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38
To some extent, our business is seasonal primarily as a result of the impact of weather conditions on customer buying patterns. While
we have historically realized operating profits in each quarter of the year, our store sales and profits have historically been higher in the
second and third quarters (April through September) than in the first and fourth quarters of the year.
QUARTERLY RESULTS
The following table sets forth certain quarterly unaudited operating data for fiscal 2009 and 2008. The unaudited quarterly information
includes all adjustments which management considers necessary for a fair presentation of the information shown.
The unaudited operating data presented below should be read in conjunction with our consolidated financial statements and related
notes included elsewhere in this annual report, and the other financial information included therein.
Fiscal 2009
First Second Third Fourth
Quarter Quarter Quarter Quarter
(In thousands, except per share data)
Sales $
1,163,749
$
1,251,377
$
1,258,239
$
1,173,697
Gross profit
542,670
603,769
610,555
569,534
Operating income
113,336
149,675
149,196
125,412
Net income
62,835
85,515
87,225
71,923
Basic net income per common share
0.47
0.63
0.64
0.52
Net income per common share – assuming dilution
0.46
0.62
0.63
0.52
Fiscal 2008
First Second Third Fourth
Quarter Quarter Quarter Quarter
(In thousands, except per share data)
Sales $
646,220
$
704,430
$
1,111,272
$
1,114,631
Gross profit
288,494
317,097
507,206
515,129
Operating income
74,156
88,388
92,471
80,602
Net income
46,331
55,788
41,399
42,714
Basic net income per common share
0.40
0.48
0.31
0.32
Net income per common share – assuming dilution
0.40
0.48
0.31
0.32
RECENT ACCOUNTING PRONOUNCEMENTS
In December 2007, the Financial Accounting Standards Board (“FASB”) issued the Consolidation Topic (“ASC 810”) of the FASB
ASC, which is effective for fiscal years beginning after December 15, 2008. ASC 810 states that accounting and reporting for minority
interests will be recharacterized as noncontrolling interests and classified as a component of equity. The calculation of earnings per
share will continue to be based on income amounts attributable to the parent. ASC 810 applies to all entities that prepare consolidated
financial statements, but will affect only those entities that have an outstanding noncontrolling interest in one or more subsidiaries or
that deconsolidate a subsidiary. The provisions of ASC 810 were effective for us beginning January 1, 2009, and are applied
prospectively. The adoption of ASC 810 did not have a material impact on our consolidated financial position, results of operations or
cash flows.
In March 2008, the FASB issued the Derivatives and Hedging Topic (“ASC 815”) of the FASB ASC, which requires entities that
utilize derivative instruments to provide qualitative disclosures about their objectives and strategies for using such instruments, as well
as any details of credit-risk-related contingent features contained within derivatives. ASC 815 also requires entities to disclose
additional information about the amounts and location of derivatives located within the financial statements, how the provisions of
ASC 815 have been applied, and the impact that hedges have on an entity’s financial position, financial performance and cash flows.
ASC 815 is effective for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. We
have adopted the provisions of ASC 815 beginning with our condensed consolidated financial statements for the quarter ended March
31, 2009.
In May 2008, the FASB issued the Debt with Conversions and Other Options Topic (“ASC 470”) of the FASB ASC, which clarifies
the accounting for convertible debt instruments that may be settled in cash (including partial cash settlement) upon conversion and
specifies that issuers of such instruments should separately account for the liability and equity components of certain convertible debt
instruments in a manner that reflects the issuer’s nonconvertible debt borrowing rate when interest cost is recognized in subsequent
periods. ASC 470 requires bifurcation of a component of the debt, classification of that component in equity if certain criteria are met