Staples 2006 Annual Report Download - page 126

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STAPLES, INC. AND SUBSIDIARIES
Notes To Consolidated Financial Statements (Continued)
C-22
NOTE K Segment Reporting (Continued)
accounting policies of the reportable segments are the same as those described in the summary of significant accounting
policies in Note A. Intersegment sales and transfers and the related intercompany profit or loss are excluded from
reportable segment amounts.
Staples’ North American Retail and North American Delivery segments are managed separately because the way
they market products is different, the classes of customers they service may be different, and the distribution methods
used to deliver products to customers is different. The International Operations are considered a separate reportable
segment because of the significant difference in the operating environment from the North American operations.
The following is a summary of significant accounts and balances by reportable segment for fiscal years 2006, 2005
and 2004 (in thousands):
2006 2005 2004
Sales:
North American Retail........................................... $ 9,938,885 $ 9,037,513 $ 8,324,299
North American Delivery......................................... 5,863,094 4,945,661 4,196,882
International Operations ......................................... 2,358,810 2,095,678 1,927,197
Consolidated.................................................. $ 18,160,789 $ 16,078,852 $ 14,448,378
Business Unit Income:
North American Retail........................................... $ 956,565 $ 843,140 $ 706,419
North American Delivery......................................... 624,729 507,131 396,065
International Operations ......................................... 50,511 13,616 69,253
Business unit income........................................... 1,631,805 1,363,887 1,171,737
Stock-based compensation........................................ (168,736) (129,806 ) (114,861)
Consolidated.................................................. $ 1,463,069 $ 1,234,081 $ 1,056,876
Depreciation & Amortization:
North American Retail........................................... $ 210,698 $ 192,112 $ 181,307
North American Delivery......................................... 74,027 60,103 51,909
International Operations ......................................... 54,574 51,685 45,629
Consolidated.................................................. $ 339,299 $ 303,900 $ 278,845
Capital Expenditures:
North American Retail........................................... $ 320,633 $ 284,173 $ 209,190
North American Delivery......................................... 141,117 87,992 55,068
International Operations ......................................... 66,725 83,938 71,177
Consolidated.................................................. $ 528,475 $ 456,103 $ 335,435
The following is a reconciliation of business unit income to income before income taxes and minority interest for
fiscal years 2006, 2005 and 2004 (in thousands):
2006 2005 2004
Consolidated business unit income...................................... $ 1,463,069 $ 1,234,081 $ 1,056,876
Other income (expense)............................................... 8,259 1,218 (10,301)
Income before income taxes and minority interest......................... $ 1,471,328 $ 1,235,299 $ 1,046,575