Cabela's 2004 Annual Report Download - page 110

CABELA'S INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (Continued)
(Dollar Amounts in Thousands Except Share and Per Share Amounts)
segment consists of ten destination retail stores in various size and formats; Financial Services issues co-
branded credit cards. The reconciling amount is primarily made up of corporate overhead and shared
services. The Company's executive management, being its chief operating decision makers, assesses the
performance of each operating segment based on an operating income measure, which is net revenue less
merchandise acquisition costs and certain directly identiÑable and allocable operating costs as described
below. For the Direct segment, these operating costs primarily consist of catalog development, production
and circulation costs, e-commerce advertising costs and order processing costs. For the Retail segment,
these operating costs primarily consist of store and selling and occupancy costs. For the Financial Services
segment, operating costs primarily consist of advertising and promotion, contract labor, salaries and wages
and other general and administrative costs. Corporate and other expenses consist of unallocated shared-
service costs, general and administrative expenses, various small companies such as travel and lodging
which are not aggregated with the other segments and eliminations. Unallocated shared-service costs
include receiving, distribution and storage costs, merchandising and quality assurance costs as well as
corporate occupancy costs. General and administrative expenses include costs associated with general
corporate management and shared departmental services (e.g., Ñnance, accounting, data processing and
human resources).
Segment assets are those directly used in or clearly allocable to an operating segment's operations. For
the Direct segment, these assets primarily include prepaid and deferred catalog costs, Ñxed assets and
goodwill. Goodwill makes up $970 of assets in the Direct segment. For the Retail segment, these assets
primarily include inventory in the stores, land, buildings, Ñxtures, leasehold improvements. For the
Financial Services segment these assets primarily include cash, credit card loans receivable, other,
buildings and Ñxtures. Corporate and other assets include corporate headquarters, merchandise distribution
inventory, and shared technology infrastructure as well as corporate cash and cash equivalents, prepaid
expenses and $830 of investment in equity method investees. Non-cash capital expenditures were $8,728 in
the other segment for a capital lease on a distribution center. Segment depreciation and amortization and
capital expenditures are correspondingly allocated to each segment. Corporate and other depreciation and
amortization and capital expenditures are related to corporate headquarters, merchandise distribution and
technology infrastructure. Unallocated assets include corporate cash and equivalents, inventory that could
be shipped for sales to the Retail or Direct segment entities, the net book value of corporate facilities and
related information systems, deferred income taxes and other corporate long-lived assets. The accounting
policies of the segments, where applicable, are the same as those described in the summary of signiÑcant
accounting policies. Intercompany revenues between the segments have been eliminated in the
consolidations.
Corporate
Financial Overhead
2004 Direct Retail Services and Other Total
Dollars in thousands
Revenue from external ÏÏÏÏÏÏÏÏÏ $968,889 $497,027 $ 78,714 $ 11,344 $1,555,974
Revenue from internalÏÏÏÏÏÏÏÏÏÏ 1,757 2,047 (610) (3,194) Ì
Total revenue ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 970,646 499,074 78,104 8,150 1,555,974
Operating income (loss) ÏÏÏÏÏÏÏÏ 146,765 72,136 31,099 (152,785) 97,215
As a % of revenue ÏÏÏÏÏÏÏÏÏÏÏ 15.1% 14.5% 39.8% N/A 6.2%
Depreciation and amortization ÏÏÏ 5,350 10,200 1,386 12,907 29,843
Assets ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 309,089 266,840 199,861 452,441 1,228,231
Capital expenditures ÏÏÏÏÏÏÏÏÏÏÏ 6,752 24,915 857 20,044 52,568
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