Aetna 2014 Annual Report Download - page 23

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Annual Report- Page 17
Presented below is a condensed statement of cash flows for each of the last three years. On May 7, 2013, we
completed the acquisition of Coventry, which is reflected in our cash flows for the full-year in 2014 and on and
after the Acquisition Date for 2013. We present net cash flows used for operating activities and net cash flows
provided by investing activities separately for our Large Case Pensions segment because changes in the insurance
reserves for the Large Case Pensions segment (which are reported as cash used for operating activities) are funded
from the sale of investments (which are reported as cash provided by investing activities). Refer to the
Consolidated Statements of Cash Flows on page 78 for additional information.
(Millions) 2014 2013 2012
Cash flows from operating activities
Health Care and Group Insurance $ 3,601.3 $ 2,625.0 $ 2,054.7
Large Case Pensions (228.5) (346.3) (229.8)
Net cash provided by operating activities 3,372.8 2,278.7 1,824.9
Cash flows from investing activities
Health Care and Group Insurance (2,453.1) (2,261.4) (477.7)
Large Case Pensions 323.4 341.6 246.4
Net cash used for investing activities (2,129.7) (1,919.8) (231.3)
Net cash (used for) provided by financing activities (1,235.0) (1,525.8) 305.9
Net increase (decrease) in cash and cash equivalents $ 8.1 $ (1,166.9) $ 1,899.5
Cash Flow Analysis
Cash flows provided by operating activities for Health Care and Group Insurance were approximately $3.6 billion
in 2014, $2.6 billion in 2013 and $2.1 billion in 2012. The increase during 2014 compared to 2013 is primarily
attributable to the effect of growth in our Insured membership and the inclusion of results from the Coventry
acquisition for the full-year in 2014, partially offset by the payment of both our portion of the ACA’s health insurer
fee and a portion of our estimated 2014 ACA reinsurance contribution in 2014. The increase during 2013 compared
to 2012 is primarily attributable to the inclusion of results from the Coventry acquisition, proceeds from the
termination of a reinsurance arrangement with Lehman Re and sale of the related claim, as well as lower benefit
payments under our 2011 voluntary early retirement program, offset somewhat by transaction, integration-related
and restructuring costs associated with the Coventry acquisition (refer to Note 17 of the Notes to Consolidated
Financial Statements on page 126 for more information on the Lehman Re reinsurance arrangement).
Cash flows used for investing activities were approximately $2.1 billion, $1.9 billion and $231.3 million for 2014,
2013 and 2012, respectively. The increase in cash used for investing activities in 2014 compared to 2013 was
primarily a result of an increase in net purchases of investments in 2014 compared to net proceeds from the sales of
investments in 2013, which was partially offset by a decline in cash used for acquisitions, as we completed the
acquisition of Coventry during 2013. The increase in cash used for investing activities in 2013 compared to 2012 is
primarily attributable to cash used to fund the Coventry acquisition, net of the cash acquired in connection with the
acquisition, partially offset by an increase in net proceeds from sales and maturities of investments. Refer to Note 3
and 7 of Notes to Consolidated Financial Statements beginning on pages 90 and 93, respectively, for additional
information.
Cash flows used for financing activities in 2014 and 2012 primarily reflected the issuance and repayment of debt,
and cash used for financing activities in all periods reflected share repurchases and dividend payments. Refer to
Note 14 and 15 of Notes to Consolidated Financial Statements beginning on pages 123 and 125, respectively, for
additional information about debt issuances and repayments, share repurchases and dividend payments.
Long-Term and Short-Term Debt and Revolving Credit Facility
In support of our capital management goals, during 2014 we redeemed a portion of our long-term debt, issued new
long-term and short-term debt, repaid maturing long-term debt and extended the maturity date of our revolving
credit facility by one additional year. Refer to Note 14 of Notes to Consolidated Financial Statements beginning on
page 123 for additional information on these transactions.