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Management’s Discussion and Analysis of
Financial Condition and Results of Operations
CVS CAREMARK 2012 ANNUAL REPORT
36
Following is a summary of our store development activity for the respective years:
2012 (2) 2011
(2) 2010 (2)
Total stores (beginning of year) 7,388 7,248 7,095
New and acquired stores (1) 150 162 183
Closed stores (1) (30) (22) (30)
Total stores (end of year) 7,508 7,388 7,248
Relocated stores 90 86 106
(1) Relocated stores are not included in new or closed store totals.
(2) Excludes specialty mail order facilities.
Net cash used in financing activities
was approximately $4.9 billion in 2012, compared to net cash used in financing
activities of $3.5 billion in 2011 and net cash used in financing activities of $2.8 billion in 2010. Net cash used in financing
activities during 2012 was primarily related to $4.3 billion of share repurchases associated with the share repurchase
programs discussed below, the repurchase of long-term debt for $1.7 billion, partially offset by the issuance of approxi-
mately $1.2 billion of long-term debt. Net cash used in financing activities during 2011 was primarily due to $3.0 billion of
share repurchases associated with the share repurchase program, as well as a net reduction in our outstanding debt of
$0.2 billion. Net cash used in financing activities during 2010 was primarily due to the repayment of long-term debt of
approximately $2.1 billion and $1.5 billion of share repurchases associated with the share repurchase programs, partially
offset by net proceeds from the issuance of long-term debt of approximately $1 billion.
Share repurchase programs –
On September 19, 2012, the Company’s Board of Directors authorized a new share
repurchase program for up to $6.0 billion of outstanding common stock (the “2012 Repurchase Program”). The share
repurchase authorization, which was effective immediately, permits the Company to effect repurchases from time to time
through a combination of open market repurchases, privately negotiated transactions, accelerated share repurchase
transactions, and/or other derivative transactions. The 2012 Repurchase Program may be modified or terminated by the
Board of Directors at any time.
On August 23, 2011, our Board of Directors authorized a share repurchase program for up to $4.0 billion of outstanding
common stock (the “2011 Repurchase Program”). The share repurchase authorization, which was effective immediately,
permits us to effect repurchases from time to time through a combination of open market repurchases, privately negotiated
transactions, accelerated share repurchase transactions, and/or other derivative transactions.
Pursuant to the authorizations under the 2011 and 2012 Repurchase Programs, on September 19, 2012, we entered into
a $1.2 billion fixed dollar accelerated share repurchase (“ASR”) agreement with Barclays Bank PLC (“Barclays”). Upon
payment of the $1.2 billion purchase price on September 20, 2012, we received a number of shares of our common stock
equal฀to฀50%฀of฀the฀$1.2฀billion฀notional฀amount฀of฀the฀ASR฀agreement฀or฀approximately฀12.6฀million฀shares฀at฀a฀price฀of฀
$47.71 per share. We received approximately 13.0 million shares of common stock on November 16, 2012 at an average
price฀of฀$46.96฀per฀share,฀representing฀the฀remaining฀50%฀of฀the฀$1.2฀billion฀notional฀amount฀of฀the฀ASR฀agreement฀and฀
thereby concluding the agreement. The total of 25.6 million shares of common stock delivered to us by Barclays over the
term of the ASR agreement were placed into treasury stock.
Pursuant to the authorization under the 2011 Repurchase Program, on August 24, 2011, we entered into a $1.0 billion
fixed dollar ASR agreement with Barclays. The ASR agreement contained provisions that establish the minimum and
maximum number of shares to be repurchased during its term. Pursuant to the ASR agreement, on August 25, 2011, we paid
$1.0 billion to Barclays in exchange for Barclays delivering 20.3 million shares of common stock to us. On September 16,
2011, upon establishment of the minimum number of shares to be repurchased, Barclays delivered an additional 5.4 million
shares of common stock to us. At the conclusion of the transaction on December 28, 2011, Barclays delivered a final