Petsmart 2005 Annual Report Download - page 77

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Note 7 — Income Taxes
Income before income tax expense is as follows (in thousands):
January 29,
2006
January 30,
2005
February 1,
2004
Fiscal Year Ended
United States .................................... $285,228 $235,375 $200,835
Foreign ........................................ 3,981 5,429 2,121
$289,209 $240,804 $202,956
Income tax expense consists of the following (in thousands):
January 29,
2006
January 30,
2005
February 1,
2004
Fiscal Year Ended
Current provision:
Federal ....................................... $102,823 $ 78,577 $74,027
State/Foreign .................................. 20,596 15,148 11,798
123,419 93,725 85,825
Deferred:
Federal ....................................... (12,339) (7,246) (7,197)
State......................................... (4,361) (3,128) (623)
(16,700) (10,374) (7,820)
Income tax expense ............................... $106,719 $ 83,351 $78,005
A reconciliation of the federal statutory income tax rate to the Company’s effective tax rate is as follows
(dollars in thousands):
Dollars % Dollars % Dollars %
January 29, 2006 January 30, 2005 February 1, 2004
Fiscal Year Ended
Provision at federal statutory tax rate .... $101,224 35.0% $84,281 35.0% $71,034 35.0%
State income taxes, net of federal income
tax benefit . . .................... 9,994 3.5 7,914 3.3 7,314 3.6
Adjustments to tax reserves ........... (4,631) (1.6) 1,071 0.4 456 0.2
Adjustments to deferred tax assets ...... 3,057 1.1 — — — —
Tax exempt interest income ........... (2,625) (0.9) (1,376) (0.6) (564) (0.3)
Adjustment to valuation allowance ...... 645 0.2 (7,737) (3.2) — —
Utilization of capital loss ............. (650) (0.2) (1,247) (0.5) — —
Other ............................ (295) (0.1) 445 0.2 (235) (0.1)
$106,719 36.9% $83,351 34.6% $78,005 38.4%
F-18
PetSmart, Inc. and Subsidiaries
Notes to Consolidated Financial Statements — (Continued)