Nordstrom 2003 Annual Report Download - page 35

NORDSTROM, INC. and SUBSIDIARIES
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The changes in the carrying amount of our intangible assets for the year
ended January 31, 2004 and 2003 are as follows:
Catalog/
Retail Stores Internet
Segment Segment
Goodwill Tradename Goodwill Total
February 1, 2002 $38,198 $100,133 $— $138,331
Impairment (5,767) (16,133) — (21,900)
Goodwill acquired
through purchase of
minority interest
(see Note 20) 8,462 — 15,716 24,178
January 31, 2004 and 2003 $40,893 $84,000 $15,716 $140,609
The following table shows the actual results of operations as well as
pro-forma results adjusted to exclude intangible amortization and the
cumulative effect of the accounting change.
Fiscal Year 2003 2002 2001
Reported net earnings $242,841 $90,224 $124,688
Intangible amortization, net of tax — — 2,824
Cumulative effect of the
accounting change,
net of tax — 13,359 —
Adjusted net earnings $242,841 $103,583 $127,512
Basic and diluted earnings per share:
Fiscal Year 2003 2002 2001
Earnings per share: Basic &
Basic Diluted Basic Diluted Diluted
Reported net earnings $1.78 $1.76 $0.67 $0.66 $0.93
Intangible amortization,
net of tax ——— — 0.02
Cumulative effect of
accounting change,
net of tax ——0.10 0.10 —
Adjusted net earnings $1.78 $1.76 $0.77 $0.76 $0.95
Before adoption of SFAS No. 142, we amortized our intangible assets
over their estimated useful lives on a straight-line basis ranging from 10
to 35 years. Accumulated amortization of intangible assets was $5,881
as of January 31, 2004 and 2003.
Note 3: Employee Benefits
We provide a profit sharing plan and 401(k) plan for our employees. The
profit sharing plan is non-contributory and is fully funded by us. The
Board of Directors establishes our contribution to the profit sharing plan
each year. The 401(k) plan is funded by voluntary employee contributions.
In addition, we provide matching contributions up to a stipulated percentage
of employee contributions. Our contributions to the profit sharing plan
and matching contributions to the 401(k) plan totaled $52,030, $35,162
and $28,525 in 2003, 2002 and 2001.
Note 4: Postretirement Benefits
We have an unfunded Supplemental Executive Retirement Plan ("SERP"),
which provides retirement benefits to certain officers and select employees.
During 2003, the SERP was amended to change the target benefit, provide
transition benefits, eliminate the offset of our contributions to the 401(k)
and profit sharing plans and increase the retirement age. Certain
grandfathered participants will remain under the previous plan provisions.
The following provides a reconciliation of benefit obligations and funded
status of the SERP:
January 31, 2004 2003
Change in benefit obligation:
Accumulated benefit obligation
at beginning of year $47,573 $34,411
Service cost 819 1,447
Interest cost 3,420 3,537
Amortization of adjustments 1,444 2,941
Change in additional minimum liability 9,046 7,760
Distributions (2,689) (2,523)
Accumulated benefit obligation
at end of year $59,613 $47,573
Funded status of plan:
Under funded status $(64,870) $(50,125)
Unrecognized prior service cost 6,228 3,805
Unrecognized loss 24,403 15,074
Accrued pension cost $(34,239) $(31,246)
Balance sheet amounts:
Additional minimum liability $(25,373) $(16,327)
Intangible asset 6,228 3,805
notes to consolidated financial statements