General Dynamics 2015 Annual Report Download - page 33

INVESTING ACTIVITIES
Cash provided by investing activities was $200 in 2015 compared with
a use of cash for investing activities of $1.1 billion in 2014 and $363
in 2013. Our primary investing activities were capital expenditures and
purchases, sales and maturities of marketable securities.
Capital Expenditures. Capital expenditures were $569 in 2015,
$521 in 2014 and $436 in 2013. We expect capital expenditures of
approximately 2 percent of revenue in 2016.
Marketable Securities. In 2015, we received $500 of proceeds
from maturing held-to-maturity securities purchased in 2014. Other
net purchases, sales and maturities of marketable securities in all three
years were not material.
Other, Net. Investing activities also include proceeds from the sale
of assets and cash paid for business acquisitions. In 2015, we
completed the sale of our axle business in the Combat Systems group
and a commercial cyber security business in our Information Systems
and Technology group. In 2014, we completed an acquisition in our
Information Systems and Technology group.
FINANCING ACTIVITIES
We used $4.3 billion in 2015, $3.6 billion in 2014 and $725 in 2013
for financing activities. Our financing activities included repurchases of
common stock, payment of dividends and debt repayments. Net cash
from financing activities also included proceeds received from stock
option exercises.
Share Repurchases. We repurchased 22.8 million of our
outstanding shares in 2015 for $3.2 billion, 29 million shares in 2014
for $3.4 billion and 9.4 million shares in 2013 for $740. As a result,
we have reduced our shares outstanding by approximately 12 percent
since the end of 2012. On December 31, 2015, 9.6 million shares
remained authorized by our board of directors for repurchase,
approximately 3 percent of our total shares outstanding.
Dividends. On March 4, 2015, our board of directors declared an
increased quarterly dividend of $0.69 per share, the 18th consecutive
annual increase. Previously, the board had increased the quarterly
dividend to $0.62 per share in March 2014 and $0.56 per share in
March 2013. Cash dividends paid were $873 in 2015, $822 in 2014
and $591 in 2013. We did not pay any dividends in the first three
months of 2013 because we accelerated our first-quarter dividend
payment to December 2012.
Debt Repayments. In January 2015, we repaid $500 of fixed-rate
notes on their scheduled maturity date with the proceeds from the
maturing marketable securities discussed above. We have no additional
material repayments of long-term debt scheduled until $500 of fixed-rate
notes mature in July 2016. As we approach the maturity date of this
debt, we will determine whether to repay these notes with cash on hand
or refinance the obligation. See Note J to the Consolidated Financial
Statements in Item 8 for additional information regarding our debt
obligations, including scheduled debt maturities and interest rates.
We ended 2015 with no commercial paper outstanding. We have $2
billion in bank credit facilities that remain available, including a $1 billion
facility expiring in July 2018 and a $1 billion facility expiring in November
2020. These facilities are for general corporate purposes and working
capital needs and are required by rating agencies to support our
commercial paper issuances. We also have an effective shelf registration
on file with the Securities and Exchange Commission that allows us to
access the debt markets.
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