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Consolidated Statements of Operations - 3Q 2009 (Unaudited) (Note 1)
(All amounts in millions except percentages and per share figures)
| |
13 Weeks Ended
|
13 Weeks Ended
|
| |
October 31,
2009
|
November 1,
2008
|
| |
$
|
% to
Net sales
|
$
|
% to
Net sales
|
| |
| Net sales |
$5,277 |
|
$5,493 |
|
| |
| Cost of sales (Note 2) |
3,156 |
59.8% |
3,324 |
60.5% |
| |
| Gross margin |
2,121 |
40.2% |
2,169 |
39.5% |
| |
| Selling, general and administrative expenses |
(2,033) |
(38.5%) |
(2,085) |
(38.0%) |
| |
| Division consolidation costs (Note 3) |
(33) |
(0.7%) |
(16) |
(0.3%) |
| |
| Operating income |
55 |
1.0% |
68 |
1.2% |
| |
| Interest expense - net |
(137) |
|
(143) |
|
| |
|
Loss before income taxes
|
(82) |
|
(75) |
|
| |
Federal, state and local income tax
benefit (Note 4)
|
47 |
|
31 |
|
| |
| Net Loss |
$(35) |
|
$(44) |
|
| |
| Basic loss per share |
$(.08) |
|
$(.10) |
|
| |
| Diluted loss per share |
$(.08) |
|
$(.10) |
|
| |
| Average common shares: |
| Basic |
421.8 |
|
421.3 |
|
| Diluted |
421.8 |
|
421.3 |
|
| |
| End of period common shares outstanding |
421.0 |
|
420.6 |
|
| |
| Depreciation and amortization expense |
$301 |
|
$320 |
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Notes:
(1) Because of the seasonal nature of the retail business, the results of operations for the 13 weeks ended October 31, 2009 and November 1, 2008 (which do not include the Christmas season) are not necessarily indicative of such results for the fiscal year.
(2) Merchandise inventories are primarily valued at the lower of cost or market using the last-in, first-out (LIFO) retail inventory method. Application of this method did not impact cost of sales for the 13 weeks ended October 31, 2009 or November 1, 2008.
(3) Represents restructuring-related costs and expenses associated with the division consolidations and localization initiatives, primarily severance and other human resource-related costs. For the 13 weeks ended October 31, 2009, restructuring-related costs associated with the division consolidations and localization initiatives announced in February 2009 amounted to $23 million after tax or $.05 per diluted share. For the 13 weeks ended November 1, 2008, restructuring-related costs associated with the division consolidations and localization initiatives announced in February 2008 amounted to $10 million after tax or $.02 per diluted share.
(4) Federal, state and local income taxes differ from the federal income tax statutory rate of 35%, principally because of the effect of state and local taxes, including the settlement of various tax issues and tax examinations.
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Consolidated Statements of Operations - 3Q 2009 (Unaudited) (Note 1)
(All amounts in millions except percentages and per share figures)
| |
39 Weeks Ended
|
39 Weeks Ended
|
| |
October 31,
2009
|
November 1,
2008
|
| |
$
|
% to
Net sales
|
$
|
% to
Net sales
|
| |
| Net sales |
$15,640 |
|
$16,958 |
|
| |
| Cost of sales (Note 2) |
9,396 |
60.1% |
10,197 |
60.1% |
| |
| Gross margin |
6,244 |
39.9% |
6,761 |
39.9% |
| |
| Selling, general and administrative expenses |
(5,850) |
(37.4%) |
(6,225) |
(36.7%) |
| |
| Division consolidation costs (Note 3) |
(205) |
(1.3%) |
(129) |
(0.8%) |
| |
| Asset impairment charges (Note 4) |
– |
–% |
(50) |
(0.3%) |
| |
| Operating income |
189 |
1.2% |
357 |
2.1% |
| |
| Interest expense - net |
(417) |
|
(417) |
|
| |
|
Loss before income taxes
|
(228) |
|
(60) |
|
| |
Federal, state and local income tax
benefit (Note 5)
|
112 |
|
30 |
|
| |
| Net loss |
$(116) |
|
$(30) |
|
| |
|
Basic loss per share
|
$(.27) |
|
$(.07) |
|
| |
|
Diluted loss per share
|
$(.27) |
|
$(.07) |
|
| |
| Average common shares: |
| Basic |
421.6 |
|
421.1 |
|
| Diluted |
421.6 |
|
421.1 |
|
| |
| End of period common shares outstanding |
421.0 |
|
420.6 |
|
| |
| Depreciation and amortization expense |
$905 |
|
$950 |
|
Notes:
(1) Because of the seasonal nature of the retail business, the results of operations for the 39 weeks ended October 31, 2009 and November 1, 2008 (which do not include the Christmas season) are not necessarily indicative of such results for the fiscal year.
(2) Merchandise inventories are primarily valued at the lower of cost or market using the last-in, first-out (LIFO) retail inventory method. Application of this method did not impact cost of sales for the 39 weeks ended October 31, 2009 or November 1, 2008.
(3) Represents restructuring-related costs and expenses associated with the division consolidations and localization initiatives, primarily severance and other human resource-related costs. For the 39 weeks ended October 31, 2009, restructuring-related costs associated with the division consolidations and localization initiatives announced in February 2009 amounted to $120 million after tax or $.28 per diluted share. For the 39 weeks ended November 1, 2008, restructuring-related costs associated with the division consolidations and localization initiatives announced in February 2008 amounted to $81 million after tax or $.19 per diluted share.
(4) Represents impairment charges associated with acquired indefinite lived private brand tradenames and amounted to $31 million after tax or $.08 per diluted share.
(5) Federal, state and local income taxes differ from the federal income tax statutory rate of 35%, principally because of the effect of state and local taxes, including the settlement of various tax issues and tax examinations.
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