Papa Johns 2010 Annual Report Download - page 60

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53
impact of the consolidation of BIBP, cash flow was $77.5 million in 2009 as compared to $83.8 million
in 2008. The $6.3 million decrease was primarily due to reductions in net income from operations,
excluding impairment and disposition losses.
The Company’s free cash flow for the last three years was as follows (in thousands):
Dec. 26, Dec. 27, Dec. 28,
2010 2009 2008
Net cash provided by operating activities 89,096$ 100,070$ 73,237$
Loss (gain) from BIBP cheese purchasing entity (6,804) (22,543) 10,540
Purchase of property and equipment (31,125) (33,538) (29,271)
Free cash flow (a) 51,167$ 43,989$ 54,506$
Year Ended
(a)
Free cash flow is defined as net cash provided by operating activities (from the consolidated
statements of cash flows) excluding the impact of BIBP, less the purchase of property and
equipment. We view free cash flow as an important measure because it is one factor that
management uses in determining the amount of cash available for discretionary investment. Free
cash flow is not a term defined by GAAP and as a result our measure of free cash flow might not
be comparable to similarly titled measures used by other companies. Free cash flow should not
be construed as a substitute for or a better indicator of the Company’s performance than the
Company’s GAAP measures.
During 2008, we divested 62 Company-owned restaurants to franchisees (no significant divestitures in
2010 or 2009). Total consideration for the sale of the restaurants was $10.5 million, consisting of cash
proceeds of $2.1 million and loans financed by Papa John’s for $8.4 million. The annual revenues of the
divested restaurants approximated $38 million.
We require capital primarily for the development, acquisition, renovation and maintenance of restaurants,
the development, renovation and maintenance of commissary and print and promotions facilities and
equipment and the enhancement of corporate systems and facilities. Purchases of property and equipment
amounted to $31.1 million, $33.5 million and $29.3 million in 2010, 2009 and 2008, respectively, and are
summarized by operating segment in “Note 19” of “Notes to Consolidated Financial Statements.”
Our Board of Directors has authorized the repurchase of our common stock through December 31, 2011.
The following is a summary of our common share repurchases for the last three years (in thousands,
except average price per share):
Fiscal
Year
Number of
Shares
Repurchased
Total Cash
Paid
Average
Price Per
Share
2008 1,400 $37,697 $26.93
2009 1,319 $28,477 $21.59
2010 1,881 $46,936 $24.95
Subsequent to year-end (through February 15, 2011), we acquired an additional 66,000 shares at an
aggregate cost of $1.8 million. As of February 15, 2011, approximately $35.0 million remained available
for repurchase of common stock under this authorization.