Apple 2011 Annual Report Download - page 40

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process equipment, real estate for the future development of the Company’
s second corporate campus, and other corporate facilities and
infrastructure. The Company’
s actual cash payments for capital expenditures during 2011 were $4.3 billion, of which $612 million relates to
retail store facilities.
The Company anticipates utilizing approximately $8.0 billion for capital expenditures during 2012, including approximately $900 million for
retail store facilities and approximately $7.1 billion for product tooling and manufacturing process equipment, and corporate facilities and
infrastructure, including information systems hardware, software and enhancements.
During 2012, the Company expects to open about 40 new retail stores, approximately three-quarters of which will 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 24, 2011 and excludes amounts already recorded on the Consolidated Balance Sheet (in millions):
Lease Commitments
The Company’
s major facility leases are typically for terms not exceeding 10 years and generally provide renewal options for terms not
exceeding five additional years. Leases for retail space are for terms ranging from five to 20 years, the majority of which are for 10 years, and
often contain multi-year renewal options. As of September 24, 2011, the Company’
s total future minimum lease payments under noncancelable
operating leases were $3.0 billion, of which $2.4 billion related to leases for retail space.
Purchase Commitments with Contract Manufacturers and Component Suppliers
The Company utilizes several outsourcing partners to manufacture sub-assemblies for the Company’
s products and to perform final assembly
and test of finished products. These outsourcing partners acquire components and build product based on demand information supplied by the
Company, which typically covers periods up to 150 days. The Company also obtains individual components for its products from a wide variety
of individual suppliers. Consistent with industry practice, the Company acquires components through a combination of purchase orders, supplier
contracts, and open orders based on projected demand information. As of September 24, 2011, the Company had outstanding off-
balance sheet
third-party manufacturing commitments and component purchase commitments of $13.9 billion.
38
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
$
3,032
$
338
$
727
$
665
$
1,302
Purchase obligations
13,949
13,949
0
0
0
Other obligations
2,415
2,297
114
4
0
Total
$
19,396
$
16,584
$
841
$
669
$
1,302