Banana Republic 2011 Annual Report Download - page 85

Gap and Banana Republic outlet retail sales are reflected within the respective results of each brand.
Financial Information for Reportable Segments
Operating income is the primary measure of profit we use to make decisions on allocating resources to our
operating segments and to assess the operating performance of each operating segment. It is defined as income
before interest expense, interest income, and income taxes. Corporate expenses are allocated to each operating
segment and recorded in operating income on a rational and systematic basis.
Reportable segment assets presented below include those assets that are directly used in, or allocable to, that
segment’s operations. Total assets for the Stores reportable segment primarily consist of merchandise inventory,
the net book value of store assets, and prepaid expenses and receivables related to store operations. Total assets
for the Direct reportable segment primarily consist of merchandise inventory, the net book value of IT and
distribution center assets, and the net book value of goodwill and intangible assets as a result of the acquisition of
Athleta. We do not allocate corporate assets to our operating segments. Unallocated corporate assets primarily
include cash and cash equivalents, short-term investments, the net book value of corporate property and
equipment, and tax-related assets. Reportable segment capital expenditures are direct purchases of property and
equipment by that segment. Unallocated capital expenditures primarily consist of corporate purchases of property
and equipment.
Selected financial information by reportable segment and reconciliations to our consolidated totals are as follows:
Fiscal Year
($ in millions) 2011 2010 2009
Operating income:
Stores ..................................................................... $1,095 $1,666 $1,563
Direct ..................................................................... 343 302 252
Operating income .......................................................... $1,438 $1,968 $1,815
Depreciation and amortization expense:
Stores ..................................................................... $ 533 $ 584 $ 589
Direct ..................................................................... 59 64 66
Depreciationandamortizationexpense ...................................... $ 592 $ 648 $ 655
Purchases of property and equipment:
Stores ..................................................................... $ 362 $ 391 $ 228
Direct ..................................................................... 70 55 42
Unallocated ................................................................ 116 111 64
Purchases of property and equipment ........................................ $ 548 $ 557 $ 334
($ in millions) January 28, 2012 January 29, 2011
Segment assets:
Stores.......................................................................... $3,315 $3,264
Direct .......................................................................... 591 545
Unallocated .................................................................... 3,516 3,256
Totalassets..................................................................... $7,422 $7,065
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