Citrix 2009 Annual Report Download - page 62

Download and view the complete annual report

Please find page 62 of the 2009 Citrix annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 138

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138

companies we believe are related to our strategic objectives. We could from time to time seek to raise additional
funds through the issuance of debt or equity securities for larger acquisitions.
Cash and Investments
December 31, 2009
Compared to
20082009 2008
(In thousands)
Cash and investments .......................................... $1,207,257 $850,881 $356,376
The increase in cash and investments at December 31, 2009 as compared to December 31, 2008, is primarily
due to cash provided by our operating activities of $484.0 million and cash received from the issuance of
common stock under our employee stock-based compensation plans of $166.0 million partially offset by
expenditures made on our stock repurchases of $214.9 million and purchases of property and equipment of
$76.2 million. We generally invest our cash and cash equivalents in investment grade, highly liquid securities to
allow for flexibility in the event of immediate cash needs. Our short-term and long-term investments primarily
consist of interest-bearing securities. See “— Liquidity and Capital Resources” and Note 4 to our consolidated
financial statements included in this Annual Report on Form 10-K for the year ended December 31, 2009 for
further information.
Available-for-sale investments
As of December 31, 2009, we recorded an unrealized loss of approximately $4.9 million, which is included
in accumulated other comprehensive loss, related to our $50.0 million face value investment issued by AIG
Matched Funding Corporation, or the AIG Capped Floater, which matures in September 2011. American
International Group, Inc., or AIG, as the issuer’s parent, provided a guarantee of the security at the time of
purchase in September 2006. The unrealized loss was primarily caused by AIG experiencing liquidity challenges
which were reportedly precipitated by problems in the capital markets. AIG’s lack of liquidity triggered a
downgrade in the credit ratings for its long-term issues by two rating agencies in 2008. As a result of AIG’s
liquidity challenges, in November 2008 the Federal Reserve Bank of New York, or the FRBNY, intervened with
a five-year credit facility to help stabilize AIG and the overall market. In addition, on March 2, 2009, AIG
announced further actions were taken in cooperation with the U.S. Department of Treasury and the FRBNY to
provide AIG with additional financial stability. As of the date of this report, AIG has not been reported to have
defaulted on capital repayments to holders of its recently matured debt and it continues to pay us interest on the
AIG Capped Floater. Because we do not intend to sell the AIG Capped Floater and it is more likely than not that
we will not be required to sell the security before the recovery of its amortized cost basis, which may not occur
until maturity, we do not consider the security to be other-than-temporarily impaired.
If AIG’s financial position deteriorates, we may be required to further adjust the carrying value of the AIG
Capped Floater and potentially recognize an impairment charge for an other-than-temporary decline in the fair
value of the investment. Based on our available cash and other investments, we do not currently anticipate that
the lack of liquidity caused by holding the AIG Capped Floater to recovery will have a material adverse effect on
our financial position.
Gross realized gains on sales of available-for-sale investments during 2009 were $0.6 million and gross
realized losses on available-for-sale investments during 2009 were $0.1 million. Gross realized gains on sales of
available-for-sale investments during 2008 were $0.4 million and gross realized losses on available-for-sale
investments during 2008 were $0.1 million. There was also an other-than-temporary loss on available-for-sale
investments of approximately $1.1 million related to an other-than-temporary impairment of an investment in our
portfolio due to the bankruptcy of Lehman Brothers Holdings.
We continue to monitor our overall investment portfolio and if the credit ratings of the issuers of our
investments deteriorate or if the issuers experience financial difficulty, including bankruptcy, we may be required
54