Banana Republic 2014 Annual Report Download - page 36

Download and view the complete annual report

Please find page 36 of the 2014 Banana Republic annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 96

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96

24
We consider the following to be measures of our liquidity and capital resources:
($ in millions) January 31,
2015 February 1,
2014 February 2,
2013
Cash, cash equivalents, and short-term investments $ 1,515 $ 1,510 $ 1,510
Debt $ 1,353 $ 1,394 $ 1,246
Working capital $ 2,083 $ 1,985 $ 1,788
Current ratio 1.93:1 1.81:1 1.76:1
As of January 31, 2015, over half of our cash and cash equivalents were held in the United States and are
generally accessible without any limitations.
We believe that current cash balances and cash flows from our operations will be sufficient to support our
business operations, including growth initiatives and planned capital expenditures, for the next 12 months and
beyond. We are also able to supplement near-term liquidity, if necessary, with our $500 million revolving credit
facility.
Cash Flows from Operating Activities
Net cash provided by operating activities during fiscal 2014 increased $424 million compared with fiscal 2013,
primarily due to the following:
• an increase of $284 million related to other current assets and other long-term assets primarily due to the
change in timing of payments received related to our credit card program;
• an increase of $132 million related to lease incentives and other long-term liabilities primarily due to the receipt
of an upfront payment in fiscal 2014 related to the amendment of our credit card program agreement with the
third-party financing company, which is being amortized over the term of the contract; and
• an increase of $184 million related to merchandise inventory primarily due to timing of receipts; partially offset
by
• a decrease of $146 million related to accounts payable primarily due to timing of payments;
• a decrease of $28 million related to accrued expenses and other current liabilities primarily due to timing of
payments; and
• a decrease of $18 million in net income.
Net cash provided by operating activities during fiscal 2013 decreased $231 million compared with fiscal 2012,
primarily due to the following:
• a decrease of $220 million related to income taxes payable, net of prepaid income taxes and other tax-related
items, in fiscal 2013 compared with fiscal 2012 primarily due to the timing of tax payments;
• a decrease of $73 million related to accrued expenses and other current liabilities primarily due to a higher
bonus payout in fiscal 2013 compared with fiscal 2012;
• a decrease of $71 million related to non-cash and other items primarily due to the realized gain related to our
derivative financial instruments in fiscal 2013 compared with a realized loss in fiscal 2012;
• a decrease of $67 million related to lease incentives and other long-term liabilities primarily due to the resolution
of tax matters, including interest, and an increase in lease incentives in fiscal 2012 related to the relocation of
our New York headquarter offices; and
• a decrease of $50 million related to merchandise inventory primarily due to volume and timing of receipts;
partially offset by
• an increase in net income of $145 million; and
• a deferred tax provision of $69 million in fiscal 2013 compared with a deferred tax benefit of $37 million in fiscal
2012.