ADT 2006 Annual Report Download - page 120

Cash flows from operating activities and other cash flow items by segment for the year ended
September 29, 2006 were as follows ($ in millions):
Engineered Corporate
Fire and Products and
Electronics Security Healthcare and Services Other Total
Cash flows from operating activities:
Operating income (loss) .......... $1,808 $1,190 $2,200 $676 $ (400) $ 5,474
Non-cash restructuring and asset
impairment charges, net ........ 3 1 4 1 — 9
Losses (gains) on divestitures ...... 2 1 (48) — 1 (44)
In-process research and development . 63 63
Depreciation ................. 463 567 270 104 11 1,415
Intangible assets amortization .... 70 514 64 2 — 650
Depreciation and amortization ..... 533 1,081 334 106 11 2,065
Non-cash compensation expense .... 65 56 58 26 70 275
Deferred income taxes ........... — — — — 72 72
Provision for losses on accounts
receivable and inventory ........ 67 31 48 28 — 174
Net (increase) decrease in working
capital and other .............. (92) (126) (605) 25 (318) (1,116)
Interest income ................ — — — — 134 134
Interest expense ................ — — — — (713) (713)
Income tax expense ............. — — — — (799) (799)
Net cash provided by (used in)
operating activities ............ $2,386 $2,234 $2,054 $862 $(1,942) $ 5,594
Other cash flow items:
Capital expenditures, net ......... $(549) $ (433) $ (429) $(98) $ (5) $(1,514)
Decrease in sale of accounts
receivable ................... — 9 — — — 9
Acquisition of customer accounts
(ADT dealer program) ......... — (373) — — — (373)
Purchase accounting and holdback
liabilities ................... (4) (6) (8) (1) — (19)
Voluntary pension contributions .... — — 2 — — 2
During 2006, the Company completed the sale of our Plastics and Adhesives segment, previously
announced in 2005. Our Plastics, Adhesives and Ludlow Coated Products businesses were sold for net
proceeds of $882 million and the A&E Products Group was sold for $2 million in net cash proceeds.
During 2006, we made additional cash outflows of approximately $450 million for the resolution of
certain previously accrued legal matters, including a patent dispute in the Healthcare segment, and a
cash payment of $50 million to settle the previously disclosed SEC enforcement action. We will
continue to use excess cash to repurchase shares.
During 2006, we repaid and terminated one of our synthetic lease facilities for a total cash
payment of $203 million, reducing principal debt and minority interest by $191 million and $10 million,
respectively. Also, we utilized $1.0 billion in cash and $700 million in credit facility borrowings for
scheduled repayments of public notes.
58 2006 Financials