þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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20-2733559
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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625 Westport Parkway
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76051
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Grapevine, Texas
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(Zip Code)
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(Address of principal executive offices)
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(Title of Class)
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(Name of Exchange on Which Registered)
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Class A Common Stock, $.001 par value per share
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New York Stock Exchange
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Rights to Purchase Series A Junior Participating Preferred
Stock, $.001 par value per share
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New York Stock Exchange
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Large Accelerated Filer
þ
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Accelerated Filer
¨
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Non-accelerated Filer
¨
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Smaller reporting company
¨
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(Do not check if a smaller reporting company)
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Page
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PART I
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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PART III
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART IV
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Item 15.
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Item 1.
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Business
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•
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the introduction of next-generation consoles and other product releases which impact sales of new products and old products, the current or future features of such consoles, manufacturer-imposed or regulatory restrictions, changes or conditions that may adversely affect our pre-owned business;
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our ability to respond quickly to technological changes and evolving consumer preferences;
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our reliance on a limited number of suppliers and vendors for timely delivery of sufficient quantities of their products;
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our dependence on the production of new, innovative and popular product releases and enhanced video game platforms and accessories by developers and manufacturers;
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general economic conditions in the U.S. and internationally, specifically Europe, which impact consumer confidence and consumer spending;
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seasonality of sales;
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the proliferation of alternate sources of distribution of video game hardware, software and content, including through digital downloads;
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the growth of alternate means to play video games, including mobile, social networking sites and browser gaming;
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the intense competition in the video game industry;
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our ability to open and operate new stores and to efficiently close underperforming stores;
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our ability to attract and retain qualified personnel;
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the failure to achieve the anticipated benefits from new ventures and transactions and our ability to effectively integrate and operate acquired companies, including digital gaming, technology-based, mobile, wireless or consumer electronics companies that are outside of our historical operating expertise;
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the impact and costs of litigation and regulatory compliance;
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the amounts, timing and prices of any share repurchases made by us under our share repurchase programs;
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the risks involved with our international operations, including depressed local economic conditions, political risks, currency exchange risks, tax rates and regulatory risks;
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the efficiency of our management information systems and back-office functions;
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data breaches involving customers or employee data and failure of our cyber security infrastructure which could expose us to litigation;
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restrictions under our credit agreement which may impose operating and financial restrictions on us; and
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other factors described in this Form 10-K, including those set forth under the caption “Item 1A. Risk Factors.”
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Video Game Hardware.
Gaming consoles are typically launched in cycles as technological developments provide significant improvements in graphics, audio quality, gameplay, internet connectivity, social features and other entertainment capabilities beyond video gaming. The most recent cycle of consoles (referred to as “next generation”) includes the Sony PlayStation 4 and Microsoft Xbox One, which both launched in most of the countries in which we operate in November 2013, and the Nintendo Wii U, which launched in November 2012. Early demand for the PlayStation 4 and Xbox One has been strong as sales exceeded our expectations since introduction.
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Video Game Software.
Sales of video game software generally increase as gaming platforms mature and gain wider acceptance. Sales of video game software are dependent upon manufacturers and third-party publishers developing and releasing game titles for existing game platforms. In recent years the number of new games introduced each year has generally declined and as a result, the market for video game sales has also declined. With the introduction of the next generation consoles, we expect the number of new games introduced to increase and we expect demand for software for those devices to be strong and demand for software for the previous generation of consoles to continue to decline.
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Video Game Accessories.
Sales of video game hardware also drive sales of video game accessories for use with the hardware and software. The most common video game accessories are controllers and gaming headsets. We expect demand for video game accessories for use on the next generation of consoles to increase as the installed base of these consoles increases. We expect the demand for accessories for use with the previous generation of consoles to decline as the sales of those consoles decline.
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Wireless Services and Products.
Our Aio Wireless and Spring Mobile businesses are exclusive resellers of AT&T and sell AT&T’s pre-paid and post-paid services, respectively, and a variety of wireless handsets manufactured for use on AT&T’s network. The market for wireless devices and services is estimated by CTIA- the Wireless Association to be approximately $184 billion with growth projected over the next five years between 3-5% annually. We expect that the market for AT&T services and products and the wireless market in general will continue to grow as more and more wireless devices get connected to the internet through wireless networks.
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Mobile Devices.
We define mobile devices as smartphones, tablets and related accessories. We sell new mobile devices in our Technology Brands stores. We buy, sell and trade pre-owned mobile devices and tablets in our Video Game Brands and Technology Brands stores. We take trades of other select pre-owned electronics and smartphones in our Video Game Brands stores and in our Technology Brands stores. The market for pre-owned mobile devices and other electronics is referred to as the recommerce industry, which has been growing in recent years as companies like NextWorth and Gazelle advertise that consumers can trade in their pre-owned electronic devices. We estimate that the size of the recommerce market is $2.3 billion in the United States and will grow at an annual rate of 20-25% over the next five years.
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Consumer Electronics.
Our Simply Mac stores are authorized Apple resellers and also offer certified training, warranty and repair services to customers. Based on Apple public statements and filings, we estimate the market for Apple products sold at retail in the U.S. to be approximately $69 billion and is expected to grow 5-10% annually in the next five years.
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Increase Market Share and Expand our Market Leadership Position.
We plan to increase market share and awareness of the GameStop brand and drive membership in our loyalty program, expand our sales of new and pre-owned mobile products and expand our market leadership position by focusing on the launch of new hardware platforms as well as physical and digital software titles.
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Increase GameStop Brand Awareness and Loyalty Membership.
Substantially all of GameStop’s U.S. and European stores are operated under the GameStop name, with the exception of the Micromania stores in France. We operate loyalty programs in each of the countries in which we operate our Video Game Brands stores. The Micromania stores introduced a loyalty program in the 1990s. Using this program as a model, we introduced our U.S. loyalty program called PowerUp Rewards
TM
("PowerUp Rewards") in 2010. We introduced other loyalty programs in our video game stores in remaining countries between 2011 and 2013. Building our brands has enabled us to leverage the increased awareness to capture advertising and marketing efficiencies. Our loyalty programs generally offer our customers the ability to sign up for a free or paid membership which gives our customers access to exclusive video game related rewards. The programs' paid memberships may also include a subscription to
Game Informer
magazine, additional discounts on pre-owned merchandise in our stores and additional credit on trade-ins of pre-owned products. As of February 1, 2014, we had 27 million members in the PowerUp Rewards program, approximately 7 million of which were paid members. In total, our loyalty programs around the world had approximately 34 million members. Our branding strategy is further supported by our Web sites which allow our customers to buy games online, reserve or pick up merchandise in our stores, order in-store for home delivery and to learn about the latest video game products and their availability in our stores. Together, our loyalty programs, Web sites, mobile applications, magazine and other properties are a part of our multi-channel retail strategy designed to enhance our relationships with our customers, make it easier for our customers to transact with us and increase brand loyalty. In fiscal 2014, we plan to continue to aggressively promote our loyalty programs and increase brand awareness over a broader demographic area in order to promote our unique buying experience in-store for new and pre-owned hardware and software, trade-ins of pre-owned video game and mobile consumer electronics products and to leverage our Web sites
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Increase Sales of Pre-Owned and Value Video Game Products.
We believe we are the largest retailer of pre-owned video game products in the world and carry the broadest selection of pre-owned and value video game products for both next and previous generation platforms, giving us a unique advantage in the video game retail industry. The opportunity to trade-in and purchase pre-owned and value video game products offers our customers a unique value proposition generally unavailable at most mass merchants, toy stores and consumer electronics retailers. We obtain most of our pre-owned video game products from trade-ins made in our stores by our customers. We also obtain value-priced, or close-out, video game products at favorable prices from publishers, other retailers or distributors and can sell those products to value-conscious consumers in our stores. Pre-owned and value video game products generate significantly higher gross margins than new video game products. Our strategy consists of increasing consumer awareness of the benefits of trading in and buying pre-owned video game products and value-priced video game products at our stores through increased marketing activities and the use of both broad and targeted marketing to our loyalty program members. The supply of value-priced video game products and trade-ins of video game products, and the demand for resale of these products, is affected by overall demand for video game products and the introduction of new software and hardware by our suppliers. We expect the recent launch of next-generation consoles and software to drive close-out availability and trade-ins of older video game products, thereby expanding our supply of pre-owned and value video game products.
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Expand our Digital Growth Strategy to Protect and Expand our Market Leadership Position.
We expect that future growth in the electronic game industry will be driven by the sale of video games delivered in digital form and the expansion of other forms of gaming. We currently sell various types of products that relate to the digital category, including Xbox Live, PlayStation Plus and Nintendo network points cards, as well as prepaid digital and online timecards and DLC. We believe we are the only significant brick-and-mortar retail seller of DLC. We believe that we are frequently the leading seller of DLC for certain game titles by out-selling online networks. We operate an online video game platform called Kongregate.com and we acquired a digital PC distribution platform, Impulse, during the 52 weeks ended January 28, 2012 (“fiscal 2011”). We will continue to make investments in e-commerce, digital delivery systems, mobile applications and in-store and Web site functionality to enable our customers to access digital content and eliminate friction in the digital sales and delivery process. We plan to continue to grow our digital sales base.
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Store Opening/Closing Strategy.
We have an analysis-driven approach to store opening and closing decisions. We intend to continue to open a limited number of new Video Game Brands stores in targeted markets where we can take market share from uncontested competitors, as well as in markets in which we already operate where we have realized returns on invested capital that have exceeded our internal targets. We analyze each market relative to target population and other demographic indices, real estate availability, competitive factors and past operating history, if available. On average, our new stores opened in the past three fiscal years have had a return of original investment of less than two years. We will be aggressive in the analysis of our existing store base to determine optimal levels of profitability and close stores where profitability goals are not being met or where we can attempt to transfer sales to other nearby existing stores and increase overall profits. We utilize our PowerUp Rewards loyalty program information to determine areas that are currently underserved and also utilize our database to ensure a high customer transfer rate from closing locations to existing locations. We opened 109 new Video Game Brands stores and closed 254 Video Game Brands stores in fiscal 2013, reducing our Video Game Brands store count by 2.2%, in line with stated targets. We opened 146 new stores and closed 227 stores in the 53 weeks ended February 2, 2013 (“fiscal 2012”), reducing our store count by 1.2%, in line with stated targets and decreasing the number of stores we opened compared to previous years. We opened 285 new stores and closed 272 stores in fiscal 2011, significantly increasing the number of stores we closed compared to previous years. We plan to open approximately 40-50 new Video Game Brands stores and close approximately 170-180 Video Game Brands stores worldwide in fiscal 2014.
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Real estate knowledge, including extensive relationships with landlords, portfolio management, negotiating skills and risk mitigation;
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Experience in rapid growth retail environments with a history of opening 300-400 stores annually;
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Knowledge of buy-sell-trade programs, including pricing algorithms, inventory balancing, refurbishment capabilities and secondhand dealer laws;
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Human resource management practices, including hiring, training, systems and processes;
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Multi-unit management in small, specialty retail stores, with expert staff in assisted selling environments and limited staffing models;
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Customer retention programs, including using our loyalty programs to drive consumer awareness of new retail concepts and promote new products; and
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The ability to deploy capital in ways that increase shareholder value, finding acquisitions that have high return on invested capital and will be accretive to operating earnings.
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United States Video Game Brands
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Number
of Stores |
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Utah
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28
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Vermont
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5
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Virginia
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137
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Washington
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78
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West Virginia
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31
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Wisconsin
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60
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Wyoming
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8
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Total Stores - United States Video Game Brands
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4,249
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International
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Number
of Stores
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Canada
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335
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Total Stores - Canada Video Game Brands
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335
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Australia
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379
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New Zealand
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39
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Total Stores - Australia Video Game Brands
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418
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Austria
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27
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Denmark
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37
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Finland
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20
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France
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442
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Germany
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209
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Ireland
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51
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Italy
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431
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Norway
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47
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Spain
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108
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Sweden
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63
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Switzerland
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20
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Total Stores - Europe Video Game Brands
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1,455
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Total International Stores
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2,208
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Technology Brands
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Arizona
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21
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California
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49
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Colorado
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26
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Georgia
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8
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Idaho
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6
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Illinois
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9
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Indiana
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5
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Iowa
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4
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Louisiana
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1
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Minnesota
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3
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Missouri
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1
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Montana
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5
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Nebraska
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3
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Nevada
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5
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New Mexico
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2
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New York
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1
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Ohio
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6
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Oregon
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1
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Texas
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16
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Utah
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36
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Washington
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2
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Wyoming
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8
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Total Stores - Technology Brands
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218
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Total Stores
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6,675
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Item 1A.
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Risk Factors
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economic downturns, specifically in the regions in which we operate;
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currency exchange rate fluctuations;
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international incidents;
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natural disasters;
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government instability; and
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competitors entering our current and potential markets.
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the timing and allocations of new product releases including new console launches;
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the timing of new store openings or closings;
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shifts in the timing or content of certain promotions or service offerings;
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the effect of changes in tax rates in the jurisdictions in which we operate;
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acquisition costs and the integration of companies we acquire or invest in;
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the mix of earnings in the countries in which we operate;
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the costs associated with the exit of unprofitable markets or stores; and
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changes in foreign currency exchange rates.
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the ability to identify new store locations, negotiate suitable leases and build out the stores in a timely and cost efficient manner;
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the ability to hire and train skilled associates;
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the ability to integrate new stores into our existing operations; and
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the ability to increase sales at new store locations.
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incur, assume or permit to exist additional indebtedness or guaranty obligations;
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incur liens or agree to negative pledges in other agreements;
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engage in sale and leaseback transactions;
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make loans and investments;
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declare dividends, make payments or redeem or repurchase capital stock;
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engage in mergers, acquisitions and other business combinations;
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prepay, redeem or purchase certain indebtedness;
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amend or otherwise alter the terms of our organizational documents and indebtedness;
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sell assets; and
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engage in transactions with affiliates.
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Item 1B.
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Unresolved Staff Comments
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Item 2.
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Properties
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Lease Terms to Expire During
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Number
of Stores
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(12 Months Ending on or About January 31)
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2015
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2,297
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2016
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1,587
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2017
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1,137
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2018
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638
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2019 and later
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1,016
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6,675
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Location
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Square
Footage
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Owned or
Leased
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Use
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United States
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Grapevine, Texas, USA
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519,000
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Owned
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Distribution and administration
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Grapevine, Texas, USA
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182,000
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Owned
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Manufacturing and distribution
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Louisville, Kentucky, USA
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260,000
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Leased
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Distribution
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Minneapolis, Minnesota, USA
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15,000
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Leased
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Administration
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Salt Lake City, Utah
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12,000
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Leased
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Administration
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San Francisco, California, USA
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8,500
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Leased
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San Francisco, California, USA
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Denver, Colorado, USA
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7,500
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Leased
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Distribution and administration
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West Chester, Pennsylvania, USA
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6,100
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Leased
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Administration
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Greenwood Village, Colorado, USA
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2,700
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Leased
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Administration
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Canada
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Brampton, Ontario, Canada
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119,000
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Owned
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Distribution and administration
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Brampton, Ontario, Canada
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59,000
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Leased
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Distribution and administration
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Australia
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Eagle Farm, Queensland, Australia
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185,000
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Owned
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Distribution and administration
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Auckland, New Zealand
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13,000
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Leased
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Distribution and administration
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Europe
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Arlov, Sweden
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80,000
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Owned
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Distribution and administration
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Milan, Italy
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123,000
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Owned
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Distribution and administration
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Memmingen, Germany
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67,000
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Owned
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Distribution and administration
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Valencia, Spain
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22,000
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Leased
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Distribution
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Valencia, Spain
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6,000
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Leased
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Administration
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Dublin, Ireland
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38,000
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Leased
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Distribution and administration
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Paris, France
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71,000
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Leased
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Distribution
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Paris, France
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1,000
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Leased
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Administration
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Sophia Antipolis, France
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17,000
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Leased
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Administration
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Item 3.
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Legal Proceedings
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Item 4.
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Mine Safety Disclosures
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Item 5.
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Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
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Fiscal 2013
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||||||
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High
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Low
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||||
Fourth Quarter
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$
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57.74
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$
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34.70
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Third Quarter
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$
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56.08
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$
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47.04
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Second Quarter
|
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$
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51.36
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$
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30.94
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First Quarter
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$
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37.23
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$
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23.36
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Period
|
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Total
Number of
Shares
Purchased
|
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Average
Price Paid per
Share
|
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Total Number of
Shares Purchased
as Part of Publicly
Announced Plans or
Programs
|
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Approximate Dollar
Value of Shares that
May Yet Be Purchased
Under the Plans or
Programs(1)
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||||||
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(In millions of dollars)
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||||||||||
November 3, 2013 through
November 30, 2013
|
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321,500
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|
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$
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51.62
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|
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321,500
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$
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490.0
|
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December 1, 2013 through
January 4, 2014
|
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479,000
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|
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$
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47.90
|
|
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479,000
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|
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$
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467.1
|
|
January 5, 2014 through
February 1, 2014
|
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237,300
|
|
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$
|
42.05
|
|
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237,300
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|
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$
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457.1
|
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Total
|
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1,037,800
|
|
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$
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47.71
|
|
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1,037,800
|
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(1)
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In November 2012, the Board of Directors authorized $500 million to be used for share repurchases. In November 2013, the Board of Directors authorized $500 million to be used for share repurchases, replacing the November 2012 authorization. The November 2013 $500 million authorization has no expiration date.
|
|
|
|
1/30/2009
|
|
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1/29/2010
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|
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1/28/2011
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|
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1/27/2012
|
|
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2/1/2013
|
|
|
1/31/2014
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GME
|
|
|
100
|
|
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79.78
|
|
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84.67
|
|
|
98.14
|
|
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103.40
|
|
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151.47
|
S&P 500 Index
|
|
|
100
|
|
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130.03
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|
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154.54
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|
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159.39
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|
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183.22
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|
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215.84
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Dow Jones Specialty Retailers Index
|
|
|
100
|
|
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144.54
|
|
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192.05
|
|
|
209.89
|
|
|
223.01
|
|
|
285.02
|
Item 6.
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Selected Financial Data
|
|
|
52 Weeks
Ended
February 1,
2014
|
|
53 Weeks
Ended February 2, 2013 |
|
52 Weeks
Ended January 28, 2012 |
|
52 Weeks
Ended January 29, 2011 |
|
52 Weeks
Ended January 30, 2010 |
||||||||||
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|
(In millions, except per share data and statistical data)
|
||||||||||||||||||
Statement of Operations Data:
|
|
|
|
|
|
|
|
|
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||||||||||
Net sales
|
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$
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9,039.5
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|
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$
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8,886.7
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$
|
9,550.5
|
|
|
$
|
9,473.7
|
|
|
$
|
9,078.0
|
|
Cost of sales
|
|
6,378.4
|
|
|
6,235.2
|
|
|
6,871.0
|
|
|
6,936.1
|
|
|
6,643.3
|
|
|||||
Gross profit
|
|
2,661.1
|
|
|
2,651.5
|
|
|
2,679.5
|
|
|
2,537.6
|
|
|
2,434.7
|
|
|||||
Selling, general and administrative expenses
|
|
1,892.4
|
|
|
1,835.9
|
|
|
1,842.1
|
|
|
1,698.8
|
|
|
1,633.3
|
|
|||||
Depreciation and amortization
|
|
166.5
|
|
|
176.5
|
|
|
186.3
|
|
|
174.7
|
|
|
162.6
|
|
|||||
Goodwill impairments(1)
|
|
10.2
|
|
|
627.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Asset impairments and restructuring charges(2)
|
|
18.5
|
|
|
53.7
|
|
|
81.2
|
|
|
1.5
|
|
|
1.8
|
|
|||||
Operating earnings (loss)
|
|
573.5
|
|
|
(41.6
|
)
|
|
569.9
|
|
|
662.6
|
|
|
637.0
|
|
|||||
Interest expense (income), net
|
|
4.7
|
|
|
3.3
|
|
|
19.8
|
|
|
35.2
|
|
|
43.2
|
|
|||||
Debt extinguishment expense
|
|
—
|
|
|
—
|
|
|
1.0
|
|
|
6.0
|
|
|
5.3
|
|
|||||
Earnings (loss) before income tax expense
|
|
568.8
|
|
|
(44.9
|
)
|
|
549.1
|
|
|
621.4
|
|
|
588.5
|
|
|||||
Income tax expense
|
|
214.6
|
|
|
224.9
|
|
|
210.6
|
|
|
214.6
|
|
|
212.8
|
|
|||||
Net income (loss)
|
|
354.2
|
|
|
(269.8
|
)
|
|
338.5
|
|
|
406.8
|
|
|
375.7
|
|
|||||
Net loss attributable to noncontrolling interests
|
|
—
|
|
|
0.1
|
|
|
1.4
|
|
|
1.2
|
|
|
1.6
|
|
|||||
Net income (loss) attributable to GameStop Corp.
|
|
$
|
354.2
|
|
|
$
|
(269.7
|
)
|
|
$
|
339.9
|
|
|
$
|
408.0
|
|
|
$
|
377.3
|
|
Basic net income (loss) per common share
|
|
$
|
3.02
|
|
|
$
|
(2.13
|
)
|
|
$
|
2.43
|
|
|
$
|
2.69
|
|
|
$
|
2.29
|
|
Diluted net income (loss) per common share
|
|
$
|
2.99
|
|
|
$
|
(2.13
|
)
|
|
$
|
2.41
|
|
|
$
|
2.65
|
|
|
$
|
2.25
|
|
Dividends per common share
|
|
$
|
1.10
|
|
|
$
|
0.80
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Weighted average common shares outstanding —basic
|
|
117.2
|
|
|
126.4
|
|
|
139.9
|
|
|
151.6
|
|
|
164.5
|
|
|||||
Weighted average common shares outstanding —diluted
|
|
118.4
|
|
|
126.4
|
|
|
141.0
|
|
|
154.0
|
|
|
167.9
|
|
|||||
Store Operating Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Number of stores by segment
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
4,249
|
|
|
4,425
|
|
|
4,503
|
|
|
4,536
|
|
|
4,429
|
|
|||||
Canada
|
|
335
|
|
|
336
|
|
|
346
|
|
|
345
|
|
|
337
|
|
|||||
Australia
|
|
418
|
|
|
416
|
|
|
411
|
|
|
405
|
|
|
388
|
|
|||||
Europe
|
|
1,455
|
|
|
1,425
|
|
|
1,423
|
|
|
1,384
|
|
|
1,296
|
|
|||||
Technology Brands
|
|
218
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
6,675
|
|
|
6,602
|
|
|
6,683
|
|
|
6,670
|
|
|
6,450
|
|
|||||
Comparable store sales increase (decrease)(3)
|
|
3.8
|
%
|
|
(8.0
|
)%
|
|
(2.1
|
)%
|
|
1.1
|
%
|
|
(7.9
|
)%
|
|||||
Inventory turnover
|
|
5.3
|
|
|
5.0
|
|
|
5.1
|
|
|
5.1
|
|
|
5.2
|
|
|||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Working capital
|
|
$
|
223.6
|
|
|
$
|
295.6
|
|
|
$
|
363.4
|
|
|
$
|
407.0
|
|
|
$
|
471.6
|
|
Total assets(4)
|
|
4,091.4
|
|
|
3,872.2
|
|
|
4,608.2
|
|
|
4,807.5
|
|
|
4,758.4
|
|
|||||
Total debt, net
|
|
4.0
|
|
|
—
|
|
|
—
|
|
|
249.0
|
|
|
447.3
|
|
|||||
Total liabilities(4)
|
|
1,840.0
|
|
|
1,585.9
|
|
|
1,568.0
|
|
|
1,911.6
|
|
|
2,035.4
|
|
|||||
Total equity
|
|
2,251.4
|
|
|
2,286.3
|
|
|
3,040.2
|
|
|
2,895.9
|
|
|
2,723.0
|
|
(1)
|
Results for fiscal 2013 include a goodwill impairment charge of $10.2 million related to our decision to abandon our investment in Spawn Labs. Results for fiscal 2012 include charges related to goodwill impairments of $627.0 million resulting from our interim goodwill impairment tests performed during the third quarter of fiscal 2012. See Note 9 to our consolidated financial statements for further information regarding our goodwill impairment charges.
|
(2)
|
Results for fiscal 2013 include impairments of $18.5 million, of which $7.4 million and $2.1 million were related to certain technology assets and other intangible assets, respectively, as a result of our decision to abandon our investment in Spawn Labs and the remaining $9.0 million was related to property and equipment impairments resulting from our evaluation of store property, equipment and other assets. Results for fiscal 2012 include charges related to asset impairments of $53.7 million, of which $44.9 million relates to the impairment of the Micromania trade name and $8.8 million relates to other impairment charges from the evaluations of store property, equipment and other assets. Results for fiscal 2011 include charges related to asset impairments and restructuring charges of $81.2 million, of which $37.8 million relates to the impairment of the Micromania trade name, $22.7 million relates to the impairment of investments in non-core businesses and $20.7 million relates to other impairments, termination benefits and facility closure costs. For fiscal years 2009 and 2010, results include impairment charges resulting from our evaluation of store property, equipment and other assets.
|
(3)
|
Comparable store sales is a measure commonly used in the retail industry and indicates store performance by measuring the growth in sales for certain stores for a particular period over the corresponding period in the prior year. Our comparable store sales are comprised of sales from stores operating for at least 12 full months as well as sales related to our Web sites and sales we earn from sales of pre-owned merchandise to wholesalers or dealers. Comparable store sales for our international operating segments exclude the effect of changes in foreign currency exchange rates. The calculation of comparable store sales for the 52 weeks ended February 1, 2014 compares the 52 weeks for the period ended February 1, 2014 to the most closely comparable weeks for the prior year period. The method of calculating comparable store sales varies across the retail industry. As a result, our method of calculating comparable store sales may not be the same as other retailers’ methods. We believe our calculation of comparable store sales best represents our strategy as a multi-channel retailer who provides its consumers several ways to access its products.
|
(4)
|
We have revised the presentation of outstanding checks in our prior period financial statements. Previously, we reduced cash and liabilities when the checks were presented for payment and cleared our bank accounts. As of February 1, 2014, we reduce cash and liabilities when the checks are released for payment. See Note 1 to our consolidated financial statements.
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
|||
Statement of Operations Data:
|
|
|
|
|
|
|
|||
Net sales
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of sales
|
|
70.6
|
|
|
70.2
|
|
|
71.9
|
|
Gross profit
|
|
29.4
|
|
|
29.8
|
|
|
28.1
|
|
Selling, general and administrative expenses
|
|
21.0
|
|
|
20.7
|
|
|
19.3
|
|
Depreciation and amortization
|
|
1.8
|
|
|
2.0
|
|
|
2.0
|
|
Goodwill impairments
|
|
0.1
|
|
|
7.0
|
|
|
—
|
|
Asset impairments and restructuring charges
|
|
0.2
|
|
|
0.6
|
|
|
0.8
|
|
Operating earnings (loss)
|
|
6.3
|
|
|
(0.5
|
)
|
|
6.0
|
|
Interest expense, net
|
|
—
|
|
|
—
|
|
|
0.2
|
|
Earnings (loss) before income tax expense
|
|
6.3
|
|
|
(0.5
|
)
|
|
5.8
|
|
Income tax expense
|
|
2.4
|
|
|
2.5
|
|
|
2.2
|
|
Net income (loss)
|
|
3.9
|
|
|
(3.0
|
)
|
|
3.6
|
|
Net loss attributable to noncontrolling interests
|
|
—
|
|
|
—
|
|
|
—
|
|
Net income (loss) attributable to GameStop Corp.
|
|
3.9
|
%
|
|
(3.0
|
)%
|
|
3.6
|
%
|
•
|
Video Game Accessories, which includes new accessories for use with video game consoles and hand-held devices and software, such as controllers, gaming headsets and memory cards;
|
•
|
Digital, which includes revenues from the sale of DLC, Xbox Live, PlayStation Plus and Nintendo network points and subscription cards, other prepaid digital currencies and time cards, Kongregate,
Game Informer
digital subscriptions and PC digital downloads;
|
•
|
Mobile and Consumer Electronics, which includes revenues from selling new and pre-owned mobile devices and consumer electronics in Video Game Brands stores and all revenues from our Technology Brands stores;
|
•
|
Other, which includes revenues from the sales of PC entertainment software, toys, strategy guides and revenues from PowerUp Pro loyalty members receiving
Game Informer
magazine in physical form.
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
|||||||||||||||
|
|
Net
Sales
|
|
Percent
of Total
|
|
Net
Sales
|
|
Percent
of Total
|
|
Net
Sales
|
|
Percent
of Total
|
|||||||||
Net Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
New video game hardware
|
|
$
|
1,730.0
|
|
|
19.1
|
%
|
|
$
|
1,333.4
|
|
|
15.0
|
%
|
|
$
|
1,611.6
|
|
|
16.9
|
%
|
New video game software
|
|
3,480.9
|
|
|
38.5
|
%
|
|
3,582.4
|
|
|
40.3
|
%
|
|
4,048.2
|
|
|
42.4
|
%
|
|||
Pre-owned and value video game products
|
|
2,329.8
|
|
|
25.8
|
%
|
|
2,430.5
|
|
|
27.4
|
%
|
|
2,620.2
|
|
|
27.4
|
%
|
|||
Video game accessories
|
|
560.6
|
|
|
6.2
|
%
|
|
611.8
|
|
|
6.9
|
%
|
|
661.1
|
|
|
6.9
|
%
|
|||
Digital
|
|
217.7
|
|
|
2.4
|
%
|
|
208.4
|
|
|
2.3
|
%
|
|
143.0
|
|
|
1.5
|
%
|
|||
Mobile and consumer electronics
|
|
303.7
|
|
|
3.4
|
%
|
|
200.3
|
|
|
2.3
|
%
|
|
12.8
|
|
|
0.1
|
%
|
|||
Other
|
|
416.8
|
|
|
4.6
|
%
|
|
519.9
|
|
|
5.8
|
%
|
|
453.6
|
|
|
4.8
|
%
|
|||
Total
|
|
$
|
9,039.5
|
|
|
100.0
|
%
|
|
$
|
8,886.7
|
|
|
100.0
|
%
|
|
$
|
9,550.5
|
|
|
100.0
|
%
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
|||||||||||||||
|
|
Gross
Profit
|
|
Gross
Profit
Percent
|
|
Gross
Profit
|
|
Gross
Profit
Percent
|
|
Gross
Profit
|
|
Gross
Profit
Percent
|
|||||||||
Gross Profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
New video game hardware
|
|
$
|
176.5
|
|
|
10.2
|
%
|
|
$
|
101.7
|
|
|
7.6
|
%
|
|
$
|
113.6
|
|
|
7.0
|
%
|
New video game software
|
|
805.3
|
|
|
23.1
|
%
|
|
786.3
|
|
|
21.9
|
%
|
|
839.0
|
|
|
20.7
|
%
|
|||
Pre-owned and value video game products
|
|
1,093.9
|
|
|
47.0
|
%
|
|
1,170.1
|
|
|
48.1
|
%
|
|
1,221.2
|
|
|
46.6
|
%
|
|||
Video game accessories
|
|
220.5
|
|
|
39.3
|
%
|
|
237.9
|
|
|
38.9
|
%
|
|
251.9
|
|
|
38.1
|
%
|
|||
Digital
|
|
149.2
|
|
|
68.5
|
%
|
|
120.9
|
|
|
58.0
|
%
|
|
66.5
|
|
|
46.5
|
%
|
|||
Mobile and consumer electronics
|
|
65.1
|
|
|
21.4
|
%
|
|
41.3
|
|
|
20.6
|
%
|
|
3.5
|
|
|
27.3
|
%
|
|||
Other
|
|
150.6
|
|
|
36.1
|
%
|
|
193.3
|
|
|
37.2
|
%
|
|
183.8
|
|
|
40.5
|
%
|
|||
Total
|
|
$
|
2,661.1
|
|
|
29.4
|
%
|
|
$
|
2,651.5
|
|
|
29.8
|
%
|
|
$
|
2,679.5
|
|
|
28.1
|
%
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
Video Game Brands:
|
|
|
|
|
|
|
||||||
United States
|
|
$
|
6,160.4
|
|
|
$
|
6,192.4
|
|
|
$
|
6,637.0
|
|
Canada
|
|
468.8
|
|
|
478.4
|
|
|
498.4
|
|
|||
Australia
|
|
613.7
|
|
|
607.3
|
|
|
604.7
|
|
|||
Europe
|
|
1,733.8
|
|
|
1,608.6
|
|
|
1,810.4
|
|
|||
Technology Brands
|
|
62.8
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
$
|
9,039.5
|
|
|
$
|
8,886.7
|
|
|
$
|
9,550.5
|
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
Video Game Brands:
|
|
|
|
|
|
|
||||||
United States
|
|
$
|
465.3
|
|
|
$
|
501.9
|
|
|
$
|
501.9
|
|
Canada
|
|
26.6
|
|
|
(74.4
|
)
|
|
12.4
|
|
|||
Australia
|
|
37.5
|
|
|
(71.6
|
)
|
|
35.4
|
|
|||
Europe
|
|
44.3
|
|
|
(397.5
|
)
|
|
20.2
|
|
|||
Technology Brands
|
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|||
Total
|
|
$
|
573.5
|
|
|
$
|
(41.6
|
)
|
|
$
|
569.9
|
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
Video Game Brands:
|
|
|
|
|
|
|
||||||
United States
|
|
$
|
24.0
|
|
|
$
|
5.7
|
|
|
$
|
28.9
|
|
Canada
|
|
—
|
|
|
100.7
|
|
|
1.3
|
|
|||
Australia
|
|
—
|
|
|
107.3
|
|
|
0.6
|
|
|||
Europe
|
|
4.7
|
|
|
467.0
|
|
|
50.4
|
|
|||
Technology Brands
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
$
|
28.7
|
|
|
$
|
680.7
|
|
|
$
|
81.2
|
|
|
|
February 1,
2014 |
|
February 2,
2013 |
|
January 28,
2012 |
||||||
Video Game Brands:
|
|
|
|
|
|
|
||||||
United States
|
|
$
|
2,320.7
|
|
|
$
|
2,404.0
|
|
|
$
|
2,479.0
|
|
Canada
|
|
228.7
|
|
|
252.2
|
|
|
350.8
|
|
|||
Australia
|
|
389.2
|
|
|
416.6
|
|
|
513.3
|
|
|||
Europe
|
|
972.2
|
|
|
799.4
|
|
|
1,265.1
|
|
|||
Technology Brands
|
|
180.6
|
|
|
—
|
|
|
—
|
|
|||
Total
|
|
$
|
4,091.4
|
|
|
$
|
3,872.2
|
|
|
$
|
4,608.2
|
|
|
|
As Previously Reported
|
|
Revision
|
|
As Revised
|
||||||
|
|
(In millions)
|
||||||||||
Consolidated Statements of Cash Flows:
|
|
|
|
|
|
|
||||||
For the 53 weeks ended February 2, 2013
|
|
|
|
|
|
|
||||||
Changes in operating assets and liabilities:
Accounts payable and accrued liabilities
|
|
$
|
48.1
|
|
|
$
|
(22.2
|
)
|
|
$
|
25.9
|
|
Net cash flows provided by operating activities
|
|
632.4
|
|
|
(22.2
|
)
|
|
610.2
|
|
|||
Cash and cash equivalents at beginning of period
|
|
655.0
|
|
|
(239.2
|
)
|
|
415.8
|
|
|||
Cash and cash equivalents at end of period
|
|
635.8
|
|
|
(261.4
|
)
|
|
374.4
|
|
|||
|
|
|
|
|
|
|
||||||
For the 52 weeks ended January 28, 2012
|
|
|
|
|
|
|
||||||
Changes in operating assets and liabilities:
Accounts payable and accrued liabilities
|
|
(104.5
|
)
|
|
17.1
|
|
|
(87.4
|
)
|
|||
Net cash flows provided by operating activities
|
|
624.7
|
|
|
17.1
|
|
|
641.8
|
|
|||
Cash and cash equivalents at beginning of period
|
|
710.8
|
|
|
(256.3
|
)
|
|
454.5
|
|
|||
Cash and cash equivalents at end of period
|
|
655.0
|
|
|
(239.2
|
)
|
|
415.8
|
|
|
|
Payments Due by Period
|
||||||||||||||||||
Contractual Obligations
|
|
Total
|
|
Less Than
1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More Than
5 Years
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Operating Leases
|
|
$
|
1,039.4
|
|
|
$
|
332.5
|
|
|
$
|
405.8
|
|
|
$
|
171.1
|
|
|
$
|
130.0
|
|
Purchase Obligations(1)
|
|
538.7
|
|
|
538.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total (2)
|
|
$
|
1,578.1
|
|
|
$
|
871.2
|
|
|
$
|
405.8
|
|
|
$
|
171.1
|
|
|
$
|
130.0
|
|
(1)
|
Purchase obligations represent outstanding purchase orders for merchandise from vendors. These purchase orders are generally cancelable until shipment of the products.
|
(2)
|
As of
February 1, 2014
, we had $20.6 million of income tax liability related to unrecognized tax benefits in other long-term liabilities in our consolidated balance sheet. At the time of this filing, the settlement period for the noncurrent portion of our income tax liability (and the timing of any related payments) cannot be reasonably determined and therefore these liabilities are excluded from the table above. In addition, certain payments related to unrecognized tax benefits would be partially offset by reductions in payments in other jurisdictions. See Note 13 to our consolidated financial statements for further information regarding our uncertain tax positions.
|
Item 7A.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 8.
|
Financial Statements and Supplementary Data
|
Item 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|
Item 9A.
|
Controls and Procedures
|
(a)
|
Evaluation of Disclosure Controls and Procedures
|
(b)
|
Management’s Annual Report on Internal Control Over Financial Reporting
|
|
/s/ D
ELOITTE
& T
OUCHE
LLP
|
|
DELOITTE & TOUCHE LLP
|
Item 9B.
|
Other Information
|
Item 10.
|
Directors, Executive Officers and Corporate Governance*
|
Item 11.
|
Executive Compensation*
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters*
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence*
|
Item 14.
|
Principal Accountant Fees and Services*
|
Item 15.
|
Exhibits and Financial Statement Schedules
|
(a)
|
The following documents are filed as a part of this Form 10-K:
|
(1)
|
Index and Consolidated Financial Statements
|
(2)
|
Financial Statement Schedules required to be filed by Item 8 of this Form 10-K:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
Balance at
Beginning
of Period
|
|
Charged to
Costs and
Expenses
|
|
Charged
to Other
Accounts-
Accounts
Payable (1)
|
|
Deductions-
Write-Offs
Net of
Recoveries
|
|
Balance at
End of
Period
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Inventory Reserve, deducted from asset accounts
|
|
|
|
|
|
|
|
|
|
|
||||||||||
52 Weeks Ended February 1, 2014
|
|
$
|
83.8
|
|
|
$
|
40.6
|
|
|
$
|
32.0
|
|
|
$
|
79.9
|
|
|
$
|
76.5
|
|
53 Weeks Ended February 2, 2013
|
|
67.7
|
|
|
43.1
|
|
|
31.6
|
|
|
58.6
|
|
|
83.8
|
|
|||||
52 Weeks Ended January 28, 2012
|
|
69.5
|
|
|
31.3
|
|
|
33.5
|
|
|
66.6
|
|
|
67.7
|
|
(b)
|
Exhibits
|
|
GAMESTOP CORP.
|
|
|
|
|
|
By:
|
/s/ J. P
AUL
R
AINES
|
|
|
J. Paul Raines
|
|
|
Chief Executive Officer and Director
|
Name
|
|
Capacity
|
|
Date
|
|
|
|
||
/s/ J. P
AUL
R
AINES
|
|
Chief Executive Officer and Director
|
|
April 2, 2014
|
J. Paul Raines
|
|
(Principal Executive Officer)
|
|
|
|
|
|
||
/s/ D
ANIEL
A. D
E
M
ATTEO
|
|
Executive Chairman and Director
|
|
April 2, 2014
|
Daniel A. DeMatteo
|
|
|
|
|
|
|
|
||
/s/ R
OBERT
A. L
LOYD
|
|
Executive Vice President and Chief
|
|
April 2, 2014
|
Robert A. Lloyd
|
|
Financial Officer
(Principal Financial Officer) |
|
|
|
|
|
||
/s/ T
ROY
W. C
RAWFORD
|
|
Senior Vice President, Chief Accounting
|
|
April 2, 2014
|
Troy W. Crawford
|
|
Officer
(Principal Accounting Officer) |
|
|
|
|
|
||
/s/ J
EROME
L. D
AVIS
|
|
Director
|
|
April 2, 2014
|
Jerome L. Davis
|
|
|
|
|
|
|
|
||
/s/ R. R
ICHARD
F
ONTAINE
|
|
Director
|
|
April 2, 2014
|
R. Richard Fontaine
|
|
|
|
|
|
|
|
||
/s/ T
HOMAS
N. K
ELLY
J
R
.
|
|
Director
|
|
April 2, 2014
|
Thomas N. Kelly Jr.
|
|
|
|
|
|
|
|
|
|
/s/ S
HANE
S. K
IM
|
|
Director
|
|
April 2, 2014
|
Shane S. Kim
|
|
|
|
|
|
|
|
||
/s/ S
TEVEN
R. K
OONIN
|
|
Director
|
|
April 2, 2014
|
Steven R. Koonin
|
|
|
|
|
|
|
|
||
/s/ S
TEPHANIE
M. S
HERN
|
|
Director
|
|
April 2, 2014
|
Stephanie M. Shern
|
|
|
|
|
|
|
|
||
/s/ G
ERALD
R. S
ZCZEPANSKI
|
|
Director
|
|
April 2, 2014
|
Gerald R. Szczepanski
|
|
|
|
|
|
|
|
||
/s/ K
ATHY
P. V
RABECK
|
|
Director
|
|
April 2, 2014
|
Kathy P. Vrabeck
|
|
|
|
|
|
|
|
||
/s/ L
AWRENCE
S. Z
ILAVY
|
|
Director
|
|
April 2, 2014
|
Lawrence S. Zilavy
|
|
|
|
|
|
Page
|
GameStop Corp. Consolidated Financial Statements:
|
|
Consolidated Financial Statements:
|
|
|
/s/ D
ELOITTE
& T
OUCHE
LLP
|
|
DELOITTE & TOUCHE LLP
|
|
/s/ BDO USA, LLP
|
|
BDO USA, LLP
|
|
|
February 1,
2014 |
|
February 2,
2013 |
||||
|
|
(In millions, except par value per share)
|
||||||
ASSETS
|
||||||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
536.2
|
|
|
$
|
374.4
|
|
Receivables, net
|
|
84.4
|
|
|
73.6
|
|
||
Merchandise inventories, net
|
|
1,198.9
|
|
|
1,171.3
|
|
||
Deferred income taxes — current
|
|
51.7
|
|
|
61.7
|
|
||
Prepaid expenses and other current assets
|
|
78.4
|
|
|
68.5
|
|
||
Total current assets
|
|
1,949.6
|
|
|
1,749.5
|
|
||
Property and equipment:
|
|
|
|
|
||||
Land
|
|
20.4
|
|
|
22.5
|
|
||
Buildings and leasehold improvements
|
|
609.6
|
|
|
606.4
|
|
||
Fixtures and equipment
|
|
841.8
|
|
|
926.0
|
|
||
Total property and equipment
|
|
1,471.8
|
|
|
1,554.9
|
|
||
Less accumulated depreciation and amortization
|
|
995.6
|
|
|
1,030.1
|
|
||
Net property and equipment
|
|
476.2
|
|
|
524.8
|
|
||
Goodwill
|
|
1,414.7
|
|
|
1,383.1
|
|
||
Other intangible assets, net
|
|
194.3
|
|
|
153.4
|
|
||
Other noncurrent assets
|
|
56.6
|
|
|
61.4
|
|
||
Total noncurrent assets
|
|
2,141.8
|
|
|
2,122.7
|
|
||
Total assets
|
|
$
|
4,091.4
|
|
|
$
|
3,872.2
|
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
783.9
|
|
|
$
|
611.6
|
|
Accrued liabilities
|
|
861.7
|
|
|
738.9
|
|
||
Income taxes payable
|
|
78.0
|
|
|
103.4
|
|
||
Notes payable
|
|
2.4
|
|
|
—
|
|
||
Total current liabilities
|
|
1,726.0
|
|
|
1,453.9
|
|
||
Deferred income taxes
|
|
37.4
|
|
|
31.5
|
|
||
Other long-term liabilities
|
|
75.0
|
|
|
100.5
|
|
||
Notes payable - long-term
|
|
1.6
|
|
|
—
|
|
||
Total long-term liabilities
|
|
114.0
|
|
|
132.0
|
|
||
Total liabilities
|
|
1,840.0
|
|
|
1,585.9
|
|
||
Commitments and contingencies (Notes 11 and 12)
|
|
—
|
|
|
—
|
|
||
Stockholders’ equity:
|
|
|
|
|
||||
Preferred stock — authorized 5.0 shares; no shares issued or outstanding
|
|
—
|
|
|
—
|
|
||
Class A common stock — $.001 par value; authorized 300.0 shares; 115.3 and 128.2 shares issued, 115.3 and 118.2 shares outstanding, respectively
|
|
0.1
|
|
|
0.1
|
|
||
Additional paid-in-capital
|
|
172.9
|
|
|
348.3
|
|
||
Accumulated other comprehensive income
|
|
82.5
|
|
|
164.4
|
|
||
Retained earnings
|
|
1,995.9
|
|
|
1,773.5
|
|
||
Total stockholders' equity
|
|
2,251.4
|
|
|
2,286.3
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
4,091.4
|
|
|
$
|
3,872.2
|
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
|
|
(In millions, except per share data)
|
||||||||||
Net sales
|
|
$
|
9,039.5
|
|
|
$
|
8,886.7
|
|
|
$
|
9,550.5
|
|
Cost of sales
|
|
6,378.4
|
|
|
6,235.2
|
|
|
6,871.0
|
|
|||
Gross profit
|
|
2,661.1
|
|
|
2,651.5
|
|
|
2,679.5
|
|
|||
Selling, general and administrative expenses
|
|
1,892.4
|
|
|
1,835.9
|
|
|
1,842.1
|
|
|||
Depreciation and amortization
|
|
166.5
|
|
|
176.5
|
|
|
186.3
|
|
|||
Goodwill impairments
|
|
10.2
|
|
|
627.0
|
|
|
—
|
|
|||
Asset impairments and restructuring charges
|
|
18.5
|
|
|
53.7
|
|
|
81.2
|
|
|||
Operating earnings (loss)
|
|
573.5
|
|
|
(41.6
|
)
|
|
569.9
|
|
|||
Interest income
|
|
(0.9
|
)
|
|
(0.9
|
)
|
|
(0.9
|
)
|
|||
Interest expense
|
|
5.6
|
|
|
4.2
|
|
|
20.7
|
|
|||
Debt extinguishment expense
|
|
—
|
|
|
—
|
|
|
1.0
|
|
|||
Earnings (loss) before income tax expense
|
|
568.8
|
|
|
(44.9
|
)
|
|
549.1
|
|
|||
Income tax expense
|
|
214.6
|
|
|
224.9
|
|
|
210.6
|
|
|||
Net income (loss)
|
|
354.2
|
|
|
(269.8
|
)
|
|
338.5
|
|
|||
Net loss attributable to noncontrolling interests
|
|
—
|
|
|
0.1
|
|
|
1.4
|
|
|||
Net income (loss) attributable to GameStop Corp.
|
|
$
|
354.2
|
|
|
$
|
(269.7
|
)
|
|
$
|
339.9
|
|
Basic net income (loss) per common share attributable to GameStop Corp.
|
|
$
|
3.02
|
|
|
$
|
(2.13
|
)
|
|
$
|
2.43
|
|
Diluted net income (loss) per common share attributable to GameStop Corp.
|
|
$
|
2.99
|
|
|
$
|
(2.13
|
)
|
|
$
|
2.41
|
|
Weighted average shares of common stock outstanding — basic
|
|
117.2
|
|
|
126.4
|
|
|
139.9
|
|
|||
Weighted average shares of common stock outstanding — diluted
|
|
118.4
|
|
|
126.4
|
|
|
141.0
|
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
|
|
(In millions)
|
||||||||||
Net income (loss)
|
|
$
|
354.2
|
|
|
$
|
(269.8
|
)
|
|
$
|
338.5
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
|
(81.9
|
)
|
|
(5.4
|
)
|
|
7.1
|
|
|||
Total comprehensive income (loss)
|
|
272.3
|
|
|
(275.2
|
)
|
|
345.6
|
|
|||
Comprehensive loss attributable to noncontrolling interests
|
|
—
|
|
|
0.2
|
|
|
1.5
|
|
|||
Comprehensive income (loss) attributable to GameStop Corp.
|
|
$
|
272.3
|
|
|
$
|
(275.0
|
)
|
|
$
|
347.1
|
|
|
|
GameStop Corp. Stockholders
|
|
Noncontrolling
Interest
|
|
Total
|
|||||||||||||||||||||
|
|
Class A
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Income
|
|
Retained
Earnings
|
|
||||||||||||||||||
|
|
Shares
|
|
Common
Stock
|
|
||||||||||||||||||||||
|
|
(In millions)
|
|||||||||||||||||||||||||
Balance at January 29, 2011
|
|
146.0
|
|
|
$
|
0.1
|
|
|
$
|
928.9
|
|
|
$
|
162.5
|
|
|
$
|
1,805.8
|
|
|
$
|
(1.4
|
)
|
|
$
|
2,895.9
|
|
Purchase of subsidiary shares from noncontrolling interest
|
|
—
|
|
|
—
|
|
|
(1.1
|
)
|
|
—
|
|
|
—
|
|
|
1.0
|
|
|
(0.1
|
)
|
||||||
Net income (loss) for the 52 weeks ended January 28, 2012
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
339.9
|
|
|
(1.4
|
)
|
|
338.5
|
|
||||||
Foreign currency translation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7.2
|
|
|
—
|
|
|
(0.1
|
)
|
|
7.1
|
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
18.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18.8
|
|
||||||
Repurchases of common stock
|
|
(11.2
|
)
|
|
—
|
|
|
(240.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(240.2
|
)
|
||||||
Exercise of employee stock options and issuance of shares upon vesting of restricted stock grants (including tax benefit of $2.1)
|
|
2.0
|
|
|
—
|
|
|
20.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20.2
|
|
||||||
Balance at January 28, 2012
|
|
136.8
|
|
|
0.1
|
|
|
726.6
|
|
|
169.7
|
|
|
2,145.7
|
|
|
(1.9
|
)
|
|
3,040.2
|
|
||||||
Purchase of subsidiary shares from noncontrolling interest
|
|
—
|
|
|
—
|
|
|
(2.1
|
)
|
|
—
|
|
|
—
|
|
|
2.1
|
|
|
—
|
|
||||||
Net loss for the 53 weeks ended February 2, 2013
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(269.7
|
)
|
|
(0.1
|
)
|
|
(269.8
|
)
|
||||||
Foreign currency translation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5.3
|
)
|
|
—
|
|
|
(0.1
|
)
|
|
(5.4
|
)
|
||||||
Dividends(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(102.5
|
)
|
|
|
|
(102.5
|
)
|
|||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
19.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19.6
|
|
||||||
Repurchases of common stock
|
|
(19.9
|
)
|
|
—
|
|
|
(409.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(409.4
|
)
|
||||||
Exercise of employee stock options and issuance of shares upon vesting of restricted stock grants (including tax benefit of $2.0)
|
|
1.3
|
|
|
—
|
|
|
13.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13.6
|
|
||||||
Balance at February 2, 2013
|
|
118.2
|
|
|
0.1
|
|
|
348.3
|
|
|
164.4
|
|
|
1,773.5
|
|
|
—
|
|
|
2,286.3
|
|
||||||
Net income for the 52 weeks ended February 1, 2014
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
354.2
|
|
|
—
|
|
|
354.2
|
|
||||||
Foreign currency translation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(81.9
|
)
|
|
—
|
|
|
—
|
|
|
(81.9
|
)
|
||||||
Dividends(1)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(131.8
|
)
|
|
—
|
|
|
(131.8
|
)
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
19.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19.4
|
|
||||||
Repurchases of common stock
|
|
(6.3
|
)
|
|
—
|
|
|
(258.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(258.3
|
)
|
||||||
Exercise of employee stock options and issuance of shares upon vesting of restricted stock grants (including tax benefit of $11.1)
|
|
3.4
|
|
|
—
|
|
|
63.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
63.5
|
|
||||||
Balance at February 1, 2014
|
|
115.3
|
|
|
$
|
0.1
|
|
|
$
|
172.9
|
|
|
$
|
82.5
|
|
|
$
|
1,995.9
|
|
|
$
|
—
|
|
|
$
|
2,251.4
|
|
(1)
|
Dividends declared per common share were
$0.80
in the
53 weeks ended February 2, 2013
and
$1.10
in the
52 weeks ended February 1, 2014
.
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
|
|
(In millions)
|
||||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||||||
Net income (loss)
|
|
$
|
354.2
|
|
|
$
|
(269.8
|
)
|
|
$
|
338.5
|
|
Adjustments to reconcile net income (loss) to net cash flows provided by operating activities:
|
|
|
|
|
|
|
||||||
Depreciation and amortization (including amounts in cost of sales)
|
|
169.2
|
|
|
178.9
|
|
|
188.6
|
|
|||
Provision for inventory reserves
|
|
40.6
|
|
|
43.1
|
|
|
31.3
|
|
|||
Goodwill impairments, asset impairments and restructuring charges
|
|
28.7
|
|
|
680.7
|
|
|
81.2
|
|
|||
Stock-based compensation expense
|
|
19.4
|
|
|
19.6
|
|
|
18.8
|
|
|||
Deferred income taxes
|
|
(2.7
|
)
|
|
(58.2
|
)
|
|
(25.2
|
)
|
|||
Excess tax benefits related to stock-based awards
|
|
(12.4
|
)
|
|
(1.3
|
)
|
|
(1.4
|
)
|
|||
Loss on disposal of property and equipment
|
|
7.1
|
|
|
13.0
|
|
|
10.9
|
|
|||
Other
|
|
(0.6
|
)
|
|
1.2
|
|
|
3.1
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||||||
Receivables, net
|
|
(1.4
|
)
|
|
(8.1
|
)
|
|
1.0
|
|
|||
Merchandise inventories
|
|
(86.9
|
)
|
|
(63.8
|
)
|
|
64.3
|
|
|||
Prepaid expenses and other current assets
|
|
(9.7
|
)
|
|
27.8
|
|
|
(3.3
|
)
|
|||
Prepaid income taxes and income taxes payable
|
|
(19.8
|
)
|
|
25.9
|
|
|
17.6
|
|
|||
Accounts payable and accrued liabilities
|
|
302.4
|
|
|
25.9
|
|
|
(87.4
|
)
|
|||
Changes in Other long-term liabilities
|
|
(25.4
|
)
|
|
(4.7
|
)
|
|
3.8
|
|
|||
Net cash flows provided by operating activities
|
|
762.7
|
|
|
610.2
|
|
|
641.8
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
|
||||||
Purchase of property and equipment
|
|
(125.6
|
)
|
|
(139.6
|
)
|
|
(165.1
|
)
|
|||
Acquisitions, net of cash acquired
|
|
(77.4
|
)
|
|
(1.5
|
)
|
|
(30.1
|
)
|
|||
Other
|
|
(4.5
|
)
|
|
(11.6
|
)
|
|
(6.4
|
)
|
|||
Net cash flows used in investing activities
|
|
(207.5
|
)
|
|
(152.7
|
)
|
|
(201.6
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
|
||||||
Repayment of acquisition-related debt
|
|
(31.8
|
)
|
|
—
|
|
|
—
|
|
|||
Repurchase of notes payable
|
|
—
|
|
|
—
|
|
|
(250.0
|
)
|
|||
Repurchase of common shares
|
|
(258.3
|
)
|
|
(409.4
|
)
|
|
(262.1
|
)
|
|||
Dividends paid
|
|
(130.9
|
)
|
|
(102.0
|
)
|
|
—
|
|
|||
Borrowings from the revolver
|
|
130.0
|
|
|
81.0
|
|
|
35.0
|
|
|||
Repayments of revolver borrowings
|
|
(130.0
|
)
|
|
(81.0
|
)
|
|
(35.0
|
)
|
|||
Exercise of stock options, net of share repurchases for withholdings taxes
|
|
58.0
|
|
|
11.6
|
|
|
18.1
|
|
|||
Excess tax benefits related to stock-based awards
|
|
12.4
|
|
|
1.3
|
|
|
1.4
|
|
|||
Net cash flows used in financing activities
|
|
(350.6
|
)
|
|
(498.5
|
)
|
|
(492.6
|
)
|
|||
Exchange rate effect on cash and cash equivalents
|
|
(42.8
|
)
|
|
(0.4
|
)
|
|
13.7
|
|
|||
Increase (decrease) in cash and cash equivalents
|
|
161.8
|
|
|
(41.4
|
)
|
|
(38.7
|
)
|
|||
Cash and cash equivalents at beginning of period
|
|
374.4
|
|
|
415.8
|
|
|
454.5
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
536.2
|
|
|
$
|
374.4
|
|
|
$
|
415.8
|
|
1.
|
Nature of Operations and Summary of Significant Accounting Policies
|
|
|
As Previously Reported
|
|
Revision
|
|
As Revised
|
||||||
|
|
(In millions)
|
||||||||||
Consolidated Balance Sheets:
|
|
|
|
|
|
|
||||||
As of February 2, 2013
|
|
|
|
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
635.8
|
|
|
$
|
(261.4
|
)
|
|
$
|
374.4
|
|
Total current assets
|
|
2,010.9
|
|
|
(261.4
|
)
|
|
1,749.5
|
|
|||
Total assets
|
|
4,133.6
|
|
|
(261.4
|
)
|
|
3,872.2
|
|
|||
Accounts payable
|
|
870.9
|
|
|
(259.3
|
)
|
|
611.6
|
|
|||
Accrued liabilities
|
|
741.0
|
|
|
(2.1
|
)
|
|
738.9
|
|
|||
Total current liabilities
|
|
1,715.3
|
|
|
(261.4
|
)
|
|
1,453.9
|
|
|||
Total liabilities
|
|
1,847.3
|
|
|
(261.4
|
)
|
|
1,585.9
|
|
|
|
As Previously Reported
|
|
Revision
|
|
As Revised
|
||||||
|
|
(In millions)
|
||||||||||
Consolidated Statements of Cash Flows:
|
|
|
|
|
|
|
||||||
For the 53 weeks ended February 2, 2013
|
|
|
|
|
|
|
||||||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||||||
Accounts payable and accrued liabilities
|
|
$
|
48.1
|
|
|
$
|
(22.2
|
)
|
|
$
|
25.9
|
|
Net cash flows provided by operating activities
|
|
632.4
|
|
|
(22.2
|
)
|
|
610.2
|
|
|||
Cash and cash equivalents at beginning of period
|
|
655.0
|
|
|
(239.2
|
)
|
|
415.8
|
|
|||
Cash and cash equivalents at end of period
|
|
635.8
|
|
|
(261.4
|
)
|
|
374.4
|
|
|||
|
|
|
|
|
|
|
||||||
For the 52 weeks ended January 28, 2012
|
|
|
|
|
|
|
||||||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
||||||
Accounts payable and accrued liabilities
|
|
(104.5
|
)
|
|
17.1
|
|
|
(87.4
|
)
|
|||
Net cash flows provided by operating activities
|
|
624.7
|
|
|
17.1
|
|
|
641.8
|
|
|||
Cash and cash equivalents at beginning of period
|
|
710.8
|
|
|
(256.3
|
)
|
|
454.5
|
|
|||
Cash and cash equivalents at end of period
|
|
655.0
|
|
|
(239.2
|
)
|
|
415.8
|
|
2.
|
Asset Impairments and Restructuring Charges
|
|
|
United States Video Game Brands
|
|
Europe Video Game Brands
|
|
Total
|
||||||
|
|
(In millions)
|
||||||||||
Goodwill impairments
|
|
$
|
10.2
|
|
|
$
|
—
|
|
|
$
|
10.2
|
|
Impairment of intangible assets
|
|
2.1
|
|
|
—
|
|
|
2.1
|
|
|||
Impairment of technology assets
|
|
7.4
|
|
|
—
|
|
|
7.4
|
|
|||
Impairments of property, equipment and other assets - store impairments
|
|
4.3
|
|
|
4.7
|
|
|
9.0
|
|
|||
Total
|
|
$
|
24.0
|
|
|
$
|
4.7
|
|
|
$
|
28.7
|
|
|
|
United States Video Game Brands
|
|
Canada Video Game Brands
|
|
Australia Video Game Brands
|
|
Europe Video Game Brands
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Goodwill impairments
|
|
$
|
—
|
|
|
$
|
100.3
|
|
|
$
|
107.1
|
|
|
$
|
419.6
|
|
|
$
|
627.0
|
|
Impairment of intangible assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44.9
|
|
|
44.9
|
|
|||||
Impairments of property, equipment and other assets - store impairments
|
|
5.7
|
|
|
0.4
|
|
|
0.2
|
|
|
2.5
|
|
|
8.8
|
|
|||||
Total
|
|
$
|
5.7
|
|
|
$
|
100.7
|
|
|
$
|
107.3
|
|
|
$
|
467.0
|
|
|
$
|
680.7
|
|
|
|
United States Video Game Brands
|
|
Canada Video Game Brands
|
|
Australia Video Game Brands
|
|
Europe Video Game Brands
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Impairment of intangible assets
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
37.8
|
|
|
$
|
37.8
|
|
Impairment of investments in non-core businesses
|
|
22.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22.7
|
|
|||||
Impairments of property, equipment and other assets - store impairments
|
|
3.2
|
|
|
1.1
|
|
|
0.5
|
|
|
6.4
|
|
|
11.2
|
|
|||||
Termination benefits
|
|
3.0
|
|
|
0.2
|
|
|
—
|
|
|
2.4
|
|
|
5.6
|
|
|||||
Facility closure and other costs
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
3.8
|
|
|
3.9
|
|
|||||
Total
|
|
$
|
28.9
|
|
|
$
|
1.3
|
|
|
$
|
0.6
|
|
|
$
|
50.4
|
|
|
$
|
81.2
|
|
3.
|
Acquisitions
|
Assets acquired
|
|
|
||
Current assets
|
|
$
|
19.0
|
|
Property and equipment
|
|
8.5
|
|
|
Identifiable intangible assets
|
|
39.6
|
|
|
Goodwill
|
|
50.2
|
|
|
Liabilities assumed
|
|
|
||
Current liabilities, excluding current portion of debt
|
|
(11.4
|
)
|
|
Debt obligations, including current portion
|
|
(34.5
|
)
|
|
Other long-term liabilities
|
|
(8.8
|
)
|
|
Total purchase price
|
|
$
|
62.6
|
|
4.
|
Vendor Arrangements
|
5.
|
Computation of Net Income (Loss) per Common Share
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
|
|
(In millions, except per share data)
|
||||||||||
Net income (loss) attributable to GameStop Corp.
|
|
$
|
354.2
|
|
|
$
|
(269.7
|
)
|
|
$
|
339.9
|
|
Weighted average common shares outstanding
|
|
117.2
|
|
|
126.4
|
|
|
139.9
|
|
|||
Dilutive effect of options and restricted shares on common stock
|
|
1.2
|
|
|
—
|
|
|
1.1
|
|
|||
Common shares and dilutive potential common shares
|
|
118.4
|
|
|
126.4
|
|
|
141.0
|
|
|||
Net income (loss) per common share:
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
3.02
|
|
|
$
|
(2.13
|
)
|
|
$
|
2.43
|
|
Diluted
|
|
$
|
2.99
|
|
|
$
|
(2.13
|
)
|
|
$
|
2.41
|
|
|
|
Anti-
Dilutive
Shares
|
|
|
|
(In millions)
|
|
52 Weeks Ended February 1, 2014
|
|
1.5
|
|
53 Weeks Ended February 2, 2013
|
|
3.3
|
|
52 Weeks Ended January 28, 2012
|
|
2.5
|
|
6.
|
Fair Value Measurements and Financial Instruments
|
|
|
February 1, 2014
Level 2 |
|
February 2, 2013
Level 2 |
||||
Assets
|
|
|
|
|
||||
Foreign currency contracts
|
|
|
|
|
||||
Other current assets
|
|
$
|
0.9
|
|
|
$
|
7.3
|
|
Other noncurrent assets
|
|
0.5
|
|
|
0.9
|
|
||
Life insurance policies we own
1
|
|
7.1
|
|
|
3.5
|
|
||
Total assets
|
|
$
|
8.5
|
|
|
$
|
11.7
|
|
Liabilities
|
|
|
|
|
||||
Foreign currency contracts
|
|
|
|
|
||||
Accrued liabilities
|
|
$
|
21.3
|
|
|
$
|
9.1
|
|
Other long-term liabilities
|
|
2.2
|
|
|
4.4
|
|
||
Nonqualified deferred compensation
2
|
|
1.1
|
|
|
0.9
|
|
||
Total liabilities
|
|
$
|
24.6
|
|
|
$
|
14.4
|
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
Gains (losses) on the changes in fair value of derivative instruments
|
|
$
|
(20.3
|
)
|
|
$
|
(19.8
|
)
|
|
$
|
13.5
|
|
Gains (losses) on the re-measurement of related intercompany loans and foreign currency assets and liabilities
|
|
23.6
|
|
|
22.3
|
|
|
(14.1
|
)
|
|||
Total
|
|
$
|
3.3
|
|
|
$
|
2.5
|
|
|
$
|
(0.6
|
)
|
7.
|
Receivables, Net
|
|
|
February 1, 2014
|
|
February 2, 2013
|
||||
Bankcard receivables
|
|
$
|
42.6
|
|
|
$
|
35.9
|
|
Other receivables
|
|
45.5
|
|
|
40.0
|
|
||
Allowance for doubtful accounts
|
|
(3.7
|
)
|
|
(2.3
|
)
|
||
Total receivables, net
|
|
$
|
84.4
|
|
|
$
|
73.6
|
|
8.
|
Accrued Liabilities
|
|
|
February 1, 2014
|
|
February 2, 2013
|
||||
Customer liabilities
|
|
$
|
368.8
|
|
|
$
|
362.8
|
|
Deferred revenue
|
|
118.1
|
|
|
93.5
|
|
||
Employee benefits, compensation and related taxes
|
|
145.3
|
|
|
129.8
|
|
||
Other taxes
|
|
53.5
|
|
|
60.5
|
|
||
Other accrued liabilities
|
|
176.0
|
|
|
92.3
|
|
||
Total accrued liabilities
|
|
$
|
861.7
|
|
|
$
|
738.9
|
|
9.
|
Goodwill and Intangible Assets
|
|
|
United States
|
|
Canada
|
|
Australia
|
|
Europe
|
|
Technology Brands
|
Total
|
||||||||||||
|
|
(In millions)
|
|||||||||||||||||||||
Balance at January 28, 2012
|
|
$
|
1,152.0
|
|
|
$
|
137.4
|
|
|
$
|
210.0
|
|
|
$
|
519.6
|
|
|
$
|
—
|
|
$
|
2,019.0
|
|
Acquisitions (Note 3)
|
|
1.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
1.5
|
|
||||||
Impairment
|
|
—
|
|
|
(100.3
|
)
|
|
(107.1
|
)
|
|
(419.6
|
)
|
|
—
|
|
(627.0
|
)
|
||||||
Foreign currency translation adjustment
|
|
—
|
|
|
0.6
|
|
|
(6.3
|
)
|
|
(4.7
|
)
|
|
—
|
|
(10.4
|
)
|
||||||
Balance at February 2, 2013
|
|
1,153.5
|
|
|
37.7
|
|
|
96.6
|
|
|
95.3
|
|
|
—
|
|
1,383.1
|
|
||||||
Acquisitions (Note 3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
62.1
|
|
62.1
|
|
||||||
Impairment
|
|
(10.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
(10.2
|
)
|
||||||
Foreign currency translation adjustment
|
|
—
|
|
|
(3.9
|
)
|
|
(15.3
|
)
|
|
(1.1
|
)
|
|
—
|
|
(20.3
|
)
|
||||||
Balance at February 1, 2014
|
|
$
|
1,143.3
|
|
|
$
|
33.8
|
|
|
$
|
81.3
|
|
|
$
|
94.2
|
|
|
$
|
62.1
|
|
$
|
1,414.7
|
|
|
|
As of February 1, 2014
|
|
As of February 2, 2013
|
||||||||||||||||||||
|
|
Gross Carrying Amount(1)
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
||||||||||||
Intangible assets with indefinite lives:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trade names
|
|
$
|
54.2
|
|
|
$
|
—
|
|
|
$
|
54.2
|
|
|
$
|
54.8
|
|
|
$
|
—
|
|
|
$
|
54.8
|
|
Dealer agreement
|
|
57.2
|
|
|
—
|
|
|
57.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Intangible assets with finite lives:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Key money
|
|
113.6
|
|
|
(44.4
|
)
|
|
69.2
|
|
|
115.9
|
|
|
(39.1
|
)
|
|
76.8
|
|
||||||
Other
|
|
40.9
|
|
|
(27.2
|
)
|
|
13.7
|
|
|
42.2
|
|
|
(20.4
|
)
|
|
21.8
|
|
||||||
Total
|
|
$
|
265.9
|
|
|
$
|
(71.6
|
)
|
|
$
|
194.3
|
|
|
$
|
212.9
|
|
|
$
|
(59.5
|
)
|
|
$
|
153.4
|
|
Fiscal Year Ending on or around January 31,
|
|
|
Projected Amortization Expense
|
||
|
|
|
|||
2015
|
|
|
$
|
12.5
|
|
2016
|
|
|
11.9
|
|
|
2017
|
|
|
9.8
|
|
|
2018
|
|
|
9.0
|
|
|
2019
|
|
|
8.6
|
|
|
|
|
|
$
|
51.8
|
|
10.
|
Debt
|
11.
|
Leases
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
|
|
(In millions)
|
||||||||||
Minimum
|
|
$
|
381.6
|
|
|
$
|
385.4
|
|
|
$
|
386.9
|
|
Percentage rentals
|
|
9.4
|
|
|
9.3
|
|
|
12.3
|
|
|||
|
|
$
|
391.0
|
|
|
$
|
394.7
|
|
|
$
|
399.2
|
|
Fiscal Year Ending on or around January 31,
|
|
Amount
|
||
|
|
(In millions)
|
||
2015
|
|
$
|
332.5
|
|
2016
|
|
243.2
|
|
|
2017
|
|
162.6
|
|
|
2018
|
|
103.3
|
|
|
2019
|
|
67.8
|
|
|
Thereafter
|
|
130.0
|
|
|
|
|
$
|
1,039.4
|
|
12.
|
Commitments and Contingencies
|
13.
|
Income Taxes
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
|
|
(In millions)
|
||||||||||
Current tax expense:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
158.2
|
|
|
$
|
229.6
|
|
|
$
|
193.5
|
|
State
|
|
24.5
|
|
|
24.1
|
|
|
20.9
|
|
|||
Foreign
|
|
34.6
|
|
|
29.4
|
|
|
21.4
|
|
|||
|
|
217.3
|
|
|
283.1
|
|
|
235.8
|
|
|||
Deferred tax expense (benefit):
|
|
|
|
|
|
|
||||||
Federal
|
|
(1.9
|
)
|
|
(46.3
|
)
|
|
(10.2
|
)
|
|||
State
|
|
(0.1
|
)
|
|
(3.5
|
)
|
|
(0.2
|
)
|
|||
Foreign
|
|
(0.7
|
)
|
|
(8.4
|
)
|
|
(14.8
|
)
|
|||
|
|
(2.7
|
)
|
|
(58.2
|
)
|
|
(25.2
|
)
|
|||
Total income tax expense
|
|
$
|
214.6
|
|
|
$
|
224.9
|
|
|
$
|
210.6
|
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
|
|
(In millions)
|
||||||||||
United States
|
|
$
|
491.6
|
|
|
$
|
547.2
|
|
|
$
|
551.9
|
|
International
|
|
77.2
|
|
|
(592.1
|
)
|
|
(2.8
|
)
|
|||
Total
|
|
$
|
568.8
|
|
|
$
|
(44.9
|
)
|
|
$
|
549.1
|
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
|||
Federal statutory tax rate
|
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State income taxes, net of federal benefit
|
|
1.9
|
|
|
(27.7
|
)
|
|
2.6
|
|
Foreign income taxes
|
|
(0.5
|
)
|
|
5.6
|
|
|
1.3
|
|
Nondeductible goodwill impairments
|
|
0.6
|
|
|
(488.6
|
)
|
|
—
|
|
Change in valuation allowance
|
|
—
|
|
|
(22.5
|
)
|
|
0.1
|
|
Subpart F income
|
|
4.8
|
|
|
(61.4
|
)
|
|
4.6
|
|
Interest income from hybrid securities
|
|
(5.8
|
)
|
|
73.3
|
|
|
(6.1
|
)
|
Other (including permanent differences)
1
|
|
1.7
|
|
|
(14.6
|
)
|
|
0.9
|
|
|
|
37.7
|
%
|
|
(500.9
|
)%
|
|
38.4
|
%
|
|
|
February 1, 2014
|
|
February 2, 2013
|
||||
Deferred tax asset:
|
|
|
|
|
||||
Inventory obsolescence reserve
|
|
$
|
18.8
|
|
|
$
|
23.6
|
|
Deferred rents
|
|
12.4
|
|
|
13.6
|
|
||
Stock-based compensation
|
|
26.4
|
|
|
25.3
|
|
||
Net operating losses
|
|
16.8
|
|
|
15.0
|
|
||
Customer liabilities
|
|
31.9
|
|
|
38.1
|
|
||
Property and equipment
|
|
21.9
|
|
|
9.3
|
|
||
Foreign tax credit carryover
|
|
1.4
|
|
|
—
|
|
||
Other
|
|
9.4
|
|
|
11.1
|
|
||
Total deferred tax assets
|
|
139.0
|
|
|
136.0
|
|
||
Valuation allowance
|
|
(13.3
|
)
|
|
(13.5
|
)
|
||
Total deferred tax assets, net
|
|
125.7
|
|
|
122.5
|
|
||
Deferred tax liabilities:
|
|
|
|
|
||||
Goodwill
|
|
(80.3
|
)
|
|
(55.0
|
)
|
||
Prepaid expenses
|
|
(4.9
|
)
|
|
(6.6
|
)
|
||
Acquired intangible assets
|
|
(20.6
|
)
|
|
(24.6
|
)
|
||
Other
|
|
(5.6
|
)
|
|
(6.1
|
)
|
||
Total deferred tax liabilities
|
|
(111.4
|
)
|
|
(92.3
|
)
|
||
Net
|
|
$
|
14.3
|
|
|
$
|
30.2
|
|
Consolidated financial statements:
|
|
|
|
|
||||
Deferred income tax assets — current
|
|
$
|
51.7
|
|
|
$
|
61.7
|
|
Deferred income tax liabilities — noncurrent
|
|
$
|
(37.4
|
)
|
|
$
|
(31.5
|
)
|
|
|
February 1, 2014
|
|
February 2, 2013
|
|
January 28, 2012
|
||||||
Beginning balance of unrecognized tax benefits
|
|
$
|
28.7
|
|
|
$
|
25.4
|
|
|
$
|
24.9
|
|
Increases related to current period tax positions
|
|
0.5
|
|
|
0.5
|
|
|
—
|
|
|||
Increases related to prior period tax positions
|
|
16.6
|
|
|
6.3
|
|
|
9.9
|
|
|||
Reductions as a result of a lapse of the applicable statute of limitations
|
|
(1.9
|
)
|
|
(3.2
|
)
|
|
(2.0
|
)
|
|||
Reductions as a result of settlements with taxing authorities
|
|
(23.3
|
)
|
|
(0.3
|
)
|
|
(7.4
|
)
|
|||
Ending balance of unrecognized tax benefits
|
|
$
|
20.6
|
|
|
$
|
28.7
|
|
|
$
|
25.4
|
|
14.
|
Stock Incentive Plan
|
|
|
52 Weeks Ended
February 1, 2014 |
|
Volatility
|
|
46.4
|
%
|
Risk-free interest rate
|
|
1.0
|
%
|
Expected life (years)
|
|
5.6
|
|
Expected dividend yield
|
|
4.3
|
%
|
|
|
Shares
|
|
Weighted-
Average
Exercise
Price
|
|||
|
|
(Millions of shares)
|
|||||
Balance, February 2, 2013
|
|
4.6
|
|
|
$
|
25.04
|
|
Granted
|
|
0.5
|
|
|
$
|
24.82
|
|
Exercised
|
|
(2.8
|
)
|
|
$
|
20.84
|
|
Forfeited
|
|
(0.3
|
)
|
|
$
|
38.33
|
|
Balance, February 1, 2014
|
|
2.0
|
|
|
$
|
29.31
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||
Range of Exercise Prices
|
|
Number
Outstanding
(Millions)
|
|
Weighted-
Average
Remaining
Life (Years)
|
|
Weighted-
Average
Contractual
Price
|
|
Number
Exercisable
(Millions)
|
|
Weighted-
Average
Exercise
Price
|
||||||
$ 9.29 - $10.13
|
|
0.3
|
|
|
1.09
|
|
$
|
10.11
|
|
|
0.3
|
|
|
$
|
10.11
|
|
$17.94 - $20.69
|
|
0.3
|
|
|
4.09
|
|
$
|
20.18
|
|
|
0.3
|
|
|
$
|
20.18
|
|
$24.82 - $26.68
|
|
0.8
|
|
|
6.95
|
|
$
|
25.45
|
|
|
0.4
|
|
|
$
|
26.24
|
|
$49.95 - $49.95
|
|
0.6
|
|
|
4.02
|
|
$
|
49.95
|
|
|
0.6
|
|
|
$
|
49.95
|
|
$ 9.29 - $49.95
|
|
2.0
|
|
|
4.71
|
|
$
|
29.31
|
|
|
1.6
|
|
|
$
|
30.61
|
|
|
|
Shares
|
|
Weighted-
Average
Grant Date
Fair Value
|
|||
|
|
(Millions of shares)
|
|||||
Nonvested shares at February 2, 2013
|
|
1.8
|
|
|
$
|
22.92
|
|
Granted
|
|
1.2
|
|
|
$
|
24.82
|
|
Vested
|
|
(0.6
|
)
|
|
$
|
21.99
|
|
Forfeited
|
|
(0.1
|
)
|
|
$
|
23.98
|
|
Nonvested shares at February 1, 2014
|
|
2.3
|
|
|
$
|
24.10
|
|
15.
|
Employees’ Defined Contribution Plan
|
16.
|
Significant Products
|
•
|
Video Game Accessories, which includes new accessories for use with video game consoles and hand-held devices and software, such as controllers, gaming headsets and memory cards;
|
•
|
Digital, which includes revenues from the sale of DLC, Xbox Live, PlayStation Plus and Nintendo network points and subscription cards, other prepaid digital currencies and time cards, Kongregate,
Game Informer
digital subscriptions and PC digital downloads;
|
•
|
Mobile and Consumer Electronics, which includes revenues from selling new and pre-owned mobile devices and consumer electronics in Video Game Brands stores and all revenues from our Technology Brands stores;
|
•
|
Other, which includes revenues from the sales of PC entertainment software, toys, strategy guides and revenues from PowerUp Pro loyalty members receiving
Game Informer
magazine in physical form.
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
|||||||||||||||
|
|
Net Sales
|
|
Percent
of Total
|
|
Net Sales
|
|
Percent
of Total
|
|
Net Sales
|
|
Percent
of Total
|
|||||||||
Net sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
New video game hardware
|
|
$
|
1,730.0
|
|
|
19.1
|
%
|
|
$
|
1,333.4
|
|
|
15.0
|
%
|
|
$
|
1,611.6
|
|
|
16.9
|
%
|
New video game software
|
|
3,480.9
|
|
|
38.5
|
%
|
|
3,582.4
|
|
|
40.3
|
%
|
|
4,048.2
|
|
|
42.4
|
%
|
|||
Pre-owned and value video game products
|
|
2,329.8
|
|
|
25.8
|
%
|
|
2,430.5
|
|
|
27.4
|
%
|
|
2,620.2
|
|
|
27.4
|
%
|
|||
Video game accessories
|
|
560.6
|
|
|
6.2
|
%
|
|
611.8
|
|
|
6.9
|
%
|
|
661.1
|
|
|
6.9
|
%
|
|||
Digital
|
|
217.7
|
|
|
2.4
|
%
|
|
208.4
|
|
|
2.3
|
%
|
|
143.0
|
|
|
1.5
|
%
|
|||
Mobile and consumer electronics
|
|
303.7
|
|
|
3.4
|
%
|
|
200.3
|
|
|
2.3
|
%
|
|
12.8
|
|
|
0.1
|
%
|
|||
Other
|
|
416.8
|
|
|
4.6
|
%
|
|
519.9
|
|
|
5.8
|
%
|
|
453.6
|
|
|
4.8
|
%
|
|||
Total
|
|
$
|
9,039.5
|
|
|
100.0
|
%
|
|
$
|
8,886.7
|
|
|
100.0
|
%
|
|
$
|
9,550.5
|
|
|
100.0
|
%
|
|
|||||||||||||||||||||
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
|||||||||||||||
|
|
Gross
Profit
|
|
Gross
Profit
Percent
|
|
Gross
Profit
|
|
Gross
Profit
Percent
|
|
Gross
Profit
|
|
Gross
Profit
Percent
|
|||||||||
Gross Profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
New video game hardware
|
|
$
|
176.5
|
|
|
10.2
|
%
|
|
$
|
101.7
|
|
|
7.6
|
%
|
|
$
|
113.6
|
|
|
7.0
|
%
|
New video game software
|
|
805.3
|
|
|
23.1
|
%
|
|
786.3
|
|
|
21.9
|
%
|
|
839.0
|
|
|
20.7
|
%
|
|||
Pre-owned and value video game products
|
|
1,093.9
|
|
|
47.0
|
%
|
|
1,170.1
|
|
|
48.1
|
%
|
|
1,221.2
|
|
|
46.6
|
%
|
|||
Video game accessories
|
|
220.5
|
|
|
39.3
|
%
|
|
237.9
|
|
|
38.9
|
%
|
|
251.9
|
|
|
38.1
|
%
|
|||
Digital
|
|
149.2
|
|
|
68.5
|
%
|
|
120.9
|
|
|
58.0
|
%
|
|
66.5
|
|
|
46.5
|
%
|
|||
Mobile and consumer electronics
|
|
65.1
|
|
|
21.4
|
%
|
|
41.3
|
|
|
20.6
|
%
|
|
3.5
|
|
|
27.3
|
%
|
|||
Other
|
|
150.6
|
|
|
36.1
|
%
|
|
193.3
|
|
|
37.2
|
%
|
|
183.8
|
|
|
40.5
|
%
|
|||
Total
|
|
$
|
2,661.1
|
|
|
29.4
|
%
|
|
$
|
2,651.5
|
|
|
29.8
|
%
|
|
$
|
2,679.5
|
|
|
28.1
|
%
|
17.
|
Segment Information
|
As of and for the Fiscal Year Ended February 1, 2014
|
|
United
States
|
|
Canada
|
|
Australia
|
|
Europe
|
|
Technology Brands
|
|
|
Consolidated
|
||||||||||||
Net sales
|
|
$
|
6,160.4
|
|
|
$
|
468.8
|
|
|
$
|
613.7
|
|
|
$
|
1,733.8
|
|
|
$
|
62.8
|
|
|
|
$
|
9,039.5
|
|
Segment operating earnings (loss)
|
|
465.3
|
|
|
26.6
|
|
|
37.5
|
|
|
44.3
|
|
|
(0.2
|
)
|
|
|
573.5
|
|
||||||
Interest income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.9
|
|
||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(5.6
|
)
|
||||||
Earnings before income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
568.8
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Goodwill
|
|
1,143.3
|
|
|
33.8
|
|
|
81.3
|
|
|
94.2
|
|
|
62.1
|
|
|
|
1,414.7
|
|
||||||
Other long-lived assets
|
|
320.0
|
|
|
20.8
|
|
|
40.4
|
|
|
269.3
|
|
|
76.6
|
|
|
|
727.1
|
|
||||||
Total assets
|
|
2,320.7
|
|
|
228.7
|
|
|
389.2
|
|
|
972.2
|
|
|
180.6
|
|
|
|
4,091.4
|
|
||||||
Income tax expense
|
|
173.2
|
|
|
11.6
|
|
|
8.8
|
|
|
21.0
|
|
|
—
|
|
|
|
214.6
|
|
||||||
Depreciation and amortization
|
|
115.4
|
|
|
4.4
|
|
|
10.5
|
|
|
35.3
|
|
|
0.9
|
|
|
|
166.5
|
|
||||||
Capital expenditures
|
|
85.7
|
|
|
6.9
|
|
|
6.7
|
|
|
21.4
|
|
|
4.9
|
|
|
|
125.6
|
|
As of and for the Fiscal Year Ended February 2, 2013
|
|
United
States
|
|
Canada
|
|
Australia
|
|
Europe
|
|
Technology Brands
|
|
|
Consolidated
|
||||||||||||
Net sales
|
|
$
|
6,192.4
|
|
|
$
|
478.4
|
|
|
$
|
607.3
|
|
|
$
|
1,608.6
|
|
|
$
|
—
|
|
|
|
$
|
8,886.7
|
|
Segment operating earnings (loss)
|
|
501.9
|
|
|
(74.4
|
)
|
|
(71.6
|
)
|
|
(397.5
|
)
|
|
—
|
|
|
|
(41.6
|
)
|
||||||
Interest income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.9
|
|
||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4.2
|
)
|
||||||
Loss before income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(44.9
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Goodwill
|
|
1,153.5
|
|
|
37.7
|
|
|
96.6
|
|
|
95.3
|
|
|
—
|
|
|
|
1,383.1
|
|
||||||
Other long-lived assets
|
|
375.4
|
|
|
21.0
|
|
|
52.1
|
|
|
291.1
|
|
|
—
|
|
|
|
739.6
|
|
||||||
Total assets
|
|
2,404.0
|
|
|
252.2
|
|
|
416.6
|
|
|
799.4
|
|
|
—
|
|
|
|
3,872.2
|
|
||||||
Income tax expense
|
|
199.8
|
|
|
7.1
|
|
|
11.6
|
|
|
6.4
|
|
|
—
|
|
|
|
224.9
|
|
||||||
Depreciation and amortization
|
|
120.7
|
|
|
5.1
|
|
|
13.8
|
|
|
36.9
|
|
|
—
|
|
|
|
176.5
|
|
||||||
Capital expenditures
|
|
101.8
|
|
|
3.6
|
|
|
9.2
|
|
|
25.0
|
|
|
—
|
|
|
|
139.6
|
|
As of and for the Fiscal Year Ended January 28, 2012
|
|
United
States
|
|
Canada
|
|
Australia
|
|
Europe
|
|
Technology Brands
|
|
|
Consolidated
|
||||||||||||
Net sales
|
|
$
|
6,637.0
|
|
|
$
|
498.4
|
|
|
$
|
604.7
|
|
|
$
|
1,810.4
|
|
|
$
|
—
|
|
|
|
$
|
9,550.5
|
|
Segment operating earnings
|
|
501.9
|
|
|
12.4
|
|
|
35.4
|
|
|
20.2
|
|
|
—
|
|
|
|
569.9
|
|
||||||
Interest income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0.9
|
|
||||||
Interest expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(20.7
|
)
|
||||||
Debt extinguishment expense
|
|
|
|
|
|
|
|
|
|
|
|
|
(1.0
|
)
|
|||||||||||
Earnings before income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
549.1
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Other Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Goodwill
|
|
1,152.0
|
|
|
137.4
|
|
|
210.0
|
|
|
519.6
|
|
|
—
|
|
|
|
2,019.0
|
|
||||||
Other long-lived assets
|
|
404.0
|
|
|
23.0
|
|
|
58.3
|
|
|
345.8
|
|
|
—
|
|
|
|
831.1
|
|
||||||
Total assets
|
|
2,479.0
|
|
|
350.8
|
|
|
513.3
|
|
|
1,265.1
|
|
|
—
|
|
|
|
4,608.2
|
|
||||||
Income tax expense
|
|
197.4
|
|
|
4.2
|
|
|
11.7
|
|
|
(2.7
|
)
|
|
—
|
|
|
|
210.6
|
|
||||||
Depreciation and amortization
|
|
126.4
|
|
|
6.1
|
|
|
12.4
|
|
|
41.4
|
|
|
—
|
|
|
|
186.3
|
|
||||||
Capital expenditures
|
|
108.7
|
|
|
3.2
|
|
|
24.4
|
|
|
28.8
|
|
|
—
|
|
|
|
165.1
|
|
18.
|
Supplemental Cash Flow Information
|
|
|
52 Weeks Ended
February 1, 2014 |
|
53 Weeks Ended
February 2, 2013 |
|
52 Weeks Ended
January 28, 2012 |
||||||
|
|
(In millions)
|
||||||||||
Cash paid during the period for:
|
|
|
|
|
|
|
||||||
Interest
|
|
$
|
2.7
|
|
|
$
|
2.7
|
|
|
$
|
24.7
|
|
Income taxes
|
|
238.0
|
|
246.1
|
|
210.7
|
||||||
Acquisitions:
|
|
|
|
|
|
|
||||||
Goodwill
|
|
62.1
|
|
|
1.5
|
|
|
26.9
|
|
|||
Noncontrolling interests
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|||
Net assets acquired
|
|
15.3
|
|
|
—
|
|
|
3.1
|
|
|||
Cash paid for acquisitions, net of cash acquired
|
|
$
|
77.4
|
|
|
$
|
1.5
|
|
|
$
|
30.1
|
|
19.
|
Stockholders’ Equity
|
20.
|
Unaudited Quarterly Financial Information
|
|
|
Fiscal Year Ended February 1, 2014
|
|
Fiscal Year Ended February 2, 2013
|
||||||||||||||||||||||||||||
|
|
1st
Quarter
|
|
2nd
Quarter
|
|
3rd
Quarter
|
|
4th
Quarter (2)
|
|
1st
Quarter
|
|
2nd
Quarter
|
|
3rd
Quarter(1)
|
|
4th
Quarter
|
||||||||||||||||
|
|
(Amounts in millions, except per share amounts)
|
||||||||||||||||||||||||||||||
Net sales
|
|
$
|
1,865.3
|
|
|
$
|
1,383.7
|
|
|
$
|
2,106.7
|
|
|
$
|
3,683.8
|
|
|
$
|
2,002.2
|
|
|
$
|
1,550.2
|
|
|
$
|
1,772.8
|
|
|
$
|
3,561.5
|
|
Gross profit
|
|
578.3
|
|
|
481.3
|
|
|
598.3
|
|
|
1,003.2
|
|
|
599.9
|
|
|
519.3
|
|
|
557.4
|
|
|
974.9
|
|
||||||||
Operating earnings (loss)
|
|
87.2
|
|
|
18.8
|
|
|
109.1
|
|
|
358.4
|
|
|
115.0
|
|
|
34.5
|
|
|
(603.5
|
)
|
|
412.3
|
|
||||||||
Net income (loss) attributable to GameStop Corp.
|
|
54.6
|
|
|
10.5
|
|
|
68.6
|
|
|
220.5
|
|
|
72.5
|
|
|
21.0
|
|
|
(624.3
|
)
|
|
261.1
|
|
||||||||
Basic net income (loss) per common share (3)
|
|
0.46
|
|
|
0.09
|
|
|
0.59
|
|
|
1.91
|
|
|
0.54
|
|
|
0.16
|
|
|
(5.08
|
)
|
|
2.17
|
|
||||||||
Diluted net income (loss) per common share (3)
|
|
0.46
|
|
|
0.09
|
|
|
0.58
|
|
|
1.89
|
|
|
0.54
|
|
|
0.16
|
|
|
(5.08
|
)
|
|
2.15
|
|
||||||||
Dividend declared per common share
|
|
0.275
|
|
|
0.275
|
|
|
0.275
|
|
|
0.275
|
|
|
0.15
|
|
|
0.15
|
|
|
0.25
|
|
|
0.25
|
|
(1)
|
The results of operations for the third quarter of the fiscal year ended February 2, 2013 include goodwill impairments of
$627.0 million
and asset impairments of
$51.8 million
.
|
(2)
|
The results of operations for the fourth quarter of the fiscal year ended February 1, 2014 include goodwill impairments of
$10.2 million
and asset impairments of
$18.5 million
. Additionally, results include a
$33.6 million
benefit associated with changes in accounting estimates primarily related to our loyalty programs and other customer liabilities.
|
(3)
|
Basic net income (loss) per common share and diluted net income (loss) per common share are calculated based on net income (loss) attributable to GameStop Corp. for the quarter. The sum of the quarters may not necessarily be equal to the full year net income (loss) per common share amount.
|
Exhibit
Number
|
|
Description
|
|
|
|
2.1
|
|
Agreement and Plan of Merger, dated as of April 17, 2005, among GameStop Corp. (f/k/a GSC Holdings Corp.), Electronics Boutique Holdings Corp., GameStop, Inc., GameStop Holdings Corp. (f/k/a GameStop Corp.), Cowboy Subsidiary LLC and Eagle Subsidiary LLC.(1)
|
|
|
|
2.2
|
|
Sale and Purchase Agreement, dated September 30, 2008, between EB International Holdings, Inc. and L Capital, LV Capital, Europ@Web and other Micromania shareholders.(2)
|
|
|
|
2.3
|
|
Amendment, dated November 17, 2008, to Sale and Purchase Agreement for Micromania Acquisition listed as Exhibit 2.2 above.(3)
|
|
|
|
3.1
|
|
Third Amended and Restated Certificate of Incorporation.(4)
|
|
|
|
3.2
|
|
Third Amended and Restated Bylaws.(4)
|
|
|
|
4.1
|
|
Indenture, dated September 28, 2005, by and among GameStop Corp. (f/k/a GSC Holdings Corp.), GameStop, Inc., the subsidiary guarantors party thereto, and Citibank N.A., as trustee.(5)
|
|
|
|
4.2
|
|
First Supplemental Indenture, dated October 8, 2005, by and among GameStop Corp. (f/k/a GSC Holdings Corp.), GameStop, Inc., the subsidiary guarantors party thereto, and Citibank N.A., as trustee.(6)
|
|
|
|
4.3
|
|
Rights Agreement, dated as of June 27, 2005, between GameStop Corp. (f/k/a GSC Holdings Corp.) and The Bank of New York, as Rights Agent.(7)
|
|
|
|
4.4
|
|
Form of Indenture.(8)
|
|
|
|
10.1*
|
|
Fourth Amended and Restated 2001 Incentive Plan.(9)
|
|
|
|
10.2*
|
|
Amended and Restated 2011 Incentive Plan.(10)
|
|
|
|
10.3*
|
|
Second Amended and Restated Supplemental Compensation Plan.(11)
|
|
|
|
10.4*
|
|
Form of Option Agreement.(12)
|
|
|
|
10.5*
|
|
Form of Restricted Share Agreement.(13)
|
|
|
|
10.6
|
|
Amended and Restated Credit Agreement, dated as of January 4, 2011, among GameStop Corp., as Lead Borrower for: GameStop Corp., GameStop, Inc., Sunrise Publications, Inc., Electronics Boutique Holdings Corp., ELBO Inc., EB International Holdings, Inc., Kongregate Inc., GameStop Texas Ltd., Marketing Control Services, Inc., SOCOM LLC and Bank of America, N.A., as Issuing Bank, Bank of America, N.A., as Administrative Agent and Collateral Agent, Wells Fargo Capital Finance, LLC, as Syndication Agent, U.S. Bank National Association and Regions Bank, as Co-Documentation Agents, and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Sole Lead Arranger and Sole Bookrunner.(14)
|
|
|
|
10.7
|
|
Guaranty, dated as of October 11, 2005, by GameStop Corp. (f/k/a GSC Holdings Corp.) and certain subsidiaries of GameStop Corp. in favor of the agents and lenders.(15)
|
|
|
|
10.8
|
|
Amended and Restated Security Agreement, dated January 4, 2011, among GameStop Corp., as Lead Borrower, the Subsidiary Borrowers party hereto, and Bank of America, N.A., as Collateral Agent.(14)
|
|
|
|
10.9
|
|
Amended and Restated Patent and Trademark Security Agreement, dated January 4, 2011, among GameStop Corp., as Lead Borrower, the Subsidiary Borrowers party hereto, and Bank of America, N.A., as Collateral Agent.(14)
|
|
|
|
10.10
|
|
Mortgage, Security Agreement, and Assignment and Deeds of Trust, dated October 11, 2005, between GameStop of Texas, L.P. and Bank of America, N.A., as Collateral Agent.(15)
|
|
|
|
10.11
|
|
Mortgage, Security Agreement, and Assignment and Deeds of Trust, dated October 11, 2005, between Electronics Boutique of America, Inc. and Bank of America, N.A., as Collateral Agent.(15)
|
|
|
|
10.12
|
|
Amended and Restated Pledge Agreement, dated January 4, 2011, by and among GameStop Corp., as Lead Borrower, the Subsidiary Borrowers party hereto, and Bank of America, N.A., as Collateral Agent.(14)
|
|
|
|
10.13
|
|
Term Loan Agreement, dated November 12, 2008, by and among GameStop Corp. (f/k/a GSC Holdings Corp.), certain subsidiaries of GameStop Corp., Bank of America, N.A., as lender, Bank of America, N.A., as Administrative Agent and Collateral Agent, and Banc of America Securities LLC, as Sole Arranger and Bookrunner.(3)
|
|
|
|
Exhibit
Number
|
|
Description
|
|
|
|
10.14
|
|
Security Agreement, dated November 12, 2008, by and among GameStop Corp. (f/k/a GSC Holdings Corp.), certain subsidiaries of GameStop Corp., Bank of America, N.A., as lender and Bank of America, N.A., as Collateral Agent.(3)
|
|
|
|
10.15
|
|
Patent and Trademark Security Agreement, dated as of November 12, 2008, by and among GameStop Corp. (f/k/a GSC Holdings Corp.), certain subsidiaries of GameStop Corp., Bank of America, N.A., as lender, and Bank of America, N.A., as Collateral Agent.(3)
|
|
|
|
10.16
|
|
Securities Collateral Pledge Agreement, dated November 12, 2008, by and among GameStop Corp. (f/k/a GSC Holdings Corp.), certain subsidiaries of GameStop Corp., Bank of America, N.A., as lender, and Bank of America, N.A., as Collateral Agent.(3)
|
|
|
|
10.17*
|
|
Executive Employment Agreement, dated as of May 10, 2013, between GameStop Corp. and Daniel A. DeMatteo.(16)
|
|
|
|
10.18*
|
|
Executive Employment Agreement, dated as of May 10, 2013, between GameStop Corp. and J. Paul Raines.(16)
|
|
|
|
10.19*
|
|
Executive Employment Agreement between GameStop Corp. and J. Paul Raines, as amended on November 13, 2013.(17)
|
|
|
|
10.20*
|
|
Executive Employment Agreement, dated as of May 10, 2013, between GameStop Corp. and Tony D. Bartel.(16)
|
|
|
|
10.21*
|
|
Executive Employment Agreement, dated as of May 10, 2013, between GameStop Corp. and Robert A. Lloyd.(16)
|
|
|
|
10.22*
|
|
Executive Employment Agreement, dated as of May 10, 2013, between GameStop Corp. and Michael K. Mauler.(16)
|
|
|
|
10.23*
|
|
Executive Employment Agreement, dated as of May 10, 2013, between GameStop Corp. and Michael P. Hogan.(20)
|
|
|
|
10.24*
|
|
Retirement Policy. (18)
|
|
|
|
10.25
|
|
Second Amended and Restated Credit Agreement, dated as of March 25, 2014, by and among GameStop Corp., certain subsidiaries of GameStop Corp., Bank of America, N.A. and the other lending institutions listed therein, Bank of America, N.A., as Issuing Bank, Bank of America, N.A., as Agent, JPMorgan Chase Bank, N.A., as Syndication Agent and Wells Fargo Capital Finance, LLC and U.S. Bank National Association, as Co-Documentation Agents. (19)
|
|
|
|
10.26
|
|
Second Amended and Restated Security Agreement, dated as of March 25, 2014. (19)
|
|
|
|
10.27
|
|
Second Amended and Restated Patent and Trademark Security Agreement, dated as of March 25, 2014. (19)
|
|
|
|
10.28
|
|
Second Amended and Restated Pledge Agreement, dated as of March 25, 2014. (19)
|
|
|
|
21.1
|
|
Subsidiaries. (20)
|
|
|
|
23.1
|
|
Consent of Deloitte & Touche LLP. (20)
|
|
|
|
23.2
|
|
Consent of BDO USA, LLP. (20)
|
|
|
|
31.1
|
|
Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (20)
|
|
|
|
31.2
|
|
Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. (20)
|
|
|
|
32.1
|
|
Certification of Chief Executive Officer pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (21)
|
|
|
|
32.2
|
|
Certification of Chief Financial Officer pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (21)
|
|
|
|
101.INS
|
|
XBRL Instance Document (22)
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema (22)
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase (22)
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase (22)
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase (22)
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase (22)
|
(1)
|
Incorporated by reference to GameStop Holdings Corp.’s Form 8-K filed with the Securities and Exchange Commission on April 18, 2005.
|
(2)
|
Incorporated by reference to the Registrant’s Form 8-K filed with the Securities and Exchange Commission on October 2, 2008.
|
(3)
|
Incorporated by reference to the Registrant’s Form 8-K filed with the Securities and Exchange Commission on November 18, 2008.
|
(4)
|
Incorporated by reference to the Registrant’s 10-Q for the fiscal quarter ended August 3, 2013 filed with the Securities and Exchange Commission on September 11, 2013.
|
(5)
|
Incorporated by reference to GameStop Holdings Corp.’s Form 8-K filed with the Securities and Exchange Commission on September 30, 2005.
|
(6)
|
Incorporated by reference to the Registrant’s Form 10-Q for the fiscal quarter ended October 29, 2005 filed with the Securities and Exchange Commission on December 8, 2005.
|
(7)
|
Incorporated by reference to the Registrant’s Amendment No.1 to Form S-4 filed with the Securities and Exchange Commission on July 8, 2005.
|
(8)
|
Incorporated by reference to the Registrant’s Form S-3ASR filed with the Securities and Exchange Commission on April 10, 2006.
|
(9)
|
Incorporated by reference to Appendix A to the Registrant’s Proxy Statement for 2009 Annual Meeting of Stockholders filed with the Securities and Exchange Commission on May 22, 2009.
|
(10)
|
Incorporated by reference to the Registrant’s Form 8-K filed with the Securities and Exchange Commission on June 27, 2013.
|
(11)
|
Incorporated by reference to Appendix A to the Registrant’s Proxy Statement for 2008 Annual Meeting of Stockholders filed with the Securities and Exchange Commission on May 23, 2008.
|
(12)
|
Incorporated by reference to GameStop Holdings Corp.’s Form 10-K for the fiscal year ended January 29, 2005 filed with the Securities and Exchange Commission on April 11, 2005.
|
(13)
|
Incorporated by reference to GameStop Holdings Corp.’s Form 8-K filed with the Securities and Exchange Commission on September 12, 2005.
|
(14)
|
Incorporated by reference to the Registrant’s Form 8-K filed with the Securities and Exchange Commission on January 6, 2011.
|
(15)
|
Incorporated by reference to the Registrant’s Form 8-K filed with the Securities and Exchange Commission on October 12, 2005.
|
(16)
|
Incorporated by reference to the Registrant’s Form 8-K filed with the Securities and Exchange Commission on May 13, 2013.
|
(17)
|
Incorporated by reference to the Registrant’s Form 8-K filed with the Securities and Exchange Commission on November 15, 2013.
|
(18)
|
Incorporated by reference to the Registrant's Form 8-K filed with the Securities and Exchange Commission on March 11, 2014.
|
(19)
|
Incorporated by reference to the Registrant's Form 8-K filed with the Securities and Exchange Commission on March 28, 2014.
|
(20)
|
Filed herewith.
|
(21)
|
Furnished herewith.
|
(22)
|
Submitted electronically herewith.
|
|
/s/ D
ELOITTE
& T
OUCHE
LLP
|
|
DELOITTE & TOUCHE LLP
|
|
/s/ BDO USA, LLP
|
|
BDO USA, LLP
|
1
|
I have reviewed this report on Form 10-K of GameStop Corp.;
|
2
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
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
|
5
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
|
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.
|
|
By:
|
/s/ J. Paul Raines
|
|
|
J. Paul Raines
|
|
|
Chief Executive Officer
|
|
|
GameStop Corp.
|
1
|
I have reviewed this report on Form 10-K of GameStop Corp.;
|
2
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
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
|
5
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):
|
|
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.
|
|
By:
|
/s/ Robert A. Lloyd
|
|
|
Robert A. Lloyd
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
GameStop Corp.
|
(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.
|
|
/s/ J. Paul Raines
|
|
J. Paul Raines
|
|
Chief Executive Officer
|
|
GameStop Corp.
|
|
|
|
April 2, 2014
|
(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.
|
|
/s/ Robert A. Lloyd
|
|
Robert A. Lloyd
|
|
Executive Vice President and
|
|
Chief Financial Officer
|
|
GameStop Corp
|
|
|
|
April 2, 2014
|