Quest Diagnostics 2009 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, 2009, 2008 AND 2007
(in thousands)
2009 2008 2007
Cash flows from operating activities:
Net income . . . ....................................................... $ 766,222 $ 613,195 $ 366,449
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization . . . ..................................... 256,687 264,593 237,879
Provision for doubtful accounts . . ..................................... 320,974 326,228 300,226
Provision for special charges ......................................... — 72,650 238,781
Deferred income tax provision (benefit) . . . ............................ 83,120 549 (1,575)
Stock-based compensation expense .................................... 75,059 70,581 56,853
Excess tax benefits from stock-based compensation arrangements ....... (5,540) (2,420) (13,981)
Other, net ........................................................... 29,699 13,772 8,310
Changes in operating assets and liabilities:
Accounts receivable ............................................. (314,102) (282,634) (265,347)
Accounts payable and accrued expenses .......................... 71,754 (4,342) (5,431)
Integration, settlement and other special charges .................. (329,607) (8,223) (14,013)
Income taxes payable ............................................ 21,190 24,653 3,213
Other assets and liabilities, net ................................... 21,962 (25,553) 15,560
Net cash provided by operating activities............................ 997,418 1,063,049 926,924
Cash flows from investing activities:
Business acquisitions, net of cash acquired ............................ (18,295) 8,066 (1,535,826)
Capital expenditures.................................................. (166,928) (212,681) (219,101)
(Increase) decrease in investments and other assets . ................... (10,681) 5,732 (4,266)
Net cash used in investing activities ................................. (195,904) (198,883) (1,759,193)
Cash flows from financing activities:
Proceeds from borrowings ............................................ 1,245,525 22,929 3,754,490
Repayments of debt .................................................. (1,218,538) (481,870) (2,705,369)
(Decrease) increase in book overdrafts ................................ (12,094) 14,201 (24,950)
Purchases of treasury stock ........................................... (499,991) (253,997) (145,660)
Exercise of stock options ............................................. 87,120 30,511 80,928
Excess tax benefits from stock-based compensation arrangements ....... 5,540 2,420 13,981
Dividends paid....................................................... (74,748) (77,964) (77,327)
Distributions to noncontrolling interests . . . ............................ (35,524) (32,931) (24,678)
Other financing activities ............................................. (18,494) (1,113) (21,192)
Net cash (used in) provided by financing activities .................. (521,204) (777,814) 850,223
Net change in cash and cash equivalents ............................ 280,310 86,352 17,954
Cash and cash equivalents, beginning of year ....................... 253,946 167,594 149,640
Cash and cash equivalents, end of year ............................. $ 534,256 $ 253,946 $ 167,594
The accompanying notes are an integral part of these statements.
F-4