Best Buy 2005 Annual Report Download - page 26

During fiscal 2006, we expect to open 75 to 80 new Shop brand in Canada and currently is considered an
stores in the United States and Canada. Most of the indefinite-lived intangible asset. If we ever were to
new stores will be opened in markets where we already abandon the Future Shop brand, we would incur an
have stores, leveraging our infrastructure and making impairment charge based on the then-carrying value of
shopping more convenient for our customers. We the Future Shop tradename.
anticipate opening approximately 60 U.S. Best Buy stores,
as well as relocating nine existing stores. We also expect Seasonality
to open 15 Best Buy stores in Canada, including seven Our revenue and earnings are typically greater during
stores in the greater Montreal market. In addition, we our fiscal fourth quarter, which includes the majority of
anticipate opening two Future Shop stores, as well as the holiday selling season.
relocating five existing stores. Finally, during fiscal 2006,
we expect that 150 to 200 U.S. Best Buy stores will be Working Capital
opened as or converted to our customer centricity
We fund the growth of our business through a
operating model. On a long-term basis, we plan to
combination of available cash and cash equivalents,
operate at least 1,200 superstores in North America.
short-term investments and cash flows generated from
Additional information regarding our ‘‘Outlook for Fiscal operations. In addition, our revolving credit facilities are
2006’’ is included in Item 7, Management’s Discussion available for additional working capital needs or
and Analysis of Financial Condition and Results of investment opportunities.
Operations, of this Annual Report on Form 10-K.
Additional information regarding our ‘‘Liquidity and
Capital Resources’’ is included in Item 7, Management’s
Intellectual Property
Discussion and Analysis of Financial Condition and
We believe we own valuable intellectual property Results of Operations, of this Annual Report on
including trademarks, service marks and tradenames, Form 10-K.
some of which are of material importance to our business,
and include ‘‘Best Buy,’’ ‘‘Yellow Tag’’ logo, ‘‘Geek Squad,’’ Customers
‘‘Future Shop’’ and ‘‘Magnolia Audio Video.’’ Some of our
We do not have a significant concentration of sales with
intellectual property is the subject of numerous United
any individual customer and, therefore, the loss of any
States and foreign trademark and service mark
one customer would not have a material impact on our
registrations. We believe our intellectual property has
business. No single customer has accounted for 10% or
significant value and is an important factor in the
more of our total revenue.
marketing of our Company, our stores and our Web sites.
We are not aware of any facts that could negatively
Backlog
impact our continuing use of any of our intellectual
property. Our stores and online shopping sites do not have a
material amount of backlog orders.
In accordance with accounting principles generally
accepted in the United States (GAAP), our balance sheets
Government Contracts
include the cost of acquired intellectual property only. The
only material acquired intellectual property presently No material portion of our business is subject to
included in our balance sheets is the Future Shop renegotiation of profits or termination of contracts or
tradename, which had a carrying value of $40 million at subcontracts at the election of any government.
the end of fiscal 2005. The value of the Future Shop
tradename is based on the continuation of the Future
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