Supercuts 2008 Annual Report Download - page 57

Investing Activities
Net cash used in investing activities during the twelve months ended June 30, 2008, 2007 and 2006 were the result of the following:
Acquisitions during fiscal year 2008 were primarily funded by a combination of operating cash flows and debt. Additionally the Company
completed 186 major remodeling projects were completed during fiscal year 2008, compared to 155 and 170 during fiscal years 2007 and 2006,
respectively. We constructed 325 company-owned salons, three hair restoration centers and acquired 382 company-owned salons (150 of which
were franchise buybacks) and six hair restoration centers, all of which were franchise buybacks, Investing activities also included a $36.4 million
loan to Empire Education Group, Inc. In addition, there was $10.9 million in cash held by the schools and European salon businesses that were
deconsolidated.
Acquisitions during fiscal year 2007were primarily funded by a combination of operating cash flows and debt. Additionally, 155 major
remodeling projects were completed during fiscal year 2007, compared to 170 and 205 during fiscal years 2006 and 2005, respectively. We
constructed 420 company-owned salons and two beauty schools and acquired 354 company-owned salons (97 of which were franchise
buybacks), one beauty school and two hair restoration centers (one of which was a franchise buyback) during fiscal year 2007. During fiscal year
2007, loans and investments, net, included $9.9 million related to an equity investment the Company made in October 2006, $8.2 million related
to a cost method investment made in April 2007, $3.1 million related to the cost method investment made in April 2007 and $4.0 million related
to a note receivable issued under a credit agreement with the entity that is the majority corporate investor of an entity in which we hold a
minority interest. Investing activities also included an $8.9 million cash outlay related to the settlement of our cross-currency swap (which had a
notional amount of $21.3 million and hedged a portion of the Company's net investment in its foreign operations).
We constructed 531 company-owned salons, two beauty schools and one hair restoration center and acquired 290 company-owned salons
(142 of which were franchise buybacks), 30 beauty schools and eight hair restoration centers (seven of which were franchise buybacks) during
fiscal year 2006. During fiscal year 2006, we entered into a credit agreement with a third party, under which we lent $6.0 million, and in 2007,
we extended the term of the note to March 31, 2009. Refer to Note 3, to the Consolidated Financial Statements for further details surrounding
this arrangement.
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Investing Cash Flows
For the Years Ended June 30,
2008 2007 2006
(Dollars in thousands)
Business and salon acquisitions
$
(132,971
)
$
(68,747
)
$
(155,481
)
Capital expenditures for remodels or other additions
(35,212
)
(35,299
)
(41,246
)
Capital expenditures for the corporate office (including all technology
-
related expenditures)
(18,310
)
(21,452
)
(30,455
)
Payment of contingent purchase price
—
—
(
3,630
)
Capital expenditures for new salon construction
(32,277
)
(33,328
)
(44,583
)
Proceeds from loans and investments
10,000
5,250
—
Disbursements for loans and investments
(46,400
)
(30,673
)
(6,000
)
Transfer of cash related to contribution of schools and European franchise salon operations
(10,906
)
—
—
Net investment hedge settlement
—
(
8,897
)
—
Proceeds from sale of assets
47
97
730
$
(266,029
)
$
(193,049
)
$
(280,665
)