GameStop 2003 Annual Report Download - page 56

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Table of Contents
GAMESTOP CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
6. Goodwill
The Company adopted the transitional disclosures of SFAS 142 effective February 3, 2002 (see Note 1). The changes in the carrying amount of goodwill for the
Company’s business segment for the 52 weeks ended January 31, 2004 and February 1, 2003 were as follows:
Goodwill
(In thousands)
Balance at February 2, 2002 $317,957
Amortization for the 52 weeks ended February 1, 2003
—
Balance at February 1, 2003 317,957
Addition for the acquisition of Gamesworld Group Limited 2,869
Amortization for the 52 weeks ended January 31, 2004
—
Balance at January 31, 2004 $ 320,826
The effects of the adoption of SFAS 142 on the reported net earnings and net earnings per common share for the 52 weeks ended January 31, 2004, February 1,
2003 and February 2, 2002 are as follows:
52 Weeks 52 Weeks 52 Weeks
Ended Ended Ended
January 31, February 1, February 2,
2004 2003 2002
(In thousands, except per share data)
Reported net earnings $63,467 $52,404 $6,960
Add Back: Goodwill amortization, net of taxes
—
—
8,413
Net earnings, as adjusted $63,467 $52,404 $15,373
Earnings per share — basic:
Reported net earnings $1.13 $0.93 $0.19
Goodwill amortization, net of taxes
—
—
0.23
Adjusted net earnings $1.13 $0.93 $0.42
Earnings per share — diluted:
Reported net earnings $1.06 $0.87 $0.18
Goodwill amortization, net of taxes
—
—
0.21
Adjusted net earnings $1.06 $0.87 $0.39
7. Debt
Concurrent with the Offering, the Company entered into a $75,000 senior secured revolving credit facility which expires in February 2005. The revolving credit
facility is governed by an eligible inventory borrowing base agreement, defined as 50% of non-defective inventory. Loans incurred under the credit facility will be
maintained from time to time, at the Company’s option, as (1) base rate loans which bear interest at the base rate (defined in the credit facility as the higher of (a) the
administrative agent’s announced base rate or (b) 1/2 of 1% in excess of the federal funds effective rate, each as in effect from time to time) or (2) London Interbank
Office Rate (“LIBOR”) loans bearing interest at the LIBOR rate for the applicable interest period, in each case plus an applicable interest margin. In addition, the
Company is required to pay a commitment fee of 0.375% for any unused amounts of the revolving credit facility. Any borrowings under the revolving credit facility are
secured by the assets of the Company. The revolving credit facility generally restricts our ability to
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