Office Depot 2005 Annual Report Download - page 22

Download and view the complete annual report

Please find page 22 of the 2005 Office Depot 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 62

  • 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

&2
53
2
5$7($1'
2
7+(5
*
HQHUDODQG$GPLQLVWUDWLYH([
S
HQVHV
'ROODUVLQPLOOLRQV



*
HQHUDODQGDGPLQLVWUDWLYHH[
S
HQVHV 


3HUFHQWD
J
HR
I
VDOHV



)LVFDO \HDU  JHQHUDO DQG DGPLQLVWUDWLYH
³*
 H[SHQVHV
LQFOXGHDSSUR[LPDWHO
\
PLOOLRQRI&KDU
J
HVZKLOH
LQFOXGHGDSSUR[LPDWHO
\
PLOOLRQRIH[HFXWLYHDQGVWDIIVHYHU
DQFHGLVSXWHUHVROXWLRQVORVVRQGLVSRVDOR
I
SURSHUW\DQGOHDVH
WHUPLQDWLRQFRVWVDVVRFLDWHGZLWKSURSHUW
\
XVHGLQ*$IXQFWLRQV
$I
WHU FRQVLGHULQ
J
WKHVHFKDU
J
HV WKH UHPDLQLQ
J
FKDQ
J
H LQ WRWDO
*
$ H[
S
HQVHV LQ  FRP
S
DUHG WR  UH
I
OHFWV WKH
S
RVLWLYH
LPSDFWV RI YDULRXV FRVW FRQWURO PHDVXUHV VXFK DV ORZHULQ
J
SUR
I
HVVLRQDO
I
HHV DQG FRQVROLGDWLQ
J
I
XQFWLRQV SDUWLDOO
\
R
II
VHW E
\
LQFUHDVHV
I
URPDGR
S
WLRQR
I
)$
6
5DQGDFFHOHUDWLRQR
I
FHUWDLQ
YDULDEOH SD
\
 DQG UHVWULFWHG VWRFN DZDUGV HDUQHG LQ

 7KH
LQFUHDVH
I
URPWRUH
I
OHFWVD
I
XOO
\
HDUR
I
*
$H[SHQVHV
I
ROORZLQJD(XURSHDQDFTXLVLWLRQLQPLGDVZHOODVWKH
LPSDFW RI WUDQVODWLQ
J
DOOLQWHUQDWLRQDO*$H[SHQVHVDWKL
J
KHU
H
[F
K
DQ
J
HUDWHV
+LVWRULFDOO
\
 ZH KDYH QRW DOORFDWHG RXU
*
$ H[SHQVHV WR RXU
GLYLVLRQV :H KDYH EHHQ DQDO\]LQJ DQG GHYHORSLQJ PHWKRGV WR
DOORFDWH *$ DQG UHILQH RWKHU H[LVWLQ
J
DOORFDWLRQVDQGOLQHLWHP
F
ODVVL
I
LFDWLRQV:HPD
\
LPSOHPHQWWKLVUHYLVHGSURFHVVLQWKH
I
LUVW
T
XDUWHUR
I
I
LVFDO\HDU7KHVHUHYLVHGDOORFDWLRQVPD\LPSDFW
L
Q
GL
Y
LG
XD
O
OL
QH
L
WHPVDQ
G
SU
L
RUSHU
L
R
G
UHVX
O
WVZRX
OG
W
K
HQ
E
HUHF
O
DV
VL
I
LHG
I
RUPHDQLQ
JI
XOFRPSDULVRQ7KHFRPPHQWVDERYHGHVFULEH
KRZRXUPDQDJHPHQWKDVKLVWRULFDOO\SUHVHQWHGRXU
*
$H[SHQVHV
2WKHU FRPSDQLHV PD
\
FKDU
J
HPRUHRUOHVV*$H[SHQVHVDQG
RWKHU FRVWVWRWKHLUVH
J
PHQWVDQGRXUUHVXOWVWKHUH
I
RUHPD
\
QRW
EHFRPSDUDEOHWRVLPLODUO\WLWOHGPHDVXUHVXVHGE\RWKHUHQWLWLHV
2
WKHU
2
SHUDWLQJ([SHQVHV
2WKHURSHUDWLQ
J
H[SHQVHVLQFOXGHSUHRSHQLQ
J
H[SHQVHVDQGLQ
DFTXLVLWLRQLQWH
J
UDWLRQFRVWV3UHRSHQLQ
J
H[SHQVHVFRQVLVW
R
I
SHUVRQQHOSURSHUW\DQGDGYHUWLVLQJH[SHQVHVLQFXUUHGLQRSHQ
LQ
J
RU UHORFDWLQ
J
VWRUHVDQG FXVWRPHU VHUYLFH FHQWHUV
³&6&V´

2
Q D ZRUOGZLGH EDVLV ZH R
S
HQHG RU UHORFDWHG  VWRUHV LQ
LQDQGLQ
,
QZHLQFXUUHGDSSUR[LPDWHO\
PLOOLRQRIQRQFDSLWDOL]
D
EO
H
L
QWH
J
UDW
L
RQFRVWV
L
QFRQQHFW
L
RQZ
L
W
K
RXU
(
XURSHDQDFTX
L
V
L
WLRQLQ-XQH7KHVHFRVWVSULPDULO
\
UHODWHGWRSUR
I
HVVLRQDO
FRQVXOWLQJ
I
HHV
I
RU DVVLVWDQFH ZLWK LQWHJUDWLRQ PDQDJHPHQW
LQWHUQDO FRPPXQLFDWLRQV SODQV DQG KXPDQ UHVRXUFH DVSHFWV R
I
W
K
HDF
T
X
L
V
L
W
L
RQ
2
WKHU,QFRPHDQG([
S
HQVH
'ROODUVLQPLOOLRQV



,
QW
H
U
HV
WLQ
FR
P
H



,
QWHUHVWH[SHQVH



/RVVRQH[WLQ
J
XLVKPHQWR
I
GHE
W
²

²
0L
VFH
OO
DQHRXV
L
QFRPHQHW



,QWHUHVW LQFRPH LQFUHDVHGLQ IURPPRGHVWO\ KLJKHULQWHUHVW
U
DWHVDQGLQIURPKL
J
KHUDYHUD
J
HFDVKDQGFDVKHTXLYDOHQW
E
DODQFHVDQGKLJKHULQWHUHVWEDVHGLQYHVWPHQW\LHOGV
7KHGHFUHDVHLQLQWHUHVWH[
S
HQVHLQUH
I
OHFWVDUHGXFWLRQR
I
L
QWHUHVWUHTXLUHPHQWVIROORZLQJWKHIDYRUDEOHVHWWOHPHQWRIYDULRXV
WD[FODLPVDVZHOODVWKHLPSDFWRIRXUUHGHPSWLRQLQ'HFHPEHU
RI WKHHQWLUHLVVXHRI WKH
PLOOLRQVHQLRU VXERUGLQDWHG
Q
RWHV 7KH QHW ORVV RQ H[WLQJXLVKPHQW RI GHEW RI
PLOOLRQ
L
QFOXGHGWKHPDNHZKROHSD
\
PHQWZULWHRIIRIGHIHUUHGLVVXDQFH
FRVWVDQGUHFRJQLWLRQR
I
DSUHYLRXVO\GH
I
HUUHGJDLQUHODWHGWRDQ
L
QWHUHVWUDWHVZDS,QWHUHVWH[SHQVHLQFUHDVHGLQUH
I
OHFWLQJ
DIXOO
\
HDURILQWHUHVWRQWKHPLOOLRQLQVHQLRUQRWHVWKDWZHUH
L
VVXHG LQ $XJXVW  DW DQ H
II
HFWLYH LQWHUHVW UDWH R
I


HVVHQWLDOO\ D IXOO \HDU RI LQWHUHVW RQ WKH
 PLOOLRQ LQ VHQLRU
VXERUGLQDWHG QRWHV ZLWK DQ HIIHFWLYH LQWHUHVW UDWH RI  D IXOO
\HDURILQWHUHVWRQDSSUR[LPDWHO\
PLOOLRQRXWVWDQGLQJXQGH
U
RXU UHYROYLQJ FUHGLW IDFLOLW\ DV ZHOO DV LQWHUHVW H[SHQVH RQ
FDS
L
WD
O
O
HDVHV
2
XUQHWPLVFHOODQHRXVLQFRPH
H[SHQVH
FRQVLVWVRIHTXLW
\
LQWKH
HDUQLQJV R
I
 RXU MRLQW YHQWXUH LQYHVWPHQWV UR\DOW\ DQG
I
UDQFKLVH
L
QFRPHDQGUHDOL]HGJDLQVDQGLPSDLUPHQWVRIRWKHULQYHVWPHQWV
2
XU HTXLW
\
PHWKRG LQYHVWPHQWV DUH QRQFRQWUROOLQ
J
LQWHUHVWVLQ
R
II
LFHVXSSO\VHOOLQJRSHUDWLRQVRXWVLGH1RUWK$PHULFDJHQHUDOO\
RSHUDWLQJ XQGHU WKH 2IILFH 'HSRW EUDQG QDPH (DUQLQJV IURP
WKHVHLQYHVWPHQWVLQFUHDVHG
PLOOLRQLQDQG
PLOOLRQ
L
Q  :H FRQWLQXH WR ORRN
I
RU ZD\V WR H[SDQG RXU SUHVHQFH
RYHUVHDVDQG PD\HQWHU LQWRDGGLWLRQDOYHQWXUHV RU LQFUHDVHRXU
L
QYHVWPHQW
L
Q H[
L
VW
L
Q
J
SRV
L
W
L
RQV Z
KL
F
K
FRX
OG
UHVX
O
W
L
Q D
GGL
W
L
RQD
O
HQWLWLHV EHLQJ FRQVROLGDWHG LQ
I
XWXUH SHULRGV 0LVFHOODQHRXV
L
QFRPH QHW LQ  DOVR LQFOXGHG UHFRJQLWLRQ RI DSSUR[LPDWHO\
PLOOLRQRIQHWIRUHL
J
QFXUUHQF
\
J
DLQVSULPDULO
\
UHVXOWLQ
J
IURP
K
ROGLQJHXURLQYHVWPHQWVLQDQWLFLSDWLRQR
I
D(XURSHDQDFTXLVLWLRQ
L
Q-XQH

,
QFRPH7D[HV
'ROODUVLQPLOOLRQV



,
Q
FR
P
H
7D
[
HV



(
II
HFWLYHLQFRPHWD[UDWH



,QFRPH7D[HVDVDSHUFHQWD
J
HRIHDUQLQ
J
VIURPFRQWLQXLQ
J
RSHUDWLRQVEHIRUH
L
Q
FR
P
H
W
D
[
HV
2
)),
&
('(3
2
7$11
8
$/5(3
2
57

0DQD
J
HPHQW·V'LVFXVVLRQDQG$QDO
\
VLVRI
)LQDQFLDO&RQGLWLRQDQG5HVXOWVRI2
S
HUDWLRQV
FRQWLQXHG