2013 Q4 Form 10-K Financial Statement

#000160171215000007 Filed on February 23, 2015

View on sec.gov

Income Statement

Concept 2013 Q4 2013 Q3 2013 Q2
Revenue
YoY Change
Cost Of Revenue
YoY Change
Gross Profit
YoY Change
Gross Profit Margin
Selling, General & Admin
YoY Change
% of Gross Profit
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $27.00M $25.00M $25.00M
YoY Change
% of Gross Profit
Operating Expenses
YoY Change
Operating Profit
YoY Change
Interest Expense $188.0M $183.0M $178.0M
YoY Change
% of Operating Profit
Other Income/Expense, Net
YoY Change
Pretax Income $692.0M $1.021B $856.0M
YoY Change -5.98% 53.07% -13.62%
Income Tax $249.0M $380.0M $320.0M
% Of Pretax Income 35.98% 37.22% 37.38%
Net Earnings $443.0M $641.0M $536.0M
YoY Change -4.94% 53.35% -13.55%
Net Earnings / Revenue
Basic Earnings Per Share $0.63 $0.91 $0.76
Diluted Earnings Per Share $0.63 $0.91 $0.76
COMMON SHARES
Basic Shares Outstanding 705.0M shares 705.3M shares
Diluted Shares Outstanding 705.0M shares 705.3M shares

Balance Sheet

Concept 2013 Q4 2013 Q3 2013 Q2
SHORT-TERM ASSETS
Cash & Short-Term Investments
YoY Change
Cash & Equivalents $2.319B $2.670B $3.110B
Short-Term Investments
Other Short-Term Assets
YoY Change
Inventory
Prepaid Expenses
Receivables
Other Receivables
Total Short-Term Assets
YoY Change
LONG-TERM ASSETS
Property, Plant & Equipment
YoY Change
Goodwill $949.0M
YoY Change 1.39%
Intangibles
YoY Change
Long-Term Investments
YoY Change
Other Assets $0.00
YoY Change
Total Long-Term Assets
YoY Change
TOTAL ASSETS
Total Short-Term Assets
Total Long-Term Assets
Total Assets $59.09B
YoY Change
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable
YoY Change
Accrued Expenses $3.085B
YoY Change
Deferred Revenue
YoY Change
Short-Term Debt
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $3.085B
YoY Change
LONG-TERM LIABILITIES
Long-Term Debt $24.32B
YoY Change
Other Long-Term Liabilities $0.00
YoY Change
Total Long-Term Liabilities $24.32B
YoY Change
TOTAL LIABILITIES
Total Short-Term Liabilities $3.085B
Total Long-Term Liabilities $24.32B
Total Liabilities $53.13B
YoY Change
SHAREHOLDERS EQUITY
Retained Earnings $0.00
YoY Change
Common Stock $0.00
YoY Change
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $5.960B $5.583B $5.518B
YoY Change
Total Liabilities & Shareholders Equity $59.09B
YoY Change

Cashflow Statement

Concept 2013 Q4 2013 Q3 2013 Q2
OPERATING ACTIVITIES
Net Income $443.0M $641.0M $536.0M
YoY Change -4.94% 53.35% -13.55%
Depreciation, Depletion And Amortization $27.00M $25.00M $25.00M
YoY Change
Cash From Operating Activities $1.145B $1.764B $1.184B
YoY Change
INVESTING ACTIVITIES
Capital Expenditures
YoY Change
Acquisitions
YoY Change
Other Investing Activities -$4.625B -$2.098B -$2.469B
YoY Change
Cash From Investing Activities -$4.625B -$2.098B -$2.469B
YoY Change
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities 3.129B -106.0M -931.0M
YoY Change
NET CHANGE
Cash From Operating Activities 1.145B 1.764B 1.184B
Cash From Investing Activities -4.625B -2.098B -2.469B
Cash From Financing Activities 3.129B -106.0M -931.0M
Net Change In Cash -351.0M -440.0M -2.216B
YoY Change
FREE CASH FLOW
Cash From Operating Activities $1.145B $1.764B $1.184B
Capital Expenditures
Free Cash Flow
YoY Change

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CY2013 us-gaap Weighted Average Number Of Shares Outstanding Basic
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CY2014 us-gaap Revenue Recognition Interest
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:12px;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;font-style:italic;">Interest and Fees on Loans</font></div><div style="line-height:120%;padding-bottom:16px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">We use the effective interest method to recognize income on loans. Interest on loans is comprised largely of interest and late fees on credit card and other loans. Interest income is recognized based upon the amount of loans outstanding and their contractual interest rate. Late fees are recognized when billable to the customer. We continue to accrue interest and fees on credit cards until the accounts are charged-off in the period the account becomes 180 days past due. For non-credit card loans, we stop accruing interest and fees when the account becomes 90 days past due. Previously recognized interest income that was accrued but not collected from the customer is reversed. Although we stop accruing interest in advance of payments, we recognize interest income as cash is collected when appropriate, provided the amount does not exceed that which would have been earned at the historical effective interest rate; otherwise, payments received are applied to reduce the principal balance of the loan.</font></div><div style="line-height:120%;padding-bottom:16px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">We resume accruing interest on non-credit card loans when the customer&#8217;s account is less than 90 days past due and collection of such amounts is probable. Interest accruals on modified loans that are not considered to be TDRs may return to current status (re-aged) only after receipt of at least three consecutive minimum monthly payments subject to a re-aging limitation of once a year, or twice in a five-year period.</font></div><div style="line-height:120%;padding-bottom:16px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">Direct loan origination costs on credit card loans are deferred and amortized on a straight-line basis over a one-year period, or the life of the loan for other loan receivables, and are included in interest and fees on loans in our Consolidated and Combined Statements of Earnings. See Note 5. </font><font style="font-family:Arial;font-size:10pt;font-style:italic;">Loan Receivables and Allowance for Loan Losses</font><font style="font-family:Arial;font-size:10pt;"> for further detail.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">Other loan fees including returned check, cash advance and other miscellaneous fees are recognized net of waivers and charge-offs when the related transaction or service is provided, and are included in other income in our Consolidated and Combined Statements of Earnings.</font></div></div>
CY2014 us-gaap Revenue Recognition Loyalty Programs
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:12px;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;font-style:italic;">Loyalty Programs</font></div><div style="line-height:120%;padding-bottom:16px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:Arial;font-size:10pt;">Our loyalty programs are designed to generate increased purchase volume per customer while reinforcing the value of our credit cards and strengthening cardholder loyalty. These programs typically provide cardholders with rewards in the form of merchandise discounts that are earned by achieving a pre-set spending level on their private label or Dual Card. Other programs provide cash back or reward points, which are redeemable for a variety of products or awards. These programs are primarily in our Retail Card platform. We establish a rewards liability based on points and merchandise discounts earned that are ultimately expected to be redeemed and the average cost per point at redemption. The rewards liability is included in accrued expenses and other liabilities in our Consolidated and Combined Statements of Financial Position. Cash rebates are earned based on a tiered percentage of purchase volume. As points and discounts are redeemed or cash rebates are issued, the rewards liability is relieved. The estimated cost of loyalty programs is classified as a reduction to other income in our Consolidated and Combined Statements of Earnings.</font></div></div>

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