Apple 2009 Annual Report Download - page 53

Download and view the complete annual report

Please find page 53 of the 2009 Apple annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 106

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106

Table of Contents
The Company’
s marketable securities investment portfolio is invested primarily in highly rated securities, generally with a minimum rating of
single-A or equivalent. As of September 26, 2009 and September 27, 2008, $17.4 billion and $11.3 billion, respectively, of the Company’
s cash,
cash equivalents and marketable securities were held by foreign subsidiaries and are generally based in U.S. dollar-
denominated holdings. The
Company believes its existing balances of cash, cash equivalents and marketable securities will be sufficient to satisfy its working capital needs,
capital asset purchases, outstanding commitments and other liquidity requirements associated with its existing operations over the next 12
months.
Capital Assets
The Company’
s cash payments for capital asset purchases were $1.1 billion during 2009, consisting of $369 million for retail store facilities and
$775 million for real estate acquisitions and corporate infrastructure including information systems enhancements. The Company anticipates
utilizing approximately $1.9 billion for capital asset purchases during 2010, including approximately $400 million for Retail facilities and
approximately $1.5 billion for corporate facilities, infrastructure, and product tooling and manufacturing process equipment.
Historically the Company has opened between 25 and 50 new retail stores per year. During 2010, the Company expects to open a number of new
stores near the upper end of this range, over half of which are expected to be located outside of the U.S.
Off-Balance Sheet Arrangements and Contractual Obligations
The Company has not entered into any transactions with unconsolidated entities whereby the Company has financial guarantees, subordinated
retained interests, derivative instruments, or other contingent arrangements that expose the Company to material continuing risks, contingent
liabilities, or any other obligation under a variable interest in an unconsolidated entity that provides financing, liquidity, market risk, or credit
risk support to the Company.
The following table presents certain payments due by the Company under contractual obligations with minimum firm commitments as of
September 26, 2009 and excludes amounts already recorded on the Consolidated Balance Sheet as current liabilities (in millions):
Lease Commitments
As of September 26, 2009, the Company had total outstanding commitments on noncancelable operating leases of $1.9 billion, $1.5 billion of
which related to the lease of retail space and related facilities. The Company’
s major facility leases are generally for terms of one to 20 years and
generally provide renewal options for terms of one to five additional years. Leases for retail space are for terms of five to 20 years, the majority
of which are for ten years, and often contain multi-year renewal options.
Purchase Commitments with Contract Manufacturers and Component Suppliers
The Company utilizes several contract manufacturers to manufacture sub-assemblies for the Company’
s products and to perform final assembly
and test of finished products. These contract manufacturers acquire components
50
Total
Payments
Due in
Less
Than
1 Year
Payments
Due in
1-
3 Years
Payments
Due in
4-
5 Years
Payments
Due in
More
Than
5 Years
Operating leases
$
1,922
$
222
$
462
$
413
$
825
Purchase obligations
4,783
4,783
—
—
—
Asset retirement obligations
32
4
8
4
16
Other obligations
356
175
129
52
—
Total
$
7,093
$
5,184
$
599
$
469
$
841