase to our fi scal 2006 income tax provision and a corresponding
decrease in fi scal 2006 net earnings of approximately $46 million, or approximately $.21 per diluted common share. During the fourth quarter of fi scal 2006, we completed the
repatriation of foreign earnings through intercompan
y
dividends under the provisions of the American Jobs Creation Act of 2004 (the “AJCA”). In connection with the repatriation,
w
e updated the computation o
f
the related aggregate tax impact, resulting in a
f
avorable adjustment o
f
approximately $11 million, or approximately $.05 per diluted common
share, to our initial tax char
g
e of $35 million recorded in fi scal 2005. The tax settlement, coupled with the AJCA favorable tax adjustment, resulted in a net increase to our fi scal
2006 income tax provision and a corresponding decrease in
fi
scal 2006 net earnings of approximatel
y
$35 million, or approximatel
y
$.16 per diluted common share
.
(b) In the fourth quarter of
fi
scal 2005, we announced plans to repatriate approximatel
y
$690 million of foreign earnings in
fi
scal
y
ear 2006, which included $500 million of
extraordinary intercompany dividends under the provisions of the AJCA. This action resulted in an aggregate tax charge of approximately $35 million in our fi scal year ended
J
une 30, 2005, which included an incremental tax charge of approximatel
y
$28 million, equal to $.12 per diluted share
.
(c) Fiscal 2003 included a special charge related to the proposed settlement of a legal action of $13.5 million, after-tax, or $.06 per diluted common share.
(d) During fi scal 2004, there was an increase of approximately $17.4 million in interest expense, net and a corresponding decrease in preferred stock dividends as a result of the
adoption o
f
Statement o
f
Financial Accounting Standards (“SFAS”) No. 150, “Accounting
f
or Certain Financial Instruments with Characteristics o
f
both Liabilities and Equity.”
A
dditionall
y
, in connection with this pronouncement, redeemable preferred stock was reclassi
fi
ed as a component of total debt subsequent to June 30, 2003 and all subsequent
a
pp
licable
p
eriods.
(e) In April 2006, we completed the sale o
f
certain assets and operations o
f
the reporting unit that marketed and sold Stila brand products. In February 2004, we sold the assets
and operations of our former reportin
g
unit that sold
j
an
e
brand products. As a result, all consolidated statements of earnin
g
s information in the consolidated
fi
nancial statements
and footnotes for all periods presented has been restated for comparative purposes to re
fl
ect those reporting units as discontinued operations.
(
f
) In May 2007, we issued and sold $300.0 million o
f
5.55% Senior Notes due May 15, 2017 and $300.0 million o
f
6.00% Senior Notes, due May 15, 2037 in a public o
ff
ering.
We used the net proceeds o
f
this o
ff
ering to repay long-term commercial paper, which was used to
f
und our accelerated stock repurchase program, and to pay transaction
f
ees
and expenses related to this offering.
(g) During fi scal 2007, we repurchased 22,461,642 shares of our outstanding common stock, of which 15,960,842 shares were purchased for $750.0 million through an
accelerated stock repurchase program with a fi nancial counterparty.
THE EST{E LAUDER COMPANIES INC. 33
SELECTED FINANCIAL DATA