Foot Locker 2007 Annual Report Download - page 59

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43
9. Property and Equipment, Net
2007 2006
(in millions)
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3 $ 3
Buildings:
Owned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 30
Furniture, fixtures and equipment:
Owned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,1171,139
Leased . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 14
1,1501,186
Less: accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (903) (870)
247316
Alterations to leased and owned buildings,
net of accumulated amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 274338
$521 $654
10. Goodwill
2007 2006
(in millions)
Athletic Stores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $186 $184
Direct-to-Customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80 80
$266 $264
The effect of foreign exchange fluctuations for the fiscal year ended February 2, 2008 increased goodwill by
$2 million, resulting from the strengthening of the euro in relation to the U.S. dollar. During the third and fourth
quarters of 2007, the Company performed reviews of its U.S. Athletic stores’ goodwill, as a result of the SFAS No. 144
recoverability analysis. These analyses did not result in an impairment charge.
11. Intangible Assets, net
(in millions)
February 2, 2008
Wtd. Avg.
Useful Life
in Years
February 3, 2007
Gross
value Accum.
amort.
Net
Value
(1) Gross
value Accum.
amort.
Net
Value
(1)
Finite life intangible assets
Lease acquisition costs . . . . . . . . . . . . . . . . . . . . . $198 $(125) $ 73 11.9 $178 $ (98) $ 80
Trademark . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 (4) 17 20.0 21 (3) 18
Loyalty program . . . . . . . . . . . . . . . . . . . . . . . . . . 1 (1) — 2.0 1 (1) —
Favorable leases . . . . . . . . . . . . . . . . . . . . . . . . . . 10 (7) 3 3.7 9 (5) 4
Total finite life intangible assets . . . . . . . . . . . . . 230 (137) 93 12.3 209 (107) 102
Intangible assets not subject to
amortization . . . . . . . . . . . . . . . . . . . . . . . . . . 3 — 3 3 — 3
Total intangible assets . . . . . . . . . . . . . . . . . . . . . $ 233 $ (137) $96 $212 $(107) $105
(1) Includes effect of foreign currency translation of $10 million in 2007, $5 million in 2006 and $8 million in 2005 primarily related to the
strengthening of the euro in relation to the U.S. dollar.
Intangible assets not subject to amortization at February 2, 2008 and February 3, 2007, include $3 million related
to the trademark of the 11 stores acquired in the Republic of Ireland.
Lease acquisition costs represent amounts that are required to secure prime lease locations and other lease
rights, primarily in Europe. Included in finite life intangibles, as a result of the Footaction and Republic of Ireland
purchases, are the trademark for the Footaction name, amounts paid for leased locations with rents below their fair
value for both acquisitions and amounts paid to obtain names of members of the Footaction loyalty program.