CDW 2012 Annual Report Download - page 37

Table of Contents
Cash Flows
Cash flows from operating, investing and financing activities were as follows:
Operating Activities
Net cash provided by operating activities for 2012 increased $102.7 million compared to 2011. The increase was primarily driven by
changes in assets and liabilities, resulting in a $148.9 million increase in net cash provided by operating activities between periods. Despite a
2012 fourth quarter increase in net sales of 4.9% between years, accounts receivable remained relatively flat from the prior year end driven by
improved collection results, particularly within the Public segment. Accounts receivable in 2011 represented a use of cash of $165.3 million,
primarily due to a 2011 fourth quarter increase in net sales of 9.3% from the same period in the prior year. Merchandise inventory also
contributed $36.1 million of the increase in cash between years driven by a return to more normalized inventory levels in 2012 following the
build-up at the end of 2011 related to the hard drive shortage from the Thailand floods, along with a higher percentage of drop shipments from
vendor partners and distributors in 2012 compared to 2011. Partially offsetting these factors in 2012 was a $54.1 million decrease in other assets
as we collected $53.3 million in income tax refunds in 2011 that did not repeat in 2012. Net income adjusted for the impact of non-cash items
such as losses on extinguishment of long-term debt was $326.8 million in 2012 compared to $373.0 million in 2011, or a decrease of $46.2
million. Improved operating performance in 2012 drove higher net income between years, but also higher net cash income taxes paid. Net cash
income taxes paid in 2012 were $123.2 million compared to a net cash tax refund of $20.9 million in 2011. In addition to the $53.3 million in
cash tax refunds received in 2011, we also fully utilized our remaining federal net operating tax loss carryforwards during 2011.
Net cash provided by operating activities for 2011 decreased $209.0 million compared to 2010. The decrease was primarily driven by
the changes in assets and liabilities, resulting in a $323.6 million reduction in cash between years. For 2011, the changes in assets and liabilities,
excluding cash and cash equivalents, reduced cash by $158.3 million compared to a cash contribution of $165.3 million in 2010. The most
significant driver of the cash contribution in 2010 was an increase in accounts payable-trade of $269.3 million as we reduced the amount of
accelerated payments we made in exchange for early pay discounts at December 31, 2010 compared to the prior year. Accounts payable-trade
decreased $19.8 million in 2011 compared to 2010, resulting in a relatively small reduction in cash. Cash flow from operating activities was
further reduced by $83.7 million in 2011 compared to 2010 following an increase in accounts receivable between years driven by higher fourth
quarter net sales in 2011. During 2011, we collected $53.3 million in cash tax refunds which reduced other assets between years, resulting in an
increase in cash flow from operating activities. Net income, adjusting for the impact of non-cash items such as losses on extinguishment of long-
term debt, increased $114.6 million between years reflecting our improved operating results in 2011.
33
(in millions) Years Ended December 31,
2012
2011 2010
Net cash provided by (used in):
Operating activities
$
317.4
$
214.7
$
423.7
Investing activities
(41.7
)
(56.0
)
(125.4
)
Net change in accounts payable - inventory financing
(29.5
)
250.5
3.2
Other financing activities
(308.5
)
(345.9
)
(353.3
)
Financing activities
(338.0
)
(95.4
)
(350.1
)
Effect of exchange rate changes on cash and cash equivalents
0.3
—
0.4
Net (decrease) increase in cash and cash equivalents
$
(62.0
)
$
63.3
$
(51.4
)