Spreadsheet: b4ad72d2-8e7e-4551-86f9-f8f59b324b35
Sheet: Sheet1

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 | Financial Results
 | (In Millions Except Per Share Amounts)
 |  | 2011 |  |  |  |  |  | 2010
 | Consolidated Income Statement | Q1 | Q2 | Q3 | Q4 | YTD |  | Q1 | Q2 | Q3 | Q4 | YTD
 | Customer Management | 458.5 | 469.6 | 490.9 | 499.8 | 1918.8 |  | 463.6 | 446.1 | 462.8999999999999 | 466.7 | 1839.3
 | Information Management | 79.8 | 77.00000000000001 | 83.6 | 88.4 | 328.8 |  | 82.4 | 78 | 81.9 | 97.80000000000001 | 340.1
 | Corporate | 6.300000000000026 | 4.999999999999986 | 2.399999999999892 | 0.7000000000001307 | 14.40000000000003 |  | -2.273181642920008e-14 | 4.100000000000017 | 11.20000000000013 | 8.699999999999989 | 24.00000000000011
 | Total Revenue | 544.6 | 551.6 | 576.8999999999999 | 588.9000000000001 | 2262 |  | 546 | 528.2 | 556 | 573.2 | 2203.4
 | Cost of Providing Services & Products Sold | 338.7 | 346.4 | 364.6999999999999 | 370.7 | 1420.5 |  | 321.9999999999999 | 319.4000000000001 | 341.1000000000001 | 358.4 | 1340.9
 | Selling, General & Administrative | 131.8 | 130.6 | 133.1 | 131.8999999999999 | 527.4 |  | 158.6 | 141 | 140.6 | 135.5000000000001 | 575.7
 | Research & Development | 13.5 | 13 | 11.6 | 11.2 | 49.3 |  | 15.1 | 14.1 | 13.1 | 13.90000000000001 | 56.2
 | Depreciation | 21.2 | 21.1 | 21.6 | 23 | 86.9 |  | 25.6 | 25.7 | 24.1 | 21.89999999999999 | 97.3
 | Amortization | 2.4 | 2.4 | 2.4 | 2.399999999999999 | 9.6 |  | 2.6 | 2.6 | 2.399999999999999 | 2.5 | 10.1
 | Restructure | 0 | 0 | 0 | 0 | 0 |  | 0 | 17.6 | 0 | 19.09999999999999 | 36.69999999999999
 | Asset Impairment | 0 | 0 | 0 | 0 | 0 |  | 0 | 0 | 0 | 181.1 | 181.1
 | Total Costs & Expenses | 507.6 | 513.5 | 533.4 | 539.1999999999998 | 2093.7 |  | 523.9 | 520.4 | 521.3000000000002 | 732.3999999999999 | 2298
 | Operating Income (Loss) | 37 | 38.09999999999999 | 43.5 | 49.70000000000002 | 168.3 |  | 22.1 | 7.799999999999994 | 34.7 | -159.2 | -94.59999999999997
 | margin | 0.06793977230995225 | 0.06907179115300942 | 0.07540301612064484 | 0.08439463406350825 | 0.07440318302387268 |  | 0.04047619047619048 | 0.01476713366149185 | 0.06241007194244605 | NM | NM
 | Adjusted Operating Income excluding HR Management impacts, CEO transition costs and impairment, restructuring and pension settlement charges (a non-GAAP measure) | 37 | 38.09999999999999 | 43.5 | 49.70000000000002 | 168.3 |  | 34.5 | 28.3 | 36.1 | 47.4 | 146.3
 | Adjusted margin excluding charges | 0.06793977230995225 | 0.06907179115300942 | 0.07540301612064484 | 0.08439463406350825 | 0.07440318302387268 |  | 0.06318681318681318 | 0.05357819007951533 | 0.06492805755395684 | 0.08269364968597347 | 0.06639738585821912
 | Earnings and Gain from Cellular Partnerships, net | 10.2 | 10 | 265 | 0 | 285.2 |  | 13.3 | 11.7 | 11.9 | 10.3 | 47.2
 | Other Income (Expense), net | 7.599999999999998 | 0.1999999999999922 | 1.199999999999989 | 0.8000000000000114 | 9.799999999999955 |  | 8.299999999999997 | -1.699999999999986 | 1.299999999999992 | 0.9999999999999595 | 8.899999999999963
 | Interest Expense | -4.6 | -4.300000000000001 | -3.6 | -3.600000000000001 | -16.1 |  | -5.7 | -5.399999999999999 | -4.1 | -4.300000000000001 | -19.5
 | Income (Loss) Before Taxes and Discontinued Operations | 50.2 | 43.99999999999999 | 306.1 | 46.89999999999998 | 447.1999999999999 |  | 38 | 12.40000000000001 | 43.79999999999999 | -152.2 | -58
 | Income Tax Expense (Benefit) | 15.3 | 12.3 | 92.4 | -1.100000000000003 | 118.9 |  | 12.4 | 1.200000000000004 | 8.799999999999997 | -5.699999999999998 | 16.7
 | Income (Loss) from continuing operations | 34.9 | 31.69999999999999 | 213.7 | 47.99999999999996 | 328.3 |  | 25.6 | 11.20000000000001 | 34.99999999999999 | -146.5 | -74.7
 | Income (Loss) from discontinued operations, net of tax | 0 | 0 | 0 | 6.5 | 6.5 |  | 9.7 | 16.2 | -6.199999999999999 | 1.800000000000001 | 21.5
 | Net Income (Loss) | 34.9 | 31.7 | 213.7 | 54.49999999999996 | 334.8 |  | 35.3 | 27.40000000000001 | 28.8 | -144.7 | -53.2
 | Diluted GAAP EPS
 | Continuing Operations | 0.277 | 0.255 | 1.75 | 0.4 | 2.67 |  | 0.203 | 0.089 | 0.279 | -1.2 | -0.61
 | Discontinued Operations | 0 | 0 | 0 | 0.05 | 0.05 |  | 0.077 | 0.129 | -0.049 | 0.014 | 0.18
 | Net Diluted EPS | 0.277 | 0.255 | 1.75 | 0.45 | 2.724 |  | 0.28 | 0.217 | 0.23 | -1.19 | -0.43
 | Diluted Shares Outstanding | 126 | 124.1 | 121.8 | 120.6 | 122.9 |  | 125.9 | 126 | 125.4 | 121.9 | 123.1
 | Note:  Previously reported non-GAAP metrics Adjusted Net Income from Continuing Operations, Adjusted Diluted EPS from Continuing Operations and Adjusted EBITDA  have been revised to exclude earnings from our investments in Cellular Partnerships
 | Adjusted Net Income from Continuing Ops (a non-GAAP measure) | 23.9 | 25.2 | 30.6 | 33.79999999999996 | 113.6 |  | 18 | 16.2 | 28.2 | 32.2 | 94.5
 | Adjusted Diluted EPS from Continuing Ops (a non-GAAP measure) | 0.19 | 0.2 | 0.25 | 0.28 | 0.92 |  | 0.14 | 0.13 | 0.22 | 0.26 | 0.75
 | Non-GAAP Diluted Shares Outstanding | 126 | 124.1 | 121.8 | 120.6 | 122.9 |  | 125.9 | 126 | 125.4 | 124.2 | 125.5
 | EBITDA | 78.3 | 71.9 | 333.7 | 75.89999999999996 | 559.8 |  | 71.9 | 46.1 | 74.4 | -123.5 | 68.9
 | Adjusted EBITDA | 61.1 | 61.9 | 68.7 | 75.89999999999996 | 267.6 |  | 58 | 54.9 | 63.9 | 70.9 | 247.7
 | Adjusted EBITDA Margin | 0.1121924348145428 | 0.1122189992748368 | 0.1190847633905357 | 0.1288843606724401 | 0.1183023872679045 |  | 0.1062271062271062 | 0.1039379023097312 | 0.1149280575539568 | 0.1416608513607815 | 0.1124171734591994
 | Customer Management | Q1 | Q2 | Q3 | Q4 | YTD |  | Q1 | Q2 | Q3 | Q4 | YTD
 | Communications | 267.6 | 276.1999999999999 | 300.3000000000001 | 303.5 | 1147.6 |  | 268.8 | 246.7 | 268.1 | 270.2 | 1053.8
 | Technology | 41.9 | 45.6 | 40.90000000000001 | 41.59999999999999 | 170 |  | 37.5 | 35.59999999999999 | 36.7 | 37.7 | 147.5
 | Financial Services | 54.6 | 54.9 | 51.90000000000001 | 46.59999999999999 | 208 |  | 64.2 | 59.2 | 58.19999999999999 | 59.90000000000001 | 241.5
 | Other | 94.39999999999998 | 92.90000000000009 | 97.79999999999993 | 108.0999999999999 | 393.1999999999999 |  | 93.10000000000002 | 104.6000000000001 | 99.89999999999989 | 98.89999999999998 | 396.4999999999999
 | Total CM Revenues | 458.5 | 469.6 | 490.9 | 499.8 | 1918.8 |  | 463.6 | 446.1 | 462.8999999999999 | 466.7 | 1839.3
 | Cost of Providing Services & Products Sold | 291.5000000000001 | 301.7999999999998 | 315.3000000000001 | 324.2999999999996 | 1232.9 |  | 277.9 | 276.6000000000001 | 289.6999999999999 | 297.8999999999996 | 1142.1
 | Selling, General & Administrative | 114.1 | 110.4 | 115.4 | 113.4 | 453.3 |  | 127.7 | 122.2 | 119.2 | 111.5 | 480.6
 | Research & Development | 3.9 | 3.6 | 3.4 | 3.1 | 14 |  | 5.5 | 4.699999999999999 | 4.200000000000001 | 3.6 | 18
 | Depreciation | 14.9 | 14.7 | 14.9 | 15.8 | 60.3 |  | 16.8 | 17.4 | 16.59999999999999 | 14.90000000000001 | 65.7
 | Amortization | 1.9 | 1.8 | 1.899999999999999 | 1.800000000000001 | 7.4 |  | 1.9 | 1.9 | 1.9 | 2 | 7.7
 | Restructure | 0 | 0 | 1 | 2.220446049250313e-16 | 1 |  | 0 | 15.3 | 0 | 7.299999999999983 | 22.59999999999999
 | Asset Impairment | 0 | 0 | 0 | 0 | 0 |  | 0 | 0 | 0 | 181.1 | 181.1
 | Total Costs & Expenses | 426.3 | 432.3 | 451.9 | 458.3999999999999 | 1768.9 |  | 429.8 | 438.1000000000001 | 431.5999999999999 | 618.3 | 1917.8
 | Operating Income | 32.2 | 37.3 | 39 | 41.40000000000001 | 149.9 |  | 33.8 | 8 | 31.30000000000001 | -151.6 | -78.49999999999999
 | margin | 0.07022900763358779 | 0.07942930153321975 | 0.07944591566510491 | 0.08283313325330134 | 0.0781217427558891 |  | 0.07290767903364968 | 0.01793319883434208 | 0.0676171959386477 | NM | NM
 | Adjusted Operating Income excluding restructuring and asset impairment charges (a non-GAAP measure) | 32.2 | 37.3 | 40 | 41.40000000000001 | 150.9 |  | 33.8 | 23.3 | 31.30000000000001 | 36.80000000000001 | 125.2
 | Adjusted margin excluding charges | 0.07022900763358779 | 0.07942930153321975 | 0.08148299042574862 | 0.08283313325330134 | 0.07864290181363352 |  | 0.07290767903364968 | 0.05223044160502129 | 0.0676171959386477 | 0.07885151060638527 | 0.06806937421845269
 | Information Management | Q1 | Q2 | Q3 | Q4 | YTD |  | Q1 | Q2 | Q3 | Q4 | YTD
 | Data Processing | 13.8 | 11.3 | 11.7 | 11.3 | 48.1 |  | 17.2 | 16 | 15.5 | 15.2 | 63.9
 | Professional & Consulting | 29.9 | 34.2 | 37.5 | 46.59999999999999 | 148.2 |  | 30.3 | 30.5 | 29.40000000000001 | 41.3 | 131.5
 | License & Other | 36.1 | 31.50000000000002 | 34.40000000000001 | 30.49999999999997 | 132.5 |  | 34.9 | 31.50000000000001 | 37.00000000000001 | 41.30000000000003 | 144.7
 | Total IM Revenues | 79.8 | 77.00000000000001 | 83.6 | 88.4 | 328.8 |  | 82.4 | 78 | 81.9 | 97.80000000000001 | 340.1
 | Cost of Providing Services & Products Sold | 42.29999999999999 | 41.10000000000004 | 47.09999999999994 | 46.30000000000004 | 176.8 |  | 44.19999999999999 | 39.70000000000003 | 41.7 | 52.89999999999998 | 178.5
 | Selling, General & Administrative | 17.1 | 16.2 | 15.5 | 15.8 | 64.6 |  | 17.1 | 15.2 | 15.90000000000001 | 17.3 | 65.5
 | Research & Development | 9.6 | 9.4 | 8.3 | 7.999999999999996 | 35.3 |  | 9.6 | 9.299999999999999 | 8.900000000000002 | 10.3 | 38.1
 | Depreciation | 3.1 | 3.2 | 3.600000000000001 | 4 | 13.9 |  | 3.9 | 3.7 | 3.5 | 3.200000000000001 | 14.3
 | Amortization | 0.5 | 0.6000000000000001 | 0.5999999999999999 | 0.5000000000000002 | 2.2 |  | 0.7 | 0.7000000000000001 | 0.5999999999999999 | 0.5 | 2.5
 | Restructure | 0 | 0 | -1.2 | -1.110223024625157e-16 | -1.2 |  | 0 | 0 | 0 | 8 | 8
 | Asset Impairment | 0 | 0 | 0 | 0 | 0 |  | 0 | 0 | 0 | 0 | 0
 | Total Costs & Expenses | 72.6 | 70.50000000000003 | 73.89999999999998 | 74.60000000000002 | 291.6 |  | 75.5 | 68.60000000000001 | 70.60000000000002 | 92.19999999999999 | 306.9
 | Operating Income | 7.2 | 6.499999999999999 | 9.7 | 13.8 | 37.2 |  | 6.9 | 9.399999999999999 | 11.3 | 5.599999999999998 | 33.2
 | margin | 0.09022556390977444 | 0.08441558441558439 | 0.1160287081339713 | 0.1561085972850678 | 0.1131386861313868 |  | 0.08373786407766991 | 0.1205128205128205 | 0.137973137973138 | 0.05725971370143147 | 0.09761834754483974
 | Adjusted Operating Income excluding restructuring and asset impairment charges (a non-GAAP measure) | 7.2 | 6.499999999999999 | 8.5 | 13.8 | 35.99999999999999 |  | 6.9 | 9.399999999999999 | 11.3 | 13.6 | 41.2
 | Adjusted margin excluding charges | 0.09022556390977444 | 0.08441558441558439 | 0.1016746411483254 | 0.1561085972850678 | 0.1094890510948905 |  | 0.08373786407766991 | 0.1205128205128205 | 0.137973137973138 | 0.1390593047034764 | 0.1211408409291385
 | Human Resource Management | Q1 | Q2 | Q3 | Q4 | YTD |  | Q1 | Q2 | Q3 | Q4 | YTD
 | Total HRM Revenues | 6.300000000000026 | 4.999999999999986 | 2.399999999999892 | 0.7000000000001307 | 14.40000000000003 |  | -0.1000000000000227 | 4.200000000000017 | 11.20000000000013 | 8.699999999999989 | 24.00000000000011
 | Cost of Providing Services & Products Sold | 6.300000000000026 | 4.999999999999986 | 2.399999999999892 | 0.7000000000001307 | 14.40000000000003 |  | -24.00000000000002 | -11.89999999999998 | 11.00000000000012 | 8.49999999999999 | -16.39999999999989
 | Selling, General & Administrative | 0 | 0 | 0 | 0 | 0 |  | 7 | 3.6 | 0.2000000000000011 | 0.1999999999999993 | 11
 | Research & Development | 0 | 0 | 0 | 0 | 0 |  | 0 | 0 | 0 | 0 | 0
 | Depreciation | 0 | 0 | 0 | 0 | 0 |  | 1.4 | 0.8999999999999999 | 0 | 0 | 2.3
 | Amortization | 0 | 0 | 0 | 0 | 0 |  | 0 | 0 | 0 | 0 | 0
 | Restructure | 0 | 0 | 0 | 0 | 0 |  | 1.3 | 0 | 0 | 0 | 1.3
 | Asset Impairment | 0 | 0 | 0 | 0 | 0 |  | 0 | 0 | 0 | 0 | 0
 | Total Costs & Expenses | 6.300000000000026 | 4.999999999999986 | 2.399999999999892 | 0.7000000000001307 | 14.40000000000003 |  | -14.30000000000002 | -7.399999999999984 | 11.20000000000013 | 8.699999999999989 | -1.799999999999887
 | Operating Income | 0 | 0 | 0 | 0 | 0 |  | 14.2 | 11.6 | 0 | 0 | 25.8
 | margin | NM | NM | NM | NM | NM |  | -141.9999999999677 | 2.761904761904751 | NM | NM | 1.074999999999995
 | OI excl restructuring, implementation and impairment charges | 0 | 0 | 0 | 0 | 0 |  | 0 | 0 | 0 | 0 | 0
 | margin excl restructuring | NM | NM | NM | NM | NM |  | NM | NM | NM | NM | NM
 | Balance Sheet & Cash Flow Data
 | (In Millions)
 |  | 2011 |  |  |  |  |  | 2010
 | Balance Sheets ($) | 2004-03-31 00:00:00 | 2004-06-30 00:00:00 | 2004-09-30 00:00:00 | 2004-12-31 00:00:00 |  |  | 2004-03-31 00:00:00 | 2004-06-30 00:00:00 | 2004-09-30 00:00:00 | 2004-12-31 00:00:00
 | Cash and Cash Equivalents | 166.3 | 181.3 | 472.5 | 421.8 |  |  | 108.4 | 129.7 | 154.7 | 186.1
 | Receivables - Net | 362.1 | 359.7 | 376.8 | 383 |  |  | 367.3 | 365.3 | 354.4 | 371.6
 | Other Current Assets | 145.4999999999999 | 139.1 | 145.2 | 148.2000000000001 |  |  | 198.2 | 146 | 133.7 | 136
 | Current Assets - Held for Sale | 11.8 | 11.8 | 9.1 | 0 |  |  | 134.7 | 4.2 | 0 | 11.8
 | Property and Equipment - Net | 341.4 | 341.5 | 341.2 | 365.4 |  |  | 339.7 | 381.2 | 376.1 | 347.6
 | Other Assets | 1081.7 | 1082.6 | 1000.3 | 1009.4 |  |  | 1200.5 | 1211 | 1222.5 | 1072.2
 | Other Assets - Held for Sale | 0 | 0 | 0 | 0 |  |  | 0 | 0 | 0 | 0
 | Total Assets | 2108.8 | 2116 | 2345.1 | 2327.8 |  |  | 2348.8 | 2237.4 | 2241.4 | 2125.3
 | Debt Maturing in One Year | 63.9 | 51.3 | 6.4 | 6.2 |  |  | 152.6 | 46.6 | 72.6 | 91
 | Other Current Liabilities | 358.2 | 356.9999999999999 | 363 | 380.9 |  |  | 388.4 | 403.6 | 360.7 | 380.2
 | Current Liabilities - Held for Sale | 0 | 0 | 0 | 0 |  |  | 108.5 | 0.7 | 0 | 0
 | Other Liabilities | 356.5999999999999 | 361.5000000000001 | 433.1 | 408.1999999999999 |  |  | 385.3 | 385.8999999999999 | 375.5999999999999 | 350.7000000000001
 | Long-Term Debt | 119.6 | 121.5 | 121 | 121 |  |  | 64.3 | 119 | 119 | 119.3
 | Other Liabilities - Held for Sale | 0 | 0 | 0 | 0 |  |  | 0 | 0 | 0 | 0
 | Common Shareholders' Equity | 1210.5 | 1224.7 | 1421.6 | 1411.5 |  |  | 1249.700000000001 | 1281.6 | 1313.5 | 1184.1
 | Total Liabilities and Equity | 2108.8 | 2116 | 2345.1 | 2327.8 |  |  | 2348.8 | 2237.4 | 2241.4 | 2125.3
 | Supporting Balance Sheet Data | 2004-03-31 00:00:00 | 2004-06-30 00:00:00 | 2004-09-30 00:00:00 | 2004-12-31 00:00:00 |  |  | 2004-03-31 00:00:00 | 2004-06-30 00:00:00 | 2004-09-30 00:00:00 | 2004-12-31 00:00:00
 | Receivables Securitization Borrowings | 0 | 0 | 0 | 0 |  |  | 50 | 0 | 0 | 0
 | Debt to Total Capital Ratio | 0.131635581061693 | 0.123649373881932 | 0.08224661071659135 | 0.08266718658607913 |  |  | 0.1478930860493658 | 0.1144278606965174 | 0.127300511593914 | 0.1508175559380379
 | Days Sales Outstanding | 59.83700717233595 | 59.34284622080904 | 60.09626654561361 | 59.83421473297194 |  |  | 60.62695641703839 | 58.39589077327876 | 58.61958730543319 | 59.64422259045213
 | Cash Flow Data ($) | Q1 | Q2 | Q3 | Q4 | YTD |  | Q1 | Q2 | Q3 | Q4 | YTD
 | Cash provided by operating activities
 | Net cash provided by operating activities of continuing operations
 | Net cash used in operating activities of discontinued operations
 | Net cash provided by operating activities | 35 | 67 | 33 | 61 | 196 |  | 48 | 64 | 48 | 34 | 194
 | Proceeds from Receivable Securitization | 0 | 0 | 0 | 0 | 0 |  | 0 | 0 | 0 | 0 | 0
 | CM Capital Expenditures, Net | -11 | -13 | -11 | -17 | -52 |  | -10 | -8 | -15 | -10 | -43
 | IM Capital Expenditures, Net | -4 | -3 | -3 | -5 | -15 |  | -2 | -2 | -3 | -3 | -10
 | HRM Capital Expenditures, Net | 0 |  |  |  | 0 |  | 0 | 0 | 0 | 0 | 0
 | Corporate Capital Expenditures, Net | -3 | -3 | -6 | -9 | -21 |  | -2 | -3 | -4 | -4 | -13
 | Total Capital Expenditures, Net | -18 | -19 | -20 | -31 | -88 |  | -14 | -13 | -22 | -17 | -66
 | Free Cash Flow | 17 | 48 | 13 | 30 | 108 |  | 34 | 51 | 26 | 17 | 128
 | Corporate Operating Income | -2.4 | -24.7 | -25.2 | -36.4 | -18.7 |  | -26.4 | -18.3 | -15.6 | -21.2 | -81.5
 | NOTE:  See reconciliation of GAAP measures to non-GAAP measures presented above and further described below on the Company's website, www.convergys.com.
 | Management uses operating income excluding the restructuring, impairment, CEO transition and HR Management related costs and net income and earnings per share data excluding those operating costs, income from our investments in the Cellular Partnerships, the impact of the gain on the sales of our investments in the Cellular Partnerships and the Finance and Accounting outsourcing line of business and the reduction of the non-operating reserve and normalization of the effective tax rate to assess the underlying operational performance of the continuing operations of the business for the year and to have a basis to compare underlying operating results to prior and future periods. These charges and credits are relevant in evaluating the overall performance of the business.
 | Limitations associated with the use of these non-GAAP measures include that these measures do not include all of the amounts associated with our results as determined in accordance with GAAP. Management compensates for these limitations by using the non-GAAP measures, operating income, income from continuing operations, net of tax and diluted earnings per share excluding the charges, and the GAAP measures, operating income, income from continuing operations, net of tax and diluted earnings per share, in its evaluation of performance. There are no material purposes for which we use these non-GAAP measures beyond those described above.
 | The Company presents the non-GAAP financial measures EBITDA and Adjusted EBITDA because management uses these measures to monitor and evaluate the performance of the business and believes the presentation of these measures will enhance the investors' ability to analyze trends in the business and evaluate the Company's underlying performance relative to other companies in the industry.
 | EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute for income from continuing operations, net of tax or other income statement data prepared in accordance with GAAP and our presentation of EBITDA and Adjusted EBITDA may not be comparable to similarly-titled measures used by other companies. Management uses both the non-GAAP measures, EBITDA and Adjusted EBITDA, and the GAAP measure, income from continuing operations, net of tax, in evaluation of its underlying performance. There are no material purposes for which we use these non-GAAP measures beyond the purposes described above. These non-GAAP measures should be considered supplemental in nature and should not be considered in isolation or be construed as being more important than comparable GAAP measures.
 | Management uses free cash flow to assess the financial performance of the Company. Convergys' management believes that free cash flow is useful to investors because it relates the operating cash flow of the Company to the capital that is spent to continue and improve business operations, such as investment in the Company’s existing businesses. Further, free cash flow facilitates Management’s ability to strengthen the Company’s balance sheet, to repay the Company’s debt obligations and to repurchase the Company’s common shares. Management also believes the presentation of this measures will enhance the investors' ability to analyze trends in the business and evaluate the Company's underlying performance relative to other companies in the industry.
 | Limitations associated with the use of free cash flow include that they do not represent the residual cash flow available for discretionary expenditures as they do not incorporate certain cash payments including payments made on capital lease obligations or cash payments for business acquisitions. Management compensates for these limitations by using both the non-GAAP measure, free cash flow, and the GAAP measure, cash flow from operating activities, in its evaluation of performance. There are no material purposes for which we use this non-GAAP measure beyond the purposes described above. This non-GAAP measure should be considered supplemental in nature and should not be considered in isolation or be construed as being more important than comparable GAAP measures.
 | Net charges on a per share basis for the three and twelve months ended December 31, 2010 include an adjustment to Diluted EPS utilizing diluted shares outstanding of 124.2 and 125.5, respectively. Given that the Company recorded a loss from continuing operations under U.S. GAAP, shares outstanding utilized to calculate Diluted EPS from continuing operations are equivalent to basic shares outstanding. Shares outstanding utilized to calculate Adjusted diluted EPS from continuing operations reflect the number of diluted shares the Company would have reported if reporting net income from continuing operations under U.S. GAAP.