Shutterfly 2014 Annual Report Download - page 78

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SHUTTERFLY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Year Ended December 31,
2014 2013 2012
Cash flows from operating activities:
Net income/(loss) ....................................... $ (7,860) $ 9,285 $ 22,998
Adjustments to reconcile net income/(loss) to net cash provided by operating
activities:
Depreciation and amortization ............................. 64,885 43,887 29,424
Amortization of intangible assets ............................ 33,867 30,969 20,685
Amortization of debt discount and transaction costs ................ 12,905 7,707 —
Stock-based compensation, net of forfeitures .................... 61,762 53,528 37,322
(Gain)/loss on disposal of property and equipment and rental assets ..... 361 13 (861)
Deferred income taxes .................................. (2,604) 331 54
Tax benefit/(shortfall) from stock-based compensation .............. (163) 2,957 14,619
Excess tax benefits from stock-based compensation ................ (1,025) (3,635) (16,622)
Changes in operating assets and liabilities:
Accounts receivable, net ................................ (9,464) (7,174) (577)
Inventories ........................................ (3,388) (3,681) (1,306)
Prepaid expenses and other current assets .................... (3,958) (4,347) (1,399)
Other assets ....................................... (1,442) (7,669) 212
Accounts payable .................................... (1,275) 3,583 15,230
Accrued and other liabilities ............................. 18,273 16,089 26,610
Deferred revenue .................................... 7,301 5,258 5,739
Other non-current liabilities ............................. (1,687) 167 (747)
Net cash provided by operating activities .................... 166,488 147,268 151,381
Cash flows from investing activities:
Acquisition of business and intangible assets, net of cash acquired ........ (12,000) (76,893) (57,212)
Purchases of property and equipment .......................... (71,169) (62,582) (40,535)
Capitalization of software and website development costs .............. (21,032) (15,760) (12,528)
Purchases of investments .................................. (124,111) — —
Maturities and sales of investments ............................ 29,980 — —
Proceeds from sale of property and equipment and rental assets ......... 904 388 986
Net cash used in investing activities ....................... (197,428) (154,847) (109,289)
Cash flows from financing activities:
Proceeds from borrowings of convertible senior notes, net of issuance costs . . — 291,897 —
Proceeds from issuance of warrants ............................ — 43,560 —
Purchase of convertible note hedge ............................ — (63,510) —
Proceeds from issuance of common stock upon exercise of stock options .... 3,243 19,112 10,211
Repurchases of common stock ............................... (88,815) (32,241) (3,752)
Excess tax benefits from stock-based compensation .................. 1,025 3,635 16,622
Principal payments of capital lease and financing obligations ............ (3,054) (878) —
Net cash provided by/(used in) financing activities .............. (87,601) 261,575 23,081
Net increase/(decrease) in cash and cash equivalents ................. (118,541) 253,996 65,173
Cash and cash equivalents, beginning of period .................... 499,084 245,088 179,915
Cash and cash equivalents, end of period ........................ $ 380,543 $ 499,084 $ 245,088
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest ............................................ $ 1,133 $ 466 $ —
Income taxes ........................................ 667 2,158 618
Supplemental schedule of non-cash investing / financing activities:
Net increase/(decrease) in accrued purchases of property and equipment . . $ (2,674) $ (3,372) $ 7,694
Net increase in accrued capitalized software and website development costs . 716 — —
Stock-based compensation capitalized with software and website
development costs .................................... 1,597 1,709 892
Increase in estimated fair market value of buildings under build-to-suit
leases ........................................... 22,855 10,080 6,372
Property and equipment acquired under capital leases .............. 37,823 — —
Amount due for acquisition of business ........................ 1,673 — 963
Amount due from adjustment of net working capital from acquired business 253 10 —
The accompanying notes are an integral part of these consolidated financial statements.
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