DIRECTV 2012 Annual Report Download - page 72

DIRECTV
2012 resulted mainly from increased income before income taxes and a decrease in discretionary and we may fund strategic investment opportunities should they arise
the bonus depreciation rate from 100% in 2011 to 50% in 2012. The increase in in the future. In 2011 we received cash of $116 million related to the sale of
cash paid for income taxes in 2011 resulted mainly from increased income before investments, as further discussed in Note 8 of the Notes to the Consolidated
income taxes as well as the utilization of tax credit carryforwards in 2010. Cash Financial Statements.
paid for interest was $781 million in 2012, $687 million in 2011 and $460 million
in 2010. The increase in cash paid for interest is due to the increase in our average Cash Flows Used in Financing Activities
debt outstanding. Under stock repurchase plans approved by our Board of Directors, we
completed the repurchase of our common stock as follows: $5,175 million in 2012,
Cash Flows Used In Investing Activities $5,496 million in 2011, $5,111 million during 2010. In the first quarter of 2013,
From 2010 to 2012, capital expenditures for subscriber leased set-top receivers we announced a new repurchase program authorization of an additional $4 billion.
at DIRECTV U.S. remained relatively flat as the decrease in gross subscriber We may make purchases under this program in the open market, through
additions has been offset by an increase in set-top receivers provided to subscribers negotiated transactions or otherwise. The timing, nature and amount of such
under upgrade and retention initiatives. transactions will depend on a variety of factors, including market conditions, and
the program may be suspended, discontinued or accelerated at any time. The
During 2010, 2011 and 2012, DIRECTV U.S. was in the process of sources of funds for the purchases under the remaining authorization are our
constructing two satellites, D14 and D15, which we expect to place into service in existing cash on hand, cash from operations and potential additional borrowings.
2014. Additionally, in 2012, we began construction on our new El Segundo
campus. During 2012, we had $5,190 million of net cash proceeds from the issuance
of senior notes and $358 million of net cash proceeds from the issuance of
Capital expenditures for subscriber leased set-top receivers at DIRECTV Latin short-term commercial paper. We also repaid $1,500 million of our long-term debt
America increased during 2010, 2011 and 2012. Part of our business strategy in and borrowed and repaid $400 million under our revolving credit facility. During
Latin America is to increase advanced product and multi-receiver installations; 2011, we had $3,990 million of net cash proceeds from the issuance of senior
therefore, our capital expenditures in Latin America are expected to continue to notes. We also repaid $1,000 million of our long-term debt during 2011. During
increase. 2010, we had $5,978 million of net cash proceeds from the issuance of senior
During 2011, DIRECTV Latin America entered into a contract to lease two notes. We also repaid $2,323 million of our long-term debt, and paid
satellites for PanAmericana, ISDLA 1 and 2, which are expected to be launched in $1,537 million to settle the debt and related equity collars assumed as part of the
2014 and 2015. As a part of the lease agreement, we are required to make Liberty Transaction.
prepayments prior to the launch and commencement of the lease term. Payments We anticipate additional borrowings in the future in order to achieve a ratio of
related to the lease agreement totaled $128 million for 2012 and $104 million for outstanding long-term debt equal to approximately 2.5 times operating profit before
2011, and are included in ‘‘Cash paid for satellites’’ in the Consolidated Statements depreciation and amortization of DIRECTV on a consolidated basis. We will
of Cash Flows. continue to evaluate our optimal leverage on an ongoing basis. We may purchase
We paid $16 million in 2012 and $11 million in 2011 for investments, net of our outstanding senior notes in the future from time to time in open market
cash acquired, in various companies. Additionally, in 2010, we paid $617 million transactions or otherwise as part of liability management initiatives.
for investments in companies, net of cash acquired, primarily for the purchase of an
approximate 19% interest in Sky Brasil held by Globo. This transaction is described Free Cash Flow
in Note 4 of the Notes to the Consolidated Financial Statements in Part II, Item 8 Free cash flow increased in 2012 as compared to 2011 due to the increase in
of this Annual Report. Our cash spending on investment in companies is net cash provided by operating activities described above, partially offset by an
52