Dillard's 2010 Annual Report Download - page 36

During fiscal 2010, 2009 and 2008, we received proceeds from the sale of property and equipment
of $17.6 million, $11.6 million and $67.1 million, respectively, and recorded related gains of
$5.6 million, $3.2 million and $24.6 million, respectively. During fiscal 2008, we also recorded a
$3.9 million loss related to property damages sustained on one store during Hurricane Ike.
During fiscal 2010, the Company invested an additional $9.0 million in one of its shopping mall
joint ventures.
On August 29, 2008, the Company purchased the remaining interest in CDI for a cash purchase
price of $9.8 million. This acquisition was accounted for under the purchase method and, accordingly,
(1) the purchase price has been allocated to CDI’s assets and liabilities based on their estimated fair
values as of the date of purchase and (2) CDI’s results of operations have been included in the
Company’s results of operations since the date of purchase. Upon recognition of the acquisition, the
Company acquired $14.1 million in cash.
Financing Activities
Our primary source of cash inflows from financing activities is generally our $1.0 billion revolving
credit facility. Financing cash outflows generally include the repayment of borrowings under the
revolving credit facility, the repayment of mortgage notes or long-term debt, the payment of dividends
and the purchase of treasury stock.
Cash used in financing activities increased to $421.7 million in fiscal 2010 from $245.7 million in
fiscal 2009. This decrease in cash flow of $176.0 million was primarily due to the purchase of treasury
stock during fiscal 2010 partially offset by short-term borrowing payments made during fiscal 2009.
Stock Repurchase. In November 2007, the Company’s Board of Directors approved the
repurchase of up to $200 million of the Company’s Class A Common Stock (‘‘2007 Stock Plan’’).
Availability under the 2007 Stock Plan at the beginning of fiscal 2008 was $200 million. During fiscal
2008, the Company repurchased 1.8 million shares for $17.4 million at an average price of $9.55 per
share. No repurchases were made during fiscal 2009. During fiscal 2010, the Company repurchased
7.2 million shares of stock for approximately $182.6 million at an average price of $25.39 per share,
which completed the remaining authorization under the 2007 Stock Plan.
In August 2010, the Company’s Board of Directors authorized the Company to repurchase up to
$250 million of the Company’s Class A Common Stock (‘‘2010 Stock Plan’’). This authorization permits
the Company to repurchase its Class A Common Stock in the open market, pursuant to preset trading
plans meeting the requirements of Rule 10b5-1 under the Securities Exchange Act of 1934 or through
privately negotiated transactions. The 2010 Stock Plan has no expiration date. During fiscal 2010, the
Company repurchased 7.5 million shares for $231.3 million at an average price of $31.04 per share. At
January 29, 2011, remaining availability under the 2010 Stock Plan was $18.7 million.
In February 2011, the Company announced that the Board of Directors authorized the repurchase
of up to $250 million of the Company’s Class A Common Stock under a new stock plan (‘‘2011 Stock
Plan’’). This authorization permits the Company to repurchase its Class A Common Stock in the open
market, pursuant to preset trading plans meeting the requirements of Rule 10b5-1 under the Securities
Exchange Act of 1934 or through privately negotiated transactions. The 2011 Stock Plan has no
expiration date.
Revolving Credit Agreement. At January 29, 2011, the Company maintained a $1.0 billion
revolving credit facility (‘‘credit agreement’’) with JPMorgan Chase Bank (‘‘JPMorgan’’) as agent for
various banks, secured by the inventory of Dillard’s, Inc. operating subsidiaries. Borrowings under the
credit agreement accrue interest at either JPMorgan’s Base Rate minus 0.5% or LIBOR plus 1.0%
(1.26% at January 29, 2011) subject to certain availability thresholds as defined in the credit agreement.
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