Comfort Inn 2005 Annual Report Download - page 31

CHOICE HOTELS INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years Ended December 31,
2005 2004 2003
(In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES
Netincome ........................................................................ $ 87,565 $ 74,345 $ 71,863
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization ..................................................... 9,051 9,947 11,225
Gain on sale of assets ............................................................ (386) ——
Gain on prepayment of note receivable from Sunburst .................................. —— (3,383)
Provision for bad debts ........................................................... 391 (157) (189)
Non-cash stock compensation ...................................................... 5,288 4,019 2,226
Non-cash interest and other investment income ........................................ (294) (463) (886)
Lossonextinguishmentofdebt .................................................... —696 —
Equity in net income of affiliates ................................................... (803) (722) (582)
Changes in assets and liabilities, net of acquisitions:
Receivables .................................................................... (2,415) (735) (887)
Receivable—marketing and reservation fees, net ....................................... 19,393 19,743 24,726
Accounts payable ............................................................... 1,923 978 6,439
Accrued expenses and other ....................................................... 12,894 6,702 289
Incometaxespayable ............................................................ 11,250 2,854 (2,675)
Deferred income taxes ........................................................... (13,318) (14,883) (7,970)
Deferred revenue ................................................................ 8,822 6,381 7,146
Other current assets .............................................................. (2,040) (599) 383
Other liabilities ................................................................. (4,414) (26) 7,579
Net cash provided by operating activities ........................................... 132,907 108,080 115,304
CASH FLOWS FROM INVESTING ACTIVITIES
Investment in property and equipment ................................................... (11,504) (6,859) (8,480)
Acquisition of Suburban, net of cash acquired ............................................. (7,314) ——
Proceeds from prepayment of note receivable from Sunburst ................................. —— 44,701
Purchases of investments ............................................................. (8,929) (8,664) (5,272)
Proceeds from sales of investments ..................................................... 3,539 4,506 2,599
Issuance of notes receivable ........................................................... (2,667) (2,264) (4,433)
Acquisition of Flag .................................................................. —— (1,211)
Proceeds from disposition of assets ..................................................... 2,811 — 498
Other items, net ..................................................................... 214 (435) (618)
Net cash (used in) provided by investing activities ................................... (23,850) (13,716) 27,784
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt .......................................................... —192,000 —
Principal payments of long-term debt .................................................... (150) (267,739) (17,404)
Net (repayments) borrowings pursuant to revolving credit facility ............................. (55,129) 157,725 (43,800)
Debt issuance costs .................................................................. (193) (1,010) —
Purchase of treasury stock ............................................................. (49,154) (148,273) (80,358)
Dividendspaid ..................................................................... (30,241) (27,690) —
Proceeds from exercise of stock options .................................................. 14,213 8,427 6,097
Net cash used in financing activities ............................................... (120,654) (86,560) (135,465)
Net change in cash and cash equivalents ............................................... (11,597) 7,804 7,623
Cash and cash equivalents at beginning of period ........................................ 28,518 20,714 13,091
Cash and cash equivalents at end of period ............................................. $ 16,921 $ 28,518 $ 20,714
Supplemental disclosure of cash flow information:
Cash payments during the year for:
Income taxes, net of refunds ................................................... $ 50,173 $ 53,622 $ 49,559
Interest .................................................................... $ 16,053 $ 12,639 $ 13,357
Non-cash investing activities:
Acquisition of Suburban, liabilities assumed ...................................... $ 5,526 ——
Non-cash financing activities:
Declaration of dividends ...................................................... $ 31,410 $ 28,061 $ 6,899
Income tax benefit realized related to stock options exercised ......................... $ 9,872 $ 4,442 $ 1,770
Issuance of restricted shares of common stock ..................................... $ 8,491 $ 7,973 $ 180
The accompanying notes are an integral part of these consolidated financial statements.
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