TORONTO, April 5, 2012 /PRNewswire/ --
The key assumptions used in performing the trademark intangible test were as follows:
2012 2011 Royalty rate - watches 7% 7% Royalty rate - jewelry 3.5% 3% Terminal growth rate 3% 3% Discount rate 12% 12%
Note 11: Other Non-Current Assets
2012 2011 February 1, 2010 Prepaid pricing discount(a), net of accumulated amortization of $10.3 million (2011 - $8.9 million) $ 1,680 $ 3,120 $ 4,560 Other assets 3,276 3,398 1,328 Refundable security deposits 9,209 8,003 9,741 $ 14,165 $ 14,521 $ 15,629(a) Prepaid pricing discount represents funds paid to Tiffany & Co. by the Company to amend its rough diamond supply agreement. The amendment eliminated all pricing discounts on future sales. The payment has been deferred and is being amortized on a straight-line basis over the remaining life of the contract. Note 12: Trade and Other Payables
February 1, 2012 2011 2010 Trade and other payables $ 41,031 $ 54,732 $ 25,949 Accrued expenses 17,835 17,635 15,837 Customer deposits 14,070 38,752 9,175 Payables and accruals at the Diavik Joint Venture 31,745 28,432 24,932 $ 104,681 $ 139,551 $ 75,893Note 13: Employee Benefit Plans The employee benefit obligation reflected in the consolidated balance sheet is as follows:
2012 2011 February 1, 2010 Defined benefit plan obligation - Harry Winston luxury brand segment (a) $ 11,381 $ 9,009 $ 7,104 Defined contribution plan obligation - Harry Winston luxury brand segment (b) 88 80 70 Deferred compensation plan obligation - Harry Winston luxury brand segment (b) - - 9,207 Post-retirement benefit plan - Diavik Diamond Mine (c) 289 - - RSU and DSU plans (note 17) 3,731 2,515 1,801 Total employee benefit plan obligation $ 15,489 $ 11,604 $ 18,182 2012 2011 February 1, 2010 Non-current $ 9,463 $ 7,287 $ 6,898 Current 6,026 4,317 11,284 Total employee benefit plan obligation $ 15,489 $ 11,604 $ 18,182The amounts recognized in the consolidated income statement in respect of employee benefit plans are as follows:
2012 2011 Defined benefit pension plan - Harry Winston luxury brand segment (a) $ 2,074 $ 1,907 Defined contribution plan - Harry Winston luxury brand segment (b) 1,065 783 Defined contribution plan - Harry Winston mining segment (b) 207 218 Defined contribution plan - Diavik Diamond Mine (b) 2,081 1,061 Post-retirement benefit plan - Diavik Diamond Mine (c) 299 - RSU and DSU plans (note 17) 2,169 936 $ 7,595 $ 4,905 Cash settled share-based payment recovery 2,091 1,338 Total employee benefit plan expense $ 9,686 $ 6,243Employee benefit plan expense has been included in the consolidated income statement as follows:
2012 2011 Cost of sales $ 3,135 $ 1,717 Selling, general and administrative expenses 6,551 4,526 $ 9,686 $ 6,243(a) Defined benefit pension plan The luxury brand segment sponsors three separate defined benefit pension plans covering employees in the United States, Japan and Switzerland. The principal pension plan is the Harry Winston Employee Retirement Plan for Harry Winston Inc. US employees. The benefits for the Harry Winston Inc. plan are based on years of service and the employee's compensation. In April 2001, Harry Winston Inc. amended its defined benefit pension plan. The amendment froze plan participation effective April 30, 2001. Harry Winston Inc.'s funding policy for the US plan is to contribute amounts to the plan sufficient to meet the minimum funding requirements set forth in the Employee Retirement Income Security Act of 1974. Plan assets consist primarily of fixed income, equity and other short-term investments. The other two defined benefit pension plans are sponsored by luxury brand segment subsidiaries Harry Winston Japan, K.K. and Harry Winston S.A., which converted their previous pension plan arrangements into defined benefit plans effective February 1, 2007. Pension liabilities for these two non-US plans are funded in accordance with local laws and regulations. (i) INFORMATION ABOUT HARRY WINSTON INC.'S US DEFINED BENEFIT PLAN IS AS FOLLOWS:
2012 2011 ACCRUED BENEFIT OBLIGATION Balance, beginning of year $ 24,643 $ 20,700 Service costs 1,788 1,646 Interest cost 904 857 Employee contributions 496 372 Actuarial gain 904 1,825 Other net expenses (411) (387) Benefits paid (1,544) (1,617) Foreign exchange 690 1,247 Balance, end of year 27,460 24,643 PLAN ASSETS Fair value, beginning of year 15,656 13,728 Actual return on plan assets (109) 1,355 Employee and employer contributions 1,968 1,556 Other net expenses (411) (387) Benefits paid (1,112) (1,363) Foreign exchange 87 745 Fair value, end of year 16,079 15,634 Funded status - plan deficit $ (11,381) $ (9,009)The following table provides the components of the net periodic pension costs for the three plans for the years ended January 31:
2012 2011 Service cost $ (1,788) $ (1,646) Interest cost (904) (857) Expected return on plan assets 618 663 Amortization of prior service cost - (67) Total $ (2,074) $ (1,907)(ii) PLAN ASSETS
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV