Petsmart 2008 Annual Report Download - page 65

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We record a charge for new closures and adjustments related to changes in subtenant assumptions and other
occupancy payments in operating, general and administrative expenses in the Consolidated Statements of Oper-
ations and Comprehensive Income.
We made payments of approximately $0.6 million, $3.2 million and $1.8 million in 2008, 2007 and 2006,
respectively, for the buyout of previously reserved lease obligations.
Note 6 — Impairment of Long-Lived Assets and Asset Write-Downs
During 2008, impairment of long-lived assets and asset write-downs were not material. During 2007, we
recorded expense of $7.5 million for accelerated depreciation of assets related to the exit of our equine product line.
During 2006, we recorded expense of $2.8 million related to the replacement of telecommunications equipment.
Note 7 — Income Taxes
Income before income tax expense and equity in income from investee was as follows (in thousands):
February 1,
2009
February 3,
2008
January 28,
2007
Year Ended
(52 weeks) (53 weeks) (52 weeks)
United States .................................... $309,311 $401,079 $283,545
Foreign ........................................ 1,786 1,114 6,572
$311,097 $402,193 $290,117
Income tax expense consisted of the following (in thousands):
February 1,
2009
February 3,
2008
January 28,
2007
Year Ended
(52 weeks) (53 weeks) (52 weeks)
Current provision:
Federal ....................................... $ 73,017 $144,961 $108,940
State/Foreign .................................. 9,056 18,325 14,693
82,073 163,286 123,633
Deferred:
Federal ....................................... 34,372 (15,139) (19,180)
State/Foreign .................................. 4,574 (2,967) 595
38,946 (18,106) (18,585)
Income tax expense ............................... $121,019 $145,180 $105,048
F-17
PetSmart, Inc. and Subsidiaries
Notes to Consolidated Financial Statements — (Continued)