Costco 2012 Annual Report Download - page 65

Certain leases may require the Company to incur costs to return leased property to its original
condition, such as the removal of gas tanks. Estimated asset retirement obligations associated with
these leases, which amounted to $44 and $31 at the end of 2012 and 2011, respectively, are included
in deferred income taxes and other liabilities in the accompanying consolidated balance sheets.
Note 6—Stockholders’ Equity
Dividends
The Company’s current quarterly dividend rate is $0.275 per share.
Stock Repurchase Programs
The Company’s stock repurchase program is conducted under a $4,000 authorization by the Board of
Directors approved in April 2011, which expires in April 2015. As of the end of 2012, the total amount
repurchased under this plan was $911. The following table summarizes the Company’s stock
repurchase activity:
Shares
Repurchased
(000’s)
Average
Price per
Share
Total
Cost
2012 .......................................... 7,272 $84.75 $617
2011 .......................................... 8,939 71.74 641
2010 .......................................... 9,943 57.14 568
These amounts differ from the stock repurchase balances in the accompanying consolidated
statements of cash flows due to changes in unsettled stock repurchases at the end of each fiscal year.
Accumulated Other Comprehensive Income
Accumulated other comprehensive income, net of tax where applicable, was $156 and $373 at the end
of 2012 and 2011, respectively, and was comprised primarily of unrealized foreign-currency translation
adjustments. In 2012, as part of the acquisition of the noncontrolling interest in Mexico, the Company
reclassified $155 of accumulated unrealized losses on foreign-currency translation adjustments to
Costco’s accumulated other comprehensive income. This balance was previously included as a
component of non-controlling interest.
Note 7—Stock-Based Compensation Plans
The Company grants stock-based compensation to employees and non-employee directors. Stock
options awards were granted under the Amended and Restated 2002 Stock Incentive Plan, amended
as of January 2006 (Second Restated 2002 Plan), and predecessor plans until, effective in the fourth
quarter of fiscal 2006, the Company began awarding restricted stock units (RSUs) under the Second
Restated 2002 Plan in lieu of stock options. Through a series of shareholder approvals, there have
been a series of amended and restated plans and new provisions implemented by the Company.
Under revisions in the Fourth Restated 2002 Plan in the fourth quarter of fiscal 2008, prospective
grants of RSUs are subject, upon certain terminations of employment, to quarterly vesting, as opposed
to daily vesting. Previously awarded RSU grants continue to involve daily vesting upon certain
terminations of employment. Additionally, employees who attain certain years of service with the
Company will receive shares under accelerated vesting provisions on the annual vesting date rather
than upon qualified retirement. The first grant impacted by these amendments occurred in the first
quarter of fiscal 2009. Each share issued in respect of stock bonus or stock unit awards is counted as
1.75 shares toward the limit of shares made available under the Fourth Restated 2002 Plan. The Sixth
63