ServiceMagic 2011 Annual Report Download - page 83

Download and view the complete annual report

Please find page 83 of the 2011 ServiceMagic annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 144

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144

IAC/INTERACTIVECORP AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 5—BUSINESS COMBINATIONS (Continued)
Intangible assets are as follows:
Meetic's other current assets, property and equipment, other assets, current liabilities and other liabilities were reviewed and adjusted to
their fair values at the date of acquisition, as necessary. The fair value of the trade names was determined using an avoided royalty discounted
cash flow analysis. Customer lists includes both paid subscribers and registered users who are not paid subscribers. The fair value relating to the
paid subscribers was determined using an excess earnings methodology and the fair value relating to the registered users who are not paid
subscribers was determined using a cost methodology. The fair value of the developed technology was determined using replacement cost
methodology. The valuations of the intangible assets incorporate significant unobservable inputs and require estimates, including the amount and
timing of future cash flows, royalty rates and discount rates. The current deferred tax liability primarily relates to the excess of tax basis over
book basis on deferred revenue, which was recorded at fair value in conjunction with the acquisition. The non-current deferred tax liabilities
primarily relate to the excess of book basis over tax basis on acquired intangible assets. None of the goodwill is tax deductible.
The unaudited pro forma financial information in the table below summarizes the combined results of IAC and Meetic as if the acquisition
of Meetic had occurred as of January 1, 2010. The pro forma financial information includes adjustments required under the acquisition method
of accounting and is presented for informational purposes only and is not necessarily indicative of what the results would have been had the
acquisition actually occurred on the aforementioned date. Pro forma adjustments reflected below include a $31.0 million reduction in revenue for
the year ended December 31, 2010 relating to a write-off of Meetic's deferred revenue, and amortization of Meetic's intangible assets totaling
$7.2 million and $23.4 million for the years ended December 31, 2011 and 2010, respectively.
77
(In thousands)
Weighted-
Average
Amortization
Life (Years)
Indefinite
lived trade names
$
129,438
Indefinite
Customer lists
18,138
1
Technology
14,917
2
Total
$
162,493
Years Ended December 31,
2011
2010
(In thousands, except per share data)
Revenue
$
2,263,986
$
1,853,199
Net earnings attributable to IAC shareholders
213,350
94,457
Basic earnings per share attributable to IAC
shareholders
2.46
0.89
Diluted earnings per share attributable to IAC
shareholders
2.26
0.89