Nautilus 2003 Annual Report Download - page 35

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Table of Contents
LIQUIDITY AND CAPITAL RESOURCES
QUARTER ENDED
In Thousands (except per share)
March 31
June 30
September 30
December 31
Total
F
iscal 2003:
Net sales
$
129,449
$
100,602
$
115,958
$
152,827
$
498,836
Gross profit
70,016
52,399
55,450
68,281
246,146
Operating income
21,527
6,165
9,787
14,337
51,816
Net income
13,689
4,698
6,643
9,372
34,402
Earnings per share:
Basic
0.42
0.14
0.20
0.29
1.06
Diluted
0.42
0.14
0.20
0.28
1.04
Fiscal 2002:
Net sales
$
135,914
$
140,408
$
152,865
$
155,463
$
584,650
Gross profit
77,301
83,769
88,430
83,067
332,567
Operating income
37,042
39,737
39,227
35,178
151,184
Net income
23,958
25,826
25,059
23,044
97,887
Earnings per share:
Basic
0.68
0.73
0.72
0.69
2.84
Diluted
0.67
0.72
0.71
0.69
2.79
Historically, we have financed our business primarily from cash generated by our operating activities. During 2003, our operating activities
generated $43.7 million in net cash, which contributed to an aggregate $72.6 million balance in cash and cash equivalents, compared with
$100.6 million in net cash generated by our operating activities in 2002.
Net cash provided by investing activities was $10.5 million in 2003 compared with net cash used in investing activities in 2002 of $57.9
million. The largest component of this change was due to the acquisition cost of StairMaster in February of 2002 of $24.1 million, net of cash
acquired. Additionally, we used $7.0 million during 2003 for capital expenditures primarily consisting of manufacturing equipment and
information systems and related equipment compared to $31.5 million in 2002. Capital expenditures in 2002 were historically high due to
substantial investments in computer systems ($16.7 million) and buildings ($11.5 million) that were not required in 2003. Offsetting the 2003
increase were proceeds from maturities of short-term investments, which were $17.6 million in 2003 versus $37.9 million in 2002.
Net cash used in financing activities was $13.5 million in 2003 compared to $47.2 million in 2002. The primary difference between the years
was $13.0 million of dividends were paid in 2003, while $50.0 million was used in 2002 for stock repurchases compared to $1.4 million in
2003.
Working capital was $138.7 million at December 31, 2003 compared to $109.0 million at December 31, 2002, largely due to increased cash
and cash equivalents as a result of net income for the period. The $25.4 million increase in trade receivables can primarily be attributed to the
$29.7 million increase in sales through our commercial/retail segment in the fourth quarter of 2003 compared to the fourth quarter of 2002. The
$10.7 million decrease in inventories can primarily be attributed to better alignment of inventory levels with sales volume. The $6.4 million
decrease in trade payables is primarily due to the timing of inventory purchases and payments for those purchases. The $12.8 million increase
in accrued liabilities can mostly be attributed to warranty, compensation and legal related expenses.
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