eTrade 2011 Annual Report Download - page 53

Corporate/Other
The following table summarizes corporate/other financial information for the years ended December 31,
2011, 2010 and 2009 (dollars in millions):
Variance
Year Ended December 31, 2011 vs. 2010
2011 2010 2009 Amount %
Total net revenue $ (0.1) $ (0.0) $ — $ (0.1) *
Compensation and benefits 70.3 80.2 93.7 (9.9) (12)%
Professional services 35.4 28.9 42.7 6.5 23%
Occupancy and equipment 2.7 2.6 3.4 0.1 4%
Communications 1.5 1.7 1.9 (0.2) (11)%
Depreciation and amortization 18.4 21.0 19.1 (2.6) (12)%
Facility restructuring and
other exit activities 7.7 14.3 20.7 (6.6) *
Other operating expenses 34.5 25.8 21.2 8.7 34%
Total operating expense 170.5 174.5 202.7 (4.0) (2)%
Operating loss (170.6) (174.5) (202.7) 3.9 (2)%
Total other income (expense) (175.8) (159.0) (1,260.4) (16.8) 11%
Corporate/other loss $(346.4) $(333.5) $(1,463.1) $(12.9) 4%
* Percentage not meaningful.
The corporate/other category includes costs that are centrally-managed, technology related costs incurred to
support centrally-managed functions, restructuring and other exit activities, corporate debt and corporate
investments.
2011 Compared to 2010
The corporate/other loss before income taxes was $346.4 million for the year ended December 31, 2011,
compared to $333.5 million in 2010. Compensation and benefits decreased 12% to $70.3 million due primarily to
a decrease in incentive compensation during the year ended December 31, 2011 compared to 2010. The increase
in professional services was due primarily to a $6.0 million credit in connection with a legal settlement in the
third quarter of 2010, which decreased professional services for the year ended December 31, 2010. Other
operating expenses increased 34% to $34.5 million primarily due to the recording of a net reserve of $10.8
million related a memorandum of understanding that was entered into to settle the Freudenberg Action during the
year ended December 31, 2011.
Total other income (expense) consisted primarily of $177.8 million in corporate interest expense for the year
ended December 31, 2011 on interest-bearing corporate debt. In addition to the stated interest on corporate debt,
the corporate interest expense line item included the benefit of discontinued fair value hedges on corporate debt,
which decreased $7.8 million for the year ended December 31, 2011 compared to 2010. Offsetting interest
expense for the year ended December 31, 2011 was a $3.1 million gain on early extinguishment of debt related to
the call of the 2013 Notes in the second quarter of 2011.
2010 Compared to 2009
The corporate/other loss was $333.5 million for the year ended December 31, 2010, compared to $1.5
billion for the same period in 2009. The loss for the year ended December 31, 2010 was due to total operating
expenses of $174.5 million and other expense of $159.0 million. Total other income (expense) primarily
50