Columbia Sportswear 2001 Annual Report Download - page 21

Cash provided by Ñnancing activities was $15.4 million for the year ended December 31, 2001 as
compared to cash used in Ñnancing activities of $1.7 million for 2000. In 2001, net cash provided by Ñnancing
activities was primarily due to proceeds from the exercise of employee stock options and employee stock
purchase plan of $8.2 million, net borrowings of short-term notes payable of $3.4 million, and net borrowings
of $3.8 million of long-term debt.
To fund our domestic working capital requirements, we have available unsecured revolving lines of credit
with aggregate seasonal limits ranging from $35 million to $75 million, of which $10 million to $50 million is
committed. Additionally, we maintain unsecured and uncommitted lines of credit with a combined limit of
$175 million available for issuing letters of credit. Internationally, our subsidiaries have local currency
operating lines in place guaranteed by our domestic operations.
We continue our investment in global infrastructure to support our growth, including the construction and
expansion of our distribution facilities. We anticipate the capital expenditures associated with these
distribution projects, including the construction of a European distribution center, will be approximately
$29 million. Coupled with our maintenance capital requirements, our anticipated capital expenditures for 2002
will be approximately $37 million and will be funded by existing cash and cash provided by operations.
However, if the need for additional Ñnancing arises, our ability to obtain additional credit facilities will depend
on prevailing market conditions, our Ñnancial condition, and our ability to negotiate favorable terms and
conditions.
Our operations are aÅected by seasonal trends typical in the outdoor apparel industry, which have
historically resulted in higher sales and proÑts in the third calendar quarter. This pattern has resulted primarily
from the timing of shipments to wholesale customers for the fall outerwear season. As our sportswear and
footwear product lines mature, they will have future impact on seasonal shipments and corresponding working
capital requirements. We believe that our liquidity requirements for at least the next 12 months will be
adequately covered by existing cash, cash provided by operations and existing short term borrowing
arrangements.
The following table shows our estimated contractual commitments (in thousands):
Year Ending December 31,
2002 2003 2004 2005 2006 Thereafter
Debt repaymentsÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $4,775 $4,682 $4,406 $4,407 $4,407 $7,145
Operating leases(1):
Non-related partiesÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 2,737 1,570 1,340 1,023 634 1,109
Related parties ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 366 366 366 366 366 1,828
(1) These operating lease commitments are not reÖected on the consolidated balance sheet under accounting
principles generally accepted in the United States.
Quantitative and Qualitative Disclosures About Market Risk
We are exposed to market risks from Öuctuations of foreign currency exchange rates and interest rates
due to our international sales, production and funding requirements. It is our policy to utilize Ñnancial
instruments to reduce market risk where internal netting and other strategies cannot be eÅectively employed.
Foreign currency and interest rate transactions are used only to the extent considered necessary to meet our
objectives. We do not enter into foreign currency or interest rate transactions for speculative purposes.
Our foreign currency risk management objective is to protect cash Öows resulting from sales, purchases
and other costs from the impact of exchange rate movements. This risk is managed by using forward exchange
contracts and purchased options to hedge certain Ñrm as well as anticipated commitments and the related
receivables and payables, including third party or intercompany transactions. Anticipated, but not yet Ñrmly
committed, transactions that we hedge carry a high level of certainty and are expected to be recognized within
one year. Cross-currency swaps are used to hedge foreign currency denominated payments related to
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