Safeway 2011 Annual Report Download - page 46

Download and view the complete annual report

Please find page 46 of the 2011 Safeway 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 108

  • 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
  • 107
  • 108

SAFEWAY INC. AND SUBSIDIARIES
Income taxes During 2009, the Company received tax refunds of $413 million as follows: (1) the Company accelerated
certain tax deductions for its 2008 income tax returns resulting in approximately $224 million of tax refunds; and (2) the
resolution of certain other income tax matters resulted in tax refunds of approximately $189 million. These tax refunds
increased cash flow from operating activities by $396 million and reduced cash flow used by financing activities by $17
million.
Bank Credit Agreement and Term Loan Agreement Information about the Company’s bank credit agreement and
term loan agreement appear in Note D to the consolidated financial statements set forth in Part II, Item 8 of this report.
The computation of Adjusted EBITDA, as defined by the credit agreement, is provided below solely to provide an
understanding of the impact that Adjusted EBITDA has on Safeway’s ability to borrow under the credit agreement and
term loan agreement. Adjusted EBITDA should not be considered as an alternative to net income or cash flow from
operating activities (which are determined in accordance with U.S. GAAP) and is not being presented as an indicator of
operating performance or a measure of liquidity. Other companies may define Adjusted EBITDA differently and, as a
result, such measures may not be comparable to Safeway’s Adjusted EBITDA (dollars in millions).
52 Weeks
2011
Adjusted EBITDA:
Net income attributable to Safeway Inc. $ 516.7
Add (subtract):
Income taxes 363.9
Interest expense 272.2
Depreciation expense 1,148.8
LIFO expense 35.1
Share-based employee compensation 50.0
Property impairment charges 44.7
Equity in earnings of unconsolidated affiliate (13.0)
Dividend from unconsolidated affiliate 6.1
Total Adjusted EBITDA $ 2,424.5
Adjusted EBITDA as a multiple of interest expense 8.91x
Minimum Adjusted EBITDA as a multiple of interest expense under bank credit agreement 2.00x
Total debt at year-end 2011 $ 5,410.2
Less cash and equivalents in excess of $75.0 at December 31, 2011 654.4
Adjusted Debt $ 4,755.8
Adjusted Debt to Adjusted EBITDA 1.96x
Maximum Adjusted Debt to Adjusted EBITDA under bank credit agreement 3.50x
Shelf Registration On October 24, 2011, the Company filed a shelf registration statement (the “Shelf”) with the SEC
which permits Safeway to issue an unlimited amount of debt securities and/or common stock. The Shelf expires on
October 24, 2014. The Safeway Board of Directors has authorized issuance of up to $3.0 billion of securities under the
Shelf. As of December 31, 2011, $2.2 billion of securities were available for issuance under the board’s authorization.
Commercial Paper Information about the Company’s commercial paper borrowings appear in Note D to the
consolidated financial statements set forth in Part II, Item 8 of this report.
28