Columbia Sportswear 2013 Annual Report Download - page 65

Download and view the complete annual report

Please find page 65 of the 2013 Columbia Sportswear annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 84

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84

COLUMBIA SPORTSWEAR COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
61
holidays. The Company recognizes the benefits related to the lease incentives on a straight-line basis over the applicable
lease term.
Rent expense, including percentage rent but excluding operating costs for which the Company is obligated, consisted
of the following (in thousands):
Year Ended December 31,
2013 2012 2011
Rent expense included in SG&A expense . . . . . . . . . . . . . . . . $ 53,972 $ 51,853 $ 46,869
Rent expense included in cost of sales. . . . . . . . . . . . . . . . . . . 1,592 1,528 1,429
$ 55,564 $ 53,381 $ 48,298
Approximate future minimum payments, including rent escalation clauses and stores that are not yet open, on all lease
obligations at December 31, 2013, are as follows (in thousands). Operating lease obligations listed below do not include
percentage rent, real estate taxes, insurance, CAM, and other costs for which the Company is obligated. These operating
lease commitments are not reflected on the Consolidated Balance Sheets.
2014. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 44,689
2015. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,298
2016. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,301
2017. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,962
2018. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,511
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88,926
$ 275,687
Inventory Purchase Obligations
Inventory purchase obligations consist of open production purchase orders for sourced apparel, footwear, accessories
and equipment, and raw material commitments not included in open production purchase orders. At December 31, 2013,
inventory purchase obligations were $216,752,000. To support certain inventory purchase obligations, the Company
maintains unsecured and uncommitted lines of credit available for issuing import letters of credit. At December 31, 2013,
the Company had no balance outstanding under these letters of credit.
Litigation
The Company is a party to various legal claims, actions and complaints from time to time. Although the ultimate
resolution of legal proceedings cannot be predicted with certainty, management believes that disposition of these matters
will not have a material adverse effect on the Company’s consolidated financial statements.
Indemnities and Guarantees
During its normal course of business, the Company has made certain indemnities, commitments and guarantees under
which it may be required to make payments in relation to certain transactions. These include (i) intellectual property
indemnities to the Company’s customers and licensees in connection with the use, sale and/or license of Company products,
(ii) indemnities to various lessors in connection with facility leases for certain claims arising from such facility or lease,
(iii) indemnities to customers, vendors and service providers pertaining to claims based on the negligence or willful
misconduct of the Company, (iv) executive severance arrangements and (v) indemnities involving the accuracy of
representations and warranties in certain contracts. The duration of these indemnities, commitments and guarantees varies,
and in certain cases, may be indefinite. The majority of these indemnities, commitments and guarantees do not provide for
any limitation of the maximum potential for future payments the Company could be obligated to make. The Company has
not recorded any liability for these indemnities, commitments and guarantees in the accompanying Consolidated Balance
Sheets.