O'Reilly Auto Parts 2012 Annual Report Download - page 47

FORM 10-k
lity
lity
e
costs
rate
ed
tee.
is
or
is
or
a
to
it
r
The
ng
the
the
t
y
nt
t
f
,
d
e
ity,
31,
The
stock
of
In
s,
us
r
31,
nt
37
The table below outlines the calculations of the fixed charge coverage ratio and adjusted debt to adjusted EBITDAR ratio covenants,
as defined in the Credit Agreement governing the Revolving Credit Facility, for the twelve months ended December 31, 2012 and
2011 (dollars in thousands):
For the Year Ended December 31,
2012 2011
GAAP net income $ 585,746 $ 507,673
Add:
Interest expense 40,200 28,165
Rent expense 240,869 230,897
Provision for income taxes 355,775 308,100
Depreciation expense 176,705 164,579
Amortization expense 401 1,301
Non-cash share-based compensation 22,026 20,579
Write-off of asset-based revolving credit facility debt issuance costs - 21,626
N
on-GAAP adjusted net income (EBITDAR) $ 1,421,722 $ 1,282,920
Interest expense $ 40,200 $ 28,165
Capitalized interest 6,064 4,666
Rent expense 240,869 230,897
Total fixed charges $ 287,133 $ 263,728
Fixed charge coverage ratio 4.95 4.86
GAAP debt $ 1,095,956 $ 797,574
Stand-by letters of credit 57,281 59,917
Discount on senior notes 4,366 3,683
Six-times rent expense 1,445,214 1,385,382
N
on-GAAP adjusted debt $ 2,602,817 $ 2,246,556
Adjusted consolidated leverage ratio 1.83 1.75
The fixed charge coverage ratio and adjusted debt to adjusted EBITDAR ratio discussed and presented in the table above are not
derived in accordance with U.S. GAAP. We do not, nor do we suggest investors should, consider such non-GAAP financial measures
in isolation from, or as a substitute for, GAAP financial information. We believe that the presentation of our fixed charge coverage
ratio, adjusted debt to adjusted EBITDAR and free cash flow provides meaningful supplemental information to both management and
investors that reflects the required covenants under our credit agreement. We include these items in judging our performance and
believe this non-GAAP information is useful to investors as well. Material limitations of these non-GAAP measures are that such
measures do not reflect actual GAAP amounts. We compensate for such limitations by presenting, in the table above, the
accompanying reconciliation to the most directly comparable GAAP measures.
Share repurchase program:
Under our share repurchase program, as approved by our Board of Directors, we may, from time to time, repurchase shares of our
common stock, solely through open market purchases effected through a broker dealer at prevailing market prices, based on a variety
of factors such as price, corporate trading policy requirements and overall market conditions. We may increase or otherwise modify,
renew, suspend or terminate the share repurchase program at any time, without prior notice. During 2012, our Board of Directors
approved resolutions to increase the cumulative authorization amount to $3.0 billion. The most recent $500 million authorization is
effective for a three-year period and expires November 12, 2015. Each prior $500 million authorization was effective for a three-year
period beginning on the date of the additional authorization.
The following table identifies shares of the Company’s common stock that have been repurchased as part of our publicly announced
share repurchase program (in thousands, except per share data):
For the Year Ended December 31,
2012 2011
Shares repurchased 16,201 15,877
Average price per share $ 89.20 $ 61.49
Total investment $ 1,445,044 $ 976,322