Sears 2014 Annual Report Download - page 67

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67
SEARS HOLDINGS CORPORATION
Consolidated Statements of Cash Flows
millions 2014 2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,810) (1,116) (1,054)
Adjustments to reconcile net loss to net cash used in operating activities:
Deferred tax valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 835 720 237
Tax benefit resulting from Other Comprehensive Income allocation. . . . . . . . . . . . . . . . . . . — (97) —
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 581 732 830
Impairment charges. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63 233 330
Gain on sales of assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (207) (667) (468)
Gain on sales of investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (105) (169) (28)
Pension and postretirement plan contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (450) (426) (593)
Pension and postretirement plan settlements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 455
Mark-to-market adjustments of financial instruments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3) — —
Settlement of Canadian dollar hedges. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 9 6
Change in operating assets and liabilities (net of acquisitions and dispositions):
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (719) (441) (206)
Merchandise inventories. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,091 446 427
Merchandise payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (528) (230) (117)
Income and other taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (110) 63 (63)
Other operating assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (37) 37 (99)
Other operating liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 (203) 40
Net cash used in operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,387) (1,109) (303)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sales of property and investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 424 995 532
Net (increase) decrease in investments and restricted cash. . . . . . . . . . . . . . . . . . . . . . . . . . . — (2) 37
Purchases of property and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (270) (329) (378)
De-consolidation of Sears Canada cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (207) — —
Proceeds from Sears Canada rights offering(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 380 — —
Net cash provided by investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 327 664 191
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from debt issuances(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,025 994 5
Repayments of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (80) (83) (335)
Increase (decrease) in short-term borrowings, primarily 90 days or less . . . . . . . . . . . . . . . . (1,117) 238 (81)
Lands' End, Inc. pre-separation funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 515 — —
Separation of Lands' End, Inc.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (31) — —
Sears Hometown and Outlet Stores, Inc. pre-separation funding . . . . . . . . . . . . . . . . . . . . . . — — 100
Proceeds from the sale of Sears Hometown and Outlet Stores, Inc.(3) . . . . . . . . . . . . . . . . . . — — 347
Debt issuance costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (27) (14) (3)
Purchase of Sears Canada shares. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (10)
Sears Canada dividends paid to noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . — (233) (50)
Net cash provided by (used in) financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 285 902 (27)
Effect of exchange rate changes on cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3) (38) 1
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS. . . . . . . . . . . . . . . . . . (778) 419 (138)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR. . . . . . . . . . . . . . . . . . . . . . . . 1,028 609 747
CASH AND CASH EQUIVALENTS, END OF YEAR
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 250 $ 1,028 $ 609
SUPPLEMENTAL INFORMATION:
Capital lease obligation incurred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 45 $ 31 $ 61
Supplemental Cash Flow Data:
Income taxes paid, net of refunds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 119 $ 21 $ 40
Cash interest paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230 206 199
Unpaid liability to acquire equipment and software . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 41 30
Non-cash dividend in connection with Spin-Off transactions. . . . . . . . . . . . . . . . . . . . . . . . . — — (542)
(1) Includes proceeds of $212 million received from ESL and its affiliates.
(2) Proceeds in 2014 include $400 million received from a secured short-term loan with JPP II, LLC and JPP, LLC, entities affiliated with ESL, and $299 million
received from ESL and its affiliates for the issuance of Senior Unsecured Notes with warrants.
(3) Includes proceeds of $217 million received from ESL and its affiliates.
See accompanying Notes to Consolidated Financial Statements.