Dick's Sporting Goods 2004 Annual Report Download - page 57

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DICK’S SPORTING GOODS, INC. 2004 ANNUAL REPORT 55
During fiscal 2004, the Company amended and restated its Certificate of Incorporation to increase the number of authorized shares of our
common stock, par value $0.01 per share from 100,000,000 to 200,000,000 and Class B common stock, par value $0.01 per share from
20,000,000 to 40,000,000.
Note Receivable for Common Stock During fiscal 2001, stock options representing 5,724,748 shares were exercised in exchange for a
note receivable due from a related party. The note receivable was repaid during fiscal 2002.
10. Income Taxes
The components of the provision for income taxes are as follows:
2004 2003 2002
(In thousands)
Current:
Federal $ 22,645 $ 21,543 $ 25,403
State 7,280 3,696 4,854
29,925 25,239 30,257
Deferred:
Federal 15,603 8,491 (4,392)
State 408 1,208 (440)
16,011 9,699 (4,832)
Total provision $ 45,936 $ 34,938 $ 25,425
The provision for income taxes differs from the amounts computed by applying the federal statutory rate as follows for the following periods:
2004 2003 2002
Federal statutory rate 35.0% 35.0% 35.0%
State tax, net of federal benefit 4.3% 5.0% 5.0%
Other permanent items 0.7% 0.0% 0.0%
Effective income tax rate 40.0% 40.0% 40.0%
Components of deferred tax assets (liabilities) consist of the following as of the fiscal periods ended:
2004 2003
(In thousands)
Other accrued expenses not currently deductible for tax purposes $ 9,643 $ 4,025
Employee benefits 6,356 4,114
Deferred rent 6,232 5,140
State net operating loss carryforwards 4,203 193
Store closings expense 3,614 1,777
Insurance 2,892 1,978
Deferred revenue 2,392 –
Property and equipment –144
Total deferred tax assets 35,332 17,371
Property and equipment (14,530) –
Inventory (11,965) (10,251)
Total deferred tax liabilities (26,495) (10,251)
Net deferred tax asset $ 8,837 $ 7,120
The gross deferred tax asset from tax loss carryforwards of $4.2 million represents approximately $91.8 million of state net operating loss
carryforwards, of which $11.2 million expires in the next ten years. The remaining $80.6 million expires between 2016 and 2024.