Pizza Hut 2002 Annual Report Download - page 60

As noted above, on December 30, 2001, we reclassified $241 mil-
lion of reacquired franchise rights to goodwill, net of related
deferred tax liabilities of $53 million.
As a result of adopting SFAS 142, we ceased amortization
of goodwill and indefinite-lived intangible assets beginning
December 30, 2001. Amortization expense for definite-lived intan-
gible assets was $6 million in 2002. Amortization expense for
goodwill and all intangible assets was $37 million and $38 million
in 2001 and 2000, respectively. Amortization expense for definite-
lived intangible assets will approximate $5 million for each of the
next five years.
The following table provides a reconciliation of reported net
income to adjusted net income as though SFAS 142 had been
effective for the years ended 2001 and 2000:
2001
Amount Basic EPS Diluted EPS
Reported net income $ 492 $ 1.68 $ 1.62
Add back amortization expense (net of tax):
Goodwill 25 0.09 0.09
Brand/Trademarks 1 ——
Adjusted net income $ 518 $ 1.77 $ 1.71
2000
Amount Basic EPS Diluted EPS
Reported net income $ 413 $ 1.41 $ 1.39
Add back amortization expense (net of tax):
Goodwill 23 0.08 0.08
Brand/Trademarks 1 ——
Adjusted net income $ 437 $ 1.49 $ 1.47
ACCOUNTS PAYABLE AND OTHER
CURRENT LIABILITIES
2002 2001
Accounts payable $ 417 $ 353
Accrued compensation and benefits 258 210
Other current liabilities 491 469
$1,166 $ 1,032
NOTE
13
SHORT-TERM BORROWINGS AND
LONG-TERM DEBT
2002 2001
Short-term Borrowings
Current maturities of long-term debt $12 $ 545
International lines of credit 115 138
Other 19 13
$ 146 $ 696
Long-term Debt
Senior, unsecured Term Loan Facility $ — $ 442
Senior, unsecured Revolving Credit Facility,
expires June 2005 153 94
Senior, Unsecured Notes, due May 2005 351 351
Senior, Unsecured Notes, due April 2006 200 198
Senior, Unsecured Notes, due May 2008 251 251
Senior, Unsecured Notes, due April 2011 645 644
Senior, Unsecured Notes, due July 2012 398 —
Capital lease obligations (See Note 15) 99 79
Other, due through 2010 (6% - 12%) 170 4
2,267 2,063
Less current maturities of long-term debt (12) (545)
Long-term debt excluding SFAS 133 adjustment 2,255 1,518
Derivative instrument adjustment
under SFAS 133 (See Note 16) 44 34
Long-term debt including
SFAS 133 adjustment $ 2,299 $ 1,552
On June 25, 2002, we closed on a new $1.4 billion senior unse-
cured Revolving Credit Facility (the “New Credit Facility”). The New
Credit Facility replaced the existing bank credit agreement which
was comprised of a senior unsecured Term Loan Facility and a
$1.75 billion senior unsecured Revolving Credit Facility (collectively
referred to as the “Old Credit Facilities”) that were scheduled to
mature on October 2, 2002. Amounts outstanding under the Old
Credit Facilities were classified as short-term borrowings in the
Consolidated Balance Sheet at December 29, 2001. On December
27, 2002, we voluntarily reduced our maximum borrowing limit
under the New Credit Facility to $1.2 billion. The New Credit Facility
matures on June 25, 2005. We used the initial borrowings under
the New Credit Facility to repay the indebtedness under the Old
Credit Facilities.
The New Credit Facility is unconditionally guaranteed by our
principal domestic subsidiaries and contains other terms and
provisions (including representations, warranties, covenants,
NOTE
14
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