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66
SEARS HOLDINGS CORPORATION
Consolidated Statements of Cash Flows
millions 2013 2012 2011
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (1,116) $ (1,054) $ (3,147)
Income from discontinued operations, net of tax. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 27
Loss from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,116) (1,054) (3,120)
Adjustments to reconcile net loss to net cash used in operating activities:
Deferred tax valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 720 237 1,798
Tax benefit resulting from Other Comprehensive Income allocation. . . . . . . . . . . . . . . . . . . (97) — —
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 732 830 853
Impairment charges. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 233 330 649
Gain on sales of assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (667) (468) (64)
Gain on sales of investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (169) (28) —
Pension and postretirement plan contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (426) (593) (390)
Pension and postretirement plan settlements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 455 —
Settlement of Canadian dollar hedges. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 6 —
Change in operating assets and liabilities (net of acquisitions and dispositions):
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (441) (206) (533)
Merchandise inventories. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 446 427 545
Merchandise payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (230) (117) (134)
Income and other taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63 (63) (50)
Mark-to-market adjustments and settlements on Sears Canada derivative instruments (6) 1 2
Other operating assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 (100) 67
Other operating liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (203) 40 70
Net cash used in operating activities—continuing operations . . . . . . . . . . . . . . . . . . . . (1,109) (303) (307)
Net cash provided by operating activities—discontinued operations . . . . . . . . . . . . . . — — 32
Net cash used in operating activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,109) (303) (275)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sales of property and investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 995 532 72
Net (increase) decrease in investments and restricted cash. . . . . . . . . . . . . . . . . . . . . . . . . . . (2) 37 8
Purchases of property and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (329) (378) (432)
Net cash provided by (used in) investing activities—continuing operations. . . . . . . . . 664 191 (352)
Net cash provided by investing activities—discontinued operations. . . . . . . . . . . . . . . — — 43
Net cash provided by (used in) investing activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 664 191 (309)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from debt issuances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 994 5 104
Repayments of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (83) (335) (611)
Increase (decrease) in short-term borrowings, primarily 90 days or less . . . . . . . . . . . . . . . . 238 (81) 815
Sears Hometown and Outlet Stores, Inc. pre-separation funding . . . . . . . . . . . . . . . . . . . . . . — 100 —
Proceeds from the sale of Sears Hometown and Outlet Stores, Inc.. . . . . . . . . . . . . . . . . . . . — 347 —
Debt issuance costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (14) (3) (35)
Purchase of Sears Canada shares. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (10) (43)
Sears Canada dividends paid to noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . (233) (50) —
Purchase of treasury stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (183)
Net cash provided by (used in) financing activities—continuing operations . . . . . . . . 902 (27) 47
Net cash used in financing activities—discontinued operations . . . . . . . . . . . . . . . . . . — — (75)
Net cash provided by (used in) financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 902 (27) (28)
Effect of exchange rate changes on cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . (38) 1 —
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS. . . . . . . . . . . . . . . . . . 419 (138) (612)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR. . . . . . . . . . . . . . . . . . . . . . . . 609 747 1,359
CASH AND CASH EQUIVALENTS, END OF YEAR
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,028 $ 609 $ 747
SUPPLEMENTAL INFORMATION:
Capital lease obligation incurred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 31 $ 61 $ 3
Supplemental Cash Flow Data:
Income taxes paid, net of refunds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 21 $ 40 $ 94
Cash interest paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206 199 223
Unpaid liability to acquire equipment and software . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 30 52
Non-cash dividend in connection with Spin-Off transactions. . . . . . . . . . . . . . . . . . . . . . . . . — (542) (74)
See accompanying Notes to Consolidated Financial Statements.