Dick's Sporting Goods 2008 Annual Report Download - page 75

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Return On Invested Capital (ROIC)
2008 2007 2006 2005 2004 2003
(Dollars in thousands)
Net (loss) income $ (35,094) $ 155,036 $ 112,611 $ 72,980 $ 68,905 $ 52,408
Impairment of goodwill and other
intangible assets, after tax 143,888 — — — — —
Impairment of store assets, after tax 17,774 — — — — —
Merger integration and store closing
costs, after tax 12,341 — — 22,674 12,202 —
Gain on sale of asset, after tax (1,414) — — — — —
Gain on sale of non cash investment,
after tax — — — (1,106) (6,589) (2,122)
Adjusted net income 137,495 155,036 112,611 94,548 74,518 50,286
Net Income for ROIC Calculation 137,495 155,036 112,611 94,548 74,518 50,286
Interest expense, net, after tax 6,578 6,797 6,015 7,775 4,805 1,099
Rent expense, net, after tax 191,538 161,045 123,473 117,801 86,369 58,232
Net Income for ROIC after
adjustments (numerator) $ 335,611 $ 322,878 $ 242,099 $ 220,124 $ 165,692 $ 109,617
Total stockholders’ equity $ 895,582 $ 888,520 $ 620,550 $ 414,793 $ 313,667 $ 240,894
Total debt 181,864 181,435 181,017 181,201 258,004 3,916
Operating leases capitalized at
8x annual rent expense 2,553,843 2,140,138 1,646,311 1,570,680 1,151,587 776,427
Total debt and operating leases
capitalized at 8x annual rent expense 2,735,707 2,321,573 1,827,328 1,751,881 1,409,591 780,343
Total capital (total stockholders’
equity + total debt and operating leases
capitalized at 8x annual rent expense) 3,631,289 3,210,093 2,447,878 2,166,674 1,723,258 1,021,237
Average total capital (denominator) 1 $ 3,420,691 $ 2,828,985 $ 2,307,276 $ 1,944,966 $ 1,372,247 $ 921,812
ROIC 9.8% 11.4% 10.5% 11.3% 12.1% 11.9%
ROIC using GAAP amounts 2
4.8% 11.4% 10.5% 10.2% 11.7% 12.1%
1 Average total capital is calculated as the sum of the current and prior year ending total capital divided by two.
2 ROIC using GAAP amounts was derived as the quotient of GAAP Net Income for ROIC not adjusted (numerator) and average total capital.
DICK’S SPORTING GOODS, INC. 2008 ANNUAL REPORT 73