Cabela's 2013 Annual Report Download - page 9

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CABELA’S INCORPORATED AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP RETURN ON INVESTED CAPITAL
Return on invested capital (“ROIC”) is not a measure of financial performance under generally accepted
accounting principles (“GAAP”) and may not be defined and calculated by other companies in the same manner.
ROIC should be considered supplemental to and not a substitute for financial information prepared in accordance
with GAAP. We use ROIC as a measure of efficiency and effectiveness of our use of total capital.
We measure ROIC by dividing adjusted net income by average total capital. Adjusted net income is calculated
by adding interest expense, rent expense, and Retail segment depreciation and amortization (all after tax) to reported
GAAP net income excluding: (1) any losses on sales of assets, (2) any impairment charges or fixed asset write-
downs, and (3) any accumulated amortization of deferred grant income caused by other than temporary impairment
losses of economic development bonds (all after tax). Total capital is calculated by adding current maturities of
long-term debt, operating leases capitalized at eight times next year’s annual minimum lease payments, and total
stockholders’ equity to long-term debt (excluding all debt of the Financial Services segment) and then subtracting
cash and cash equivalents (excluding cash and cash equivalents of the Financial Services segment). Average total
capital is calculated as the sum of current and prior year ending total capital divided by two. The following table
reconciles the components of ROIC to the most comparable GAAP financial measures.
Fiscal Year Ended
December 28,
2013 December 29,
2012 December 31,
2011 January 1,
2011
(Dollars in Thousands)
Net income as GAAP reported $ 224,390 $173,513 $142,620 $112 ,159
Add back:
Interest expense 21,889 20,171 24,454 27,482
Rent expense 14,319 13,605 9,541 7,506
Depreciation and amortization - Retail segment 54,882 46,997 41,506 40,011
Exclude:
Impairment charges or fixed asset writedowns 937 19,015 4,771 5,626
Accumulated amortization of deferred grant income 4,931 1,309 6,538 -
96,958 101,097 86,810 80,625
After tax effect 63,314 67,027 57,729 54,253
Effective tax rate 34.7%33.7%33.5%32.7%
Adjusted net income, non-GAAP $287,704 $240,540 $200,349 $166,412
Calculation of total capital:
Current maturities of long-term debt $ 8,418 $ 8,402 $ 8,387 $230
Deferred compensation - - - 291
Operating leases capitalized at 8x next year’s
annual minimum lease payments 128,280 95,168 85,968 55,864
Total stockholders’ equity 1,606,334 1,375,979 1,181,316 1,024,548
Long-term debt (excluding Financial Services segment) 322,647 328,133 336,535 344,922
2,065,679 1,807,682 1,612,206 1,425,855
Less:
Cash and cash equivalents (199,072)(288,750)(304,679)(136,419)
Add back cash and cash equivalents at the
Financial Services segment 94,112 91,365 117,035 81,904
(104,960)(197,385)(187,644)(54,515)
Adjusted total capital, non-GAAP $1,960,719 $1,610,297 $1,424,562 $1,371,340
Average total capital, non-GAAP $1,785,508 $1,517,430 $1,397,951 $1,273,610
Return on Invested Capital, non-GAAP 16.1%15.9%14.3%13.1%