GameStop 2009 Annual Report Download - page 93

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In the ordinary course of the Company’s business, the Company is, from time to time, subject to various other
legal proceedings, including matters involving wage and hour employee class actions. The Company may enter into
discussions regarding settlement of these and other types of lawsuits, and may enter into settlement agreements, if it
believes settlement is in the best interest of the Company’s shareholders. Management does not believe that any
such other legal proceedings or settlements, individually or in the aggregate, will have a material adverse effect on
the Company’s financial condition, results of operations or liquidity.
In 2003, the Company purchased a 51% controlling interest in GameStop Group Limited, which operates
stores in Ireland and the United Kingdom. Under the terms of the purchase agreement, the minority interest owners
have the ability to require the Company to purchase their remaining shares in incremental percentages at a price to
be determined based partially on the Company’s price to earnings ratio and GameStop Group Limited’s earnings.
Shares representing approximately 16% were purchased in June 2008 and in July 2009 an additional 16% was
purchased, bringing the Company’s total interest in GameStop Group Limited to approximately 84%. The
Company already consolidates the results of GameStop Group Limited; therefore, any additional amounts acquired
will not have a material effect on the Company’s financial statements.
12. Income Taxes
The provision for income tax consisted of the following:
52 Weeks
Ended
January 30,
2010
52 Weeks
Ended
January 31,
2009
52 Weeks
Ended
February 2,
2008
(In thousands)
Current tax expense:
Federal ....................................... $162,339 $201,438 $120,606
State......................................... 12,119 18,933 13,436
Foreign....................................... 39,556 39,999 31,874
214,014 260,370 165,916
Deferred tax expense (benefit):
Federal ....................................... 219 (15,858) (2,582)
State......................................... 1,496 (7,468) (1,805)
Foreign....................................... (2,925) (1,375) (8,764)
(1,210) (24,701) (13,151)
Total income tax expense ........................... $212,804 $235,669 $152,765
The components of earnings before income tax expense consisted of the following:
52 Weeks
Ended
January 30,
2010
52 Weeks
Ended
January 31,
2009
52 Weeks
Ended
February 2,
2008
(In thousands)
United States .................................... $508,961 $532,787 $364,929
International ..................................... 79,572 101,164 76,127
Total .......................................... $588,533 $633,951 $441,056
F-25
GAMESTOP CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)