Virginia
|
26-2018846
|
(State or other jurisdiction of
|
(I.R.S. Employer
|
incorporation or organization)
|
Identification No.)
|
Securities Registered Pursuant to Section 12(b) of the Act:
|
|
Title of Each Class
|
Name of Each Exchange on Which Registered
|
Common Stock (par value $.01 per share)
|
NASDAQ
|
Yes (X)
|
No ( )
|
Yes ( )
|
No (X)
|
Yes (X)
|
No ( )
|
Yes (X)
|
No ( )
|
Large accelerated filer (X)
|
Accelerated filer ( )
|
Non-accelerated filer ( )
|
Smaller reporting company ( )
|
Yes ( )
|
No (X)
|
•
|
our anticipated sales, including comparable store net sales, net sales growth and earnings growth;
|
•
|
costs of pending and possible future legal claims;
|
•
|
our growth plans, including our plans to add, expand or relocate stores, our anticipated square footage increase, and our ability to renew leases at existing store locations;
|
•
|
the average size of our stores to be added in
2014
and beyond;
|
•
|
the effect on merchandise mix of consumables and the increase in the number of our stores with freezers and coolers on gross profit margin and sales;
|
•
|
the net sales per square foot, net sales and operating income of our stores;
|
•
|
the potential effect of inflation and other economic changes on our costs and profitability, including the potential effect of future changes in minimum wage rates, shipping rates, domestic and import freight costs, fuel costs and wage and benefit costs;
|
•
|
our gross profit margin, earnings, inventory levels and ability to leverage selling, general and administrative and other fixed costs;
|
•
|
our seasonal sales patterns including those relating to the length of the holiday selling seasons;
|
•
|
the capabilities of our inventory supply chain technology and other systems;
|
•
|
the reliability of, and cost associated with, our sources of supply, particularly imported goods such as those sourced from China;
|
•
|
the capacity, performance and cost of our distribution centers;
|
•
|
our cash needs, including our ability to fund our future capital expenditures and working capital requirements;
|
•
|
our expectations regarding competition and growth in our retail sector; and
|
•
|
management's estimates associated with our critical accounting policies, including inventory valuation, accrued expenses and income taxes.
|
•
|
consumable merchandise, which includes candy and food, health and beauty care, and everyday consumables such as paper and chemicals, and in select stores, frozen and refrigerated food;
|
•
|
variety merchandise, which includes toys, durable housewares, gifts, party goods, greeting cards, softlines, and other items; and
|
•
|
seasonal goods, which include, among others, Valentine's Day, Easter, Halloween and Christmas merchandise.
|
|
February 1,
|
|
February 2,
|
||
Merchandise Type
|
2014
|
|
2013
|
||
Consumable
|
49.4
|
%
|
|
49.9
|
%
|
Variety categories
|
46.3
|
%
|
|
45.8
|
%
|
Seasonal
|
4.3
|
%
|
|
4.3
|
%
|
Year
|
|
Number of Stores
|
|
Average Selling Square Footage Per Store
|
|
Average Selling Square Footage Per New Store Opened
|
2009
|
|
3,806
|
|
8,480
|
|
7,950
|
2010
|
|
4,101
|
|
8,570
|
|
8,400
|
2011
|
|
4,351
|
|
8,640
|
|
8,360
|
2012
|
|
4,671
|
|
8,660
|
|
8,060
|
2013
|
|
4,992
|
|
8,660
|
|
8,020
|
•
|
raw material shortages, work stoppages, strikes and political unrest;
|
•
|
economic crises and international disputes;
|
•
|
changes in currency exchange rates or policies and local economic conditions, including inflation in the country of origin; and
|
•
|
failure of the United States to maintain normal trade relations with China.
|
•
|
Shipping disruption.
Our oceanic shipping schedules may be disrupted or delayed from time to time.
|
•
|
Shipping costs.
We could experience increases in shipping rates imposed by the trans-Pacific ocean carriers. Changes in import duties, import quotas and other trade sanctions could increase our costs.
|
•
|
Diesel fuel costs.
We have experienced volatility in diesel fuel costs over the past few years, which could recur unexpectedly, at any time.
|
•
|
Vulnerability to natural or man-made disasters.
A fire, explosion or natural disaster at a port or any of our distribution facilities could result in a loss of merchandise and impair our ability to adequately stock our stores. Some facilities are vulnerable to earthquakes, hurricanes or tornadoes.
|
•
|
Labor disagreement.
Labor disagreements, disruptions or strikes may result in delays in the delivery of merchandise to our distribution centers or stores and increase costs.
|
•
|
War, terrorism and other events.
War and acts of terrorism in the United States, the Middle East, or in China or other parts of Asia, where we buy a significant amount of our imported merchandise, could disrupt our supply chain or increase our transportation costs.
|
•
|
Economic conditions.
Suppliers may encounter financial or other difficulties.
|
•
|
provide that only the Board of Directors, chairman or president may call special meetings of the shareholders;
|
•
|
establish certain advance notice procedures for nominations of candidates for election as directors and for shareholder proposals to be considered at shareholders' meetings;
|
•
|
permit the Board of Directors, without further action of the shareholders, to issue and fix the terms of preferred stock, which may have rights senior to those of the common stock.
|
Alabama
|
|
103
|
|
|
Maine
|
|
27
|
|
|
Oklahoma
|
|
54
|
|
Arizona
|
|
86
|
|
|
Maryland
|
|
102
|
|
|
Oregon
|
|
85
|
|
Arkansas
|
|
48
|
|
|
Massachusetts
|
|
89
|
|
|
Pennsylvania
|
|
244
|
|
California
|
|
437
|
|
|
Michigan
|
|
180
|
|
|
Rhode Island
|
|
23
|
|
Colorado
|
|
80
|
|
|
Minnesota
|
|
85
|
|
|
South Carolina
|
|
92
|
|
Connecticut
|
|
52
|
|
|
Mississippi
|
|
61
|
|
|
South Dakota
|
|
8
|
|
Delaware
|
|
27
|
|
|
Missouri
|
|
95
|
|
|
Tennessee
|
|
123
|
|
District of Columbia
|
|
1
|
|
|
Montana
|
|
10
|
|
|
Texas
|
|
307
|
|
Florida
|
|
367
|
|
|
Nebraska
|
|
16
|
|
|
Utah
|
|
45
|
|
Georgia
|
|
186
|
|
|
Nevada
|
|
35
|
|
|
Vermont
|
|
5
|
|
Idaho
|
|
23
|
|
|
New Hampshire
|
|
30
|
|
|
Virginia
|
|
150
|
|
Illinois
|
|
195
|
|
|
New Jersey
|
|
115
|
|
|
Washington
|
|
95
|
|
Indiana
|
|
99
|
|
|
New Mexico
|
|
36
|
|
|
West Virginia
|
|
36
|
|
Iowa
|
|
36
|
|
|
New York
|
|
239
|
|
|
Wisconsin
|
|
95
|
|
Kansas
|
|
32
|
|
|
North Carolina
|
|
194
|
|
|
Wyoming
|
|
13
|
|
Kentucky
|
|
79
|
|
|
North Dakota
|
|
7
|
|
|
|
|
|
|
Louisiana
|
|
83
|
|
|
Ohio
|
|
182
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Alberta
|
|
26
|
|
|
Manitoba
|
|
10
|
|
|
Saskatchewan
|
|
8
|
|
British Columbia
|
|
52
|
|
|
Ontario
|
|
84
|
|
|
|
|
|
Location
|
Size in
Square Feet
|
Chesapeake, Virginia
|
400,000
|
Olive Branch, Mississippi
|
425,000
|
Joliet, Illinois
|
1,200,000
|
Stockton, California
|
525,000
|
Briar Creek, Pennsylvania
|
1,003,000
|
Savannah, Georgia
|
1,014,000
|
Marietta, Oklahoma
|
1,004,000
|
San Bernardino, California
|
802,000
|
Ridgefield, Washington
|
665,000
|
Windsor, Connecticut
|
1,001,000
|
•
|
employment-related matters;
|
•
|
infringement of intellectual property rights;
|
•
|
personal injury/wrongful death claims;
|
•
|
product safety matters, which may include product recalls in cooperation with the Consumer Products Safety Commission or other jurisdictions;
|
•
|
real estate matters related to store leases; and
|
•
|
environmental issues.
|
|
High
|
|
Low
|
||||
Fiscal year ended February 2, 2013:
|
|
|
|
||||
First Quarter
|
$
|
51.21
|
|
|
$
|
42.04
|
|
Second Quarter
|
56.82
|
|
|
46.35
|
|
||
Third Quarter
|
53.00
|
|
|
38.40
|
|
||
Fourth Quarter
|
42.66
|
|
|
37.12
|
|
||
Fiscal year ended February 1, 2014:
|
|
|
|
|
|
||
First Quarter
|
$
|
48.92
|
|
|
$
|
38.43
|
|
Second Quarter
|
55.02
|
|
|
47.70
|
|
||
Third Quarter
|
60.19
|
|
|
50.33
|
|
||
Fourth Quarter
|
60.11
|
|
|
49.66
|
|
|
|
Total number
of shares
|
|
Average
price paid
|
|
Total number
of shares
purchased as
part of publicly
announced plans
|
|
Approximate
dollar value of
shares that may
yet be purchased
under the plans
or programs
|
||||||
Period
|
|
purchased
|
|
per share
|
|
or programs
|
|
(in millions)
|
||||||
November 3, 2013 to November 30, 2013
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
1,000.0
|
|
December 1, 2013 to January 4, 2014
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,000.0
|
|
||
January 5, 2014 to February 1, 2014
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,000.0
|
|
||
Total
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
1,000.0
|
|
|
Year Ended
|
||||||||||||||||||
|
February 1,
2014 |
|
February 2,
2013 |
|
January 28,
2012 |
|
January 29,
2011 |
|
January 30,
2010 |
||||||||||
Income Statement Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
$
|
7,840.3
|
|
|
$
|
7,394.5
|
|
|
$
|
6,630.5
|
|
|
$
|
5,882.4
|
|
|
$
|
5,231.2
|
|
Gross profit
|
2,789.8
|
|
|
2,652.7
|
|
|
2,378.3
|
|
|
2,087.6
|
|
|
1,856.8
|
|
|||||
Selling, general and administrative expenses
|
1,819.5
|
|
|
1,732.6
|
|
|
1,596.2
|
|
|
1,457.6
|
|
|
1,344.0
|
|
|||||
Operating income
|
970.3
|
|
|
920.1
|
|
|
782.1
|
|
|
630.0
|
|
|
512.8
|
|
|||||
Net income
|
596.7
|
|
|
619.3
|
|
|
488.3
|
|
|
397.3
|
|
|
320.5
|
|
|||||
Margin Data (as a percentage of net sales):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Gross profit
|
35.6
|
%
|
|
35.9
|
%
|
|
35.9
|
%
|
|
35.5
|
%
|
|
35.5
|
%
|
|||||
Selling, general and administrative expenses
|
23.2
|
%
|
|
23.5
|
%
|
|
24.1
|
%
|
|
24.8
|
%
|
|
25.7
|
%
|
|||||
Operating income
|
12.4
|
%
|
|
12.4
|
%
|
|
11.8
|
%
|
|
10.7
|
%
|
|
9.8
|
%
|
|||||
Net income
|
7.6
|
%
|
|
8.4
|
%
|
|
7.4
|
%
|
|
6.8
|
%
|
|
6.1
|
%
|
|||||
Per Share Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Diluted net income per share
|
$
|
2.72
|
|
|
$
|
2.68
|
|
|
$
|
2.01
|
|
|
$
|
1.55
|
|
|
$
|
1.19
|
|
Diluted net income per share increase
|
1.5
|
%
|
|
33.3
|
%
|
|
29.7
|
%
|
|
30.3
|
%
|
|
41.7
|
%
|
|
As of
|
||||||||||||||||||
|
February 1,
2014 |
|
February 2,
2013 |
|
January 28,
2012 |
|
January 29,
2011 |
|
January 30,
2010 |
||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
|
|
|
|
|
|
|
|
||||||||||
and short-term investments
|
$
|
267.7
|
|
|
$
|
399.9
|
|
|
$
|
288.3
|
|
|
$
|
486.0
|
|
|
$
|
599.4
|
|
Working capital
|
692.2
|
|
|
797.3
|
|
|
628.4
|
|
|
800.4
|
|
|
829.7
|
|
|||||
Total assets
|
2,771.9
|
|
|
2,752.0
|
|
|
2,328.6
|
|
|
2,380.5
|
|
|
2,289.7
|
|
|||||
Total debt, including capital lease obligations
|
769.8
|
|
|
271.3
|
|
|
265.8
|
|
|
267.8
|
|
|
267.8
|
|
|||||
Shareholders' equity
|
1,170.7
|
|
|
1,667.3
|
|
|
1,344.6
|
|
|
1,459.0
|
|
|
1,429.2
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Year Ended
|
||||||||||||||||||
|
February 1,
2014 |
|
February 2,
2013 |
|
January 28,
2012 |
|
January 29,
2011 |
|
January 30,
2010 |
||||||||||
Selected Operating Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Number of stores open at end of period
|
4,992
|
|
|
4,671
|
|
|
4,351
|
|
|
4,101
|
|
|
3,806
|
|
|||||
Gross square footage at end of period
|
54.3
|
|
|
50.9
|
|
|
47.4
|
|
|
44.4
|
|
|
41.1
|
|
|||||
Selling square footage at end of period
|
43.2
|
|
|
40.5
|
|
|
37.6
|
|
|
35.1
|
|
|
32.3
|
|
|||||
Selling square footage annual growth
|
6.9
|
%
|
|
7.7
|
%
|
|
6.9
|
%
|
|
8.8
|
%
|
|
6.6
|
%
|
|||||
Net sales annual growth
|
6.0
|
%
|
|
11.5
|
%
|
|
12.7
|
%
|
|
12.4
|
%
|
|
12.6
|
%
|
|||||
Comparable store net sales increase
|
2.4
|
%
|
|
3.4
|
%
|
|
6.0
|
%
|
|
6.3
|
%
|
|
7.2
|
%
|
|||||
Net sales per selling square foot
|
$
|
187
|
|
|
$
|
190
|
|
|
$
|
182
|
|
|
$
|
174
|
|
|
$
|
167
|
|
Net sales per store
|
$
|
1.6
|
|
|
$
|
1.6
|
|
|
$
|
1.6
|
|
|
$
|
1.5
|
|
|
$
|
1.4
|
|
Selected Financial Ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Return on assets
|
21.6
|
%
|
|
24.4
|
%
|
|
20.7
|
%
|
|
17.0
|
%
|
|
14.8
|
%
|
|||||
Return on equity
|
42.1
|
%
|
|
41.1
|
%
|
|
34.8
|
%
|
|
27.5
|
%
|
|
23.9
|
%
|
|||||
Inventory turns
|
4.1
|
|
|
4.3
|
|
|
4.2
|
|
|
4.2
|
|
|
4.1
|
|
•
|
what factors affect our business;
|
•
|
what our net sales, earnings, gross margins and costs were in
2013
,
2012
and
2011
;
|
•
|
why those net sales, earnings, gross margins and costs were different from the year before;
|
•
|
how all of this affects our overall financial condition;
|
•
|
what our expenditures for capital projects were in
2013
and
2012
and what we expect them to be in
2014
; and
|
•
|
where funds will come from to pay for future expenditures.
|
•
|
On September 17, 2013, we entered into agreements with JP Morgan Chase Bank to repurchase $1.0 billion of our common stock under a variable maturity accelerated share repurchase program, 50% of which is collared and 50% of which is uncollared.
|
•
|
On September 16, 2013, we completed a private placement with institutional investors of $750 million aggregate principal amount of Senior Notes. The Senior Notes include three tranches with $300 million of 4.03% Senior Notes due in September 2020, $350 million of 4.63% Senior Notes due in September 2023 and $100 million of 4.78% Senior Notes due in September 2025.
|
•
|
On September 13, 2013, our Board of Directors authorized the repurchase of an additional $2.0 billion of our common stock. This authorization replaced all previous authorizations. At February 1, 2014, we had $1.0 billion remaining under Board repurchase authorization.
|
•
|
In August 2013, we completed a 401,000 square foot expansion of our distribution center in Marietta, Oklahoma. The Marietta distribution center is now a 1,004,000 square foot, fully automated facility.
|
•
|
In June 2013, we completed construction on a new 1.0 million square foot distribution center in Windsor, Connecticut.
|
•
|
In March 2013, we leased an additional 0.4 million square feet at our distribution center in San Bernardino, California. The San Bernardino distribution center is now an 802,000 square foot facility.
|
•
|
On June 6, 2012, we entered into a five-year $750.0 million Unsecured Credit Agreement which provides for a $750.0 million revolving line of credit, including up to $150.0 million in available letters of credit. The interest rate on the facility is based, at our option, on a LIBOR rate, plus a margin, or an alternate base rate, plus a margin.
|
•
|
In October 2011, we completed a 410,000 square foot expansion of our distribution center in Savannah, Georgia. The Savannah distribution center is now a 1,014,000 square foot, fully automated facility.
|
|
Year Ended
|
|||||||
|
February 1,
2014
|
|
February 2,
2013
|
|
January 28,
2012
|
|||
Net sales
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of sales
|
64.4
|
%
|
|
64.1
|
%
|
|
64.1
|
%
|
Gross profit
|
35.6
|
%
|
|
35.9
|
%
|
|
35.9
|
%
|
Selling, general and administrative expenses
|
23.2
|
%
|
|
23.5
|
%
|
|
24.1
|
%
|
Operating income
|
12.4
|
%
|
|
12.4
|
%
|
|
11.8
|
%
|
Interest expense,net
|
0.2
|
%
|
|
—
|
%
|
|
—
|
%
|
Other (income) expense, net
|
—
|
%
|
|
(0.8
|
)%
|
|
—
|
|
Income before income taxes
|
12.2
|
%
|
|
13.2
|
%
|
|
11.8
|
%
|
Provision for income taxes
|
4.6
|
%
|
|
4.8
|
%
|
|
4.4
|
%
|
Net income
|
7.6
|
%
|
|
8.4
|
%
|
|
7.4
|
%
|
|
February 1, 2014
|
|
February 2, 2013
|
||
New stores
|
343
|
|
|
345
|
|
Expanded or relocated stores
|
71
|
|
|
87
|
|
Closed stores
|
(22
|
)
|
|
(25
|
)
|
|
February 2, 2013
|
|
January 28, 2012
|
||
New stores
|
345
|
|
|
278
|
|
Expanded or relocated stores
|
87
|
|
|
91
|
|
Closed stores
|
(25
|
)
|
|
(28
|
)
|
•
|
Payroll expenses decreased 25 basis points due to lower incentive compensation achievement.
|
•
|
Store operating costs decreased 15 basis points due to lower utility costs and reduced repairs and maintenance expenses.
|
•
|
Operating and corporate expenses decreased 15 basis points due to a favorable legal settlement and lower debit and credit fees.
|
•
|
Depreciation decreased 10 basis points primarily due to the leveraging associated with the increase in comparable store net sales in the current year and sales in the 53rd week of 2012.
|
|
|
Year Ended
|
||||||||||
|
|
February 1,
|
|
February 2,
|
|
January 28,
|
||||||
(in millions)
|
|
2014
|
|
2013
|
|
2012
|
||||||
Net cash provided by (used in):
|
|
|
|
|
|
|
||||||
Operating activities
|
|
$
|
793.4
|
|
|
$
|
677.7
|
|
|
$
|
686.5
|
|
Investing activities
|
|
(324.3
|
)
|
|
(261.3
|
)
|
|
(86.1
|
)
|
|||
Financing activities
|
|
(597.8
|
)
|
|
(303.4
|
)
|
|
(623.2
|
)
|
Contractual Obligations
|
Total
|
2014
|
2015
|
2016
|
2017
|
2018
|
Thereafter
|
||||||||||||||
Lease Financing
|
|
|
|
|
|
|
|
||||||||||||||
Operating lease obligations
|
$
|
2,326.3
|
|
$
|
516.4
|
|
$
|
476.4
|
|
$
|
394.2
|
|
$
|
329.6
|
|
$
|
206.3
|
|
$
|
403.4
|
|
Long-term Borrowings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Senior notes
|
750.0
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
750.0
|
|
|||||||
Demand revenue bonds
|
12.8
|
|
12.8
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Forgivable promissory note
|
7.0
|
|
—
|
|
—
|
|
—
|
|
0.2
|
|
1.4
|
|
5.4
|
|
|||||||
Interest on long-term borrowings
|
294.8
|
|
33.2
|
|
33.2
|
|
33.1
|
|
33.1
|
|
33.1
|
|
129.1
|
|
|||||||
Total obligations
|
$
|
3,390.9
|
|
$
|
562.4
|
|
$
|
509.6
|
|
$
|
427.3
|
|
$
|
362.9
|
|
$
|
240.8
|
|
$
|
1,287.9
|
|
Commitments
|
Total
|
Expiring in 2014
|
Expiring in 2015
|
Expiring in 2016
|
Expiring in 2017
|
Expiring in 2018
|
Thereafter
|
||||||||||||||
Letters of credit and surety bonds
|
$
|
173.8
|
|
$
|
173.8
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Technology assets
|
2.4
|
|
2.4
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Telecommunication contracts
|
19.3
|
|
7.2
|
|
5.5
|
|
5.1
|
|
1.5
|
|
—
|
|
—
|
|
|||||||
Total commitments
|
$
|
195.5
|
|
$
|
183.4
|
|
$
|
5.5
|
|
$
|
5.1
|
|
$
|
1.5
|
|
$
|
—
|
|
$
|
—
|
|
•
|
shifts in the timing of certain holidays, especially
Easter;
|
•
|
the timing of new store openings;
|
•
|
the net sales contributed by new stores;
|
•
|
changes in our merchandise mix; and
|
•
|
competition.
|
Index to Consolidated Financial Statements
|
Page
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
|
|
Consolidated Statements of Operations for the years ended
|
|
February 1, 2014, February 2, 2013 and January 28, 2012
|
|
|
|
Consolidated Statements of Comprehensive Income
|
|
for the years ended February 1, 2014, February 2, 2013 and
|
|
January 28, 2012
|
|
|
|
Consolidated Balance Sheets as of February 1, 2014 and
|
|
February 2, 2013
|
|
|
|
Consolidated Statements of Shareholders’ Equity for the years
|
|
ended February 1, 2014, February 2, 2013 and
|
|
January 28, 2012
|
|
|
|
Consolidated Statements of Cash Flows for the years ended
|
|
February 1, 2014, February 2, 2013 and January 28, 2012
|
|
|
|
Notes to Consolidated Financial Statements
|
|
|
Year Ended
|
||||||||||
|
|
February 1,
|
|
February 2,
|
|
January 28,
|
||||||
(in millions, except per share data)
|
|
2014
|
|
2013
|
|
2012
|
||||||
Net sales
|
|
$
|
7,840.3
|
|
|
$
|
7,394.5
|
|
|
$
|
6,630.5
|
|
Cost of sales
|
|
5,050.5
|
|
|
4,741.8
|
|
|
4,252.2
|
|
|||
Gross profit
|
|
2,789.8
|
|
|
2,652.7
|
|
|
2,378.3
|
|
|||
Selling, general and administrative
|
|
|
|
|
|
|
|
|
|
|||
expenses
|
|
1,819.5
|
|
|
1,732.6
|
|
|
1,596.2
|
|
|||
Operating income
|
|
970.3
|
|
|
920.1
|
|
|
782.1
|
|
|||
Interest expense, net
|
|
15.4
|
|
|
2.8
|
|
|
2.9
|
|
|||
Other (income) expense, net
|
|
0.6
|
|
|
(61.6
|
)
|
|
(0.3
|
)
|
|||
Income before income taxes
|
|
954.3
|
|
|
978.9
|
|
|
779.5
|
|
|||
Provision for income taxes
|
|
357.6
|
|
|
359.6
|
|
|
291.2
|
|
|||
Net income
|
|
$
|
596.7
|
|
|
$
|
619.3
|
|
|
$
|
488.3
|
|
Basic net income per share
|
|
$
|
2.74
|
|
|
$
|
2.70
|
|
|
$
|
2.03
|
|
Diluted net income per share
|
|
$
|
2.72
|
|
|
$
|
2.68
|
|
|
$
|
2.01
|
|
|
|
Year Ended
|
||||||||||
|
|
February 1,
|
|
February 2,
|
|
January 28,
|
||||||
(in millions)
|
|
2014
|
|
2013
|
|
2012
|
||||||
Net income
|
|
$
|
596.7
|
|
|
$
|
619.3
|
|
|
$
|
488.3
|
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
|
(15.4
|
)
|
|
(0.9
|
)
|
|
(0.3
|
)
|
|||
Fair value adjustment - derivative cash
|
|
|
|
|
|
|
||||||
flow hedging instrument, net of tax
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|||
|
|
|
|
|
|
|
||||||
Total comprehensive income
|
|
$
|
581.3
|
|
|
$
|
618.4
|
|
|
$
|
488.1
|
|
(in millions, except share and per share data)
|
|
February 1, 2014
|
|
February 2, 2013
|
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
267.7
|
|
|
$
|
399.9
|
|
Merchandise inventories, net
|
|
1,035.3
|
|
|
971.7
|
|
||
Current deferred tax assets, net
|
|
18.9
|
|
|
22.5
|
|
||
Prepaid expenses and other current assets
|
|
56.6
|
|
|
79.4
|
|
||
Total current assets
|
|
1,378.5
|
|
|
1,473.5
|
|
||
Property, plant and equipment, net
|
|
1,094.0
|
|
|
960.7
|
|
||
Goodwill
|
|
169.3
|
|
|
173.3
|
|
||
Deferred tax assets, net
|
|
24.1
|
|
|
28.3
|
|
||
Other assets, net
|
|
106.0
|
|
|
116.2
|
|
||
TOTAL ASSETS
|
|
$
|
2,771.9
|
|
|
$
|
2,752.0
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
|
||
Current portion of long-term debt
|
|
$
|
12.8
|
|
|
$
|
14.3
|
|
Accounts payable
|
|
393.9
|
|
|
346.5
|
|
||
Other current liabilities
|
|
232.3
|
|
|
235.8
|
|
||
Income taxes payable
|
|
47.3
|
|
|
79.6
|
|
||
Total current liabilities
|
|
686.3
|
|
|
676.2
|
|
||
Long-term debt, excluding current portion
|
|
757.0
|
|
|
257.0
|
|
||
Income taxes payable, long-term
|
|
5.5
|
|
|
5.6
|
|
||
Other liabilities
|
|
152.4
|
|
|
145.9
|
|
||
Total liabilities
|
|
1,601.2
|
|
|
1,084.7
|
|
||
Commitments and contingencies
|
|
|
|
|
|
|
||
Shareholders' equity:
|
|
|
|
|
|
|
||
Common stock, par value $0.01; 600,000,000 shares
|
|
|
|
|
|
|
||
authorized, 208,131,669 and 224,584,393 shares
|
|
|
|
|
|
|
||
issued and outstanding at February 1, 2014
|
|
|
|
|
|
|
||
and February 2, 2013, respectively
|
|
2.1
|
|
|
2.2
|
|
||
Additional paid-in capital
|
|
10.7
|
|
|
0.3
|
|
||
Accumulated other comprehensive loss
|
|
(16.9
|
)
|
|
(1.5
|
)
|
||
Retained earnings
|
|
1,174.8
|
|
|
1,666.3
|
|
||
Total shareholders' equity
|
|
1,170.7
|
|
|
1,667.3
|
|
||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
$
|
2,771.9
|
|
|
$
|
2,752.0
|
|
(in millions)
|
|
Common
Stock
Shares
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Retained
Earnings
|
|
Share-
holders'
Equity
|
|||||||||||
Balance at January 29, 2011
|
|
246.8
|
|
|
$
|
1.2
|
|
|
$
|
—
|
|
|
$
|
(0.4
|
)
|
|
$
|
1,458.2
|
|
|
$
|
1,459.0
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
488.3
|
|
|
488.3
|
|
|||||
Total other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
|||||
Issuance of stock under Employee Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Purchase Plan
|
|
0.2
|
|
|
—
|
|
|
4.4
|
|
|
—
|
|
|
—
|
|
|
4.4
|
|
|||||
Exercise of stock options, including
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
income tax benefit of $3.0
|
|
0.7
|
|
|
—
|
|
|
9.5
|
|
|
—
|
|
|
—
|
|
|
9.5
|
|
|||||
Repurchase and retirement of shares
|
|
(17.4
|
)
|
|
(0.1
|
)
|
|
(43.4
|
)
|
|
—
|
|
|
(602.4
|
)
|
|
(645.9
|
)
|
|||||
Stock-based compensation, net, including
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
income tax benefit of $10.8
|
|
0.9
|
|
|
—
|
|
|
29.5
|
|
|
—
|
|
|
—
|
|
|
29.5
|
|
|||||
Balance at January 28, 2012
|
|
231.2
|
|
|
1.1
|
|
|
—
|
|
|
(0.6
|
)
|
|
1,344.1
|
|
|
1,344.6
|
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
619.3
|
|
|
619.3
|
|
|||||
Total other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.9
|
)
|
|
—
|
|
|
(0.9
|
)
|
|||||
Transfer from additional paid-in capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
for Common Stock dividend
|
|
—
|
|
|
1.2
|
|
|
(1.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Issuance of stock under Employee Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Purchase Plan
|
|
0.1
|
|
|
—
|
|
|
4.8
|
|
|
—
|
|
|
—
|
|
|
4.8
|
|
|||||
Exercise of stock options, including
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
income tax benefit of $7.0
|
|
0.6
|
|
|
—
|
|
|
12.8
|
|
|
—
|
|
|
—
|
|
|
12.8
|
|
|||||
Repurchase and retirement of shares
|
|
(8.1
|
)
|
|
(0.1
|
)
|
|
(43.0
|
)
|
|
—
|
|
|
(297.1
|
)
|
|
(340.2
|
)
|
|||||
Stock-based compensation, net, including
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
income tax benefit of $14.3
|
|
0.8
|
|
|
—
|
|
|
26.9
|
|
|
—
|
|
|
—
|
|
|
26.9
|
|
|||||
Balance at February 2, 2013
|
|
224.6
|
|
|
2.2
|
|
|
0.3
|
|
|
(1.5
|
)
|
|
1,666.3
|
|
|
1,667.3
|
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
596.7
|
|
|
596.7
|
|
|||||
Total other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15.4
|
)
|
|
—
|
|
|
(15.4
|
)
|
|||||
Issuance of stock under Employee Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Purchase Plan
|
|
0.1
|
|
|
—
|
|
|
4.8
|
|
|
—
|
|
|
—
|
|
|
4.8
|
|
|||||
Exercise of stock options, including
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
income tax benefit of $1.6
|
|
0.1
|
|
|
—
|
|
|
3.7
|
|
|
—
|
|
|
—
|
|
|
3.7
|
|
|||||
Repurchase and retirement of shares
|
|
(17.4
|
)
|
|
(0.1
|
)
|
|
(23.8
|
)
|
|
—
|
|
|
(1,088.2
|
)
|
|
(1,112.1
|
)
|
|||||
Stock-based compensation, net, including
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
income tax benefit of $8.2
|
|
0.7
|
|
|
—
|
|
|
25.7
|
|
|
—
|
|
|
—
|
|
|
25.7
|
|
|||||
Balance at February 1, 2014
|
|
208.1
|
|
|
$
|
2.1
|
|
|
$
|
10.7
|
|
|
$
|
(16.9
|
)
|
|
$
|
1,174.8
|
|
|
$
|
1,170.7
|
|
|
|
Year Ended
|
||||||||||
|
|
February 1,
|
|
February 2,
|
|
January 28,
|
||||||
(in millions)
|
|
2014
|
|
2013
|
|
2012
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
596.7
|
|
|
$
|
619.3
|
|
|
$
|
488.3
|
|
Adjustments to reconcile net income to net cash
|
|
|
|
|
|
|
|
|
|
|||
provided by operating activities:
|
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
|
190.5
|
|
|
175.3
|
|
|
163.9
|
|
|||
Gain on sale of Ollie's investment
|
|
—
|
|
|
(60.8
|
)
|
|
—
|
|
|||
Provision for deferred income taxes
|
|
6.7
|
|
|
(7.7
|
)
|
|
10.9
|
|
|||
Stock-based compensation expense
|
|
37.0
|
|
|
35.5
|
|
|
31.6
|
|
|||
Other non-cash adjustments to net income
|
|
3.9
|
|
|
4.1
|
|
|
4.4
|
|
|||
Changes in assets and liabilities increasing
|
|
|
|
|
|
|
|
|
|
|||
(decreasing) cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
|||
Merchandise inventories
|
|
(67.7
|
)
|
|
(104.0
|
)
|
|
(64.5
|
)
|
|||
Other assets
|
|
26.1
|
|
|
(56.7
|
)
|
|
(1.3
|
)
|
|||
Accounts payable
|
|
46.9
|
|
|
59.3
|
|
|
26.9
|
|
|||
Income taxes payable
|
|
(32.3
|
)
|
|
16.3
|
|
|
(1.1
|
)
|
|||
Other current liabilities
|
|
(2.9
|
)
|
|
20.3
|
|
|
25.4
|
|
|||
Other liabilities
|
|
(11.5
|
)
|
|
(23.2
|
)
|
|
2.0
|
|
|||
Net cash provided by operating activities
|
|
793.4
|
|
|
677.7
|
|
|
686.5
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|||
Capital expenditures
|
|
(330.1
|
)
|
|
(312.2
|
)
|
|
(250.1
|
)
|
|||
Purchase of short-term investments
|
|
—
|
|
|
—
|
|
|
(6.0
|
)
|
|||
Proceeds from sale of short-term investments
|
|
—
|
|
|
—
|
|
|
180.8
|
|
|||
Proceeds from sale of Ollie's investment
|
|
—
|
|
|
62.3
|
|
|
—
|
|
|||
Purchase of restricted investments
|
|
(8.8
|
)
|
|
(11.0
|
)
|
|
(16.3
|
)
|
|||
Proceeds from sale of restricted investments
|
|
15.0
|
|
|
—
|
|
|
5.3
|
|
|||
Foreign currency gain (loss)
|
|
(0.1
|
)
|
|
(0.4
|
)
|
|
0.2
|
|
|||
Acquisition of favorable lease rights
|
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash used in investing activities
|
|
(324.3
|
)
|
|
(261.3
|
)
|
|
(86.1
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|||
Principal payments under long-term debt and capital lease obligations
|
|
(271.5
|
)
|
|
(1.5
|
)
|
|
(2.0
|
)
|
|||
Proceeds from long-term debt
|
|
770.0
|
|
|
7.0
|
|
|
—
|
|
|||
Payments for share repurchases
|
|
(1,112.1
|
)
|
|
(340.2
|
)
|
|
(645.9
|
)
|
|||
Proceeds from stock issued pursuant to stock-based
|
|
|
|
|
|
|
|
|
|
|||
compensation plans
|
|
6.0
|
|
|
10.0
|
|
|
10.9
|
|
|||
Tax benefit of exercises/vesting of equity based compensation
|
|
9.8
|
|
|
21.3
|
|
|
13.8
|
|
|||
Net cash used in financing activities
|
|
(597.8
|
)
|
|
(303.4
|
)
|
|
(623.2
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
|
(3.5
|
)
|
|
(1.4
|
)
|
|
(0.1
|
)
|
|||
Net increase (decrease) in cash and cash equivalents
|
|
(132.2
|
)
|
|
111.6
|
|
|
(22.9
|
)
|
|||
Cash and cash equivalents at beginning of year
|
|
399.9
|
|
|
288.3
|
|
|
311.2
|
|
|||
Cash and cash equivalents at end of year
|
|
$
|
267.7
|
|
|
$
|
399.9
|
|
|
$
|
288.3
|
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
|
|||
Cash paid for:
|
|
|
|
|
|
|
|
|
|
|||
Interest
|
|
$
|
14.5
|
|
|
$
|
3.3
|
|
|
$
|
3.2
|
|
Income taxes
|
|
$
|
373.2
|
|
|
$
|
333.9
|
|
|
$
|
268.3
|
|
Buildings
|
39 to 40 years
|
Furniture, fixtures and equipment
|
3 to 15 years
|
|
February 1,
|
|
February 2,
|
||||
(in millions)
|
2014
|
|
2013
|
||||
Land
|
$
|
65.2
|
|
|
$
|
51.4
|
|
Buildings
|
319.8
|
|
|
223.9
|
|
||
Leasehold improvements
|
960.7
|
|
|
876.2
|
|
||
Furniture, fixtures and equipment
|
1,307.0
|
|
|
1,174.5
|
|
||
Construction in progress
|
57.4
|
|
|
107.9
|
|
||
Total property, plant and equipment
|
2,710.1
|
|
|
2,433.9
|
|
||
Less: accumulated depreciation
|
1,616.1
|
|
|
1,473.2
|
|
||
Total property, plant and equipment, net
|
$
|
1,094.0
|
|
|
$
|
960.7
|
|
|
February 1,
|
|
February 2,
|
||||
(in millions)
|
2014
|
|
2013
|
||||
Compensation and benefits
|
$
|
95.3
|
|
|
$
|
99.1
|
|
Taxes (other than income taxes)
|
26.4
|
|
|
31.8
|
|
||
Insurance
|
34.1
|
|
|
33.0
|
|
||
Other
|
76.5
|
|
|
71.9
|
|
||
Total other current liabilities
|
$
|
232.3
|
|
|
$
|
235.8
|
|
|
February 1,
|
|
February 2,
|
||||
(in millions)
|
2014
|
|
2013
|
||||
Deferred rent
|
$
|
86.3
|
|
|
$
|
83.0
|
|
Insurance
|
54.7
|
|
|
51.3
|
|
||
Other
|
11.4
|
|
|
11.6
|
|
||
Total other long-term liabilities
|
$
|
152.4
|
|
|
$
|
145.9
|
|
|
Year Ended
|
||||||||||
|
February 1, 2014
|
|
February 2, 2013
|
|
January 28, 2012
|
||||||
(in millions)
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
357.6
|
|
|
$
|
359.6
|
|
|
$
|
291.2
|
|
Accumulated other comprehensive loss
|
|
|
|
|
|
|
|
|
|||
marking derivative financial instruments
|
|
|
|
|
|
|
|
|
|||
to fair value
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|||
Shareholders' equity, tax benefit on
|
|
|
|
|
|
|
|
|
|||
exercises/vesting of equity-based
|
|
|
|
|
|
|
|
|
|||
compensation
|
(9.8
|
)
|
|
(21.3
|
)
|
|
(13.8
|
)
|
|||
|
$
|
347.8
|
|
|
$
|
338.3
|
|
|
$
|
277.3
|
|
|
Year Ended
|
||||||||||
|
February 1,
|
|
February 2,
|
|
January 28,
|
||||||
(in millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Federal - current
|
$
|
304.6
|
|
|
$
|
324.5
|
|
|
$
|
240.4
|
|
State - current
|
45.9
|
|
|
42.4
|
|
|
39.4
|
|
|||
Foreign - current
|
0.4
|
|
|
0.5
|
|
|
0.3
|
|
|||
Total current
|
350.9
|
|
|
367.4
|
|
|
280.1
|
|
|||
|
|
|
|
|
|
||||||
Federal - deferred
|
10.5
|
|
|
0.3
|
|
|
14.9
|
|
|||
State - deferred
|
0.9
|
|
|
(3.5
|
)
|
|
0.1
|
|
|||
Foreign - deferred
|
(4.7
|
)
|
|
(4.6
|
)
|
|
(3.9
|
)
|
|||
Total deferred
|
$
|
6.7
|
|
|
$
|
(7.8
|
)
|
|
$
|
11.1
|
|
|
Year Ended
|
|||||||
|
February 1, 2014
|
|
February 2, 2013
|
|
January 28, 2012
|
|||
Statutory tax rate
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
Effect of:
|
|
|
|
|
|
|
|
|
State and local income taxes,
|
|
|
|
|
|
|
|
|
net of federal income tax benefit
|
3.3
|
|
|
3.0
|
|
|
3.4
|
|
Other, net
|
(0.8
|
)
|
|
(1.3
|
)
|
|
(1.0
|
)
|
Effective tax rate
|
37.5
|
%
|
|
36.7
|
%
|
|
37.4
|
%
|
|
February 1,
2014 |
|
February 2,
2013 |
||||
(in millions)
|
|
|
|
||||
Deferred tax assets:
|
|
|
|
||||
Deferred rent
|
$
|
38.2
|
|
|
$
|
35.6
|
|
Accrued expenses
|
34.2
|
|
|
32.6
|
|
||
Net operating losses and credit carryforwards
|
19.3
|
|
|
14.4
|
|
||
Accrued compensation expense
|
29.5
|
|
|
28.2
|
|
||
Other
|
0.6
|
|
|
0.8
|
|
||
Total deferred tax assets
|
121.8
|
|
|
111.6
|
|
||
Valuation allowance
|
(6.0
|
)
|
|
(4.3
|
)
|
||
Deferred tax assets, net
|
115.8
|
|
|
107.3
|
|
||
Deferred tax liabilities:
|
|
|
|
|
|
||
Property and equipment
|
(46.6
|
)
|
|
(32.8
|
)
|
||
Goodwill
|
(16.9
|
)
|
|
(15.9
|
)
|
||
Prepaid expenses
|
(3.7
|
)
|
|
(4.0
|
)
|
||
Inventory
|
(5.6
|
)
|
|
(3.8
|
)
|
||
Total deferred tax liabilities
|
(72.8
|
)
|
|
(56.5
|
)
|
||
Net deferred tax asset
|
$
|
43.0
|
|
|
$
|
50.8
|
|
|
February 1, 2014
|
|
February 2, 2013
|
||||
Beginning Balance
|
$
|
5.6
|
|
|
$
|
15.5
|
|
Additions, based on tax positions related to current year
|
0.2
|
|
|
2.5
|
|
||
Additions for tax positions of prior years
|
0.8
|
|
|
2.1
|
|
||
Reductions for tax positions of prior years
|
(0.2
|
)
|
|
(3.1
|
)
|
||
Settlements
|
(0.3
|
)
|
|
(1.9
|
)
|
||
Lapses in statutes of limitation
|
(0.6
|
)
|
|
(9.5
|
)
|
||
Ending balance
|
$
|
5.5
|
|
|
$
|
5.6
|
|
|
(in millions)
|
||
2014
|
$
|
516.4
|
|
2015
|
476.4
|
|
|
2016
|
394.2
|
|
|
2017
|
329.6
|
|
|
2018
|
206.3
|
|
|
Thereafter
|
403.4
|
|
|
Total minimum lease payments
|
$
|
2,326.3
|
|
|
Year Ended
|
||||||||||
|
February 1,
|
|
February 2,
|
|
January 28,
|
||||||
(in millions)
|
2014
|
|
2013
|
|
2012
|
||||||
Minimum rentals
|
$
|
496.4
|
|
|
$
|
455.5
|
|
|
$
|
421.8
|
|
Contingent rentals
|
1.8
|
|
|
2.0
|
|
|
1.8
|
|
|
February 1,
|
|
February 2,
|
||||
(in millions)
|
2014
|
|
2013
|
||||
$750.0 million Senior Notes,
|
$
|
750.0
|
|
|
$
|
—
|
|
fixed rate interest payable semi-annually, January 15 and July 15
|
|
|
|
||||
$750.0 million Unsecured Credit Agreement,
|
|
|
|
||||
interest payable monthly at LIBOR,
|
|
|
|
||||
plus 0.90%, which was 1.06% at
|
|
|
|
||||
February 1, 2014, amounts outstanding payable upon
|
|
|
|
||||
expiration of the facility in February 2017
|
—
|
|
|
250.0
|
|
||
Demand Revenue Bonds, interest payable monthly
|
|
|
|
|
|
||
at a variable rate which was 0.19% at
|
|
|
|
|
|
||
February 1, 2014, principal payable on
|
|
|
|
|
|
||
demand, maturing June 2018
|
12.8
|
|
|
14.3
|
|
||
$7.0 million Forgivable Promissory Note, interest payable
|
|
|
|
||||
beginning in November 2017 at a rate of 1%,
|
|
|
|
||||
principal payable beginning November 2017
|
7.0
|
|
|
7.0
|
|
||
Total long-term debt
|
$
|
769.8
|
|
|
$
|
271.3
|
|
Less current portion
|
12.8
|
|
|
14.3
|
|
||
Long-term debt, excluding current portion
|
$
|
757.0
|
|
|
$
|
257.0
|
|
|
|
Year Ended
|
||||||||||
|
|
February 1,
|
|
February 2,
|
|
January 28,
|
||||||
(in millions, except per share data)
|
|
2014
|
|
2013
|
|
2012
|
||||||
Basic net income per share:
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
596.7
|
|
|
$
|
619.3
|
|
|
$
|
488.3
|
|
Weighted average number of shares
|
|
|
|
|
|
|
|
|
|
|||
outstanding
|
|
218.1
|
|
|
229.3
|
|
|
240.6
|
|
|||
Basic net income per share
|
|
$
|
2.74
|
|
|
$
|
2.70
|
|
|
$
|
2.03
|
|
Diluted net income per share:
|
|
|
|
|
|
|
|
|
|
|||
Net income
|
|
$
|
596.7
|
|
|
$
|
619.3
|
|
|
$
|
488.3
|
|
Weighted average number of shares
|
|
|
|
|
|
|
|
|
|
|||
outstanding
|
|
218.1
|
|
|
229.3
|
|
|
240.6
|
|
|||
Dilutive effect of stock options and
|
|
|
|
|
|
|
|
|
|
|||
restricted stock (as determined by
|
|
|
|
|
|
|
|
|
|
|||
applying the treasury stock method)
|
|
1.0
|
|
|
1.4
|
|
|
1.8
|
|
|||
Weighted average number of shares and
|
|
|
|
|
|
|
|
|
|
|||
dilutive potential shares outstanding
|
|
219.1
|
|
|
230.7
|
|
|
242.4
|
|
|||
Diluted net income per share
|
|
$
|
2.72
|
|
|
$
|
2.68
|
|
|
$
|
2.01
|
|
Year ended February 1, 2014
|
|
$35.8 million
|
Year ended February 2, 2013
|
|
$40.7 million
|
Year Ended January 28, 2012
|
|
$37.9 million
|
|
20% after two years of service
|
|
40% after three years of service
|
|
60% after four years of service
|
|
100% after five years of service
|
|
Shares
|
|
Weighted
Average
Grant
Date Fair
Value
|
|||
Nonvested at February 2, 2013
|
2,054,173
|
|
|
$
|
35.37
|
|
Granted
|
781,883
|
|
|
47.24
|
|
|
Vested
|
(1,026,993
|
)
|
|
28.87
|
|
|
Forfeited
|
(85,429
|
)
|
|
41.63
|
|
|
Nonvested at February 1, 2014
|
1,723,634
|
|
|
$
|
41.64
|
|
Stock Option Activity
|
|||||||||||||
|
|
February 1, 2014
|
|||||||||||
|
|
|
|
Weighted
|
|
|
|
|
|||||
|
|
|
|
Average
|
|
Weighted
|
|
Aggregate
|
|||||
|
|
|
|
Per Share
|
|
Average
|
|
Intrinsic
|
|||||
|
|
|
|
Exercise
|
|
Remaining
|
|
Value (in
|
|||||
|
|
Shares
|
|
Price
|
|
Term
|
|
millions)
|
|||||
Outstanding, beginning of period
|
|
718,255
|
|
|
$
|
11.66
|
|
|
|
|
|
||
Granted
|
|
12,228
|
|
|
53.59
|
|
|
|
|
|
|||
Exercised
|
|
(138,673
|
)
|
|
9.05
|
|
|
|
|
|
|||
Forfeited
|
|
(22,992
|
)
|
|
6.67
|
|
|
|
|
|
|||
Outstanding, end of period
|
|
568,818
|
|
|
$
|
13.40
|
|
|
3.7
|
|
$
|
21.2
|
|
Options vested and expected to vest
|
|
|
|
|
|
|
|
|
|
|
|
||
at February 1, 2014
|
|
568,818
|
|
|
$
|
13.40
|
|
|
3.7
|
|
$
|
21.2
|
|
Options exercisable at end of period
|
|
568,818
|
|
|
$
|
13.40
|
|
|
3.7
|
|
$
|
21.2
|
|
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||
|
|
Options
|
|
|
|
|
|
Options
|
|
|
||||||
Range of
|
|
Outstanding
|
|
Weighted Avg.
|
|
Weighted Avg.
|
|
Exercisable
|
|
Weighted Avg.
|
||||||
Exercise
|
|
at February 1,
|
|
Remaining
|
|
Exercise
|
|
at February 1,
|
|
Exercise
|
||||||
Prices
|
|
2014
|
|
Contractual Life
|
|
Price
|
|
2014
|
|
Price
|
||||||
$7.21 to $9.71
|
|
305,840
|
|
|
2.3
|
|
$
|
8.92
|
|
|
305,840
|
|
|
$
|
8.92
|
|
$9.72 to $14.52
|
|
192,214
|
|
|
4.6
|
|
13.07
|
|
|
192,214
|
|
|
13.07
|
|
||
$14.53 to $19.93
|
|
15,516
|
|
|
5.9
|
|
17.21
|
|
|
15,516
|
|
|
17.21
|
|
||
$19.94 to $28.36
|
|
21,132
|
|
|
6.8
|
|
25.09
|
|
|
21,132
|
|
|
25.09
|
|
||
$28.37 to $58.45
|
|
34,116
|
|
|
8.6
|
|
46.41
|
|
|
34,116
|
|
|
46.41
|
|
||
$7.21 to $58.45
|
|
568,818
|
|
|
3.7
|
|
$
|
13.40
|
|
|
568,818
|
|
|
$
|
13.40
|
|
|
Fiscal 2013
|
|
Fiscal 2012
|
|
Fiscal 2011
|
|||
Expected term
|
3 months
|
|
3 months
|
|
3 months
|
|||
Expected volatility
|
11.6
|
%
|
|
11.9
|
%
|
|
12.6
|
%
|
Annual dividend yield
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Risk free interest rate
|
—
|
%
|
|
0.1
|
%
|
|
0.1
|
%
|
(dollars in millions, except diluted net income per share data)
|
|
First
Quarter (1)
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter (2)
|
||||||||
Fiscal 2013:
|
|
|
|
|
|
|
|
|
||||||||
Net sales
|
|
$
|
1,865.8
|
|
|
$
|
1,854.9
|
|
|
$
|
1,884.7
|
|
|
$
|
2,234.9
|
|
Gross profit
|
|
$
|
656.0
|
|
|
$
|
648.7
|
|
|
$
|
659.9
|
|
|
$
|
825.2
|
|
Operating income
|
|
$
|
216.6
|
|
|
$
|
201.3
|
|
|
$
|
204.3
|
|
|
$
|
348.2
|
|
Net income
|
|
$
|
133.5
|
|
|
$
|
124.7
|
|
|
$
|
125.4
|
|
|
$
|
213.0
|
|
Diluted net income per share
|
|
$
|
0.59
|
|
|
$
|
0.56
|
|
|
$
|
0.58
|
|
|
$
|
1.02
|
|
Stores open at end of quarter
|
|
4,763
|
|
|
4,842
|
|
|
4,953
|
|
|
4,992
|
|
||||
Comparable store net sales change
|
|
2.1
|
%
|
|
3.7
|
%
|
|
3.1
|
%
|
|
1.2
|
%
|
||||
Fiscal 2012:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net sales
|
|
$
|
1,723.6
|
|
|
$
|
1,704.6
|
|
|
$
|
1,720.5
|
|
|
$
|
2,245.8
|
|
Gross profit
|
|
$
|
602.7
|
|
|
$
|
599.6
|
|
|
$
|
599.6
|
|
|
$
|
850.7
|
|
Operating income
|
|
$
|
188.0
|
|
|
$
|
184.4
|
|
|
$
|
184.2
|
|
|
$
|
363.5
|
|
Net income
|
|
$
|
116.1
|
|
|
$
|
119.2
|
|
|
$
|
155.4
|
|
|
$
|
228.6
|
|
Diluted net income per share
|
|
$
|
0.50
|
|
|
$
|
0.51
|
|
|
$
|
0.68
|
|
|
$
|
1.01
|
|
Stores open at end of quarter
|
|
4,451
|
|
|
4,523
|
|
|
4,630
|
|
|
4,671
|
|
||||
Comparable store net sales change
|
|
5.6
|
%
|
|
4.5
|
%
|
|
1.6
|
%
|
|
2.4
|
%
|
1.
|
Documents filed as part of this report
:
|
1.
|
Financial Statements. Reference is made to the Index to the Consolidated Financial Statements set forth under Part II, Item 8, on Page 28 of this Form 10-K.
|
2.
|
Financial Statement Schedules. All schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are not required under the related instructions, are not applicable, or the information is included in the Consolidated Financial Statements, and therefore have been omitted.
|
3.
|
Exhibits. The following exhibits, are filed as part of, or incorporated by reference into, this report.
|
2.
|
Plan of Reorganization
|
2.1
|
Agreement and Plan of Merger among Dollar Tree Stores, Inc., Dollar Tree, Inc. and Dollar Tree Merger Sub, Inc., dated February 27, 2008 (Exhibit 2.1 to the Company’s February 27, 2008 Current Report on Form 8-K, incorporated herein by this reference).
|
3.
|
Articles and Bylaws
|
3.1
|
Articles of Incorporation of Dollar Tree, Inc. (as amended, effective June 17, 2010) (Exhibit 3.1 to the Company’s June 17, 2010 Current Report on Form 8-K, incorporated herein by this reference).
|
3.2
|
Bylaws of Dollar Tree, Inc., as amended (Exhibit 3.1 to the Company’s October 6, 2011 Current Report on Form 8-K, incorporated herein by this reference).
|
4.
|
Instruments Defining the Rights of Security Holders
|
4.1
|
Form of Common Stock Certificate (Exhibit 4.1 to the Company’s March 13, 2008 Current Report on Form 8-K, incorporated herein by this reference).
|
10.
|
Material Contracts
|
21.
|
Subsidiaries of the Registrant
|
21.1
|
Subsidiaries (filed herewith)
|
23.
|
Consents of Experts and Counsel
|
23.1
|
Consent of Independent Registered Public Accounting Firm (filed herewith)
|
31.
|
Certifications required under Section 302 of the Sarbanes-Oxley Act
|
31.1
|
Certification required under Section 302 of the Sarbanes-Oxley Act of Chief Executive Officer
|
31.2
|
Certification required under Section 302 of the Sarbanes-Oxley Act of Chief Financial Officer
|
32.
|
Statements under Section 906 of the Sarbanes-Oxley Act
|
32.1
|
Statement under Section 906 of the Sarbanes-Oxley Act of Chief Executive Officer
|
32.2
|
Statement under Section 906 of the Sarbanes-Oxley Act of Chief Financial Officer
|
101.INS
|
XBRL Instance Document
|
101.SCH
|
XBRL Taxonomy Schema Document
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
DOLLAR TREE, INC.
|
|
|
|
|
DATE:
|
March 14, 2014
|
By:
|
/s/ Bob Sasser
|
|
|
Bob Sasser
|
|
|
|
Chief Executive Officer
|
Signature
|
Title
|
Date
|
|
|
|
/s/ Macon F. Brock, Jr.
|
|
|
Macon F. Brock, Jr.
|
Chairman; Director
|
March 14, 2014
|
|
|
|
/s/ Bob Sasser
|
|
|
Bob Sasser
|
Director, Chief Executive Officer
|
March 14, 2014
|
|
(principal executive officer)
|
|
|
|
|
/s/ Thomas A. Saunders, III
|
|
|
Thomas A. Saunders, III
|
Lead Independent Director
|
March 14, 2014
|
|
|
|
/s/ J. Douglas Perry
|
|
|
J. Douglas Perry
|
Chairman Emeritus; Director
|
March 14, 2014
|
|
|
|
/s/ Arnold S. Barron
|
|
|
Arnold S. Barron
|
Director
|
March 14, 2014
|
|
|
|
/s/ Mary Anne Citrino
|
|
|
Mary Anne Citrino
|
Director
|
March 14, 2014
|
|
|
|
/s/ H. Ray Compton
|
|
|
H. Ray Compton
|
Director
|
March 14, 2014
|
|
|
|
/s/ Conrad M. Hall
|
|
March 14, 2014
|
Conrad M. Hall
|
Director
|
|
|
|
|
/s/ Lemuel E. Lewis
|
|
|
Lemuel E. Lewis
|
Director
|
March 14, 2014
|
|
|
|
/s/ Kevin S. Wampler
|
|
|
Kevin S. Wampler
|
Chief Financial Officer
|
March 14, 2014
|
|
(principal financial and
|
|
|
accounting officer)
|
|
|
|
|
/s/ Thomas E. Whiddon
|
|
|
Thomas E. Whiddon
|
Director
|
March 14, 2014
|
|
|
|
/s/ Dr. Carl P. Zeithaml
|
|
|
Dr. Carl P. Zeithaml
|
Director
|
March 14, 2014
|
1.
|
Post-Retirement Benefits
. In consideration of Mr. Perry’s past services to Dollar Tree, the Company hereby agrees to
|
a.
|
pay a post-retirement benefit to Mr. Perry in the gross amount of $30,000.00 per annum during his lifetime. Such amount shall be paid in equal quarterly installments or as otherwise agreed upon between the parties. Mr. Perry acknowledges that taxes including, without limitation, state and federal income taxes, social security and Medicare, shall be withheld from this amount to the extent required by law.
|
b.
|
permit Mr. Perry and his spouse to be fully eligible to participate in the group health insurance maintained by the Company, currently the Dollar Tree UnitedHealthcare Choice Plus Plan and any successor insurance coverage that may be offered by the Company from time to time, so long as Mr. Perry and/or his spouse pay the full cost of such insurance coverage on an after-tax basis. Notwithstanding the foregoing, in the event that providing Mr. Perry and his spouse continued eligibility under the Company's group health plan (the "continuation coverage") is determined to be discriminatory pursuant to Section 105(h) of the Internal Revenue Code of 1986, as amended (the "Code"), or Section 2716 to the Public Health Service Act or to otherwise violate applicable law, then the parties shall use their best efforts to amend the Agreement such that the continuation coverage is not discriminatory or complies with applicable law.
|
2.
|
Termination
. This Agreement may only be terminated by written agreement of Mr. Perry and Dollar Tree.
|
3.
|
Successors in Interest
. This Agreement shall be binding upon and shall inure to the benefit of any and all successors and assigns of the Company. The rights and interests of Mr. Perry and his spouse under this Agreement are personal and not assignable.
|
4.
|
Code Section 409A
. All payments made and benefits provided under this Agreement are intended to comply with Code Section 409A and the regulations promulgated thereunder, and the provisions of this Agreement shall be interpreted and construed as necessary to comply with such intent. To the extent any provision of this Agreement does not comply with Code Section 409A, such provisions shall be deemed amended to comply.
|
5.
|
Miscellaneous
. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia. This Agreement constitutes the entire understanding between the parties with respect to the subject matter hereto and specifically replaces the Consulting Agreement between the parties dated February 1, 2005. No amendment, modification, or supplement hereto shall be of any force or effect unless it is in writing and signed by all of the parties hereto. Mr. Perry’s spouse is an intended third party beneficiary of this Agreement.
|
5.
|
In the event that providing you or your spouse continued eligibility under the Company's group health plan (the "continuation coverage") is determined to be discriminatory pursuant to Section 105(h) of the Internal Revenue Code of 1986, as amended (the "Code"), or Section 2716 to the Public Health Service Act or to otherwise violate applicable law, then we will use our best mutual efforts to amend the Agreement such that the continuation coverage is not discriminatory or complies with applicable law.
|
6.
|
All payments made and benefits provided under the Agreement are intended to comply with Code Section 409A and the regulations promulgated thereunder, and the provisions of this Agreement shall be interpreted and construed as necessary to comply with such intent. To the extent any provision of this Agreement does not comply with Code Section 409A, such provisions shall be deemed amended to comply.
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(a)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(b)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(c)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Bob Sasser
|
|
Bob Sasser
|
|
Chief Executive Officer
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
/s/ Kevin S. Wampler
|
|
Kevin S. Wampler
|
|
Chief Financial Officer
|
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
March 14, 2014
|
/s/ Bob Sasser
|
Date
|
Bob Sasser
|
|
Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
March 14, 2014
|
/s/ Kevin S. Wampler
|
Date
|
Kevin S. Wampler
|
|
Chief Financial Officer
|