Best Buy Reports Fourth Quarter and Fiscal Year Results

Fri Mar 1, 2013 8:00am EST

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0.9% Fourth Quarter Domestic Comparable Store Sales Increase

$965 Million Adjusted Annual Free Cash Flow

$150 Million in Phase One Renew Blue Cost Reductions
MINNEAPOLIS--(Business Wire)--
Best Buy Co., Inc. (NYSE: BBY) today announced results for the 13-week fourth
quarter ("Q4 FY13") and 53-week fiscal year ended February 2, 2013 ("FY13"), as
compared to the 13-week fourth quarter ("Q4 FY12") and the 52-week fiscal year
ended January 28, 2012 ("FY12"). In FY13, the extra week occurred during the
first quarter.

                                                                                    
 Overview($ in millions, except per share amounts)              Q4 FY13    Q4 FY12  
 Revenue                                                        $16,711    $16,671  
 Comparable store sales % change1                               (0.8%)     (1.3%)   
 Domestic Segment:                                                                  
 Comparable store sales % change1                               0.9%       (1.1%)   
 Online growth                                                  11.2%      25.4%    
 International Segment:                                                             
 Comparable store sales % change1                               (6.6%)     (1.8%)   
 Adjusted (non-GAAP) operating income as a % of revenue2        5.5%       7.2%     
 GAAP operating loss as a % of revenue                          (0.9%)     (0.7%)   
 Adjusted (non-GAAP) diluted EPS from continuing operations2    $1.64      $2.18    
 GAAP EPS from continuing operations                            ($1.21)    ($4.86)  
 Adjusted (non-GAAP) return on invested capital3                9.2%       11.0%    


 Please see the table titled "Reconciliation of Non-GAAP Financial Measures" attached to this release for more detail.  
                                                                                                                        


Hubert Joly, Best Buy President and CEO commented, "On revenue growth of 0.2%,
we delivered non-GAAP diluted earnings per share of $1.64. Adjusted free cash
flow for the year reached $965 million as we aggressively reduced inventories
and focused on working capital and cash flow management. To deliver these
better-than-expected results, renewed momentum in the Domestic business more
than offset continued softness in the International business." 

Joly continued, "Fourth quarter Domestic comparable store sales increased 0.9%,
with an overall 10 basis point decline in the gross profit rate. Domestic online
revenue increased 11%. These results were driven by a compelling assortment of
new products in key growth categories, increased "blue-shirt" training and
higher customer engagement in our retail stores, and impactful
`traffic-generating` marketing activities. It was a quarter that was driven, not
given and we are encouraged by the intensity, collaboration and momentum that
was generated by both our front line and corporate teams as we began to execute
against our Renew Blue initiatives." 

Joly concluded, "To build on this momentum in fiscal 2014, we remain intently
focused on the two problems we have to solve: stabilizing and improving our
comparable store sales and increasing profitability across our global
businesses. We recognize, however, that fiscal 2014 is a year of transition and
that further investment will be required to advance our Renew Blue
transformation. I would like to highlight six key priorities that will be
pursued in fiscal 2014 that fall under the various pillars of Renew Blue. These
priorities are (1) accelerating online growth; (2) escalating the multi-channel
customer experience; (3) increasing revenue and gross profit per square foot
through enhanced store space optimization and merchandising; (4) driving down
cost of goods sold through supply chain efficiencies; (5) continuing to
gradually optimize the U.S. real estate portfolio; and (6) further reducing SG&A
costs. In addition, we will focus on driving operational improvements in our
International business." 

Sharon McCollam, EVP, CAO and CFO of Best Buy, commented, "To support these
initiatives, we are expecting capital spending in fiscal 2014 to be in the range
of $700 to $800 million and incremental SG&A investments in the range of $150 to
$200 million. These investments will be principally in the areas of online,
mobile and the multi-channel customer experience, in addition to non-recurring
costs associated with the insourcing of IT (expected to be completed in FY14)
and the replatforming of bestbuy.com (expected to be completed in FY15). These
incremental SG&A investments, however, are expected to be substantially offset
by our Renew Blue cost reduction initiatives, including the $150 million of
Phase One reductions that were enacted over the last several weeks and the
additional reductions that we are expecting to announce in the second quarter
and later this year." 

McCollam continued, "From a revenue and earnings perspective in fiscal 2014, we
will not be providing financial guidance. Directionally, however, we do expect
the first quarter to be under significant pressure due to (1) the absence of an
additional week and the impact of this year`s "pre-Super Bowl" sales shifting
into Q4 FY13 versus Q1 FY14 (an impact of approximately $0.14 in diluted EPS);
(2) a less favorable product and services mix due to the timing of high velocity
product launches that occurred in Q1 FY13 that are not expected to recur in Q1
FY14; (3) the first quarter carry-over effect of sales and marketing investments
that were implemented in the second and third quarters of FY13; (4) greater
investment in price competitiveness, including the impact of the company`s
recently launched price match program; and (5) the timing and impact of capital
and SG&A investments in the P&L versus the timing of the realization of the
benefits (including the insourcing of IT and replatforming of bestbuy.com)." 

McCollam concluded, "Despite these first quarter financial pressures, the energy
in the organization around the successful execution of our Renew Blue
initiatives is inspiring. Our fourth quarter results and the actions that we
have taken since then to begin rationalizing our infrastructure, have given the
organization something that they have not had in a long time - pride in the
outcome and belief in what is possible. Our fourth quarter results have also
affirmed what Hubert shared at the November analyst day and what I knew was true
when I joined the company: (1) Best Buy is the market leader in a highly
fragmented and growing market; (2) we have a powerful platform from which to
deliver a superior multi-channel shopping and service experience to our
customers; (3) while already the 11th largest e-commerce retailer in the U.S.,
Best Buy is underpenetrated from a market share perspective and early investment
and the momentum we have seen have validated that this is a significant growth
opportunity; and (4) the runway to improve financial returns through increased
online growth, enhanced retail execution, and extensive structural cost
reductions is tremendous." 

Domestic Segment Fourth Quarter Results

Revenue

Domestic revenue of $12.55 billion declined 0.3% versus last year. This decline
was driven by the loss of revenue from 49 big box stores that were closed
earlier in the year, but was substantially offset by a positive 0.9% comparable
store sales increase and incremental revenue from 126 additional Best Buy Mobile
stand-alone stores. It is important to note, however, that comparable store
sales in the quarter benefitted from an estimated 35 basis points due to a
calendar shift in this year`s "pre-Super Bowl" sales from Q1 FY14 to Q4 FY13. 

Domestic online sales increased 11.2%, reaching a record $1.3 billion as
momentum accelerated throughout the quarter. Highly effective
"traffic-generating" marketing initiatives drove these better-than-expected
results. 

From a merchandising perspective in the Domestic segment, strong growth in
mobile phone, tablets/eReaders and appliances was partially offset by declines
in gaming and digital imaging. 

Gross Profit Rate

Adjusted (non-GAAP) Domestic gross profit rate was 22.4% (22.4% on a GAAP basis)
versus 22.5% (22.3% on a GAAP basis) last year. This 10 basis point decrease is
a net impact of two business drivers. The first, which represents a 40 basis
point decrease, is higher promotional activity principally in home theater, that
was partially offset by lower sales in gaming which sells at a lower gross
profit rate. The second is a 30 basis point benefit from a periodic profit
sharing payment that was earned by the company based on the long-term
performance of the company`s externally managed extended service plan portfolio.


Selling, General and Administrative Expenses ("SG&A")

Adjusted (non-GAAP) Domestic SG&A expenses were $2.07 billion ($2.08 billion on
a GAAP basis) or 16.5% of revenue versus $1.90 billion ($1.91 billion on a GAAP
basis) or 15.1% last year. The 140 basis point increase was primarily driven by
(1) increased investments in advertising and other direct selling costs to drive
in-store and online revenue; (2) a reversal of incentive compensation expense in
the prior year that did not recur in Q4 FY13; (3) an increase in field incentive
compensation and executive retention and transition costs; and (4) a
year-over-year increase in legal-related reserves. 

International Segment Fourth Quarter Results

Revenue

International revenue of $4.16 billion increased 2% versus $4.09 billion last
year. This increase was driven by the positive impact of changes in foreign
currency exchange rates, partially offset by 6.6% decline in comparable store
sales. Positive comparable store sales in Europe were more than offset by
declines in Canada and China. In Canada, overall industry softness drove the
decline in comparable store sales. In China, however, increased competition from
e-commerce and year-over-impacts from expired government stimulus programs in
FY12 were the key drivers of the comparable store sales decline. 

Gross Profit Rate

International gross profit rate was 23.4% versus 25.5% last year. This 210 basis
points rate decline was primarily driven by a lower gross profit rate in Europe.
In Europe, the decline was driven by a higher percentage of revenue coming from
the wholesale channel, an unfavorable product mix, and greater promotional
activity. The International segment`s gross profit rate was also negatively
impacted by phone carrier and other periodic payments that were earned by the
company in the prior year that did not recur in Q4 FY13. 

SG&A

Adjusted (non-GAAP) International SG&A expenses were $791 million ($826 million
on a GAAP basis) or 19.0% of revenue versus $782 million ($831 million on a GAAP
basis) or 19.1% last year. This 10 basis point decrease was primarily driven by
overall lower costs, partially offset by the negative impact of changes in
foreign currency exchange rates. 

Renew Blue Cost Reduction Initiatives

Over the last several weeks, the company enacted Phase One of its Renew Blue
Cost reductions, which totaled $150 million in annualized savings and included
an initial headcount reduction of approximately 400 people. These savings are
being driven by (1) the discontinuation of non-core activities; (2) the take-out
of management layers; and (3) various efficiency improvements, including the
removal of organizational silos that have driven up costs and undermined
accountability. 

Non-Cash Impairments and Restructuring Charges

During Q4 FY13, the company recorded a pre-tax non-cash impairment charge of
$822 million primarily to reflect the write-off of goodwill for Canada and
China, as recent economic and competitive pressures contributed to a
worse-than-expected fourth quarter performance and lowered long-term outlooks
for both countries. The same factors that resulted in the goodwill impairments
also led to higher than normal non-restructuring, non-cash asset impairments,
which are included in the SG&A line and totaled $44 million (including $9
million related to Domestic segment asset impairments). 

The company also recorded pre-tax restructuring charges totaling $203 million in
Q4 FY13 primarily related to previously announced store closures in Canada and
Europe in addition to severance charges associated with the Renew Blue SG&A cost
reduction initiatives outlined above. Of this $203 million, approximately $140
million is expected to be paid out in cash primarily over the next two years. 

Please see the table titled "Reconciliation of Non-GAAP Financial Measures"
attached to this release for more detail. 

Adjusted Free Cash Flow4

Adjusted free cash flow FY13 was $965 million versus the most recently provided
guidance of $500 million. This better-than-expected outcome was primarily driven
by an aggressive inventory reduction plan and an intense focus on working
capital and cash flow management initiatives that were both implemented after
the company`s last financial press release, in addition to the impact of
better-than-expected Q4 FY13 earnings. 

The adjusted free cash flow excludes the impact of previously announced
restructuring activities and includes the benefit from a change in restricted
cash related to working capital. Please see the table titled "Consolidated
Statement of Cash Flows" attached to this release for more detail. 

Dividends

On December 31, 2012, the company paid a quarterly dividend of $0.17 per common
share outstanding, or $57 million in the aggregate. 

Conference Call

Best Buy is scheduled to conduct an earnings conference call at 9:00 a.m.
Eastern Time (8:00 a.m. Central Time) on March 1, 2013. A webcast of the call is
expected to be available on its website at www.investors.bestbuy.comboth live
and after the call. A telephone replay is also available starting at
approximately 12:00 p.m. Eastern Time (11:00 a.m. Central Time) on March 1
through March 15, 2013. The dial-in number for the replay is 800-406-7325
(domestic) or 303-590-3030 (international), and the access code is 4596731. 

(1) Best Buy`s comparable store sales is comprised of revenue at stores, call
centers, and websites operating for at least 14 full months as well as revenue
related to other comparable sales channels. Relocated stores, as well as
remodeled, expanded and downsized stores closed more than 14 days, are excluded
from the comparable store sales calculation until at least 14 full months after
reopening. Acquired stores and businesses are included in the comparable store
sales calculation beginning with the first full quarter following the first
anniversary of the date of the acquisition. The portion of the calculation of
the comparable store sales percentage change attributable to the International
segment excludes the effect of fluctuations in foreign currency exchange rates.
The calculation of comparable store sales excludes the impact of the extra week
of revenue in the first quarter of fiscal 2012, as well as revenue from
discontinued operations. The method of calculating comparable store sales varies
across the retail industry. As a result, Best Buy`s method of calculating
comparable store sales may not be the same as other retailers` methods. Online
revenue is included in Best Buy`s same store sales calculation. 

(2) The company defines adjusted gross profit, adjusted SG&A and adjusted
operating income for the periods presented as its reported gross profit, SG&A
and operating income for those periods calculated in accordance with accounting
principles generally accepted in the U.S. ("GAAP") adjusted to exclude the
effects of restructuring charges, costs related to the purchase of CPW`s share
of the Best Buy Mobile profit share agreement ("BBE transaction costs"),
non-restructuring asset impairments and goodwill impairments. The inclusion of
non-restructuring asset impairments represents a change from prior periods. In
addition, the company defines adjusted net earnings and adjusted diluted
earnings per share from continuing operations for the periods presented as its
reported net earnings and diluted earnings per share from continuing operations
calculated in accordance with GAAP adjusted to exclude the effects of the above
referenced items, gains of sales of investments and the noncontrolling interest
impact of restructuring charges, BBE transaction costs and the purchase of CPW`s
share of the Best Buy Mobile profit share agreement. 

These non-GAAP financial measures provide investors with an understanding of the
company`s gross profit, SG&A, operating income, net earnings, and diluted
earnings per share adjusted to exclude the effect of the items described above.
These non-GAAP financial measures assist investors in making a ready comparison
of the company`s operating income, net earnings, and diluted earnings per share
for its fiscal quarter and year ended February 2, 2013, against the company`s
results for the respective prior-year periods and against third party estimates
of the company`s diluted earnings per share for those periods that may not have
included the effect of such items. Additionally, management uses these non-GAAP
financial measures as an internal measure to analyze trends, allocate resources,
and analyze underlying operating performance. This non-GAAP financial measure
should not be considered superior to, as a substitute for, or as an alternative
to, and should be considered in conjunction with, GAAP financial measures and
may differ from similar measures used by other companies. Please see
"Reconciliation of Non-GAAP Financial Measures" attached to this release for
more detail. 

(3) The company defines adjusted return on invested capital ("ROIC") as adjusted
net operating profit after taxes divided by average invested capital for the
periods presented (including both continuing and discontinued operations).
Adjusted net operating profit after taxes is defined as our operating income for
the periods presented calculated in accordance with GAAP adjusted to exclude the
effects of: (i) operating lease interest; (ii) investment income; (iii) net
earnings attributable to noncontrolling interests; (iv) income taxes; (v) all
restructuring charges in costs of goods sold and operating expenses, goodwill
and tradename impairments, and BBE transaction costs; and (vi) the
noncontrolling interest impact of the restructuring charges, Best Buy Europe
transaction costs and the purchase of CPW's share of the Best Buy Mobile profit
share agreement. Average invested capital is defined as the average of our total
assets for the trailing four quarters in relation to the periods presented
adjusted to: (i) exclude excess cash and cash equivalent and short-term
investments; (ii) include capitalized operating lease obligations calculated
using a multiple of eight times rental expenses; (iii) exclude our total
liabilities, less our outstanding debt; and (iv) exclude equity of
noncontrolling interests. 

This non-GAAP financial measure provides investors with a supplemental measure
to evaluate how effectively the company is investing its capital and deploying
its assets. Management uses this non-GAAP financial measure to assist in
allocating resources, and trends in the measure may fluctuate over time as
management balances long-term initiatives with possible short-term impacts. Our
ROIC calculation utilizes total operations in order to provide a measure that
includes the results of and capital invested in all operations, including those
businesses that are no longer continuing operations. This non-GAAP financial
measure should not be considered superior to, as a substitute for, or as an
alternative to, and should be considered in conjunction with, GAAP financial
measures and may differ from similar measures used by other companies. Please
see "Reconciliation of Non-GAAP Financial Measures" attached to this release for
more detail. 

(4) Best Buy defines free cash flow as total cash provided by (used in)
operating activities less additions to property and equipment. This non-GAAP
financial measure assists investors in making a ready comparison of the
company`s free cash flow results for the year ending February 2, 2013, against
the company`s results for the respective prior-year periods and against
management`s previously provided expectations. The company`s free cash flow
excludes the impact of previously announced restructuring activities (net of
taxes) and includes a benefit from a change in restricted cash related to
working capital, which is included within investing activities on the condensed
consolidated statements of cash flows. This non-GAAP financial measure should
not be considered superior to, as a substitute for, or as an alternative to, and
should be considered in conjunction with, GAAP financial measures and may differ
from similar measures used by other companies. Please see "Condensed
Consolidated Statements of Cash Flows" attached to this release for more detail.


Forward-Looking and Cautionary Statements:

This news release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 as contained in Section 27A of
the Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934 that reflect management`s current views and estimates regarding future
market conditions, company performance and financial results, business
prospects, new strategies, the competitive environment and other events. You can
identify these statements by the fact that they use words such as "anticipate,"
"believe," "assume," "estimate," "expect," "intend," "project," "guidance,"
"plan," "outlook," and other words and terms of similar meaning. These
statements involve a number of risks and uncertainties that could cause actual
results to differ materially from the potential results discussed in the
forward-looking statements. Among the factors that could cause actual results
and outcomes to differ materially from those contained in such forward-looking
statements are the following: general economic conditions, changes in consumer
preferences, credit market constraints, acquisitions and development of new
businesses, divestitures, product availability, sales volumes, pricing actions
and promotional activities of competitors, profit margins, weather, natural or
man-made disasters, changes in law or regulations, foreign currency fluctuation,
availability of suitable real estate locations, the company`s ability to react
to a disaster recovery situation, the impact of labor markets and new product
introductions on overall profitability, failure to achieve anticipated benefits
of announced transactions, integration challenges relating to new ventures and
unanticipated costs associated with previously announced or future restructuring
activities. A further list and description of these risks, uncertainties and
other matters can be found in the company`s annual report and other reports
filed from time to time with the Securities and Exchange Commission, including,
but not limited to, Best Buy`s Annual Report on Form 10-K filed with the SEC on
May 1, 2012. Best Buy cautions that the foregoing list of important factors is
not complete, and any forward-looking statements speak only as of the date they
are made, and Best Buy assumes no obligation to update any forward-looking
statement that it may make.

 BEST BUY CO., INC.                                                                                                                                                                                                       
 CONSOLIDATED STATEMENTS OF EARNINGS                                                                                                                                                                                      
 ($ in millions, except per share amounts)                                                                                                                                                                                
 (Unaudited and subject to reclassification)                                                                                                                                                                              
                                                                                                                                                                                                                          
                                                                                                        Three Months Ended                                                            Twelve Months Ended                 
                                                                                                        Feb. 2,                                Jan. 28,                               Feb. 2,             Jan. 28,        
                                                                                                        2013                                   2012                                   2013                2012            
 Revenue                                                                                                $            16,711                    $            16,671                    $     49,621        $      50,041   
 Cost of goods sold                                                                                                  12,929                                 12,798                          37,782               37,632   
 Restructuring charges - cost of goods sold                                                                          1                                      19                              1                    19       
 Gross profit                                                                                                        3,781                                  3,854                           11,838               12,390   
 Gross profit %                                                                                                      22.6%                                  23.1%                           23.9%                24.8%    
 Selling, general and administrative expenses                                                                        2,902                                  2,736                           10,398               10,167   
 SG&A %                                                                                                              17.4%                                  16.4%                           21.0%                20.3%    
 Goodwill impairment                                                                                                 822                                    1,207                           822                  1,207    
 Restructuring charges                                                                                               202                                    32                              456                  36       
 Operating income (loss)                                                                                             (145)                                  (121)                           162                  980      
 Operating income (loss) %                                                                                           (0.9%)                                 (0.7%)                          0.3%                 2.0%     
 Other income (expense):                                                                                                                                                                                                  
 Gain on sale of investments                                                                                         18                                     55                              18                   55       
 Investment income and other                                                                                         7                                      21                              32                   46       
 Interest expense                                                                                                    (31)                                   (31)                            (125)                (129)    
 Earnings (loss) from continuing operations before income tax expense and equity in loss of affiliates               (151)                                  (76)                            87                   952      
 Income tax expense                                                                                                  226                                    328                             310                  692      
 Effective tax rate                                                                                                  (149.9%)                               (434.9%)                        354.4%               72.7%    
 Equity in loss of affiliates                                                                                        -                                      (1)                             (5)                  (4)      
 Net earnings (loss) from continuing operations                                                                      (377)                                  (405)                           (228)                256      
 Loss from discontinued operations, net of tax                                                                       (2)                                    (188)                           (5)                  (325)    
 Net loss including noncontrolling interest                                                                          (379)                                  (593)                           (233)                (69)     
 Net earnings from continuing operations attributable to noncontrolling interests                                    (31)                                   (1,305)                         (20)                 (1,388)  
 Net loss from discontinued operations attributable to noncontrolling interests                                      1                                      79                              4                    134      
 Net loss attributable to Best Buy Co., Inc. shareholders                                               $            (409)                     $            (1,819)                   $     (249)         $      (1,323)  
                                                                                                                                                                                                                          
 Amounts attributable to Best Buy Co., Inc. shareholders                                                                                                                                                                  
 Net loss from continuing operations                                                                    $            (408)                     $            (1,710)                   $     (248)         $      (1,132)  
 Net loss from discontinued operations                                                                               (1)                                    (109)                           (1)                  (191)    
 Net loss attributable to Best Buy Co., Inc. shareholders                                               $            (409)                     $            (1,819)                   $     (249)         $      (1,323)  
                                                                                                                                                                                                                          
 Basic loss per share attributable to Best Buy Co., Inc. shareholders                                                                                                                                                     
 Continuing operations                                                                                  $            (1.21)                    $            (4.86)                    $     (0.73)        $      (3.05)   
 Discontinued operations                                                                                             -                                      (0.31)                          -                    (0.52)   
 Basic loss per share                                                                                   $            (1.21)                    $            (5.17)                    $     (0.73)        $      (3.57)   
                                                                                                                                                                                                                          
 Diluted loss per share attributable to Best Buy Co., Inc. shareholders1                                                                                                                                                  
 Continuing operations                                                                                  $            (1.21)                    $            (4.86)                    $     (0.73)        $      (3.05)   
 Discontinued operations                                                                                             -                                      (0.31)                          -                    (0.52)   
 Diluted loss per share                                                                                 $            (1.21)                    $            (5.17)                    $     (0.73)        $      (3.57)   
                                                                                                                                                                                                                          
 Dividends declared per Best Buy Co., Inc. common share                                                 $            0.17                      $            0.16                      $     0.66          $      0.62     
                                                                                                                                                                                                                          
 Weighted average Best Buy Co., Inc. common shares outstanding (in millions)                                                                                                                                              
 Basic                                                                                                               338.1                                  351.8                           339.0                370.6    
 Diluted                                                                                                             338.1                                  351.8                           339.0                370.6    
                                                                                                                                                                                                                          


(1) The calculation of diluted earnings loss per share for the three and twelve
months ended February 2, 2013 and March 3, 2012 does not include potentially
dilutive shares of common stock because their inclusion would be anti-dilutive
(i.e., reduce the net loss per share).

                                                                                         
 BEST BUY CO., INC.                                                                      
 CONDENSED CONSOLIDATED BALANCE SHEETS                                                   
 ($ in millions)                                                                         
 (Unaudited and subject to reclassification)                                             
                                                                                         
                                                  Feb. 2, 2013         Jan. 28, 2012     
 ASSETS                                                                                  
 Current assets                                                                          
 Cash and cash equivalents                        $        1,826       $        1,401    
 Receivables                                               2,704                2,448    
 Merchandise inventories                                   6,571                6,803    
 Other current assets                                      946                  827      
 Total current assets                                      12,047               11,479   
 Net property and equipment                                3,270                3,491    
 Goodwill                                                  528                  1,328    
 Tradenames                                                131                  129      
 Customer relationships                                    203                  229      
 Equity and other investments                              86                   142      
 Other assets                                              522                  447      
 TOTAL ASSETS                                     $        16,787      $        17,245   
                                                                                         
 LIABILITIES & EQUITY                                                                    
 Current liabilities                                                                     
 Accounts payable                                 $        6,951       $        6,858    
 Unredeemed gift card liabilities                          428                  491      
 Accrued compensation                                      520                  524      
 Accrued liabilities                                       1,639                1,641    
 Accrued income taxes                                      129                  213      
 Short-term debt                                           596                  480      
 Current portion of long-term debt                         547                  46       
 Total current liabilities                                 10,810               10,253   
 Long-term liabilities                                     1,109                1,065    
 Long-term debt                                            1,153                1,685    
 Equity                                                                                  
 Common stock                                              34                   35       
 Additional paid-in capital                                54                   -        
 Retained earnings                                         2,861                3,512    
 Accumulated other comprehensive income                    112                  74       
 Total Best Buy Co., Inc. shareholders' equity             3,061                3,621    
 Noncontrolling interests                                  654                  621      
 Total equity                                              3,715                4,242    
 TOTAL LIABILITIES & EQUITY                       $        16,787      $        17,245   
                                                                                         


 BEST BUY CO., INC.                                                                                                                       
 CONSOLIDATED STATEMENTS OF CASH FLOWS                                                                                                    
 ($ in millions) (Unaudited and subject to reclassification)                                                                              
                                                                                                                                          
                                                                                         Twelve Months Ended                              
                                                                                         Feb. 2, 2013               Jan. 28, 2012         
 OPERATING ACTIVITIES                                                                                                                     
 Net loss including noncontrolling interests                                             $      (233    )           $      (69     )      
 Adjustments to reconcile net loss to total cash provided by operating activities:                                                        
 Depreciation                                                                                   876                        884            
 Amortization of definite-lived intangible assets                                               41                         48             
 Restructuring charges                                                                          457                        308            
 Goodwill impairment                                                                            822                        1,207          
 Stock-based compensation                                                                       117                        126            
 Realized gain on sale of investments                                                           (18     )                  (55     )      
 Deferred income taxes                                                                          (100    )                  3              
 Other, net                                                                                     68                         19             
 Changes in operating assets and liabilities, net of acquired assets and liabilities:                                                     
 Receivables                                                                                    (217    )                  (187    )      
 Merchandise inventories                                                                        265                        524            
 Other assets                                                                                   (110    )                  41             
 Accounts payable                                                                               38                         284            
 Other liabilities                                                                              (432    )                  (32     )      
 Income taxes                                                                                   (152    )                  (31     )      
 Total cash provided by operating activities                                                    1,422                      3,070          
                                                                                                                                          
 INVESTING ACTIVITIES                                                                                                                     
 Additions to property and equipment                                                            (742    )                  (747    )      
 Purchases of investments                                                                       (13     )                  (111    )      
 Sales of investments                                                                           69                         297            
 Acquisition of business, net of cash acquired                                                  -                          (174    )      
 Change in restricted assets                                                                    74                         72             
 Other, net                                                                                     10                         (2      )      
 Total cash used in investing activities                                                        (602    )                  (665    )      
                                                                                                                                          
 FINANCING ACTIVITIES                                                                                                                     
 Repurchase of common stock                                                                     (255    )                  (1,368  )      
 Issuance of common stock                                                                       27                         68             
 Dividends paid                                                                                 (224    )                  (228    )      
 Repayments of debt                                                                             (2,103  )                  (3,438  )      
 Proceeds from issuance of debt                                                                 2,173                      3,951          
 Payment to noncontrolling interest                                                             -                          (1,303  )      
 Other, net                                                                                     (14     )                  (31     )      
 Total cash used in by financing activities                                                     (396    )                  (2,349  )      
                                                                                                                                          
 EFFECT OF EXCHANGE RATE CHANGES ON CASH                                                        1                          7              
 ADJUSTMENT FOR CHANGE IN FISCAL YEAR                                                           202                        235            
 INCREASE IN CASH AND CASH EQUIVALENTS                                                          627                        298            
 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                                               1,199                      1,103          
 CASH AND CASH EQUIVALENTS AT END OF PERIOD                                              $      1,826               $      1,401          
                                                                                                                                          
 Total cash provided by operating activities                                             $      1,422               $      3,070          
 Additions to property and equipment                                                            (742    )                  (747    )      
 Free cash flow                                                                                 680                        2,323          
 Add: cash paid for restructuring                                                               171                        30             
 Add: changes in restricted cash related to payables                                            114                        17             
 Adjusted free cash flow                                                                 $      965                 $      2,370          
                                                                                                                                          


 BEST BUY CO., INC.                                                                                                
 SEGMENT INFORMATION                                                                                               
 ($ in millions)                                                                                                   
 (Unaudited and subject to reclassification)                                                                       
                                                                                                                   
 Domestic Segment Performance Summary                                                                              
                                     Three Months Ended                      Twelve Months Ended                   
                                     Feb. 2, 2013           Jan. 28, 2012    Feb. 2, 2013           Jan. 28, 2012  
 Revenue                             $12,550                $12,583          $36,848                $37,007        
 Gross profit                        $2,809                 $2,810           $8,793                 $9,016         
 SG&A                                $2,076                 $1,905           $7,414                 $7,252         
 Operating income                    $649                   $888             $1,043                 $1,742         
                                                                                                                   
 Key Metrics:                                                                                                      
 Comparable store sales % change(1)  0.9%                   (1.1%)           (1.7%)                 (2.1%)         
 Gross profit as a % of revenue      22.4%                  22.3%            23.9%                  24.4%          
 SG&A as a % of revenue              16.5%                  15.1%            20.1%                  19.6%          
 Operating income as a % of revenue  5.2%                   7.1%             2.8%                   4.7%           
                                                                                                                   
 Adjusted (non-GAAP) Results(2)                                                                                    
 Gross profit                        $2,810                 $2,829           $8,794                 $9,035         
 Gross profit as a % of revenue      22.4%                  22.5%            23.9%                  24.4%          
 SG&A                                $2,067                 $1,897           $7,391                 $7,244         
 SG&A as a % of revenue              16.5%                  15.1%            20.1%                  19.6%          
 Operating income                    $743                   $932             $1,403                 $1,791         
 Operating income as a % of revenue  5.9%                   7.4%             3.8%                   4.8%           
                                                                                                                   
 International Segment Performance Summary                                                                         
                                     Three Months Ended                      Twelve Months Ended                   
                                     Feb. 2, 2013           Jan. 28, 2012    Feb. 2, 2013           Jan. 28, 2012  
 Revenue                             $4,161                 $4,088           $12,773                $13,034        
 Gross profit                        $972                   $1,044           $3,045                 $3,374         
 SG&A                                $826                   $831             $2,984                 $2,915         
 Operating loss                      ($794)                 ($1,009)         ($881)                 ($762)         
                                                                                                                   
 Key Metrics:                                                                                                      
 Comparable store sales % change(1)  (6.6%)                 (1.8%)           (7.5%)                 (2.0%)         
 Gross profit as a % of revenue      23.4%                  25.5%            23.8%                  25.9%          
 SG&A as a % of revenue              19.9%                  20.3%            23.4%                  22.4%          
 Operating loss as a % of revenue    (19.1%)                (24.7%)          (6.9%)                 (5.8%)         
                                                                                                                   
 Adjusted (non-GAAP) Results(2)                                                                                    
 SG&A                                $791                   $782             $2,946                 $2,865         
 SG&A as a % of revenue              19.0%                  19.1%            23.1%                  22.0%          
 Operating income                    $181                   $262             $99                    $509           
 Operating income as a % of revenue  4.3%                   6.4%             0.8%                   3.9%           


 (1) Best Buy`s comparable store sales is comprised of revenue at stores, call centers, and Web sites operating for at least 14 full months as well as revenue related to other comparable sales channels. Relocated stores, as well as remodeled, expanded and downsized stores closed more than 14 days, are excluded from the comparable store sales calculation until at least 14 full months after reopening. Acquired stores are included in the comparable store sales calculation beginning with the first full quarter  
 following the first anniversary of the date of the acquisition. The portion of the calculation of the comparable store sales percentage change attributable to the International segment excludes the effect of fluctuations in foreign currency exchange rates. The method of calculating comparable store sales varies across the retail industry. As a result, Best Buy`s method of calculating comparable store sales may not be the same as other retailers` methods. Online revenue is included in Best Buy`s same store  
 sales calculation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              


 (2) Excludes the impact of previously announced restructuring charges. Please see table titled "Reconciliation of Non-GAAP Financial Measures" at the back of this release.  
                                                                                                                                                                              


 BEST BUY CO., INC.                                                                                            
 REVENUE CATEGORY SUMMARY                                                                                      
 (Unaudited and subject to reclassification)                                                                   
                                                                                                               
 Domestic Segment Summary                                                                                      
                                Revenue Mix Summary                     Comparable Store Sales                 
                                Three Months Ended                      Three Months Ended                     
                                Feb. 2, 2013           Jan. 28, 2012    Feb. 2, 2013            Jan. 28, 2012  
 Consumer Electronics           35%                    38%              (5.8%)                  (4.8%)         
 Computing and Mobile Phones    42%                    37%              13.4%                   11.1%          
 Entertainment                  12%                    15%              (18.9%)                 (17.9%)        
 Appliances                     5%                     4%               11.7%                   14.5%          
 Services(1)                    5%                     5%               6.2%                    (4.9%)         
 Other                          1%                     1%               n/a                     n/a            
 Total                          100%                   100%             0.9%                    (1.1%)         
                                                                                                               
                                                                                                               
                                                                                                               
 International Segment Summary                                                                                 
                                Revenue Mix Summary                     Comparable Store Sales                 
                                Three Months Ended                      Three Months Ended                     
                                Feb. 2, 2013           Jan. 28, 2012    Feb. 2, 2013            Jan. 28, 2012  
 Consumer Electronics           20%                    24%              (18.4%)                 (4.8%)         
 Computing and Mobile Phones    60%                    53%              2.5%                    0.8%           
 Entertainment                  6%                     7%               (17.8%)                 (16.0%)        
 Appliances                     8%                     9%               (14.7%)                 7.2%           
 Services(1)                    6%                     7%               (3.3%)                  0.1%           
 Other                          <1%                    <1%              n/a                     n/a            
 Total                          100%                   100%             (6.6%)                  (1.8%)         


 (1) The "Services" revenue category consists primarily of service contracts, extended warranties, computer related services, product repair and delivery and installation for home theater, mobile audio and appliances.  
                                                                                                                                                                                                                           


 BEST BUY CO., INC. 
 RECONCILIATION OF NON-GAAP FINANCIAL MEASURES 
 CONTINUING OPERATIONS 
 ($ in millions, except per share amounts) (Unaudited and subject to reclassification) 
     
 The following information provides reconciliations of non-GAAP financial measures from continuing operations to the most comparable financial measures calculated and presented in accordance with accounting principles generally accepted in the U.S. ("GAAP"). The company has provided non-GAAP financial measures, which are not calculated or presented in accordance with GAAP, as information supplemental and in addition to the financial measures presented in the accompanying news release that are calculated and 
 presented in accordance with GAAP. Such non-GAAP financial measures should not be considered superior to, as a substitute for, or as an alternative to, and should be considered in conjunction with, the GAAP financial measures presented in the news release. The non-GAAP financial measures in the accompanying news release may differ from similar measures used by other companies. 
     
 The following tables reconcile operating income, net earnings and diluted earnings per share for the periods presented for continuing operations (GAAP financial measures) to adjusted operating income, adjusted net earnings and adjusted diluted earnings per share for continuing operations (non-GAAP financial measures) for the periods presented. 


                                                                   Three Months Ended             Three Months Ended            
                                                                   Feb. 2, 2013                   Jan. 28, 2012                 
                                                                   $                 % of Rev.    $                  % of Rev.  
 Domestic - Continuing Operations                                                                                               
 Gross profit                                                      $2,809            22.4%        $2,810             22.3%      
 Restructuring charges - COGS                                      1                 0.0%         19                 0.2%       
 Adjusted gross profit                                             $2,810            22.4%        $2,829             22.5%      
                                                                                                                                
 SG&A                                                              $2,076            16.5%        $1,905             15.1%      
 Non-restructuring asset impairments - SG&A                        (9)               (0.1%)       (8)                (0.1%)     
 Adjusted SG&A                                                     $2,067            16.5%        $1,897             15.1%      
                                                                                                                                
 Operating income                                                  $649              5.2%         $888               7.1%       
 Restructuring charges - COGS                                      1                 0.0%         19                 0.2%       
 Non-restructuring asset impairments - SG&A                        9                 0.1%         8                  0.1%       
 Goodwill impairments                                              3                 0.0%         0                  0.0%       
 Restructuring charges                                             81                0.6%         17                 0.1%       
 Adjusted operating income                                         $743              5.9%         $932               7.4%       
                                                                                                                                
 International - Continuing Operations                                                                                          
 SG&A                                                              $826              19.9%        $831               20.3%      
 BBE transaction costs - SG&A                                      0                 0.0%         (46)               (1.1%)     
 Non-restructuring asset impairments - SG&A                        (35)              (0.8%)       (3)                (0.1%)     
 Adjusted SG&A                                                     $791              19.0%        $782               19.1%      
                                                                                                                                
 Operating loss                                                    ($794)            (19.1%)      ($1,009)           (24.7%)    
 BBE transaction costs - SG&A                                      0                 0.0%         46                 1.1%       
 Non-restructuring asset impairments - SG&A                        35                0.8%         3                  0.1%       
 Goodwill impairments                                              819               19.7%        1,207              29.5%      
 Restructuring charges                                             121               2.9%         15                 0.4%       
 Adjusted operating income                                         $181              4.3%         $262               6.4%       
                                                                                                                                
 Consolidated - Continuing Operations                                                                                           
 Gross profit                                                      $3,781            22.6%        $3,854             23.1%      
 Restructuring charges - COGS                                      1                 0.0%         19                 0.1%       
 Adjusted gross pofit                                              $3,782            22.6%        $3,873             23.2%      
                                                                                                                                
 SG&A                                                              $2,902            17.4%        $2,736             16.4%      
 BBE transaction costs - SG&A                                      0                 0.0%         (46)               (0.3%)     
 Non-restructuring asset impairments - SG&A                        (44)              (0.3%)       (11)               (0.1%)     
 Adjusted SG&A                                                     $2,858            17.1%        $2,679             16.1%      
                                                                                                                                
 Operating loss                                                    ($145)            (0.9%)       ($121)             (0.7%)     
 Restructuring charges - COGS                                      1                 0.0%         19                 0.1%       
 BBE transaction costs - SG&A                                      0                 0.0%         46                 0.3%       
 Non-restructuring asset impairments - SG&A                        44                0.3%         11                 0.1%       
 Goodwill impairments                                              822               4.9%         1,207              7.2%       
 Restructuring charges                                             202               1.2%         32                 0.2%       
 Adjusted operating income                                         $924              5.5%         $1,194             7.2%       
                                                                                                                                
 Net loss                                                          ($408)                         ($1,710)                      
 After-tax impact of restructuring charges - COGS                  1                              12                            
 After-tax impact of BBE transaction costs - SG&A                  0                              33                            
 After-tax impact of non-restructuring asset impairments - SG&A    30                             8                             
 After-tax impact of restructuring charges                         132                            21                            
 After-tax impact of goodwill impairments                          821                            1,180                         
 After-tax impact of gain on sale of investments                   (18)                           (48)                          
 After-tax impact of BBYM profit share buyout - NCI                0                              1,303                         
 After-tax impact of BBE transaction costs - NCI                   0                              (13)                          
 After-tax impact of restructuring charges - NCI                   (13)                           (3)                           
 After-tax impact of gain on sale of investments - NCI             9                              0                             
 Adjusted net earnings                                             $554                           $783                          
                                                                                                                                
 Basic EPS                                                         ($1.21)                        ($4.86)                       
 Per share impact of diluted share count                           0.00                           0.11                          
 Per share impact of restructuring charges - COGS                  0.01                           0.04                          
 Per share impact of BBE transaction costs - SG&A                  0.00                           0.09                          
 Per share impact of non-restructuring asset impairments - SG&A    0.09                           0.02                          
 Per share impact of restructuring charges                         0.39                           0.06                          
 Per share impact of goodwill impairments                          2.42                           3.28                          
 Per share impact of gain on sale of investments                   (0.05)                         (0.13)                        
 Per share impact of BBYM profit share buyout - NCI                0.00                           3.62                          
 Per share impact of BBE transaction costs - NCI                   0.00                           (0.04)                        
 Per share impact of restructuring charges - NCI                   (0.04)                         (0.01)                        
 Per share impact of gain on sale of investments - NCI             0.03                           0.00                          
 Adjusted diluted EPS                                              $1.64                          $2.18                         
                                                                                                                                
                                                                   Twelve Months Ended            Twelve Months Ended           
                                                                   Feb. 2, 2013                   Jan. 28, 2012                 
                                                                   $                 % of Rev.    $                  % of Rev.  
 Domestic - Continuing Operations                                                                                               
 Gross profit                                                      $8,793            23.9%        $9,016             24.4%      
 Restructuring charges - COGS                                      1                 0.0%         19                 0.1%       
 Adjusted gross profit                                             $8,794            23.9%        $9,035             24.4%      
                                                                                                                                
 SG&A                                                              $7,414            20.1%        $7,252             19.6%      
 Non-restructuring asset impairments - SG&A                        (23)              (0.1%)       (8)                (0.0%)     
 Adjusted SG&A                                                     $7,391            20.1%        $7,244             19.6%      
                                                                                                                                
 Operating income                                                  $1,043            2.8%         $1,742             4.7%       
 Restructuring charges - COGS                                      1                 0.0%         19                 0.1%       
 Non-restructuring asset impairments - SG&A                        23                0.1%         8                  0.0%       
 Goodwill impairments                                              3                 0.0%         0                  0.0%       
 Restructuring charges                                             333               0.9%         22                 0.1%       
 Adjusted operating income                                         $1,403            3.8%         $1,791             4.8%       
                                                                                                                                
 International - Continuing Operations                                                                                          
 SG&A                                                              $2,984            23.4%        $2,915             22.4%      
 BBE transaction costs - SG&A                                      0                 0.0%         (46)               (0.4%)     
 Non-restructuring asset impairments - SG&A                        (38)              (0.3%)       (4)                (0.0%)     
 Adjusted SG&A                                                     $2,946            23.1%        $2,865             22.0%      
                                                                                                                                
 Operating loss                                                    ($881)            (6.9%)       ($762)             (5.8%)     
 BBE transaction costs - SG&A                                      0                 0.0%         46                 0.4%       
 Non-restructuring asset impairments - SG&A                        38                0.3%         4                  0.0%       
 Goodwill impairments                                              819               6.4%         1,207              9.3%       
 Restructuring charges                                             123               1.0%         14                 0.1%       
 Adjusted operating income                                         $99               0.8%         $509               3.9%       
                                                                                                                                
 Consolidated - Continuing Operations                                                                                           
 Gross profit                                                      $11,838           23.9%        $12,390            24.8%      
 Restructuring charges - COGS                                      1                 0.0%         19                 0.0%       
 Adjusted gross pofit                                              $11,839           23.9%        $12,409            24.8%      
                                                                                                                                
 SG&A                                                              $10,398           21.0%        $10,167            20.3%      
 BBE transaction costs - SG&A                                      0                 0.0%         (46)               (0.1%)     
 Non-restructuring asset impairments - SG&A                        (61)              (0.1%)       (12)               (0.0%)     
 Adjusted SG&A                                                     $10,337           20.8%        $10,109            20.2%      
                                                                                                                                
 Operating income                                                  $162              0.3%         $980               2.0%       
 Restructuring charges - COGS                                      1                 0.0%         19                 0.0%       
 BBE transaction costs - SG&A                                      0                 0.0%         46                 0.1%       
 Non-restructuring asset impairments - SG&A                        61                0.1%         12                 0.0%       
 Goodwill impairments                                              822               1.7%         1,207              2.4%       
 Restructuring charges                                             456               0.9%         36                 0.1%       
 Adjusted operating income                                         $1,502            3.0%         $2,300             4.6%       
                                                                                                                                
 Net loss                                                          ($248)                         ($1,132)                      
 After-tax impact of restructuring charges - COGS                  1                              12                            
 After-tax impact of BBE transaction costs - SG&A                  0                              33                            
 After-tax impact of non-restructuring asset impairments - SG&A    41                             9                             
 After-tax impact of restructuring charges                         296                            24                            
 After-tax impact of goodwill impairments                          821                            1,180                         
 After-tax impact of gain on sale of investments                   (18)                           (48)                          
 After-tax impact of BBYM profit share buyout - NCI                0                              1,303                         
 After-tax impact of BBE transaction costs - NCI                   0                              (13)                          
 After-tax impact of restructuring charges - NCI                   (13)                           (3)                           
 After-tax impact of gain on sale of investments - NCI             9                              0                             
 Adjusted net earnings                                             $889                           $1,365                        
                                                                                                                                
 Basic EPS                                                         ($0.73)                        ($3.05)                       
 Per share impact of diluted share count                           0.00                           0.09                          
 Per share impact of restructuring charges - COGS                  0.00                           0.03                          
 Per share impact of BBE transaction costs - SG&A                  0.00                           0.09                          
 Per share impact of non-restructuring asset impairments - SG&A    0.12                           0.02                          
 Per share impact of restructuring charges                         0.87                           0.06                          
 Per share impact of goodwill impairments                          2.42                           3.11                          
 Per share impact of gain on sale of investments                   (0.05)                         (0.13)                        
 Per share impact of BBYM profit share buyout - NCI                0.00                           3.43                          
 Per share impact of BBE transaction costs - NCI                   0.00                           (0.03)                        
 Per share impact of restructuring charges - NCI                   (0.04)                         (0.01)                        
 Per share impact of gain on sale of investments - NCI             0.03                           0.00                          
 Adjusted diluted EPS                                              $2.62                          $3.61                         
                                                                                                                                


 BEST BUY CO., INC. 
 RECONCILIATION OF NON-GAAP FINANCIAL MEASURES 
 ($ in millions) 
 (Unaudited and subject to reclassification) 
     
 The following information provides a reconciliation of a non-GAAP financial measure to the most comparable financial measure calculated and presented in accordance with GAAP. The company has provided the non-GAAP financial measure, which is not calculated or presented in accordance with GAAP, as information supplemental and in addition to the financial measure that is calculated and presented in accordance with GAAP. Such non-GAAP financial measures should not be considered superior to, as a substitute for, 
 or as an alternative to, and should be considered in conjunction with, the GAAP financial measure. The non-GAAP financial measure may differ from similar measures used by other companies. 
 
The following table includes the calculation of Adjusted ROIC for total operations, which includes both continuing and discontinued operations (non-GAAP financial measures), along with a reconciliation to the calculation of return on total assets ("ROA") (GAAP financial measure) for the periods presented. 
     


 Calculation of Return on Invested Capital1                                                                                     
                                                                                       Feb. 2, 20132        Jan. 28, 20122      
 Net Operating Profit After Taxes (NOPAT)                                                                                       
 Operating income - continuing operations                                              $        162         $         980       
 Operating loss - discontinued operations                                                       (7)                   (423)     
 Total operating income                                                                         155                   557       
 Add: Operating lease interest3                                                                 587                   602       
 Add: Investment income                                                                         32                    46        
 Less: Net earnings attributable to noncontrolling interest (NCI)                               (16)                  (1,254)   
 Less: Income taxes4                                                                            (763)                 (981)     
 NOPAT                                                                                 $        (5)         $         (1,030)   
 Add: Restructuring charges and impairments5                                                    1,340                 1,574     
 Add: NCI impact of BBYM profit share buyout, restructuring charges and impairments             (2)                   1,201     
 Adjusted NOPAT                                                                        $        1,333       $         1,745     
                                                                                                                                
 Average Invested Capital                                                                                                       
 Total assets                                                                          $        16,551      $         19,060    
 Less: Excess Cash6                                                                             (554)                 (1,612)   
 Add: Capitalized operating lease obligations7                                                  9,397                 9,637     
 Total liabilities                                                                              (12,485)              (12,832)  
 Exclude: Debt8                                                                                 2,140                 2,307     
 Less: Noncontrolling interests                                                                 (627)                 (696)     
 Average invested capital                                                              $        14,422      $         15,864    
                                                                                                                                
 Adjusted Return on invested capital (ROIC)                                                     9.2%                  11.0%     
                                                                                                                                
 Calculation of Return on Assets1                                                                                               
                                                                                       Feb. 2, 20132        Jan. 28, 20122      
 Net loss including noncontrolling interests                                           $        (233)       $         (69)      
 Total assets                                                                                   16,551                19,060    
 Return on assets (ROA)                                                                         (1.4%)                (0.4%)    


 (1) The calculations of Return on Invested Capital and Return on Assets use total operations, which includes both continuing and discontinued operations.                                                                                                                                                                                 
 (2) Income statement accounts represent the activity for the 12 months ended as of each of the balance sheet dates. Balance sheet accounts represent the average account balances for the 4 quarters ended as of each of the balance sheet dates.                                                                                         
 (3) Operating lease interest represents the add-back to operating income driven by our capitalized lease obligations and represents 50% of our annual rental expense, which we consider to be an appropriate multiple for our lease portfolio.                                                                                            
 (4) Income taxes are calculated using a blended statutory rate at the enterprise level based on statutory rates from the countries we do business in.                                                                                                                                                                                     
 (5) Includes all restructuring charges in costs of goods sold and operating expenses, goodwill and tradename impairments, non-restructuring impairments, and the BBE transaction costs.                                                                                                                                                   
 (6) Cash and cash equivalents and short-term investments are capped at the greater of 1% of revenue or actual amounts on hand. The cash and cash equivalents and short-term investments in excess of the cap are subtracted from our calculation of average invested capital to show their exclusion from total assets.                   
 (7) The multiple of eight times annual rental expense in the calculation of our capitalized operating lease obligations is the multiple used for the retail sector by one of the nationally recognized credit rating agencies that rates our creditworthiness, and we consider it to be an appropriate multiple for our lease portfolio.  
 (8) Debt includes short-term debt, current portion of long-term debt and long-term debt and is added back to our calculation of average invested capital to show its exclusion from total liabilities.                                                                                                                                    


Best Buy Co., Inc.
Investor Contacts:
Bill Seymour, 612-291-6122
Vice President, Investor Relations
bill.seymour@bestbuy.com
or
Mollie O`Brien, 612-291-7735
Director, Investor Relations
mollie.obrien@bestbuy.com
or
Media Contact:
Amy von Walter, 612-291-4490
Senior Director, Public Relations
amy.vonwalter@bestbuy.com

Copyright Business Wire 2013

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