Office Depot 2007 Annual Report Download - page 71

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69
NOTE K — SEGMENT INFORMATION
Office Depot operates in three reportable segments: North American Retail Division, North American Business
Solutions Division, and International Division. Each of these segments is managed separately primarily because it
serves different customer groups. The accounting policies for each segment are the same as those described in the
summary of significant accounting policies (see Note A).
The following is a summary of our significant accounts and balances by segment, reconciled to our consolidated
totals.
(Dollars in thousands)
North
American
Retail
Division
North
American
Business
Solutions
Division
International
Division
Eliminations
and Other*
Consolidated
Total
Sales................................................... 2007 $ 6,813,575 $ 4,518,356 $ 4,195,606 $ — $ 15,527,537
2006 6,789,386 4,576,803 3,644,592 — 15,010,781
2005 6,510,239 4,300,781 3,470,898 (2,974) 14,278,944
Division operating profit ................... 2007 $ 354,547 $ 220,137 $ 231,056 $ (73) $ 805,667
2006 454,308 367,037 249,164 (512) 1,069,997
2005 393,597 350,776 207,539 (210) 951,702
Capital expenditures .......................... 2007 $ 197,284 $ 18,494 $ 129,928 $ 114,865 $ 460,571
2006 187,232 15,353 39,363 101,467 343,415
2005 145,283 28,254 48,795 38,441 260,773
Depreciation and amortization........... 2007 $ 133,012 $ 27,135 $ 45,291 $ 75,945 $ 281,383
2006 127,261 29,334 43,912 78,498 279,005
2005 110,431 28,423 51,582 77,662 268,098
Charges for losses on 2007 $ 66,036 $ 33,375 $ 10,387 —$ 109,798
receivables and inventories............ 2006 46,399 27,703 11,508 — 85,610
2005 43,947 24,352 23,837 — 92,136
Net earnings from equity method 2007 — — $ 34,825 —$ 34,825
investments ................................ 2006 ——
27,125 — 27,125
2005 ——
23,394 — 23,394
Assets................................................. 2007 $ 2,377,008 $ 1,335,434 $ 3,002,128 $ 541,970 $ 7,256,540
2006 1,920,888 1,278,289 2,699,824 658,437 6,557,438
____________
* Amounts included in “Eliminations and Other” consist of inter-segment sales, which are generally recorded at
the cost to the selling entity, and assets (including all cash and equivalents) and depreciation related to corporate
activities.
A reconciliation of the measure of Division operating profit to consolidated earnings from continuing operations
before income taxes follows.
(Dollars in thousands) 2007 2006 2005
Division operating profit....................................................................... $ 805,667 $ 1,069,997 $ 951,702
(Add)/subtract:
Charges (see Note L) ............................................................................ 39,982 63,297 282,088
General and administrative expenses — corporate............................... 282,084 293,513 321,572
Interest expense, net.............................................................................. 53,640 31,002 10,176
Loss on extinguishment of debt............................................................ — 5,715 —
Miscellaneous income, net.................................................................... (28,672) (30,565) (23,649)
Earnings before income taxes............................................................... $ 458,633 $ 707,035 $ 361,515