Comcast 2008 Annual Report Download - page 33

Operating Activities
Components of Net Cash Provided by Operating Activities
Year ended December 31 (in millions) 2008 2007 2006
Operating income $ 6,732 $ 5,578 $ 4,619
Depreciation and amortization 6,400 6,208 4,823
Operating income before
depreciation and
amortization 13,132 11,786 9,442
Operating income before
depreciation and
amortization from
discontinued operations —— 264
Noncash share-based
compensation and
contribution expense 258 223 223
Changes in operating assets
and liabilities (251) (200) (280)
Cash basis operating
income 13,139 11,809 9,649
Payments of interest (2,256) (2,134) (1,880)
Payments of income taxes (762) (1,638) (1,284)
Proceeds from interest,
dividends and other
nonoperating items 125 185 233
Payments related to settlement
of litigation of an acquired
company —— (67)
Excess tax benefit under SFAS
No. 123R presented in
financing activities (15) (33) (33)
Net cash provided by
operating activities $10,231 $ 8,189 $ 6,618
The increases in interest payments in 2008 and 2007 were primar-
ily due to an increase in our average debt outstanding.
The decrease in tax payments in 2008 was primarily due to the
Economic Stimulus Act of 2008, which resulted in a reduction in
our tax payments of approximately $600 million. The increase in
tax payments in 2007 was primarily due to the effects of increases
in income, sales of investments, and the settlement of federal and
state tax audits of $376 million.
Financing Activities
Net cash provided by (used in) financing activities consists primar-
ily of our proceeds from borrowings offset by our debt
repayments, our repurchases of our Class A and Class A Special
common stock and dividend payments. Proceeds from borrow-
ings fluctuate from year to year based on the amounts paid to fund
acquisitions and debt repayments. We have made, and may from
time to time in the future make, optional repayments on our debt
obligations, which may include repurchases of our outstanding
public notes and debentures, depending on various factors, such
as market conditions. In 2008, we made $307 million of optional
public bond repurchases. See Note 9 to our consolidated financial
statements for further discussion of our financing activities, includ-
ing details of our debt repayments and borrowings.
Available Borrowings Under Credit Facilities
We traditionally maintain significant availability under our lines of
credit and our commercial paper program to meet our short-term
liquidity requirements. In January 2008, we entered into an
amended and restated revolving bank credit facility that may be
used for general corporate purposes. This amendment increased
the size of the credit facility from $5.0 billion to $7.0 billion and
extended the maturity of the loan commitment from October 2010
to January 2013. Under our credit facility, other lenders are not
obligated to fund a defaulting lender’s commitment, although
another lender could agree to fund the defaulting lender’s
commitment. However, non-defaulting lenders are not able to use
a default by another bank to avoid their own commitments. In
December 2008, we terminated a $200 million commitment to our
credit facility by Lehman Brothers Bank, FSB (“Lehman”) as a
result of Lehman’s default under a borrowing request. At a dis-
counted value, we repaid Lehman’s portion of our outstanding
credit facility, along with accrued interest and fees. Subsequent to
this termination, the size of our credit facility is $6.8 billion. As of
December 31, 2008, amounts available under all of our credit
facilities totaled approximately $5.5 billion.
Debt Covenants
We and our cable subsidiaries that have provided guarantees are
subject to the covenants and restrictions set forth in the indentures
governing our public debt securities and in the credit agreements
governing our bank credit facilities (see Note 18 to our con-
solidated financial statements). We and the guarantors are in
compliance with the covenants, and we believe that neither the
covenants nor the restrictions in our indentures or loan documents
will limit our ability to operate our business or raise additional capi-
tal. Our credit facilities’ covenants are tested on an ongoing basis.
The only financial covenant in our $6.8 billion revolving credit
31 Comcast 2008 Annual Report on Form 10-K