Dick's Sporting Goods 2004 Annual Report Download - page 51

Download and view the complete annual report

Please find page 51 of the 2004 Dick's Sporting Goods 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 66

  • 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

DICK’S SPORTING GOODS, INC. 2004 ANNUAL REPORT 49
The estimated weighted average economic useful life is 12 years. The annual amortization expense of the favorable leases recorded as of
January 29, 2005 is expected to be as follows:
Fiscal Years Estimated Amortization Expense
(In thousands)
2005 $46
2006 142
2007 241
2008 345
2009 453
Thereafter 4,084
Total $ 5,311
4. Store and Corporate Office Closings
As a result of the Galyan’s acquisition, the Company has decided to close six Dick’s Sporting Goods stores and four Galyan’s stores,
two of which have lease terms expiring in fiscal 2004, the Galyan’s clearance center and the Galyan’s corporate headquarters. As of
January 29, 2005, the Company has recorded $3.7 million of reserves and write-offs, net of cash payments for leases and other exit costs,
related to the closings of the Galyan’s locations. The Company decided to close certain stores that were in overlapping trade areas.
The following table provides a summary of the activity of the Galyan’s store closing reserves and write-offs established in conjunction with
the purchase price allocation:
Write-offs of
Lease and Property and
Other Costs Equipment Total
(In thousands)
Store and corporate office closing reserves and write-offs
in conjunction with the Galyan’s acquisition at July 31, 2004 $ 15,838 $ 6,953 $ 22,791
Adjustments to the reserves:
Additional write-offs of property and equipment – 8,950 8,950
Decrease in accruals related to Galyan’s store closings (8,331) – (8,331)
Cash payments for leases and other closing costs (3,834) – (3,834)
Non-cash utilization of reserves related to property and
equipment write-offs upon store and corporate office closure – (15,903) (15,903)
Store and corporate office closing reserves and write-offs at January 29, 2005 $ 3,673 $ – $ 3,673
In addition to the one Dick’s store closed due to the acquisition, the Company closed two Dick’s stores that were not related to the
Galyan’s acquisition. One store was closed as its replacement was opened in fiscal 2003, and the second store was closed due to poor
performance. The following table summarizes the activity of the Dick’s store closing reserves and write-offs established due to store
closings as a result of the Galyan’s acquisition and the other strategic actions:
Not Related
Acquisition Related to the Acquisition Total
Balance at February 1, 2004 $ – $ – $ –
Expense charged to earnings 3,315 1,579 4,894
Cash payments for leases and other costs (124) (1,579) (1,703)
Balance at January 29, 2005 $ 3,191 $ – $ 3,191