Cabela's 2010 Annual Report Download - page 40

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30
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion and analysis of financial condition, results of operations, liquidity, and capital
resources should be read in conjunction with our audited consolidated financial statements and notes thereto
appearing elsewhere in this report.
Forward Looking Statements – Our discussion contains forward-looking statements with respect to our
plans and strategies for our businesses and the business environment that are impacted by risks and uncertainties.
Refer to “Special Note Regarding Forward-Looking Statements” preceding PART I, ITEM 1, and to ITEM 1A
“Risk Factors” for information regarding certain of the risks and uncertainties that affect our business and the
industries in which we operate. Please note that our actual results may differ materially from those we may
estimate or project in any of these forward-looking statements.
Cabela’s®
We are a leading specialty retailer, and the world’s largest direct marketer, of hunting, fishing, camping,
and related outdoor merchandise. We provide a quality service to our customers who enjoy an outdoor lifestyle
by supplying outdoor products through our multi-channel retail business consisting of our Retail and Direct
business segments. Our Retail business segment is comprised of 31 stores, 30 located in the United States and
one in Canada. Our Direct business segment is comprised of our highly acclaimed Internet website, which is
supplemented by our catalog distributions as a selling and marketing tool.
Our Financial Services business segment also plays an integral role in supporting our merchandising
business. Our Financial Services business segment comprises our credit card services, reinforces our strong brand,
and strengthens our customer loyalty through our credit card loyalty programs.
Fiscal 2010 Executive Overview
2010 2009 Increase
(Decrease) % Change
(Dollars in Thousands)
Revenue:
Retail $1,412,715 $1,388,991 $23,724 1.7%
Direct 999,771 1,058,644 (58,873)(5.6)
Total merchandise sales 2,412,486 2,447,635 (35,149)(1.4)
Financial Services 227,675 171,414 56,261 32.8
Other revenue 23,081 13,191 9,890 75.0
Total revenue $ 2,663,242 $2,632,240 $31,002 1.2
Operating income $ 186,762 $92,678 $94,084 101.5
Earnings per diluted share $ 1.62 $0.74 $0.88 118.9
Revenues for 2010 totaled $2.7 billion, an increase of 1.2% over 2009. Revenue in our merchandising business
decreased $35 million, or 1.4%, in 2010 compared to 2009. The net decrease in total merchandise sales comparing
2010 to 2009 was due to:
• $51 million in sales that was reflected in the extra week in 2009 compared to 2010 which consisted of
52 weeks; and
• a net decrease in Direct revenue of $25 million compared to 2009 from our non-core businesses that we
divested of in October 2010 (home restoration products) and in the fall of 2009 (taxidermy and wildlife
prints and collectibles).