Quest Diagnostics 2007 Annual Report Download - page 74

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QUEST DIAGNOSTICS INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2007, 2006 AND 2005
(in thousands)
2007 2006 2005
Cash flows from operating activities:
Net income . . ......................................................... $ 339,939 $ 586,421 $ 546,277
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization . . ....................................... 237,879 197,398 176,124
Provision for doubtful accounts . ....................................... 300,226 243,443 233,628
Provision for restructuring and other special charges .................... 238,781 55,788 -
Deferred income tax provision (benefit) . . .............................. (1,575) (46,280) 661
Minority share of income.............................................. 26,510 23,900 19,495
Stock compensation expense........................................... 56,853 55,478 2,037
Tax benefits associated with stock-based compensation plans ............ - - 33,823
Excess tax benefits from stock-based compensation arrangements ........ (13,981) (32,693) -
Other, net . . . ......................................................... 8,310 20,172 21,673
Changes in operating assets and liabilities:
Accounts receivable .............................................. (265,347) (273,232) (238,421)
Accounts payable and accrued expenses ........................... (5,431) 81,347 36,038
Integration, settlement and other special charges ................... (14,013) (4,247) (5,400)
Income taxes payable ............................................. 3,213 45,330 15,382
Other assets and liabilities, net .................................... 15,560 (929) 10,266
Net cash provided by operating activities ............................ 926,924 951,896 851,583
Cash flows from investing activities:
Business acquisitions, net of cash acquired ............................. (1,535,826) (236,543) (814,219)
Capital expenditures. . . ................................................ (219,101) (193,422) (224,270)
(Increase) decrease in investments and other assets ..................... (4,266) 15,563 (41,304)
Net cash used in investing activities .................................. (1,759,193) (414,402) (1,079,793)
Cash flows from financing activities:
Proceeds from borrowings ............................................. 3,754,490 375,000 1,100,186
Repayments of debt . . . ................................................ (2,705,369) (416,208) (497,276)
(Decrease) increase in book overdrafts . . . .............................. (24,950) (1,705) 33,384
Purchases of treasury stock ............................................ (145,660) (472,325) (390,163)
Exercise of stock options .............................................. 80,928 102,324 98,335
Excess tax benefits from stock-based compensation arrangements ........ 13,981 32,693 -
Dividends paid........................................................ (77,327) (77,135) (69,673)
Distributions to minority partners ...................................... (24,678) (21,900) (21,477)
Financing costs paid . . ................................................ (21,192) (728) (6,278)
Net cash provided by (used in) financing activities ................... 850,223 (479,984) 247,038
Net change in cash and cash equivalents ............................. 17,954 57,510 18,828
Cash and cash equivalents, beginning of year ........................ 149,640 92,130 73,302
Cash and cash equivalents, end of year .............................. $ 167,594 $ 149,640 $ 92,130
The accompanying notes are an integral part of these statements.
F-4