Go Daddy 2015 Annual Report Download - page 72

Table of Contents
Depreciation and amortization
Depreciation and amortization expenses consist of charges relating to the depreciation of the property and equipment used in our business and the
amortization of acquired intangible assets, particularly those resulting from the Merger. Depreciation and amortization may increase or decrease in absolute dollars
in future periods depending on our future level of capital investments in hardware and other equipment as well as amortization expense associated with future
acquisitions.
Year Ended December 31,
2015 to 2014
2014 to 2013
2015
2014
2013
$ change
% change
$ change
% change
Depreciation and amortization $ 158.8
$ 152.8
$ 140.6
$ 6.0
4%
$ 12.2
9%
2015 compared to 2014 . There were no material changes in depreciation and amortization expense.
2014 compared to 2013 . Depreciation and amortization expense increased $12.2 million , or 8.7% , from $140.6 million in 2013 to $152.8 million in 2014 .
The increase results from a $6.8 million increase in amortization of intangible assets, primarily from acquisitions completed in the second half of 2013 , and a $5.4
million increase in depreciation expense related to additional property and equipment from capital expenditures and assets assumed in acquisitions.
Interest expense
Year Ended December 31,
2015 to 2014
2014 to 2013
2015
2014
2013
$ change
% change
$ change
% change
Interest expense $ 69.2
$ 85.0
$ 71.0
$ (15.8)
(19)%
$ 14.0
20%
2015 compared to 2014 . Interest expense decreased $15.8 million , or 18.6% , from $85.0 million in 2014 to $69.2 million in 2015 , primarily driven by
interest savings resulting from our repayment of the $300.0 million senior note to Holdings in April 2015 , partially offset by increased borrowings from the May
2014 refinancing of our term loan.
2014 compared to 2013 . Interest expense increased $14.0 million , or 19.7% , from $71.0 million in 2013 to $85.0 million in 2014 . The increase was
primarily driven by an increase in our outstanding long-term debt from $1,132.8 million as of December 31, 2013 to $1,469.5 million as of December 31, 2014 ,
partially offset by amendments to our long-term debt agreements during 2013 and 2014 , which lowered our average effective interest rate to 5.2% as of
December 31, 2014 .
Loss on debt extinguishment
In April 2015 , we recognized a $21.4 million loss on debt extinguishment as a result of the repayment of the senior note to Holdings, which consisted of a
prepayment premium of $13.5 million and the write-off of $7.1 million of unamortized original issue discount and $0.8 million of deferred debt issuance costs.
Liquidity and Capital Resources
Overview
Other than the receipt of proceeds from our IPO in April 2015 , our principal sources of liquidity have been cash flow generated from operations and long-
term debt borrowings. Our principal uses of cash have been to fund operations, acquisitions and capital expenditures, as well as make distributions to holders of
LLC Units, interest payments and mandatory principal payments on our long-term debt.
On April 7, 2015 , we completed our IPO and sold 26.0 million shares of Class A common stock at a public offering price of $20.00 per share, receiving
$491.8 million in proceeds, net of underwriting discounts and commissions. We incurred $11.2 million of legal, accounting, printing and other professional fees
related to the IPO, which were charged against additional paid-in capital upon completion of the IPO. We used the net proceeds to:
• make a final aggregate payment of $26.7 million to the Sponsors upon the termination of the transaction and monitoring fee agreement;
• make a payment of $3.0 million to Bob Parsons upon the termination of the executive chairman services agreement;
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