Cabela's 2010 Annual Report Download - page 64

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54
2010 versus 2009
Effective fiscal 2010, the consolidation of the assets and liabilities of the Trust resulted in reflecting the net
change in total credit card loans originated at Cabela’s as an operating activity and the net change in total credit
card loans originated at third parties as an investing activity. Activities in 2009 do not reflect the consolidation
of the credit card loans held by the Trust but reflect in operating activities the related securitization transactions
associated with securitized loans, including retained interests, and activity on credit card loans held by WFB.
Operating Activities – Cash derived from operating activities decreased $127 million in 2010 compared to
2009. This net decrease in cash from operations was primarily due to inventory growth from the new retail store
in Grand Junction, Colorado, and from more merchandise on hand than at the end of 2009 as we are focused on
maintaining sufficient core inventory heading into 2011. Inventory increased $69 million in 2010, to a balance of
$509 million, compared to a decrease of $78 million in 2009, or to a balance of $440 million. WFB paid cash out
on a net basis of $49 million for credit card loans originated at Cabela’s through our Retail and Direct businesses.
Current and deferred income taxes payable decreased $71 million compared to 2009, partially offset by increases
in unrecognized tax benefits and related accrued interest of $44 million and in current and deferred income taxes
recoverable of $15 million comparing 2010 to 2009. These net decreases were partially offset by an increase of
$66 million in the provision for loan losses.
Investing Activities – Cash used in investing activities increased $242 million in 2010 compared to 2009. In
2010, WFB purchased United States government agency securities totaling $350 million which matured during
fiscal 2010. In addition, WFB disbursed cash on a net basis for credit card loans originated externally at third
parties totaling $281 million in 2010. In 2009, WFB retained asset-backed securities totaling $75 million from
the $500 million Series 2009-I issuance of the Trust and purchased triple-A rated notes for $2 million from a
previously issued series of the Trust. WFB classified these notes as asset-backed available for sale securities which
are reflected in the consolidated balance sheet under the caption “retained interests in securitized loans, including
asset-backed securities.” Cash paid for property and equipment additions totaled $75 million in 2010 compared to
$49 million in 2009. At January 2, 2011, we estimated total capital expenditures for the development, construction,
and completion of retail stores, including the purchase of economic development bonds, to approximate $37 million
through the next 12 months. We expect to fund these estimated capital expenditures with funds from operations.
The following table presents the growth of our retail stores, and the activity of economic development bonds
related to the construction of these stores and related projects, for the years ended:
2010 2009
(Dollars In Thousands)
Property and equipment additions $ 75,349 $49,113
Proceeds from retirements and maturities of economic development bonds 7,214 2,654
Number of new retail stores opened during the year 1 1
Number of retail stores at the end of the year 31 30
Financing Activities – Cash used in financing activities decreased $250 million in 2010 compared to 2009.
This net decrease was primarily due to the repaying of $289 million of secured variable funding Trust obligations
in 2010. We also had a decrease of $33 million in the change related to unpresented checks. Partially offsetting
these decreases was an increase in time deposits, which WFB utilizes to fund its credit card operations, of
$36 million in 2010 compared to a net decrease of $8 million in 2009. Also, borrowings on our lines of credit for
working capital and inventory financing increased $20 million in 2010 compared to 2009. At the end of 2010 and
2009, there were no amounts outstanding on our unsecured revolving credit facility.