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New Fiscal Calendar(1) | Previous Fiscal Calendar(1) | |||
2013 | 2012 | 2012 | ||
February 2012 - April 2012 | February 2011 - April 2011 | March 2011 - May 2011 |
(1) | For entities reported on a lag, the fiscal months included in the first quarters of fiscal 2013 and 2012 were January through March under both the new and previous fiscal calendars. |
February 2012 | February 2011 | ||||||
Net earnings | $ | 206 | $ | 115 | |||
Impact of share repurchases(1) | (98 | ) | — | ||||
Net reconciling item to Retained earnings | $ | 108 | $ | 115 |
(1) | Share repurchases reduced Retained earnings after the Additional paid-in capital balance was reduced to zero during February 2012. |
|
May 5, 2012 | April 30, 2011 | ||||||
(recast) | |||||||
Revenue | $ | 8 | $ | 128 | |||
Restructuring charges(1) | 6 | 28 | |||||
Loss from discontinued operations before income tax benefit | (15 | ) | (74 | ) | |||
Income tax benefit | 6 | 20 | |||||
Net loss from discontinued operations including noncontrolling interests | (9 | ) | (54 | ) | |||
Net loss from discontinued operations attributable to noncontrolling interests | 6 | 11 | |||||
Net loss from discontinued operations attributable to Best Buy Co., Inc. | $ | (3 | ) | $ | (43 | ) |
(1) | See Note 7, Restructuring Charges, for further discussion of the restructuring charges associated with discontinued operations. |
|
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
Short-term investments | |||||||||||
U.S. Treasury bills | — | — | 20 | ||||||||
Equity and other investments | |||||||||||
Debt securities (auction rate securities) | $ | 66 | $ | 82 | $ | 97 | |||||
Marketable equity securities | 3 | 3 | 147 | ||||||||
Other investments | 59 | 55 | 72 | ||||||||
Total equity and other investments | $ | 128 | $ | 140 | $ | 316 |
Description | Nature of collateral or guarantee | May 5, 2012 | March 3, 2012 | April 30, 2011 | ||||||||||
(recast) | ||||||||||||||
Student loan bonds | Student loans guaranteed 95% to 100% by the U.S. government | $ | 64 | $ | 80 | $ | 95 | |||||||
Municipal revenue bonds | 100% insured by AA/Aa-rated bond insurers at May 5, 2012 | 2 | 2 | 2 | ||||||||||
Total fair value plus accrued interest(1) | $ | 66 | $ | 82 | $ | 97 |
(1) | The par value and weighted-average interest rates (taxable equivalent) of our ARS were $71, $88 and $101, and 0.66%, 0.50% and 0.75%, respectively, at May 5, 2012, March 3, 2012, and April 30, 2011, respectively. |
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
Common stock of TalkTalk Telecom Group PLC | $ | — | $ | — | $ | 87 | |||||
Common stock of Carphone Warehouse Group plc | — | — | 60 | ||||||||
Other | 3 | 3 | — | ||||||||
Total | $ | 3 | $ | 3 | $ | 147 |
|
• | Quoted prices for similar assets or liabilities in active markets; |
• | Quoted prices for identical or similar assets in non-active markets; |
• | Inputs other than quoted prices that are observable for the asset or liability; and |
• | Inputs that are derived principally from or corroborated by other observable market data. |
Fair Value Measurements Using Inputs Considered as | |||||||||||||||
Fair Value at May 5, 2012 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
ASSETS | |||||||||||||||
Cash and cash equivalents | |||||||||||||||
Money market funds | $ | 439 | $ | 439 | $ | — | $ | — | |||||||
Other current assets | |||||||||||||||
Money market funds (restricted cash) | 104 | 104 | — | — | |||||||||||
U.S. Treasury bills (restricted cash) | 30 | 30 | — | — | |||||||||||
Equity and other investments | |||||||||||||||
Auction rate securities | 66 | — | — | 66 | |||||||||||
Marketable equity securities | 3 | 3 | — | — |
Fair Value Measurements Using Inputs Considered as | |||||||||||||||
Fair Value at March 3, 2012 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
ASSETS | |||||||||||||||
Cash and cash equivalents | |||||||||||||||
Money market funds | $ | 272 | $ | 272 | $ | — | $ | — | |||||||
Other current assets | |||||||||||||||
Money market funds (restricted cash) | 119 | 119 | — | — | |||||||||||
U.S. Treasury bills (restricted cash) | 30 | 30 | — | — | |||||||||||
Foreign currency derivative instruments | 1 | — | 1 | — | |||||||||||
Equity and other investments | |||||||||||||||
Auction rate securities | 82 | — | — | 82 | |||||||||||
Marketable equity securities | 3 | 3 | — | — | |||||||||||
LIABILITIES | |||||||||||||||
Accrued liabilities | |||||||||||||||
Foreign currency derivative instruments | 2 | — | 2 | — |
Fair Value Measurements Using Inputs Considered as | |||||||||||
Fair Value at April 30, 2011 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||
(recast) | (recast) | (recast) | (recast) | ||||||||
ASSETS | |||||||||||
Cash and cash equivalents | |||||||||||
Money market funds | 1,485 | 1,485 | — | — | |||||||
Commercial paper | 60 | — | 60 | — | |||||||
U.S. Treasury bills | 190 | 190 | — | — | |||||||
Short-term investments | |||||||||||
U.S. Treasury bills | 20 | 20 | — | — | |||||||
Other current assets | |||||||||||
Money market funds (restricted assets) | 107 | 107 | — | — | |||||||
U.S. Treasury bills (restricted assets) | 70 | 70 | — | — | |||||||
Foreign currency derivative instruments | 9 | — | 9 | — | |||||||
Equity and other investments | |||||||||||
Auction rate securities | 97 | — | — | 97 | |||||||
Marketable equity securities | 147 | 147 | — | — | |||||||
Other assets | |||||||||||
Foreign currency derivative instruments | 2 | — | 2 | — | |||||||
LIABILITIES | |||||||||||
Accrued liabilities | |||||||||||
Foreign currency derivative instruments | 2 | — | 2 | — |
Debt securities- Auction rate securities only | |||||||||||
Student loan bonds | Municipal revenue bonds | Total | |||||||||
Balances at March 3, 2012 | $ | 80 | $ | 2 | $ | 82 | |||||
Changes in unrealized losses included in other comprehensive income | 1 | — | 1 | ||||||||
Sales | (17 | ) | — | (17 | ) | ||||||
Balances at May 5, 2012 | $ | 64 | $ | 2 | $ | 66 |
Debt securities- Auction rate securities only | |||||||||||
Student loan bonds | Municipal revenue bonds | Total | |||||||||
Balances at February 26, 2011 | $ | 108 | $ | 2 | $ | 110 | |||||
Changes in unrealized losses included in other comprehensive income | 1 | — | 1 | ||||||||
Sales | (14 | ) | — | (14 | ) | ||||||
Balances at April 30, 2011 (recast) | $ | 95 | $ | 2 | $ | 97 |
Three Months Ended | Three Months Ended | ||||||||||||||
May 5, 2012 | April 30, 2011 | ||||||||||||||
Impairments | Remaining Net Carrying Value | Impairments | Remaining Net Carrying Value | ||||||||||||
(recast) | (recast) | ||||||||||||||
Continuing Operations | |||||||||||||||
Property and equipment | $ | 26 | $ | — | $ | 1 | $ | — |
|
Goodwill | Indefinite-lived Tradenames | ||||||||||||||||||||||
Domestic | International | Total | Domestic | International | Total | ||||||||||||||||||
Balances at March 3, 2012 | $ | 516 | $ | 819 | $ | 1,335 | $ | 19 | $ | 111 | $ | 130 | |||||||||||
Changes in foreign currency exchange rates | — | (4 | ) | (4 | ) | — | — | — | |||||||||||||||
Acquisitions | 4 | — | 4 | — | — | — | |||||||||||||||||
Balances at May 5, 2012 | $ | 520 | $ | 815 | $ | 1,335 | $ | 19 | $ | 111 | $ | 130 |
Goodwill | Indefinite-lived Tradenames | ||||||||||||||||||||||
Domestic | International | Total | Domestic | International | Total | ||||||||||||||||||
Balances at February 26, 2011 | $ | 422 | $ | 2,032 | $ | 2,454 | $ | 21 | $ | 84 | $ | 105 | |||||||||||
Changes in foreign currency exchange rates | — | 52 | 52 | — | 3 | 3 | |||||||||||||||||
Other(1) | — | — | — | — | 28 | 28 | |||||||||||||||||
Balances at April 30, 2011 (recast) | $ | 422 | $ | 2,084 | $ | 2,506 | $ | 21 | $ | 115 | $ | 136 |
(1) | Represents the transfer of certain definite-lived tradenames (at their net book value) to indefinite-lived tradenames following our decision to no longer phase out certain tradenames. We believe these tradenames will continue to contribute to our future cash flows indefinitely. |
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||||||||||||||
Gross Carrying Amount | Cumulative Impairment | Gross Carrying Amount | Cumulative Impairment | Gross Carrying Amount | Cumulative Impairment | ||||||||||||||||||
(recast) | (recast) | ||||||||||||||||||||||
Goodwill | $ | 2,596 | $ | (1,261 | ) | $ | 2,596 | $ | (1,261 | ) | $ | 2,571 | $ | (65 | ) |
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Gross Carrying Amount | Accumulated Amortization | Gross Carrying Amount | Accumulated Amortization | ||||||||||||
(recast) | (recast) | ||||||||||||||||
Customer relationships | 463 | (239 | ) | 453 | (224 | ) | 393 | (199 | ) |
Fiscal Year | |||
Remainder of fiscal 2013 | $ | 32 | |
2014 | 41 | ||
2015 | 41 | ||
2016 | 41 | ||
2017 | 23 | ||
Thereafter | 46 |
|
Three Months Ended | |||||||
May 5, 2012 | April 30, 2011 | ||||||
(recast) | |||||||
Continuing operations | |||||||
Fiscal 2013 restructuring | $ | 133 | $ | — | |||
Fiscal 2012 restructuring | 6 | — | |||||
Fiscal 2011 restructuring | (12 | ) | 4 | ||||
Total | 127 | 4 | |||||
Discontinued operations | |||||||
Fiscal 2013 restructuring | — | — | |||||
Fiscal 2012 restructuring | 3 | — | |||||
Fiscal 2011 restructuring | 3 | 28 | |||||
Total (Note 3) | 6 | 28 | |||||
Total | $ | 133 | $ | 32 |
Three Months Ended May 5, 2012 | |||
Continuing operations | |||
Property and equipment impairments | $ | 25 | |
Termination benefits | 107 | ||
Facility closure and other costs, net | 1 | ||
Total | $ | 133 |
Termination Benefits | Facility Closure and Other Costs | Total | |||||||||
Balance at March 3, 2012 | $ | — | $ | — | $ | — | |||||
Charges | 103 | 1 | 104 | ||||||||
Cash payments | — | — | — | ||||||||
Adjustments | — | — | — | ||||||||
Balance at May 5, 2012 | $ | 103 | $ | 1 | $ | 104 |
Domestic | International | Total | |||||||||||||||||||||
Three Months Ended May 5, 2012 | Cumulative Amount through May 5, 2012 | Three Months Ended May 5, 2012 | Cumulative Amount through May 5, 2012 | Three Months Ended May 5, 2012 | Cumulative Amount through May 5, 2012 | ||||||||||||||||||
Continuing operations | |||||||||||||||||||||||
Property and equipment impairments | $ | 1 | $ | 17 | $ | — | $ | 15 | $ | 1 | $ | 32 | |||||||||||
Termination benefits | — | 1 | — | — | — | 1 | |||||||||||||||||
Facility closure and other costs, net | 5 | 5 | — | — | 5 | 5 | |||||||||||||||||
Total | 6 | 23 | — | 15 | 6 | 38 | |||||||||||||||||
Discontinued operations | |||||||||||||||||||||||
Inventory write-downs | — | — | — | 11 | — | 11 | |||||||||||||||||
Property and equipment impairments | — | — | — | 96 | — | 96 | |||||||||||||||||
Termination benefits | — | — | 1 | 17 | 1 | 17 | |||||||||||||||||
Facility closure and other costs, net | — | — | 2 | 84 | 2 | 84 | |||||||||||||||||
Total | — | — | 3 | 208 | 3 | 208 | |||||||||||||||||
Total | $ | 6 | $ | 23 | $ | 3 | $ | 223 | $ | 9 | $ | 246 |
Termination Benefits | Facility Closure and Other Costs(1) | Total | |||||||||
Balance at March 3, 2012 | $ | 17 | $ | 85 | $ | 102 | |||||
Charges | 1 | 2 | 3 | ||||||||
Cash payments | (14 | ) | (43 | ) | (57 | ) | |||||
Adjustments | — | 34 | 34 | ||||||||
Changes in foreign currency exchange rates | — | 3 | 3 | ||||||||
Balance at May 5, 2012 | $ | 4 | $ | 81 | $ | 85 |
(1) | Included within the facility closure and other costs adjustments is $34 from the first quarter of fiscal 2013, representing an adjustment to exclude non-cash charges or benefits, which had no impact on our Condensed Consolidated Statements of Earnings and Comprehensive Income in the first quarter of fiscal 2013. |
Domestic | International | Total | |||||||||||||||||||||||||||||||||
Three Months Ended | Cumulative Amount through May 5, 2012 | Three Months Ended | Cumulative Amount through May 5, 2012 | Three Months Ended | Cumulative Amount through May 5, 2012 | ||||||||||||||||||||||||||||||
May 5, 2012 | April 30, 2011 | May 5, 2012 | April 30, 2011 | May 5, 2012 | April 30, 2011 | ||||||||||||||||||||||||||||||
(recast) | (recast) | (recast) | |||||||||||||||||||||||||||||||||
Continuing operations | |||||||||||||||||||||||||||||||||||
Inventory write-downs | $ | — | $ | — | $ | 28 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 28 | |||||||||||||||||
Property and equipment impairments | (12 | ) | 2 | 3 | — | (1 | ) | 107 | (12 | ) | 1 | 110 | |||||||||||||||||||||||
Termination benefits | — | 1 | 13 | — | — | — | — | 1 | 13 | ||||||||||||||||||||||||||
Facility closure and other costs, net | — | 2 | 4 | — | — | — | — | 2 | 4 | ||||||||||||||||||||||||||
Total | (12 | ) | 5 | 48 | — | (1 | ) | 107 | (12 | ) | 4 | 155 | |||||||||||||||||||||||
Discontinued operations | |||||||||||||||||||||||||||||||||||
Inventory write-downs | — | — | — | — | — | 15 | — | — | 15 | ||||||||||||||||||||||||||
Property and equipment impairments | — | — | 15 | — | — | 25 | — | — | 40 | ||||||||||||||||||||||||||
Termination benefits | — | — | 4 | — | 14 | 19 | — | 14 | 23 | ||||||||||||||||||||||||||
Intangible asset impairments | — | — | 13 | — | — | — | — | — | 13 | ||||||||||||||||||||||||||
Facility closure and other costs, net | 3 | — | 3 | — | 14 | 5 | 3 | 14 | 8 | ||||||||||||||||||||||||||
Total | 3 | — | 35 | — | 28 | 64 | 3 | 28 | 99 | ||||||||||||||||||||||||||
Total | $ | (9 | ) | $ | 5 | $ | 83 | $ | — | $ | 27 | $ | 171 | $ | (9 | ) | $ | 32 | $ | 254 |
Termination Benefits | Facility Closure and Other Costs(1) | Total | |||||||||
Balance at February 26, 2011 | $ | 28 | $ | 13 | $ | 41 | |||||
Charges | 2 | — | 2 | ||||||||
Cash payments | (11 | ) | (3 | ) | (14 | ) | |||||
Adjustments | (2 | ) | 10 | 8 | |||||||
Balance at April 30, 2011 (recast) | $ | 17 | $ | 20 | $ | 37 |
(1) | Included within the facility closure and other costs adjustments is $10 from the first quarter of fiscal 2011, representing an adjustment to exclude non-cash charges or benefits, which had no impact on our Consolidated Statements of Earnings and Comprehensive Income in the first quarter of fiscal 2012. |
Termination Benefits | Facility Closure and Other Costs | Total | |||||||||
Balance at March 3, 2012 | $ | 3 | $ | 9 | $ | 12 | |||||
Charges | — | — | — | ||||||||
Cash payments | (2 | ) | (3 | ) | (5 | ) | |||||
Adjustments | — | — | — | ||||||||
Balance at May 5, 2012 | $ | 1 | $ | 6 | $ | 7 |
|
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
U.S. revolving credit facility – 364-Day | $ | — | $ | — | $ | — | |||||
U.S. revolving credit facility – Five-Year | — | — | — | ||||||||
Europe revolving credit facility | 306 | 480 | — | ||||||||
Europe receivables financing facility | — | — | 24 | ||||||||
Old Europe revolving credit facility | — | — | — | ||||||||
Canada revolving demand facility | — | — | — | ||||||||
China revolving demand facilities | — | — | 15 | ||||||||
Total short-term debt | $ | 306 | $ | 480 | $ | 39 |
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
2013 Notes | $ | 500 | $ | 500 | $ | 500 | |||||
2016 Notes | 349 | 349 | 349 | ||||||||
2021 Notes | 648 | 648 | 648 | ||||||||
Convertible debentures | — | — | 402 | ||||||||
Financing lease obligations | 145 | 149 | 168 | ||||||||
Capital lease obligations | 78 | 81 | 77 | ||||||||
Other debt | 1 | 1 | 2 | ||||||||
Total long-term debt | 1,721 | 1,728 | 2,146 | ||||||||
Less: current portion(1) | (43 | ) | (43 | ) | (442 | ) | |||||
Total long-term debt, less current portion | $ | 1,678 | $ | 1,685 | $ | 1,704 |
(1) | Since holders of our convertible debentures required us to purchase all or a portion of the debentures on January 15, 2012, we classified the $402 for such debentures in the current portion of long-term debt at April 30, 2011. |
|
May 5, 2012 | March 3, 2012 | April 30, 2011 | ||||||||||||||||||||||
Contract Type | Assets | Liabilities | Assets | Liabilities | Assets | Liabilities | ||||||||||||||||||
(recast) | (recast) | |||||||||||||||||||||||
Cash flow hedges (foreign exchange forward contracts) | $ | — | $ | — | $ | — | $ | — | $ | 7 | $ | — | ||||||||||||
No hedge designation (foreign exchange forward contracts) | — | — | 1 | (2 | ) | 4 | (2 | ) | ||||||||||||||||
Total | $ | — | $ | — | $ | 1 | $ | (2 | ) | $ | 11 | $ | (2 | ) |
Three Months Ended | ||||||||
May 5, 2012 | ||||||||
Contract Type | Pre-tax Gain (Loss) Recognized in OCI(1) | (Loss) Reclassified from Accumulated OCI to Earnings (Effective Portion)(2) | ||||||
Cash flow hedges (foreign exchange forward contracts) | $ | — | $ | (1 | ) |
Three Months Ended | ||||||||
April 30, 2011 | ||||||||
Contract Type | Pre-tax Gain Recognized in OCI(1) | Gain Reclassified from Accumulated OCI to Earnings (Effective Portion)(2) | ||||||
(recast) | (recast) | |||||||
Cash flow hedges (foreign exchange forward contracts) | $ | 8 | $ | 2 |
(1) | Reflects the amount recognized in OCI prior to the reclassification of 50% to noncontrolling interests for the cash flow and net investment hedges, respectively. |
(2) | Gain reclassified from accumulated OCI is included within selling, general and administrative expenses (“SG&A”) in our Condensed Consolidated Statements of Earnings and Comprehensive Income. |
(Loss) Recognized within SG&A | ||||||||
Three Months Ended | Three Months Ended | |||||||
Contract Type | May 5, 2012 | April 30, 2011 | ||||||
(recast) | ||||||||
No hedge designation (foreign exchange forward contracts) | $ | (3 | ) | $ | (8 | ) |
Notional Amount | ||||||||||||
Contract Type | May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | ||||||||||||
Derivatives designated as cash flow hedging instruments | $ | — | $ | — | $ | 293 | ||||||
Derivatives not designated as hedging instruments | 240 | 238 | 115 | |||||||||
Total | $ | 240 | $ | 238 | $ | 408 |
|
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
Foreign currency translation | $ | 101 | $ | 93 | $ | 201 | |||||
Unrealized (losses) gains on available-for-sale investments | (3 | ) | (3 | ) | 71 | ||||||
Unrealized gains on derivative instruments (cash flow hedges) | — | — | 2 | ||||||||
Total | $ | 98 | $ | 90 | $ | 274 |
|
Three Months Ended | |||||||
May 5, 2012 | April 30, 2011 | ||||||
(recast) | |||||||
June 2011 Program | |||||||
Number of shares repurchased | 4.6 | — | |||||
Cost of shares repurchased | $ | 115 | $ | — | |||
June 2007 Program | |||||||
Number of shares repurchased | — | 10.9 | |||||
Cost of shares repurchased | $ | — | $ | 325 |
|
Three Months Ended | |||||||
May 5, 2012 | April 30, 2011 | ||||||
(recast) | |||||||
Domestic | $ | 8,822 | $ | 8,392 | |||
International | 2,788 | 2,977 | |||||
Total | $ | 11,610 | $ | 11,369 |
Three Months Ended | |||||||
May 5, 2012 | April 30, 2011 | ||||||
(recast) | |||||||
Domestic | $ | 295 | $ | 366 | |||
International | (33 | ) | 94 | ||||
Total operating income | 262 | 460 | |||||
Other income (expense) | |||||||
Investment income and other | 6 | 17 | |||||
Interest expense | (33 | ) | (28 | ) | |||
Earnings from continuing operations before income tax expense and equity in loss of affiliates | $ | 235 | $ | 449 |
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
Domestic | $ | 10,147 | $ | 9,592 | $ | 11,598 | |||||
International | 5,864 | 6,413 | 7,974 | ||||||||
Total | $ | 16,011 | $ | 16,005 | $ | 19,572 |
|
|
Three Months Ended | Three Months Ended | ||||||||||||||
May 5, 2012 | April 30, 2011 | ||||||||||||||
Impairments | Remaining Net Carrying Value | Impairments | Remaining Net Carrying Value | ||||||||||||
(recast) | (recast) | ||||||||||||||
Continuing Operations | |||||||||||||||
Property and equipment | $ | 26 | $ | — | $ | 1 | $ | — |
|
February 2012 | February 2011 | ||||||
Net earnings | $ | 206 | $ | 115 | |||
Impact of share repurchases(1) | (98 | ) | — | ||||
Net reconciling item to Retained earnings | $ | 108 | $ | 115 |
(1) | Share repurchases reduced Retained earnings after the Additional paid-in capital balance was reduced to zero during February 2012. |
|
May 5, 2012 | April 30, 2011 | ||||||
(recast) | |||||||
Revenue | $ | 8 | $ | 128 | |||
Restructuring charges(1) | 6 | 28 | |||||
Loss from discontinued operations before income tax benefit | (15 | ) | (74 | ) | |||
Income tax benefit | 6 | 20 | |||||
Net loss from discontinued operations including noncontrolling interests | (9 | ) | (54 | ) | |||
Net loss from discontinued operations attributable to noncontrolling interests | 6 | 11 | |||||
Net loss from discontinued operations attributable to Best Buy Co., Inc. | $ | (3 | ) | $ | (43 | ) |
(1) | See Note 7, Restructuring Charges, for further discussion of the restructuring charges associated with discontinued operations. |
|
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
Short-term investments | |||||||||||
U.S. Treasury bills | — | — | 20 | ||||||||
Equity and other investments | |||||||||||
Debt securities (auction rate securities) | $ | 66 | $ | 82 | $ | 97 | |||||
Marketable equity securities | 3 | 3 | 147 | ||||||||
Other investments | 59 | 55 | 72 | ||||||||
Total equity and other investments | $ | 128 | $ | 140 | $ | 316 |
Description | Nature of collateral or guarantee | May 5, 2012 | March 3, 2012 | April 30, 2011 | ||||||||||
(recast) | ||||||||||||||
Student loan bonds | Student loans guaranteed 95% to 100% by the U.S. government | $ | 64 | $ | 80 | $ | 95 | |||||||
Municipal revenue bonds | 100% insured by AA/Aa-rated bond insurers at May 5, 2012 | 2 | 2 | 2 | ||||||||||
Total fair value plus accrued interest(1) | $ | 66 | $ | 82 | $ | 97 |
(1) | The par value and weighted-average interest rates (taxable equivalent) of our ARS were $71, $88 and $101, and 0.66%, 0.50% and 0.75%, respectively, at May 5, 2012, March 3, 2012, and April 30, 2011, respectively. |
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
Common stock of TalkTalk Telecom Group PLC | $ | — | $ | — | $ | 87 | |||||
Common stock of Carphone Warehouse Group plc | — | — | 60 | ||||||||
Other | 3 | 3 | — | ||||||||
Total | $ | 3 | $ | 3 | $ | 147 |
|
Fair Value Measurements Using Inputs Considered as | |||||||||||||||
Fair Value at May 5, 2012 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
ASSETS | |||||||||||||||
Cash and cash equivalents | |||||||||||||||
Money market funds | $ | 439 | $ | 439 | $ | — | $ | — | |||||||
Other current assets | |||||||||||||||
Money market funds (restricted cash) | 104 | 104 | — | — | |||||||||||
U.S. Treasury bills (restricted cash) | 30 | 30 | — | — | |||||||||||
Equity and other investments | |||||||||||||||
Auction rate securities | 66 | — | — | 66 | |||||||||||
Marketable equity securities | 3 | 3 | — | — |
Fair Value Measurements Using Inputs Considered as | |||||||||||||||
Fair Value at March 3, 2012 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
ASSETS | |||||||||||||||
Cash and cash equivalents | |||||||||||||||
Money market funds | $ | 272 | $ | 272 | $ | — | $ | — | |||||||
Other current assets | |||||||||||||||
Money market funds (restricted cash) | 119 | 119 | — | — | |||||||||||
U.S. Treasury bills (restricted cash) | 30 | 30 | — | — | |||||||||||
Foreign currency derivative instruments | 1 | — | 1 | — | |||||||||||
Equity and other investments | |||||||||||||||
Auction rate securities | 82 | — | — | 82 | |||||||||||
Marketable equity securities | 3 | 3 | — | — | |||||||||||
LIABILITIES | |||||||||||||||
Accrued liabilities | |||||||||||||||
Foreign currency derivative instruments | 2 | — | 2 | — |
Fair Value Measurements Using Inputs Considered as | |||||||||||
Fair Value at April 30, 2011 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||
(recast) | (recast) | (recast) | (recast) | ||||||||
ASSETS | |||||||||||
Cash and cash equivalents | |||||||||||
Money market funds | 1,485 | 1,485 | — | — | |||||||
Commercial paper | 60 | — | 60 | — | |||||||
U.S. Treasury bills | 190 | 190 | — | — | |||||||
Short-term investments | |||||||||||
U.S. Treasury bills | 20 | 20 | — | — | |||||||
Other current assets | |||||||||||
Money market funds (restricted assets) | 107 | 107 | — | — | |||||||
U.S. Treasury bills (restricted assets) | 70 | 70 | — | — | |||||||
Foreign currency derivative instruments | 9 | — | 9 | — | |||||||
Equity and other investments | |||||||||||
Auction rate securities | 97 | — | — | 97 | |||||||
Marketable equity securities | 147 | 147 | — | — | |||||||
Other assets | |||||||||||
Foreign currency derivative instruments | 2 | — | 2 | — | |||||||
LIABILITIES | |||||||||||
Accrued liabilities | |||||||||||
Foreign currency derivative instruments | 2 | — | 2 | — |
Debt securities- Auction rate securities only | |||||||||||
Student loan bonds | Municipal revenue bonds | Total | |||||||||
Balances at March 3, 2012 | $ | 80 | $ | 2 | $ | 82 | |||||
Changes in unrealized losses included in other comprehensive income | 1 | — | 1 | ||||||||
Sales | (17 | ) | — | (17 | ) | ||||||
Balances at May 5, 2012 | $ | 64 | $ | 2 | $ | 66 |
Debt securities- Auction rate securities only | |||||||||||
Student loan bonds | Municipal revenue bonds | Total | |||||||||
Balances at February 26, 2011 | $ | 108 | $ | 2 | $ | 110 | |||||
Changes in unrealized losses included in other comprehensive income | 1 | — | 1 | ||||||||
Sales | (14 | ) | — | (14 | ) | ||||||
Balances at April 30, 2011 (recast) | $ | 95 | $ | 2 | $ | 97 |
Three Months Ended | Three Months Ended | ||||||||||||||
May 5, 2012 | April 30, 2011 | ||||||||||||||
Impairments | Remaining Net Carrying Value | Impairments | Remaining Net Carrying Value | ||||||||||||
(recast) | (recast) | ||||||||||||||
Continuing Operations | |||||||||||||||
Property and equipment | $ | 26 | $ | — | $ | 1 | $ | — |
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Goodwill | Indefinite-lived Tradenames | ||||||||||||||||||||||
Domestic | International | Total | Domestic | International | Total | ||||||||||||||||||
Balances at March 3, 2012 | $ | 516 | $ | 819 | $ | 1,335 | $ | 19 | $ | 111 | $ | 130 | |||||||||||
Changes in foreign currency exchange rates | — | (4 | ) | (4 | ) | — | — | — | |||||||||||||||
Acquisitions | 4 | — | 4 | — | — | — | |||||||||||||||||
Balances at May 5, 2012 | $ | 520 | $ | 815 | $ | 1,335 | $ | 19 | $ | 111 | $ | 130 |
Goodwill | Indefinite-lived Tradenames | ||||||||||||||||||||||
Domestic | International | Total | Domestic | International | Total | ||||||||||||||||||
Balances at February 26, 2011 | $ | 422 | $ | 2,032 | $ | 2,454 | $ | 21 | $ | 84 | $ | 105 | |||||||||||
Changes in foreign currency exchange rates | — | 52 | 52 | — | 3 | 3 | |||||||||||||||||
Other(1) | — | — | — | — | 28 | 28 | |||||||||||||||||
Balances at April 30, 2011 (recast) | $ | 422 | $ | 2,084 | $ | 2,506 | $ | 21 | $ | 115 | $ | 136 |
(1) | Represents the transfer of certain definite-lived tradenames (at their net book value) to indefinite-lived tradenames following our decision to no longer phase out certain tradenames. We believe these tradenames will continue to contribute to our future cash flows indefinitely. |
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||||||||||||||
Gross Carrying Amount | Cumulative Impairment | Gross Carrying Amount | Cumulative Impairment | Gross Carrying Amount | Cumulative Impairment | ||||||||||||||||||
(recast) | (recast) | ||||||||||||||||||||||
Goodwill | $ | 2,596 | $ | (1,261 | ) | $ | 2,596 | $ | (1,261 | ) | $ | 2,571 | $ | (65 | ) |
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Gross Carrying Amount | Accumulated Amortization | Gross Carrying Amount | Accumulated Amortization | ||||||||||||
(recast) | (recast) | ||||||||||||||||
Customer relationships | 463 | (239 | ) | 453 | (224 | ) | 393 | (199 | ) |
Fiscal Year | |||
Remainder of fiscal 2013 | $ | 32 | |
2014 | 41 | ||
2015 | 41 | ||
2016 | 41 | ||
2017 | 23 | ||
Thereafter | 46 |
|
Three Months Ended May 5, 2012 | |||
Continuing operations | |||
Property and equipment impairments | $ | 25 | |
Termination benefits | 107 | ||
Facility closure and other costs, net | 1 | ||
Total | $ | 133 |
Domestic | International | Total | |||||||||||||||||||||
Three Months Ended May 5, 2012 | Cumulative Amount through May 5, 2012 | Three Months Ended May 5, 2012 | Cumulative Amount through May 5, 2012 | Three Months Ended May 5, 2012 | Cumulative Amount through May 5, 2012 | ||||||||||||||||||
Continuing operations | |||||||||||||||||||||||
Property and equipment impairments | $ | 1 | $ | 17 | $ | — | $ | 15 | $ | 1 | $ | 32 | |||||||||||
Termination benefits | — | 1 | — | — | — | 1 | |||||||||||||||||
Facility closure and other costs, net | 5 | 5 | — | — | 5 | 5 | |||||||||||||||||
Total | 6 | 23 | — | 15 | 6 | 38 | |||||||||||||||||
Discontinued operations | |||||||||||||||||||||||
Inventory write-downs | — | — | — | 11 | — | 11 | |||||||||||||||||
Property and equipment impairments | — | — | — | 96 | — | 96 | |||||||||||||||||
Termination benefits | — | — | 1 | 17 | 1 | 17 | |||||||||||||||||
Facility closure and other costs, net | — | — | 2 | 84 | 2 | 84 | |||||||||||||||||
Total | — | — | 3 | 208 | 3 | 208 | |||||||||||||||||
Total | $ | 6 | $ | 23 | $ | 3 | $ | 223 | $ | 9 | $ | 246 |
Three Months Ended | |||||||
May 5, 2012 | April 30, 2011 | ||||||
(recast) | |||||||
Continuing operations | |||||||
Fiscal 2013 restructuring | $ | 133 | $ | — | |||
Fiscal 2012 restructuring | 6 | — | |||||
Fiscal 2011 restructuring | (12 | ) | 4 | ||||
Total | 127 | 4 | |||||
Discontinued operations | |||||||
Fiscal 2013 restructuring | — | — | |||||
Fiscal 2012 restructuring | 3 | — | |||||
Fiscal 2011 restructuring | 3 | 28 | |||||
Total (Note 3) | 6 | 28 | |||||
Total | $ | 133 | $ | 32 |
Domestic | International | Total | |||||||||||||||||||||||||||||||||
Three Months Ended | Cumulative Amount through May 5, 2012 | Three Months Ended | Cumulative Amount through May 5, 2012 | Three Months Ended | Cumulative Amount through May 5, 2012 | ||||||||||||||||||||||||||||||
May 5, 2012 | April 30, 2011 | May 5, 2012 | April 30, 2011 | May 5, 2012 | April 30, 2011 | ||||||||||||||||||||||||||||||
(recast) | (recast) | (recast) | |||||||||||||||||||||||||||||||||
Continuing operations | |||||||||||||||||||||||||||||||||||
Inventory write-downs | $ | — | $ | — | $ | 28 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 28 | |||||||||||||||||
Property and equipment impairments | (12 | ) | 2 | 3 | — | (1 | ) | 107 | (12 | ) | 1 | 110 | |||||||||||||||||||||||
Termination benefits | — | 1 | 13 | — | — | — | — | 1 | 13 | ||||||||||||||||||||||||||
Facility closure and other costs, net | — | 2 | 4 | — | — | — | — | 2 | 4 | ||||||||||||||||||||||||||
Total | (12 | ) | 5 | 48 | — | (1 | ) | 107 | (12 | ) | 4 | 155 | |||||||||||||||||||||||
Discontinued operations | |||||||||||||||||||||||||||||||||||
Inventory write-downs | — | — | — | — | — | 15 | — | — | 15 | ||||||||||||||||||||||||||
Property and equipment impairments | — | — | 15 | — | — | 25 | — | — | 40 | ||||||||||||||||||||||||||
Termination benefits | — | — | 4 | — | 14 | 19 | — | 14 | 23 | ||||||||||||||||||||||||||
Intangible asset impairments | — | — | 13 | — | — | — | — | — | 13 | ||||||||||||||||||||||||||
Facility closure and other costs, net | 3 | — | 3 | — | 14 | 5 | 3 | 14 | 8 | ||||||||||||||||||||||||||
Total | 3 | — | 35 | — | 28 | 64 | 3 | 28 | 99 | ||||||||||||||||||||||||||
Total | $ | (9 | ) | $ | 5 | $ | 83 | $ | — | $ | 27 | $ | 171 | $ | (9 | ) | $ | 32 | $ | 254 |
Termination Benefits | Facility Closure and Other Costs(1) | Total | |||||||||
Balance at March 3, 2012 | $ | 17 | $ | 85 | $ | 102 | |||||
Charges | 1 | 2 | 3 | ||||||||
Cash payments | (14 | ) | (43 | ) | (57 | ) | |||||
Adjustments | — | 34 | 34 | ||||||||
Changes in foreign currency exchange rates | — | 3 | 3 | ||||||||
Balance at May 5, 2012 | $ | 4 | $ | 81 | $ | 85 |
(1) | Included within the facility closure and other costs adjustments is $34 from the first quarter of fiscal 2013, representing an adjustment to exclude non-cash charges or benefits, which had no impact on our Condensed Consolidated Statements of Earnings and Comprehensive Income in the first quarter of fiscal 2013. |
Termination Benefits | Facility Closure and Other Costs | Total | |||||||||
Balance at March 3, 2012 | $ | — | $ | — | $ | — | |||||
Charges | 103 | 1 | 104 | ||||||||
Cash payments | — | — | — | ||||||||
Adjustments | — | — | — | ||||||||
Balance at May 5, 2012 | $ | 103 | $ | 1 | $ | 104 |
Termination Benefits | Facility Closure and Other Costs(1) | Total | |||||||||
Balance at February 26, 2011 | $ | 28 | $ | 13 | $ | 41 | |||||
Charges | 2 | — | 2 | ||||||||
Cash payments | (11 | ) | (3 | ) | (14 | ) | |||||
Adjustments | (2 | ) | 10 | 8 | |||||||
Balance at April 30, 2011 (recast) | $ | 17 | $ | 20 | $ | 37 |
(1) | Included within the facility closure and other costs adjustments is $10 from the first quarter of fiscal 2011, representing an adjustment to exclude non-cash charges or benefits, which had no impact on our Consolidated Statements of Earnings and Comprehensive Income in the first quarter of fiscal 2012. |
Termination Benefits | Facility Closure and Other Costs | Total | |||||||||
Balance at March 3, 2012 | $ | 3 | $ | 9 | $ | 12 | |||||
Charges | — | — | — | ||||||||
Cash payments | (2 | ) | (3 | ) | (5 | ) | |||||
Adjustments | — | — | — | ||||||||
Balance at May 5, 2012 | $ | 1 | $ | 6 | $ | 7 |
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May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
U.S. revolving credit facility – 364-Day | $ | — | $ | — | $ | — | |||||
U.S. revolving credit facility – Five-Year | — | — | — | ||||||||
Europe revolving credit facility | 306 | 480 | — | ||||||||
Europe receivables financing facility | — | — | 24 | ||||||||
Old Europe revolving credit facility | — | — | — | ||||||||
Canada revolving demand facility | — | — | — | ||||||||
China revolving demand facilities | — | — | 15 | ||||||||
Total short-term debt | $ | 306 | $ | 480 | $ | 39 |
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
2013 Notes | $ | 500 | $ | 500 | $ | 500 | |||||
2016 Notes | 349 | 349 | 349 | ||||||||
2021 Notes | 648 | 648 | 648 | ||||||||
Convertible debentures | — | — | 402 | ||||||||
Financing lease obligations | 145 | 149 | 168 | ||||||||
Capital lease obligations | 78 | 81 | 77 | ||||||||
Other debt | 1 | 1 | 2 | ||||||||
Total long-term debt | 1,721 | 1,728 | 2,146 | ||||||||
Less: current portion(1) | (43 | ) | (43 | ) | (442 | ) | |||||
Total long-term debt, less current portion | $ | 1,678 | $ | 1,685 | $ | 1,704 |
(1) | Since holders of our convertible debentures required us to purchase all or a portion of the debentures on January 15, 2012, we classified the $402 for such debentures in the current portion of long-term debt at April 30, 2011. |
|
May 5, 2012 | March 3, 2012 | April 30, 2011 | ||||||||||||||||||||||
Contract Type | Assets | Liabilities | Assets | Liabilities | Assets | Liabilities | ||||||||||||||||||
(recast) | (recast) | |||||||||||||||||||||||
Cash flow hedges (foreign exchange forward contracts) | $ | — | $ | — | $ | — | $ | — | $ | 7 | $ | — | ||||||||||||
No hedge designation (foreign exchange forward contracts) | — | — | 1 | (2 | ) | 4 | (2 | ) | ||||||||||||||||
Total | $ | — | $ | — | $ | 1 | $ | (2 | ) | $ | 11 | $ | (2 | ) |
Three Months Ended | ||||||||
May 5, 2012 | ||||||||
Contract Type | Pre-tax Gain (Loss) Recognized in OCI(1) | (Loss) Reclassified from Accumulated OCI to Earnings (Effective Portion)(2) | ||||||
Cash flow hedges (foreign exchange forward contracts) | $ | — | $ | (1 | ) |
Three Months Ended | ||||||||
April 30, 2011 | ||||||||
Contract Type | Pre-tax Gain Recognized in OCI(1) | Gain Reclassified from Accumulated OCI to Earnings (Effective Portion)(2) | ||||||
(recast) | (recast) | |||||||
Cash flow hedges (foreign exchange forward contracts) | $ | 8 | $ | 2 |
(1) | Reflects the amount recognized in OCI prior to the reclassification of 50% to noncontrolling interests for the cash flow and net investment hedges, respectively. |
(2) | Gain reclassified from accumulated OCI is included within selling, general and administrative expenses (“SG&A”) in our Condensed Consolidated Statements of Earnings and Comprehensive Income. |
(Loss) Recognized within SG&A | ||||||||
Three Months Ended | Three Months Ended | |||||||
Contract Type | May 5, 2012 | April 30, 2011 | ||||||
(recast) | ||||||||
No hedge designation (foreign exchange forward contracts) | $ | (3 | ) | $ | (8 | ) |
Notional Amount | ||||||||||||
Contract Type | May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | ||||||||||||
Derivatives designated as cash flow hedging instruments | $ | — | $ | — | $ | 293 | ||||||
Derivatives not designated as hedging instruments | 240 | 238 | 115 | |||||||||
Total | $ | 240 | $ | 238 | $ | 408 |
|
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
Foreign currency translation | $ | 101 | $ | 93 | $ | 201 | |||||
Unrealized (losses) gains on available-for-sale investments | (3 | ) | (3 | ) | 71 | ||||||
Unrealized gains on derivative instruments (cash flow hedges) | — | — | 2 | ||||||||
Total | $ | 98 | $ | 90 | $ | 274 |
|
Three Months Ended | |||||||
May 5, 2012 | April 30, 2011 | ||||||
(recast) | |||||||
June 2011 Program | |||||||
Number of shares repurchased | 4.6 | — | |||||
Cost of shares repurchased | $ | 115 | $ | — | |||
June 2007 Program | |||||||
Number of shares repurchased | — | 10.9 | |||||
Cost of shares repurchased | $ | — | $ | 325 |
|
Three Months Ended | |||||||
May 5, 2012 | April 30, 2011 | ||||||
(recast) | |||||||
Domestic | $ | 8,822 | $ | 8,392 | |||
International | 2,788 | 2,977 | |||||
Total | $ | 11,610 | $ | 11,369 |
Three Months Ended | |||||||
May 5, 2012 | April 30, 2011 | ||||||
(recast) | |||||||
Domestic | $ | 295 | $ | 366 | |||
International | (33 | ) | 94 | ||||
Total operating income | 262 | 460 | |||||
Other income (expense) | |||||||
Investment income and other | 6 | 17 | |||||
Interest expense | (33 | ) | (28 | ) | |||
Earnings from continuing operations before income tax expense and equity in loss of affiliates | $ | 235 | $ | 449 |
May 5, 2012 | March 3, 2012 | April 30, 2011 | |||||||||
(recast) | |||||||||||
Domestic | $ | 10,147 | $ | 9,592 | $ | 11,598 | |||||
International | 5,864 | 6,413 | 7,974 | ||||||||
Total | $ | 16,011 | $ | 16,005 | $ | 19,572 |
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