Dillard's 2009 Annual Report Download - page 37

balance of $22.2 million as of January 30, 2010, was issued during fiscal 2008 towards the purchase of a
corporate aircraft and bears interest at 5.93% with a due date of 2012.
We reduced our net level of outstanding debt and capital leases during fiscal 2009 by $33.9 million
compared to a reduction of $199.5 million in fiscal 2008. The debt decline in both periods was
primarily due to regular maturities of outstanding notes and scheduled payments of mortgage principal.
During fiscal 2009, the Company also repurchased $8.4 million face amount of 9.125% notes with
an original maturity on August 1, 2011. This repurchase resulted in a pretax gain of approximately
$1.7 million which was recorded in net interest and debt expense. No notes were repurchased during
fiscal 2008 or 2007.
As of January 30, 2010, maturities of long-term debt over the next five years are $2 million,
$49 million, $77 million, $0 and $0.
Stock Repurchase. In May 2005, the Company’s Board of Directors approved the repurchase of
up to $200 million of the Company’s Class A Common Stock (‘‘2005 Stock Plan’’). Availability under
the 2005 Stock Plan at the beginning of fiscal 2007 was $112 million. During fiscal 2007, the Company
repurchased 5.2 million shares for $112 million which completed the authorization under the 2005
Stock Plan.
In November 2007, the Company’s Board of Directors authorized another share repurchase plan
under which the Company may repurchase up to $200 million of its Class A Common Stock (‘‘2007
Stock Plan’’). This open-ended authorization permits the Company to repurchase its Class A Common
Stock in the open market or through privately negotiated transactions. No repurchases were made
during fiscal 2007 under the 2007 Stock Plan. During fiscal 2008, the Company repurchased 1,826,600
shares for $17.4 million at an average price of $9.55 per share. No repurchases were made during fiscal
2009 leaving $182.6 million in share repurchase authorization remaining under the 2007 Stock Plan at
January 30, 2010.
Subordinated Debentures. The Company had $200 million outstanding of its 7.5% subordinated
debentures due August 1, 2038. All of these subordinated debentures were held by Dillard’s Capital
Trust I, a 100% owned, unconsolidated finance subsidiary of the Company.
Fiscal 2010
During fiscal 2010, the Company expects to finance its capital expenditures and its working capital
requirements including required debt repayments and stock repurchases, if any, from cash on hand,
cash flows generated from operations and utilization of the credit facility. The peak borrowings
incurred under the credit facilities were approximately $208 million during 2009, and borrowings for
fiscal 2010 are expected to be minimal. 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 for 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
does not have any 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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