Safeway 2010 Annual Report Download - page 45

SAFEWAY INC. AND SUBSIDIARIES
Stock Repurchase Program From the initiation of the Company’s stock repurchase program in 1999 through the end
of fiscal 2010, the aggregate cost of shares of common stock repurchased by the Company, including commissions, was
approximately $5.3 billion, leaving an authorized amount for repurchases of approximately $1.7 billion. During fiscal
2010, Safeway repurchased approximately 27.4 million shares of its common stock under the repurchase program at an
aggregate price, including commissions, of $621.1 million. The average price per share, excluding commissions, was
$22.67. The Company will evaluate the timing and volume of future repurchases based on several factors, including
market conditions, and may repurchase stock in the near- or long-term as circumstances warrant.
Contractual Obligations The table below presents significant contractual obligations of the Company at year-end
2010 (in millions) (1):
2011 2012 2013 2014 2015 Thereafter Total
Long-term debt (2) $ 505.6 $ 801.7 $ 1.7 $ 751.9 $ 1.9 $ 2,275.0 $ 4,337.8
Estimated interest on long-term
debt 240.6 223.6 177.1 161.4 131.7 1,072.0 2,006.4
Capital lease obligations (2),(3) 30.7 31.7 32.6 33.1 32.1 326.7 486.9
Interest on capital leases 47.1 43.8 40.6 37.8 33.8 178.0 381.1
Self-insurance liability 129.5 92.9 63.3 42.1 29.2 111.5 468.5
Interest on self-insurance liability 1.3 2.8 3.2 3.0 2.7 24.9 37.9
Operating leases (3) 470.5 439.0 403.0 367.9 320.4 2,129.3 4,130.1
Marketing development funds 15.4 15.5 17.2 11.4 7.9 9.3 76.7
Contracts for purchase of property,
equipment and construction of
buildings 249.0 – – – – – 249.0
Fixed-price energy contracts (4) 83.1 39.1 0.7 0.7 0.7 6.8 131.1
Other purchase obligations 84.7 16.1 12.5 11.4 – – 124.7
Total $ 1,857.5 $ 1,706.2 $ 751.9 $ 1,420.7 $ 560.4 $ 6,133.5 $ 12,430.2
(1) Excludes funding of pension and post-retirement benefit obligations which were $17.7 million in 2010. The Company currently
expects to contribute approximately $175 million to its pension and post-retirement benefit plans in 2011. Also excludes
contributions under various multi-employer pension plans, which totaled $292.3 million in 2010. Additionally, the amount of
unrecognized tax benefits ($159.9 million at January 1, 2011) has been excluded from the contractual obligations table because a
reasonably reliable estimate of the timing of future tax settlements cannot be determined. Purchase orders for inventory are not
included in the above table as they are cancelable by their terms.
(2) Required principal payments only.
(3) Excludes common area maintenance, insurance or tax payments for which the Company is also obligated. In fiscal 2010, these
charges totaled approximately $212.2 million.
(4) See Part II, Item 7A to this report under the caption “Commodity Price Risk.”
Off-Balance Sheet Arrangements
Guarantees The Company is party to a variety of contractual agreements under which it may be obligated to indemnify
the other party for certain matters. These contracts primarily relate to the Company’s commercial contracts, operating
leases and other real estate contracts, trademarks, intellectual property, financial agreements and various other
agreements. Under these agreements, the Company may provide certain routine indemnifications relating to
representations and warranties (for example, ownership of assets, environmental or tax indemnifications) or personal
injury matters. The terms of these indemnifications range in duration and may not be explicitly defined. Historically,
Safeway has not made significant payments for these indemnifications. The Company believes that if it were to incur a
loss in any of these matters, the loss would not have a material effect on the Company’s financial statements.
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