Petsmart 2009 Annual Report Download - page 76

Note 14 — Supplemental Schedule of Cash Flows
Supplemental cash flow information for 2009, 2008 and 2007 was as follows (in thousands):
2009 2008 2007
(52 weeks) (52 weeks) (53 weeks)
Interest paid ....................................... $59,153 $55,937 $ 50,812
Income taxes paid, net of refunds ....................... $81,511 $92,786 $171,303
Assets acquired using capital lease obligations .............. $18,849 $86,083 $100,506
Accruals and accounts payable for capital expenditures ....... $25,827 $19,770 $ 27,560
Dividends declared but unpaid .......................... $12,073 $ 3,816 $ 3,837
Note 15 — Acquisition of Store Locations in Canada
We completed the purchase of 19 store locations which added 18 net new stores in Canada on May 31, 2007,
for approximately $37.0 million after all adjustments. The operating results of the acquired stores are included in
the consolidated financial statements from the date of acquisition. In connection with the acquisition, we initially
recorded $27.5 million of goodwill. During the thirteen weeks ended October 28, 2007, we decreased our
preliminary purchase price by $0.5 million as a result of adjustments to inventory. The purchase price allocation
was finalized during the fourteen weeks ended February 3, 2008, with further adjustments to the carrying values of
assets and liabilities acquired, the useful lives of intangible assets and the residual amount allocated to goodwill.
The impact of the acquisition on our results of operations is immaterial, and the goodwill is expected to be
deductible for tax purposes.
Note 16 — Discontinuation of Equine Product Line
On February 28, 2007, we announced plans to exit our equine product line, including the sale or discon-
tinuation of StateLineTack.com and our equine catalog, and the sale of a warehouse, call center and store facility in
Brockport, New York.
On April 29, 2007, we entered into an agreement to sell a portion of the equine product line, including the State
Line Tack brand, certain inventory, customer lists and certain other assets to a third-party. The gain recognized was
not material.
During 2007, we performed an impairment analysis on the remaining assets supporting the equine product line,
including the Brockport, New York facility that indicated no impairment existed. We accelerated the depreciation
on these assets, and they were fully depreciated to their estimated salvage value as of February 3, 2008.
We also recognized a charge to income to reduce the remaining equine inventory to the lower of cost or market
value and recorded operating expenses related to the exit of the equine product line, remerchandising of the store
space previously used for equine inventory and severance costs. The net effect of the gain on sale of the assets,
inventory valuation adjustments, accelerated depreciation, severance and operating expenses was an after-tax loss
of $9.8 million for 2007. The inventory valuation adjustments and $7.5 million for accelerated depreciation of
certain assets were recorded in cost of sales, and the operating expenses, severance and accelerated depreciation on
certain assets were recorded in operating, general and administrative expenses in the Consolidated Statements of
Operations and Comprehensive Income.
F-28
PetSmart, Inc. and Subsidiaries
Notes to Consolidated Financial Statements — (Continued)