Best Buy 2005 Annual Report Download - page 49

The following table reconciles Domestic stores open at the beginning and end of fiscal 2005:
Total Total
Stores at Stores at
End of Stores Stores End of
Fiscal 2004 Opened Closed Fiscal 2005
U.S. Best Buy 608 61 1 668
Magnolia Audio Video 22 — 2 20
Total 630 61 3 688
Note: During fiscal 2005, we converted 67 existing U.S. Best Buy stores to our customer centricity format and relocated six other U.S.
Best Buy stores. No other U.S. Best Buy stores were relocated or remodeled during fiscal 2005. At the end of fiscal 2005, we operated
668 U.S. Best Buy stores in 48 states and the District of Columbia. No Magnolia Audio Video stores were relocated or remodeled
during fiscal 2005. At the end of fiscal 2005, we operated 20 Magnolia Audio Video stores in California, Washington and Oregon.
The following table reconciles Domestic stores open at the beginning and end of fiscal 2004:
Total Total
Stores at Stores at
End of Stores Stores End of
Fiscal 2003 Opened Closed Fiscal 2004
U.S. Best Buy 548 60 — 608
Magnolia Audio Video 19 3 — 22
Total 567 63 — 630
Note: We relocated four and remodeled three U.S. Best Buy stores during fiscal 2004. At the end of fiscal 2004, we operated 608 U.S.
Best Buy stores in 48 states and the District of Columbia. One Magnolia Audio Video store was remodeled during fiscal 2004. At the
end of fiscal 2004, we operated 22 Magnolia Audio Video stores in California, Washington and Oregon.
International
The following table presents selected financial data for the International segment for each of the past three fiscal years
($ in millions):
Segment Performance Summary (unaudited) 2005 2004(1) 2003(1)
Revenue $2,817 $2,323 $1,640
Comparable stores sales % gain(2) 3.3% 4.7% 4.3%
Gross profit as % of revenue 22.5% 22.2% 23.0%
SG&A as % of revenue 20.7% 20.6% 22.5%
Operating income $ 49 $ 37 $ 8
Operating income as % of revenue 1.7% 1.6% 0.5%
(1) Certain amounts have been reclassified to conform to the current presentation. These reclassifications had no effect on operating
income, net earnings, financial position or cash flows. During fiscal 2005, we reclassified from SG&A into cost of goods sold
certain expenses related to operating our distribution network, consisting primarily of handling and transportation costs related to
moving merchandise from our distribution centers to our stores. We believe that the revised presentation provides greater
consistency for investors by aligning the classification of our distribution costs with the practices of many other retailers.
(2) Comprised of revenue at stores and Web sites operating for at least 14 full months, as well as remodeled and expanded locations.
Relocated stores are excluded from the comparable store sales calculation until at least 14 full months after reopening. The
calculation of the comparable store sales percentage gain excludes the impact of fluctuations in foreign currency exchange rates.
During fiscal 2004, we refined our methodology for calculating our comparable store sales percentage gain to reflect the impact of
non-point-of-sale (non-POS) revenue transactions. We refined our comparable store sales calculation methodology in light of
changes in our business. Previously, our comparable store sales calculation was based on store POS revenue. The comparable store
sales percentage gains for fiscal 2005 and fiscal 2004 have been computed based on the refined methodology. The comparable
store sales percentage gain for fiscal 2003 has not been computed using the refined methodology. Refining the methodology for
calculating our comparable store sales percentage gain did not impact previously reported revenue, net earnings or cash flows.
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