Dillard's 2005 Annual Report Download - page 32

Stock Repurchase
During 2005, the Company completed the remaining authorized repurchase of Class A Common Stock
under its $200 million program, which was approved by the board of directors in May of 2000. In May 2005, the
Company announced that the Board of Directors authorized the repurchase of up to an additional $200 million of
its Class A Common Stock. During fiscal 2005, the Company repurchased approximately $100.9 million of
Class A Common Stock, representing 4.6 million shares at an average price of $22.09 per share. Approximately
$115.2 million in share repurchase authorization remained under this open-ended plan at January 28, 2006.
Guaranteed Beneficial Interests in the Company’s Subordinated Debentures
The Company has $200 million liquidation amount of 7.5% Capital Securities, due August 1, 2038
representing the beneficial ownership interest in the assets of Dillard’s Capital Trust I, a consolidated entity of
the Company.
Fiscal 2006
The sale of the Company’s credit card business significantly strengthened its liquidity and financial
position. The Company had cash on hand of $300 million as of January 28, 2006 and reduced outstanding debt
and capital leases by $163.9 million during fiscal 2005. During fiscal 2006, the Company expects to finance its
capital expenditures and its working capital requirements including required debt repayments and stock
repurchases, if any, from cash flows generated from operations. As part of its overall funding strategy and for
peak working capital requirements, the Company expects to obtain funds through its $1.2 billion revolving credit
agreement. The peak borrowings incurred under the facilities were $166 million during 2005. The Company
expects peak funding requirements of approximately $250 million during fiscal 2006. Depending on conditions
in the capital markets and other factors, the Company will from time to time consider possible financing
transactions, the proceeds of which could be used to refinance current indebtedness or other corporate purposes.
Off-Balance-Sheet Arrangements
The Company has not created, and is not party to, any special-purpose or off-balance-sheet entities for the
purpose of raising capital, incurring debt or operating the Company’s business.
The Company is a 50% guarantor on a $54.3 million loan commitment for a joint venture as of January 28,
2006. At January 28, 2006, the joint venture had $45.3 million outstanding on the loan. The loan is collateralized
by a mall in Yuma, Arizona with a book value of $55.4 million at January 28, 2006.
The Company is a guarantor on a $185 million loan commitment with another joint venture as of
January 28, 2006. The Company is a guarantor on up to 50% of the loan balance with the joint venture partner
guaranteeing the remaining 50% of the loan balance. A mall currently under construction in Bonita Springs,
Florida provides collateral for the loan. The loan had an outstanding balance of $64.8 million as of January 28,
2006.
The Company does not have any additional arrangements or relationships with entities that are not
consolidated into the financial statements that are reasonably likely to materially affect the Company’s liquidity
or the availability of capital resources.
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