Starbucks 2007 Annual Report Download - page 61

Minimum future rental payments under noncancelable operating leases as of September 30, 2007, are as follows (in
thousands):
Fiscal Year Ending
2008 .............................................................. $ 691,011
2009 .............................................................. 671,080
2010 .............................................................. 629,696
2011 .............................................................. 582,509
2012 .............................................................. 526,684
Thereafter .......................................................... 1,915,603
Total minimum lease payments .......................................... $5,016,583
The Company has subleases related to certain of its operating leases. During fiscal 2007, 2006 and 2005, the
Company recognized sublease income of $3.6 million, $5.7 million and $4.3 million, respectively.
The Company had capital lease obligations of $3.1 million and $4.1 million as of September 30, 2007 and October 1,
2006, respectively. As of September 30, 2007, the $1.2 million current portion of the total obligation was included in
“Other accrued expenses” and the remaining long-term portion of $1.9 million was included in “Other long-term
liabilities” on the consolidated balance sheet. Capital lease obligations expire at various dates, with the latest
maturity in 2020. Assets held under capital leases are included in “Property, plant and equipment, net,” on the
consolidated balance sheets.
Note 12: Shareholders’ Equity
In addition to 1.2 billion shares of authorized common stock with $0.001 par value per share, the Company has
authorized 7.5 million shares of preferred stock, none of which was outstanding at September 30, 2007.
Under the Company’s authorized share repurchase program, Starbucks acquired 33.0 million shares at an average
price of $30.72 for a total accrual-based cost of $1.0 billion in fiscal 2007. The related cash amount used to
repurchase shares in fiscal 2007 totaled $997 million. The difference between the two amounts represents the effect
of the net change in unsettled trades totaling $16 million from October 1, 2006. Starbucks acquired 25.6 million
shares at an average price of $32.34 for a total accrual-based cost of $828 million during fiscal 2006. The related
cash amount used to repurchase shares in fiscal 2006 totaled $854 million. The difference between the two amounts
represents the effect of the net change in unsettled trades totaling $26 million from October 2, 2005. Share
repurchases were funded through cash, cash equivalents, available-for-sale securities, borrowings under the
revolving credit facility and commercial paper program and proceeds from sale of the notes, and were part of
the Company’s active capital management program. On May 1, 2007, the Starbucks Board of Directors authorized
the repurchase of up to 25 million additional shares of the Company’s common stock. As of September 30, 2007, a
total of up to 13.5 million shares remained available for repurchase, under the current authorization.
Comprehensive Income
Comprehensive income includes all changes in equity during the period, except those resulting from transactions
with shareholders and subsidiaries of the Company. It has two components: net earnings and other comprehensive
income. Accumulated other comprehensive income reported on the Company’s consolidated balance sheets
consists of foreign currency translation adjustments and the unrealized gains and losses, net of applicable taxes,
on available-for-sale securities and on derivative instruments designated and qualifying as cash flow and net
investment hedges.
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