Provision for Income Taxes. The pro forma adjustment to the provision for income taxes was calculated using the statutory federal income tax rate of 35.0%, as detailed below: Three Months Ended Year Ended ($ in millions) March 31, 2016 March 31, 2015 December 31, 2015 Cost of Goods Sold Adjustment $ (0.3 ) $ (0.9 ) $ (2.6 ) Tax expense 0.1 0.3 0.9 Interest Expense and Debt Issuance Costs Adjustment 9.5 9.3 36.8 Tax benefit (3.3 ) (3.3 ) (12.9 ) SG&A Expenses Adjustment 0.2 (0.4 ) (1.7 ) Tax (benefit) expense (0.1 ) 0.2 0.6 Total Adjustment for Pro Forma Tax Benefit $ (3.3 ) $ (2.8 ) $ (11.4 )
Provision for Income Taxes. The provision for income taxes is based on our estimated annual effective income tax rate for the full fiscal year equal to approximately 40.5%. Our estimated annual effective income tax rate differs from the federal statutory rate primarily due to nondeductible permanent differences, foreign taxes and state income taxes. Nine months ended September 30, 2007 compared to nine months ended September 30, 2006 Revenues Nine months ended September 30, Percent change 2006 2007 Home and community based services $ 106,672,463 $ 153,227,446 43.6 % Xxxxxx care services 16,099,070 18,544,830 15.2 % Management fees 13,147,299 14,729,020 12.0 % Total revenue $ 135,918,832 $ 186,501,296 37.2 % Home and community based services. The acquisition of Raystown in January 2007, WCG in August 2007, A to Z In-Home Tutoring, LLC, or A to Z, and Family Based Strategies, Inc, or FBS, in February 2006, IES in August 2006 and Correctional Services in October 2006 added, on an aggregate basis, approximately $19.7 million to home and community based services revenue for the nine months ended September 30, 2007 as compared to the same prior year period. Table of Contents Excluding the acquisition of Raystown, WCG, and the acquisitions completed in 2006, our home and community based services provided additional revenue of approximately $26.9 million for the nine months ended September 30, 2007, as compared to the same period one year ago due to client volume increases in new and existing locations, and moderate rate increases for services we provide. Generally, increases in rates for services we provide are based on the cost of living index. Xxxxxx care services. Our cross-selling and recruiting efforts along with the operations of MSO that we consolidated effective May 1, 2007 (as noted above) resulted in an increase in xxxxxx care services revenue of approximately $1.4 million for the nine months ended September 30, 2007 as compared to the prior year nine month period. We are increasing our efforts to recruit additional xxxxxx care homes in many of our markets which we expect will increase our xxxxxx care service offerings. Management fees. Revenue for entities we manage but do not consolidate for financial reporting purposes (managed entity revenue) increased to $165.1 million for the nine months ended September 30, 2007 as compared to $137.2 million for the same prior year period. The combined effects of business growth and the addition of a management agreement acquired in connecti...
Provision for Income Taxes. The provision for income taxes is based on our estimated annual effective income tax rate for the full fiscal year equal to approximately 40.5%. Our estimated annual effective income tax rate differs from the federal statutory rate primarily due to nondeductible permanent differences, foreign taxes and state income taxes. Seasonality Our quarterly operating results and operating cash flows normally fluctuate as a result of seasonal variations in our business, principally due to lower client demand for our home and community based services during the holiday and summer seasons. As we have grown our home and community based services business, our exposure to seasonal variations has grown and will continue to grow, particularly with respect to our school based services, educational services and tutoring services. We experience lower home and community based services revenue when school is not in session. Our expenses, however, do not vary significantly with these changes and, as a result, such expenses may not fluctuate significantly on a quarterly basis. We expect quarterly fluctuations in operating results and operating cash flows to continue as a result of the uneven seasonal demand for our home and community based services. Moreover, as we enter new markets, we could be subject to additional seasonal variations along with any competitive response to our entry by other social services providers. Liquidity and capital resources Sources of cash for the nine months ended September 30, 2007 were from operations, proceeds from long-term debt and cash received upon exercise of stock options. Our balance of cash and cash equivalents was approximately $37.7 million at September 30, 2007, down from $40.7 million at December 31, 2006. The decrease was primarily due to the purchase of our common stock in the amount of approximately $10.9 million pursuant to the stock repurchase program approved by our board of directors in February 2007 and acquisition activity during the nine months ended September 30, 2007. At September 30, 2007 and December 31, 2006, our total debt was approximately $18.8 million and $951,000, respectively.
Provision for Income Taxes. During 2002, we recorded a tax benefit of $311,000 reflecting an effective tax rate of (111.9%). In 2002, after subtracting our tax-exempt investment income, we had a loss before our income tax provision. During 2001, we recorded a tax provision of $8.9 million, reflecting, an effective tax rate of 33.0%. The decrease in our effective tax rate resulted primarily from a decrease in operating income coupled with our investments in tax-exempt marketable securities and our recording of a valuation allowance of $1.5 million associated with our operations in Germany. RESULTS OF QUARTERLY OPERATIONS The following tables set forth a summary of our unaudited quarterly operating results for each of our eight most recently ended fiscal quarters. We have derived this information from our unaudited interim consolidated financial statements, which, in the opinion of our management, have been prepared on a basis consistent with our financial statements contained elsewhere in this annual report and include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation in accordance with generally accepted accounting principles in the United States when read in conjunction with our consolidated financial statements and related notes included elsewhere in this annual report. Certain reclassifications have been made to the quarterly presentation to conform with our year-end presentation. Historically, our total revenues, operating profit, and net income in the fourth quarter have reflected the significant positive contribution of revenues attributable to advisory services performed and Forum events held in the fourth quarter. As a result, we have historically experienced a decline in total revenues, operating profit, and net income from the quarter ended December 31 to the quarter ended March 31. Our quarterly operating results are not necessarily indicative of future results of operations. THREE MONTHS ENDED MAR. 31, JUN. 30, SEP. 30, DEC. 31, MAR. 31, JUN. 30, SEP. 30, DEC. 31, 2002 2002 2002 2002 2003 2003 2003 2003 (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) Core research..................... $19,286 $17,221 $15,958 $14,915 $18,506 $25,865 $23,798 $24,120 Advisory services and other....... 6,770 8,212 5,980 8,594 5,976 8,113 8,410 11,211 Total revenues.................. 26,056 25,433 21,938 23,509 24,482 33,978 32,208 35,331 Cost of services and fulfillment..................... 8,981 8,873 7,540 8,632 9,525 14,330 12,525 13,667 S...
Provision for Income Taxes. During 2004, we recorded an income tax provision of $2.1 million reflecting an effective tax rate of 33.7%. During 2003, we recorded an income tax provision of $1.0 million reflecting an effective tax rate of 31%. The increase in our effective tax rate for fiscal year 2004 resulted primarily from our tax-exempt investment income comprising a smaller percentage of our estimated total pre-tax income in 2004 as compared to 2003. YEARS ENDED DECEMBER 31, 2003 AND DECEMBER 31, 2002 REVENUES YEAR ENDED DECEMBER 31, ABSOLUTE INCREASE PERCENTAGE INCREASE 2002 2003 (DECREASE) (DECREASE) Revenues (in millions)......................... Revenues from research services (in millions).................................... $ 96.9 $ 71.0 $126.0 $ 92.3 $29.1 $21.3 30% 30% Advisory services and other revenues (in millions).................................... $ 26.0 $ 33.7 $ 7.7 30% Revenues attributable to customers outside of the United States (in millions).............. $ 27.8 $ 36.6 $ 8.8 32% Revenues attributable to customers outside of the United States as a percentage of revenue...................................... 29% 29% -- -- Number of clients.............................. 1,125 1,812 687 61% Number of research employees................... 101 193 92 91% Number of events............................... 14 8 (6) (43)% The increases in total revenues, revenues from research services and in the number of clients are primarily attributable to the Giga acquisition which closed on February 28, 2003, and as such, Giga's operations have been included in the consolidated financial statements since February 28, 2003. No single client company accounted for more than 3% of revenues during 2003 or 2002. The increase in advisory services and other revenues is primarily attributable to increases in the number of clients and in the number of research employees delivering advisory services, which more than offset the decrease in event revenue attributable to our holding fewer events during 2003 than during 2002. The increase in the number of clients and research employees in our research organization is primarily attributable to the acquisition of Giga. The increase in international revenues is primarily attributable to the acquisition of Giga. We invoice our United Kingdom customers in pound sterling, the functional currency of our London subsidiary; our continental European customers in euros, the functional currency of our Amsterdam subsidiary and all other international customers ...
Provision for Income Taxes. The provision for income taxes amounted to $13.3 million in 2002 and $14.2 million in 2001. The effective tax rate was 25.9% and 29.1% in 2002 and 2001, respectively. The decline in the effective tax rate was attributable to the Bank having a higher proportion of income exempt from taxes in 2002 compared with 2001. Tax-exempt income is derived primarily from the securities portfolio and bank owned life insurance. CLOSING OF BRANCHES During the fourth quarter 2003, the Bank completed the previously announced closing of 9 in-store branches, recognizing a pretax charge of $0.8 million. This was in addition to the one in-store branch closed during the second quarter 2003 at an insignificant cost. In January 2004, the Bank announced plans to close an additional twenty in-store branches, continuing a strategy of closing under-performing locations. These closings are expected to occur no later than May 2004, prior to the anticipated closing of the merger with NFB. It is estimated that a pretax charge of $7.0 million will be recognized in the second quarter 2004 with respect to the twenty branches that are being closed. Consistent with its previous experience, the Bank believes that it will retain a major portion of the deposits and customer relationships of these branches. The Bank estimates that the 29 in-store closings will contribute $4.0 million in pretax earnings on an annual basis. AVERAGE BALANCE, INTEREST AND AVERAGE YIELDS AND RATES The following table sets forth certain information relating to our average interest-earning assets and average interest-bearing liabilities and reflects the average yield on assets and the average cost of liabilities for the periods indicated. Such yields and costs are derived by dividing income or expense by the average balances of assets or liabilities, respectively, for the periods shown. The tables also present information for the periods indicated with respect to the difference between the weighted average yield earned on interest- earning assets and the weighted average rate paid on interest-bearing liabilities, or "interest rate spread," which banking institutions have traditionally used as an indicator of profitability. Another indicator of an institution's net interest income is its "net interest margin," which is its net interest income divided by its average balance of interest-earning assets. Net interest income is affected by the interest rate spread and by the relative amounts of interest-earning assets and inte...
Provision for Income Taxes. For the six months ended June 30, 2000 we recorded an income tax benefit of $3.7 million compared to a net expense of $1.6 million for the six months ended June 30, 1999. The change from net income tax expense to net income tax benefit is due to our generation of net operating losses in the six months ended June 30, 2000, compared to net operating income in the six months ended June 30, 1999. The effective tax rate in both periods differs from statutory rates primarily as a result of the effect of non-deductible goodwill amortization expense. As of June 30, 2000, a significant portion of our long-term deferred tax assets related primarily to net operating loss carryforwards, which expire in 2020. Management has assessed the realizability of its deferred tax assets in light of our change in pricing model and product strategy and has concluded that it is more likely than not that such deferred tax assets will be fully utilized.
Provision for Income Taxes. The provision for income taxes reflects foreign withholding tax expense in various foreign jurisdictions. For all historic periods reported in the financial statements, Xxxxxxxx maintained valuation allowances against its net deferred tax assets, including net operating loss carryforwards, because it was more likely than not that the deferred taxes would not be realized. The provision for income taxes include foreign taxes withheld by our customers and paid to foreign jurisdictions on our behalf. The DMRC "carve-out" financial statements indicate cumulative losses through the first three months of 2008. Furthermore, the amounts of cumulative expenses in the financial statements that were not allowed for Federal and state income tax purposes were not sufficient enough to require us to record income tax expense. As a result of the above, no Federal and state income tax benefit was recognized for the book losses that were incurred in those periods prior to 2007 and no income tax expense was recognized during the 2007 and 2008 periods as any expense was offset by the benefit of net operating loss carry-forwards. After the spin-off, DMRC Corporation, as a separate legal entity, will not benefit from any of the carrryforward tax attributes of Digimarc, including net operating loss carryforwards. Years Ended December 31, 2007 and 2006 Revenue Year Ended December 31, Dollar Increase (Decrease) Percent Increase (Decrease) 2007 2006 Revenue: Service $ 7,806 $ 6,812 $ 994 15 % License and subscription 5,219 4,259 960 23 % Total $ 13,025 $ 11,071 $ 1,954 18 % Revenue (as % of total revenue): Service 60 % 62 % License and subscription 40 % 38 % Total 100 % 100 % The increase in service revenue for the year was primarily due to increases in consulting revenue from our Central Banks consortium, Nielsen, and contracts with various other government agencies. We entered into our contract with Nielsen in late 2007. The increase in license and subscription revenue for the year was primarily attributable to higher license revenues from customers whose revenues fluctuate from period to period and a combination of growing levels of fixed and variable royalties from a larger customer base. Revenue by Geography Year Ended December 31, Dollar Increase (Decrease) Percent Increase (Decrease) 2007 2006 (in 000'S) Revenue by geography: Domestic $ 3,696 $ 2,414 $ 1,282 53 % International 9,329 8,657 672 8 % Total $ 13,025 $ 11,071 $ 1,954 18 % Revenue (as % of total revenue): Domestic 2...
Provision for Income Taxes. The provision for income taxes reflects withholding tax expense in various foreign jurisdictions. For all historic periods reported in the financial statements, Xxxxxxxx maintained valuation allowances against its net deferred tax assets, including net operating loss carryforwards, because it was more likely than not that the deferred taxes would not be realized. The provision for income taxes included foreign taxes withheld by our customers and paid to foreign jurisdictions on our behalf. The DMRC "carve-out" financial statements indicate cumulative losses through the first three months of 2008. Furthermore, the amounts of cumulative expenses in the financial statements that were not allowed for federal and state income tax purposes were not sufficient enough to result in positive taxable income which would have required the company to record income tax expense. As a result of the above, no Federal and state income tax benefit was recognized for the book losses that were incurred in those periods prior to 2007 and no income tax expense was recognized during the 2007 and 2008 periods as any expense was offset by the benefit of net operating loss carry-forwards. After the spin-off, DMRC Corporation as a separate legal entity, will not benefit from any of the carrryforward tax attributes of Digimarc, including net operating loss carryforwards.
Provision for Income Taxes. The effective tax rate in fiscal 1998 is calculated as a percentage of income before taxes, exclusive of the non-recurring charges for in-process research and development. The effective tax rate decreased for fiscal 1998 to 33.6% of pre-tax income from 35.9% for fiscal 1997. This decrease was primarily due to utilization of foreign loss carrybacks, foreign tax credits, and research and development credits. QUARTERLY RESULTS The Company's operating results and cash flow have fluctuated in the past and may fluctuate significantly in the future as a result of a variety of factors, including purchasing patterns, timing of introductions of new solutions and enhancements by the Company and its competitors, and fluctuating economic conditions. Because license fees for the Company's software products are substantial and the implementation of the Company's solutions often requires the services of the Company's engineers over an extended period of time, the sales process for the Company's solutions is lengthy and can exceed one year. Accordingly, software revenue is difficult to predict, and the delay of any order could cause the Company's quarterly revenues to fall substantially below expectations. Moreover, to the extent that the Company succeeds in shifting customer purchases away from point solutions and toward integrated suites of its software and service solutions, the likelihood of delays in ordering may increase and the effect of any delay may become more pronounced. The Company ships software products within a short period after receipt of an order and usually does not have a material backlog of unfilled orders of software products. Consequently, revenues from software licenses, including license renewals in any quarter are substantially dependent on orders booked and shipped in that quarter. Historically, a majority of each quarter's revenues from software licenses has been derived from license agreements that have been consummated in the final weeks of the quarter. Therefore, even a short delay in the consummation of an agreement may cause revenues to fall below expectations for that quarter. The company's revenues in certain quarters of fiscal 1999 were lower than expected due to delayed decision making of economic difficulties among certain customers. These lower revenues resulted in lower than planned operating results and a net operating loss in each quarter of fiscal 1999. Additionally, since the Company's expense levels are based in part on anticipa...
