Dollar General 2007 Annual Report Download - page 46

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Cash flows used in investing activities totaling $282.0 million in 2006 were primarily
related to capital expenditures and, to a lesser degree, purchases of long-term investments.
Significant components of our property and equipment purchases in 2006 included the following
approximate amounts: $66 million for distribution and transportation-related capital expenditures
(including approximately $30 million related to our distribution center in Marion, Indiana which
opened in 2006); $66 million for new stores; $50 million for the EZstoreTM project; and $38
million for capital projects in existing stores. During 2006 we opened 537 new stores and
remodeled or relocated 64 stores.
Purchases and sales of short-term investments in 2006, which equaled net sales of $1.9
million, reflect our investment activities in tax-exempt auction rate securities as well as investing
activities of our captive insurance subsidiary. Purchases of long-term investments are related to
the captive insurance subsidiary.
Significant components of our purchases of property and equipment in 2005 included the
following approximate amounts: $102 million for distribution and transportation-related capital
expenditures; $96 million for new stores; $47 million related to the EZstoreTM project; $18
million for certain fixtures in existing stores; and $15 million for various systems-related capital
projects. During 2005, we opened 734 new stores and relocated or remodeled 82 stores.
Distribution and transportation expenditures in 2005 included costs associated with the
construction of our new distribution centers in South Carolina and Indiana.
Net sales of short-term investments in 2005 of $34.1 million primarily reflect our
investment activities in tax-exempt auction rate securities. Purchases of long-term investments
are related to our captive insurance subsidiary.
Capital expenditures during 2008 are projected to be approximately $200 to $220 million.
We anticipate funding 2008 capital requirements with cash flows from operations and our
revolving credit facility, if necessary. Significant components of the 2008 capital plan include
growth initiatives as well as continued investment in our existing store base, plans for
remodeling and relocating approximately 400 stores, additional investments in our supply chain,
and leasehold improvements and fixtures and equipment for approximately 200 new stores. We
plan to undertake these expenditures in order to improve our infrastructure and enhance our cash
generated from operating activities.
Cash flows from financing activities. To finance the Merger, we issued long-term debt of
approximately $4.2 billion and issued common stock in the amount of approximately $2.8
billion. We incurred costs associated with the issuance of Merger-related long-term debt of $87.4
million. As discussed above, we completed a cash tender offer for our 2010 Notes.
Approximately 99% of the 2010 Notes were validly tendered resulting in repayments of long-
term debt and related consent fees in the amount of $215.6 million. Borrowings, net of
repayments, under our new asset-based revolving credit facility in 2007 totaled $102.5 million.
Cash flows used in financing activities during 2006 included the repurchase of
approximately 4.5 million shares of our common stock at a total cost of $79.9 million, cash
dividends paid of $62.5 million, or $0.20 per share, on our outstanding common stock, and $14.1