Pep Boys 2012 Annual Report Download - page 67

In fiscal 2012, cash used in financing activities was $34.8 million, as compared to cash provided by
financing activities of $20.0 million in the prior year period. During the third quarter of 2012, we
increased the amount of our borrowing under our amended and restated Senior Secured Term Loan
from $150.0 to $200.0 million and used those proceeds together with cash on hand to repay, in full, the
$147.0 million principal amount then outstanding under our 7.5% Senior Subordinated Notes due 2014
and to settle our outstanding interest rate swap (see Note 5 to the Consolidated Financial Statements).
As a result of the refinancing, we reduced our total debt by $95.1 million and extended its maturity to
2018. While this refinancing activity resulted in a one-time charge to interest expense of $11.2 million,
it also reduced our annual interest expense by approximately $11.0 million.
Our trade payable program, which has an availability of $175.0 million, is funded by various bank
participants who have the ability, but not the obligation, to purchase, directly from our vendors,
account receivables owed by Pep Boys. In fiscal 2012, we increased net borrowings on our trade payable
program by $64.5 million to $149.7 million as of February 2, 2013 from $85.2 million as of January 28,
2012 (classified as trade payable program liability on the consolidated balance sheet).
In fiscal 2011, we paid $2.4 million in financing costs to amend and restate our revolving credit
agreement to reduce its interest rate by 75 basis points and to extend its maturity to July 2016 and paid
a cash dividend of $6.3 million.
In the fourth quarter of fiscal 2012, our Board of Directors authorized a program to repurchase up
to $50.0 million of our common stock. During the fourth quarter of fiscal 2012, we used $0.3 million to
repurchase shares under the program.
We anticipate that cash on hand and cash generated by operating activities will exceed our
expected cash requirements in fiscal 2013. In addition, we expect to have excess availability under our
existing revolving credit agreement during the entirety of fiscal 2013. As of February 2, 2013 we had
undrawn availability on our revolving credit facility of $141.2 million. As of February 2, 2013 we had
$59.2 million of cash and cash equivalents on hand.
Our working capital was $126.5 million and $166.6 million at February 2, 2013 and January 28,
2012, respectively. Our total debt, net of cash on hand, as a percentage of our net capitalization, was
20.8% and 32.0% at February 2, 2013 and January 28, 2012, respectively.
Contractual Obligations
The following chart represents our total contractual obligations and commercial commitments as of
February 2, 2013:
From From
Contractual Obligations Total Within 1 year 1 to 3 years 3 to 5 years After 5 years
(dollars amounts in thousands)
Long-term debt(1) ................ $ 200,000 $ 2,000 $ 4,000 $ 4,000 $190,000
Operating leases ................. 791,723 102,609 189,296 159,742 340,076
Expected scheduled interest payments
on long-term debt .............. 59,533 10,675 21,048 20,645 7,165
Other long-term obligations(2) ....... 13,915 — — — —
Total contractual obligations ......... $1,065,171 $115,284 $214,344 $184,387 $537,241
(1) Long-term debt includes current maturities.
(2) Comprised of deferred compensation items of $6.1 million, income tax liabilities of $1.8 million
and asset retirement obligations of $6.0 million. We made voluntary contributions of $3.0 million
and $5.0 million to our defined benefit pension plan in fiscal 2011 and 2010, respectively. The
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