Pep Boys 2005 Annual Report Download - page 49

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44
THE PEP BOYS—MANNY, MOE & JACK AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Years ended January 28, 2006, January 29, 2005 and January 31, 2004
(dollar amounts in thousands, except share data)
Reserve Summary
The following chart details the reserve balances through January 28, 2006. The reserve includes remaining rent on leases
net of sublease income, other contractual obligations associated with leased properties and employee severance.
Severance
Lease
Expenses
Contractual
Obligations Total
Reserve balance at Jan. 31, 2004 $ 373 $ 2,368 $ 463 $ 3,204
Provision for present value of liabilities 160 256 416
Changes in assumptions about future sublease income, lease
termination, contractual obligations and severance (158) 82 - (76)
Cash payments (215) (855) (578) (1,648)
Reserve balance at Jan. 29, 2005 $ - $ 1,755 $ 141 $ 1,896
Provision for present value of liabilities 119 - 119
Changes in assumptions about future sublease income, lease
termination, contractual obligations and severance (1,011) 73 (938)
Cash payments (675) (105) (780)
Reserve balance at Jan. 28, 2006 $ - $ 188 $ 109 $ 297
NOTE 8—STORE CLOSURES AND SALES
Discontinued Operations
In accordance with SFAS No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets” (SFAS 144), our
discontinued operations continue to reflect the ongoing costs for the stores remaining from the 33 stores closed on July 31,
2003 as part of our corporate restructuring (see Note 7). Additionally, during the quarter ended October 29, 2005 the Company
reclassified into discontinued operations the revenues and costs associated with another store in accordance with SFAS 144.
Below is a summary of these stores’ operations for the fifty-two weeks ended January 28, 2006 and January 29, 2005:
Fifty-two weeks ended
January 28,
2006
January 29,
2005
January 31,
2004
Revenues in discontinued operations:
Merchandise Sales $ 2,342 $ 2,386 $ 32,161
Service Revenue 462 536 8,513
Total revenues, discontinued operations $ 2,804 $ 2,922 40,674
Earnings (loss) from discontinued operations before income taxes $ 419 $ (2,996) (25,299)
Additionally, the Company has classified certain assets as assets held for disposal on its consolidated balance sheets. As
of January 28, 2006 and January 29, 2005, these reclassifications were as follows:
January 28,
2006
January 29,
2005
Land $ 120 $ 543
Building and improvements 532 122
$ 652 $ 665