Windstream 2007 Annual Report Download - page 120

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CONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31,
(Millions, except per share amounts) 2007 2006 2005
Revenues and sales:
Service revenues $ 2,959.4 $ 2,633.6 $ 2,463.6
Product sales 301.4 399.7 459.9
Total revenues and sales 3,260.8 3,033.3 2,923.5
Costs and expenses:
Cost of services (excluding depreciation of $404.4, $383.8 and $415.8 in 2007,
2006 and 2005, respectively included below) 992.0 858.4 796.1
Cost of products sold 184.2 281.8 374.8
Selling, general, administrative and other 412.1 365.7 340.1
Depreciation and amortization 507.5 449.6 474.2
Royalty expense to Alltel - 129.6 268.8
Restructuring charges 4.6 10.6 4.5
Merger and integration costs 9.3 38.8 31.2
Total costs and expenses 2,109.7 2,134.5 2,289.7
Operating income 1,151.1 898.8 633.8
Other income, net 11.1 8.7 11.6
Gain on sale of publishing business 451.3 - -
Loss on extinguishment of debt - (7.9) -
Intercompany interest income - 31.9 23.3
Interest expense (444.4) (209.6) (19.1)
Income before income taxes, extraordinary item and cumulative effect of
accounting change 1,169.1 721.9 649.6
Income taxes 252.0 276.3 267.9
Income before extraordinary item and cumulative effect of accounting change 917.1 445.6 381.7
Extraordinary item (net of income taxes of $74.5) - 99.7 -
Cumulative effect of accounting change (net of income tax benefit of $4.6) - - (7.4)
Net income $ 917.1 $ 545.3 $ 374.3
Earnings per share:
Basic:
Income before extraordinary item and cumulative effect of accounting change $1.94 $1.02 $ .95
Extraordinary item - .23 -
Cumulative effect of accounting change - - (.02)
Net income $1.94 $1.25 $ .93
Diluted:
Income before extraordinary item and cumulative effect of accounting change $1.94 $1.02 $ .95
Extraordinary item - .23 -
Cumulative effect of accounting change - - (.02)
Net income $1.94 $1.25 $ .93
Pro forma amounts assuming changes in accounting principles were applied
retroactively:
Net income as reported: $ 917.1 $ 545.3 $ 374.3
Effect of recognition of conditional asset retirement obligations - - 7.4
Net income as adjusted $ 917.1 $ 545.3 $ 381.7
Earnings per share as adjusted:
Basic $1.94 $1.25 $ .95
Diluted $1.94 $1.25 $ .95
The accompanying notes are an integral part of these consolidated financial statements.
F-34