Pier 1 2008 Annual Report Download - page 50

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dividends unless the availability under the facility is less than 30% of the Company’s calculated borrowing
base. Since the Company entered an agreement to sell its corporate headquarters subsequent to fiscal 2008 year
end, it will exclude this property from secured assets prior to the transaction’s closing. The borrowing base
could decrease by up to $50,000,000 at that time.
NOTE 8 — CONDENSED FINANCIAL STATEMENTS
The Company’s 6.375% convertible senior notes are fully and unconditionally guaranteed, on a joint and
several basis, by all of the Company’s material domestic consolidated subsidiaries (the “Guarantor Subsidiar-
ies”). The subsidiaries that do not guarantee such notes are comprised of the Company’s foreign subsidiaries
and certain other insignificant domestic consolidated subsidiaries (the “Non-Guarantor Subsidiaries”). Each of
the Guarantor Subsidiaries is wholly owned. The Company registered these Notes with the Securities and
Exchange Commission in June 2006; therefore, in lieu of providing separate audited financial statements for
the Guarantor Subsidiaries, condensed consolidating financial information is presented below.
CONSOLIDATING CONDENSED STATEMENT OF OPERATIONS
Year Ended March 1, 2008
(In thousands)
Pier 1
Imports, Inc.
Guarantor
Subsidiaries
Non-Guarantor
Subsidiaries Eliminations Total
Net sales . .................... $ — $1,505,011 $38,155 $(31,334) $1,511,832
Cost of sales (including buying
and store occupancy costs) .... — 1,068,371 35,466 (31,557) 1,072,280
Selling, general and administrative
(including depreciation and
amortization) .............. 1,829 525,279 582 — 527,690
Operating income (loss) ........ (1,829) (88,639) 2,107 223 (88,138)
Nonoperating (income) expenses.... (2,106) 7,999 (614) — 5,279
Income (loss) from continuing
operations before income
taxes .................... 277 (96,638) 2,721 223 (93,417)
Provision for income taxes ........ — 2,380 214 — 2,594
Net income (loss) from continuing
operations ................. 277 (99,018) 2,507 223 (96,011)
Net income (loss) from
subsidiaries ................ (96,511) 2,507 — 94,004 —
Net income (loss) ............... $(96,234) $ (96,511) $ 2,507 $ 94,227 $ (96,011)
48
Pier 1 Imports, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)