Columbia Sportswear 2009 Annual Report Download - page 58

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COLUMBIA SPORTSWEAR COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging
Activities, which was codified into Topic 815 Derivatives and Hedging in the ASC.This standard is intended to
improve financial reporting about derivative instruments and hedging activities by requiring enhanced
disclosures to enable investors to better understand their effects on an entity’s financial position, financial
performance and cash flows. The provisions of this standard are effective for fiscal years and interim quarters
beginning after November 15, 2008. The adoption of this standard did not have a material effect on the
Company’s consolidated financial position, results of operations or cash flows. See Note 16.
NOTE 3—INVENTORIES, NET
Inventories consist of the following (in thousands):
December 31,
2009 2008
Raw materials .................................................... $ 1,021 $ 621
Work in process ................................................... 163 1,065
Finished goods .................................................... 220,977 254,626
$222,161 $256,312
NOTE 4—PROPERTY, PLANT, AND EQUIPMENT, NET
Property, plant, and equipment consist of the following (in thousands):
December 31,
2009 2008
Land and improvements ............................................ $ 16,557 $ 16,465
Building and improvements ......................................... 147,093 143,997
Machinery and equipment ........................................... 184,721 171,091
Furniture and fixtures .............................................. 44,158 37,886
Leasehold improvements ............................................ 57,866 45,231
Construction in progress ............................................ 8,932 5,929
459,327 420,599
Less accumulated depreciation ....................................... 223,887 190,906
$235,440 $229,693
NOTE 5—SHORT-TERM BORROWINGS AND CREDIT LINES
The Company has available an unsecured and committed revolving line of credit providing for borrowings
in an aggregate amount not to exceed, at any time, $100,000,000 during the period of August 15 through
November 14 and $25,000,000 at all other times. The maturity date of this agreement is July 1, 2010. Interest,
payable monthly, is computed at the bank’s prime rate minus 195 to 205 basis points per annum or LIBOR plus
45 to 65 basis points. The unsecured revolving line of credit requires the Company to comply with certain
covenants including a Capital Ratio, which limits indebtedness to tangible net worth. At December 31, 2009, the
Company was in compliance with all of these covenants. If the Company defaults on its payments, it is
prohibited, subject to certain exceptions, from making dividend payments or other distributions. The Company
also has available an unsecured and uncommitted revolving line of credit providing for borrowing to a maximum
of $25,000,000. The revolving line accrues interest at LIBOR plus 125 basis points. There were no balances
outstanding under either of these lines at December 31, 2009 and 2008.
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