Bed, Bath and Beyond 2001 Annual Report Download - page 14

BED BATH & BEYOND ANNUAL REPORT 2001
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Included in other current assets and in deferred rent and
other liabilities is a net current deferred income tax asset of
$39.6 million and a net noncurrent deferred income tax liability
of $8.1 million, respectively, which reflect the net tax effects
of temporary differences between the carrying amounts of
assets and liabilities for financial reporting purposes and the
amounts used for income tax purposes. The significant
components of the Company’s deferred tax assets and liabilities
consist of the following:
March 2, March 3,
(in thousands) 2002 2001
Deferred Tax Assets:
Inventories $ 14,827)$ 13,729)
Deferred rent 10,193)9,103)
Other 27,606)21,684)
Deferred Tax Liability:
Depreciation (21,122) (11,279)
$ 31,504)$ 33,237)
For fiscal 2001, the effective tax rate is comprised of the
Federal statutory income tax rate of 35.00% and the state income
tax rate, net of Federal benefit, of 3.50%. For fiscal 2000 and
1999, the effective tax rate was comprised of the Federal statutory
income tax rate of 35.00% and the state income tax rate, net of
Federal benefit, of 4.00%.
6. TRANSACTIONS AND BALANCES WITH RELATED PARTIES
A. The Company has an interest in certain life insurance policies
on the lives of its Co-Chairmen. The beneficiaries of these
policies are related to the aforementioned individuals. The
Company’s interest in these policies is equivalent to the net
premiums paid by the Company. At March 2, 2002 and March 3,
2001, other assets (noncurrent) include $5.0 million and $4.5
million, respectively, representing the Company’s interest in the
life insurance policies.
B. The Company obtained certain payroll services from a related
party through August 2001. The Company paid fees for such
services of $203,000, $366,000 and $557,000 for fiscal 2001, 2000
and 1999, respectively.
C. The Company made charitable contributions to the Mitzi and
Warren Eisenberg Family Foundation, Inc. (the “Eisenberg
Foundation”) and the Feinstein Family Foundation, Inc. (the
“Feinstein Foundation”) in the aggregate amounts of $761,000,
$634,000 and $488,000 for fiscal 2001, 2000 and 1999,
respectively. The Eisenberg Foundation and the Feinstein
Foundation are each not-for-profit corporations of which Messrs.
Eisenberg and Feinstein, the Co-Chairmen of the Company, and
their family members are the trustees and officers.
7. LEASES
The Company leases retail stores, as well as warehouses, office
facilities and equipment, under agreements expiring at various
dates through 2022. Certain leases provide for contingent rents
(which are based upon store sales exceeding stipulated amounts
and are immaterial in fiscal 2001, 2000 and 1999), scheduled rent
increases and renewal options generally ranging from five to
fifteen years. The Company is obligated under a majority of the
leases to pay for taxes, insurance and common area maintenance
charges.
As of March 2, 2002, future minimum lease payments under
noncancelable operating leases are as follows:
FISCAL YEAR (in thousands) AMOUNT
2002 $ 198,275
2003 207,073
2004 203,493
2005 201,150
2006 197,032
Thereafter 1,134,924
Total future minimum lease payments $2,141,947
As of March 29, 2002, the Company had executed leases for
50 stores planned for opening in fiscal 2002.
Expenses for all operating leases were $178.7 million,
$142.6 million and $113.3 million for fiscal 2001, 2000 and 1999,
respectively.
Notes to Consolidated Financial Statements
(Continued)