Dollar General 2010 Annual Report Download - page 122

10-K
in 2009 compared to an increase of $20.9 million, or 8%, in 2008. The home products category declined
$9.1 million, or 6%, in 2009 compared to a decline of $2.6 million, or 2%, in 2008. The apparel
category declined by $22.9 million, or 10%, in 2009 compared to an increase of $30.2 million, or 15%,
in 2008. In addition, increased net income in 2009 compared to 2008 was a principal factor in the
increase in income taxes paid in 2009 compared to 2008. Changes in Accrued expenses and other were
affected in part by the timing of the payments related to the Litigation settlement and related costs
discussed above under ‘‘Results of Operations,’’ as the associated insurance proceeds of $10.0 million
were received at the end of 2008 while the payment of the $40.0 million settlement occurred at the
beginning of 2009.
Cash flows from investing activities. Cash flows used in investing activities totaling $418.9 million in
2010 were primarily related to capital expenditures. Significant components of our property and
equipment purchases in 2010 included the following approximate amounts: $156 million for
improvements, upgrades, remodels and relocations of existing stores; $100 million for new leased stores;
$91 million for stores purchased or built by us; $45 million for distribution and transportation-related
capital expenditures; and $22 million for information systems upgrades and technology-related projects.
During 2010 we opened 600 new stores and remodeled or relocated 504 stores.
Cash flows used in investing activities totaling $248.0 million in 2009 were also primarily related to
capital expenditures. Significant components of our property and equipment purchases in 2009 included
the following approximate amounts: $114 million for improvements, upgrades, remodels and relocations
of existing stores; $69 million for new leased stores; $28 million for distribution and transportation-
related capital expenditures; $24 million for various administrative capital costs; and $11 million for
information systems upgrades and technology-related projects. During 2009 we opened 500 new stores
and remodeled or relocated 450 stores.
Cash flows used in investing activities totaling $152.6 million in 2008 were primarily related to
capital expenditures, offset by sales of investments. Significant components of our property and
equipment purchases in 2008 included the following approximate amounts: $149 million for
improvements, upgrades, remodels and relocations of existing stores; $22 million for new leased stores;
$17 million for distribution and transportation-related capital expenditures; and $13 million for
information systems upgrades and technology-related projects. During 2008 we opened 207 new stores
and remodeled or relocated 404 stores.
Purchases and sales of short-term investments equal to net sales of $51.6 million in 2008 primarily
reflected investment activities in our captive insurance subsidiary.
Capital expenditures during 2011 are projected to be in the range of $550-$600 million. We
anticipate funding 2011 capital requirements with cash flows from operations, and if necessary, we also
have significant availability under our ABL Facility. Significant components of the 2011 capital plan
include growth initiatives, such as approximately 625 new stores including the purchase of existing
stores and the construction of new stores; costs related to new leased stores including leasehold
improvements, fixtures and equipment; continued investment in our existing store base with plans for
remodeling and relocating approximately 550 stores; the construction of a new distribution center in
Alabama; as well as additional investments in our supply chain and information technology. We plan to
undertake these expenditures as part of our efforts to improve our infrastructure and increase our cash
generated from operating activities.
Cash flows from financing activities. During 2010, we repurchased $115.0 million outstanding
principal amount of our outstanding Senior Notes at a total cost of $127.5 million including associated
premiums. We had no borrowings or repayments under the ABL Facility in 2010.
In 2009, we had cash inflows from the issuance of equity of $443.8 million primarily due to our
initial public offering of 22.7 million shares of common stock. We used the proceeds from the offering
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