Starbucks 2000 Annual Report Download - page 25

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Note 10: Leases
The Company leases retail stores, roasting and distribution facilities and office space under operating
leases expiring through 2023. Most lease agreements contain renewal options and rent escalation clauses.
Certain leases provide for contingent rentals based upon gross sales.
Rental expense under these lease agreements was as follows (in thousands):
Fiscal year ended Oct 1, 2000 Oct 3, 1999 Sept 27, 1998
Minimum rentals $ 127,149 $ 95,613 $ 75,912
Contingent rentals 3,743 1,581 1,406
Total $ 130,892 $ 97,194 $ 77,318
Minimum future rental payments under non-cancelable lease obligations as of October 1, 2000, are as
follows (in thousands):
Fiscal year ending
2001 $ 129,407
2002 129,018
2003 127,604
2004 122,404
2005 112,988
Thereafter 417,874
Total minimum lease payments $ 1,039,295
Note 11: Shareholders’ equity
The Company has authorized 7,500,000 shares of its preferred stock, none of which was outstanding at
October 1, 2000.
comprehensive income
The Company adopted SFAS No. 130, “Reporting Comprehensive Income,” as of the first quarter of
fiscal 1999. Comprehensive income includes all changes in equity during the period, except those resulting
from transactions with shareholders of the Company. It has two components: net income and other
comprehensive income. Accumulated other comprehensive income (loss) reported on the Company’s
consolidated balance sheets consists of foreign currency translation adjustments and the unrealized gains
and losses, net of applicable taxes, on available-for-sale securities. Comprehensive income, net of related
tax effects, is as follows (in thousands):
Fiscal year ended Oct 1, 2000 Oct 3, 1999 Sept 27, 1998
Net earnings $ 94,564 $ 101,693 $ 68,372
Unrealized holding gains (losses) on
investments, net of tax (provision)
benefit of $52, ($155) and $373
in 2000, 1999 and 1998, respectively (85) 252 (595)
Reclassification adjustment for (gains) losses
realized in net income, net of tax provision
(benefit) of ($48) and $270, respectively (78) 431 -
Net unrealized gain (loss) (163) 683 (595)
Translation adjustment (6,867) 2,534 (5,120)
Total comprehensive income $ 87,534 $ 104,910 $ 62,657
starbucks coffee company P. 41