Earthlink 2015 Annual Report Download - page 49

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Table of Contents
offset by $46.9 million of net cash generated from sales and maturities of marketable securities, net of purchases, during the year ended December 31, 2013. The
decrease in capital expenditures during the year ended December 31, 2014 was due to additional cash used in 2013 to expand our fiber network and upgrade our
network and technology infrastructure, which was substantially complete by the end of 2013, and a focused effort in 2014 to reduce capital expenditures.
The decrease in net cash used in investing activities during the year ended December 31, 2015 compared to the prior year was primarily due to a $15.4 million
decrease in capital expenditures. The decrease was primarily driven by an increased focus on managing our cash flows by improving our processes and being more
efficient, more scrutiny of capital projects, a decrease in customer additions and timing of certain projects. Capital expenditures for the year ended December 31,
2015 primarily related to enhancing our network and technology infrastructure and the acquisition of new customers.
Financing activities
The decrease in net cash used in financing activities during the year ended December 31, 2014 compared to the prior year was primarily due to the following:
• a $24.3 million decrease in net cash used for debt and capital lease transactions.
•a $4.8 million decrease in dividends paid due to the timing of our quarterly dividend payment to shareholders. During the years ended December 31, 2013
and 2014, we declared cash dividends of $0.20 per share. However, we funded four quarterly payments during the year ended December 31, 2013
compared to three quarterly payments during the year ended December 31, 2014.
• a $3.9 million decrease in repurchases of common stock. We repurchased 1.1 million shares of our common stock for $6.1 million during the year ended
December 31, 2013, compared to 0.7 million shares of our common stock for $2.2 million during the year ended December 31, 2014.
The increase in net cash used in financing activities during the year ended December 31, 2015 compared to the prior year was primarily due to the following:
• $131.3 million used for the redemption and repurchase of $126.1 million outstanding principal of our Senior Notes during the year ended December 31,
2015. For more information about these transactions, refer to Note 7 to our Consolidated Financial Statements.
• a $10.4 million increase in dividends paid due to the timing of the funding of our quarterly dividend payment. During the the years ended December 31,
2014 and 2015, we declared cash dividends of $0.20 per share. However, we funded three quarterly payments during the year ended December 31, 2014
compared to five quarterly payments during the year ended December 31, 2015.
• partially offset by $35.0 million drawn down under our senior secured revolving credit facility, net of repayments.
• partially offset by a $2.2 million decrease in repurchases of common stock and $1.7 million of proceeds received for stock option exercises during the
year ended December 31, 2015.
Future uses of cash
Our cash requirements depend on numerous factors, including the costs required to maintain our network infrastructure, the outcome of various
telecommunications-related disputes and proceedings, the level of resources used for our sales and marketing activities, the level of restructuring activities, interest
payments on outstanding debt, the costs incurred to redeem or repurchase debt and the size and types of future acquisitions in which we may engage, among others.
The following is a summary of our primary future cash requirements:
• Debt and interest. We expect to use cash to service our outstanding indebtedness, including $300.0 million aggregate principal amount of our Senior
Secured Notes due in June 2020, $173.9 million aggregate principal amount of our Senior Notes due in May 2019 and current and future borrowings
under our $135.0 million revolving credit facility. We may also use cash to repay outstanding indebtedness. During the year ended December 31, 2015,
we redeemed or repurchased $126.1 million outstanding principal of our Senior Notes for $131.3 million. We may repurchase or redeem additional debt.
• Capital expenditures . We expect to incur capital expenditures of approximately $85.0 million to $105.0 million during 2016. The capital expenditures
primarily relate to the acquisition of new customers and to maintain and upgrade our network and technology infrastructure. The actual amount of capital
expenditures may fluctuate due to a number of factors which are difficult to predict and could change significantly over time. Additionally, technological
advances may require
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