Starbucks 2007 Annual Report Download - page 62

Comprehensive income, net of related tax effects, is as follows (in thousands):
Fiscal Year Ended Sept 30, 2007 Oct 1, 2006 Oct 2, 2005
Net earnings .................................... $672,638 $564,259 $494,370
Unrealized holding gains/(losses) on available-for-sale
securities, net of tax benefit/(provision) of ($152),
($1,298) and $889 in 2007, 2006 and 2005,
respectively ................................. 254 2,164 (1,482)
Unrealized holding losses on cash flow hedging
instruments, net of tax benefit of $7,489, $1,646 and
$2,268 in 2007, 2006 and 2005, respectively ......... (12,751) (2,803) (3,861)
Unrealized holding gains/(losses) on net investment
hedging instruments, net of tax benefit/(provision) of
$5,175, ($21) and ($609) in 2007, 2006 and 2005,
respectively ................................. (8,812) 35 1,037
Reclassification adjustment for net (gains)/losses realized
in net earnings for available-for-sale securities, net of
tax provision/(benefit) of ($1), $1,060 and ($812) in
2007, 2006 and 2005, respectively . . .............. 1 (1,767) 1,354
Reclassification adjustment for net losses realized in net
earnings for cash flow hedges, net of tax benefit of
$545, $2,430 and $1,939 in 2007, 2006 and 2005,
respectively ................................. 928 4,138 3,302
Net unrealized gain/(loss) .......................... (20,380) 1,767 350
Translation adjustment, net of tax provision of $12, $1,794
and $5,482 in 2007, 2006, and 2005, respectively ....... 37,727 14,592 (8,677)
Total comprehensive income ........................ $689,985 $580,618 $486,043
The favorable translation adjustment change during fiscal 2007 of $37.7 million was primarily due to the weakening
of the U.S. dollar against several currencies including the euro, Canadian dollar and British pound sterling. The
favorable translation adjustment change during fiscal 2006 of $14.6 million was primarily due to the weakening of
the U.S. dollar against several currencies including British pound sterling, the euro and Canadian dollar. The
unfavorable translation adjustment change during fiscal 2005 of $8.7 million was primarily due to the strengthening
of the U.S. dollar against the euro, British pound sterling and Japanese yen.
The components of accumulated other comprehensive income, net of tax, were as follows (in thousands):
Fiscal Year Ended Sept 30, 2007 Oct 1, 2006
Net unrealized holding gains/(losses) on available-for-sale securities ..... $ 1 $ (254)
Net unrealized holding (losses) on hedging instruments .............. (27,051) (6,416)
Translation adjustment. . ..................................... 81,670 43,943
Accumulated other comprehensive income ........................ $54,620 $37,273
As of September 30, 2007, the translation adjustment of $81.7 million was net of tax provisions of $7.3 million. As
of October 1, 2006, the translation adjustment of $43.9 million was net of tax provisions of $7.3 million.
Note 13: Employee Stock and Benefit Plans
The Company maintains several equity incentive plans under which it may grant non-qualified stock options,
incentive stock options, restricted stock, RSUs, or stock appreciation rights to employees, non-employee directors
and consultants. The Company issues new shares of common stock upon exercise of stock options and the vesting of
RSUs. As of September 30, 2007, there were 59.1 million shares of common stock available for issuance pursuant to
future equity-based compensation awards.
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