TeleNav 2010 Annual Report Download - page 64

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Liquidity and capital resources
The following table sets forth the major sources and uses of cash for each of the periods set forth below:
Fiscal Year Ended June 30,
2010 2009 2008
(in thousands)
Net cash provided by (used in) operating activities .............. $44,450 $23,040 $ (286)
Net cash used in investing activities .......................... (9,815) (6,994) (1,721)
Net cash provided by (used in) financing activities .............. 45,104 68 (35)
Effect of exchange rate changes on cash and cash equivalents ..... (5) 164 159
Net increase (decrease) in cash .............................. $79,734 $16,278 $(1,883)
At June 30, 2010, we had cash and cash equivalents of $112.9 million, which primarily consisted of money
market mutual funds held at major financial institutions. From inception until fiscal 2010, we financed our
operations primarily through private sales of equity. On May 18, 2010, we completed our IPO of 6,550,000
shares of common stock. We raised net proceeds from the offering of $44.6 million after deducting the
underwriter’s discount and offering expenses payable by us, based on an IPO price of $8.00 per share, including
1,050,000 shares of common stock purchased by the underwriters in connection with the exercise of their over-
allotment option.
Our accounts receivable are heavily concentrated in two wireless carrier partners. As of June 30, 2010, our
accounts receivable balance was $37.3 million, of which Sprint and AT&T represented 49% and 38%,
respectively.
Our future capital requirements will depend on many factors including our growth rate, the timing and
extent of expenditures to support development efforts, the expansion of research and development and sales and
marketing activities and headcount, the introduction of our new and enhanced service and product offerings and
the growth in our end user base. We believe our cash and cash equivalents and anticipated cash flows from
operations and the proceeds of our IPO will be sufficient to satisfy our financial obligations through at least the
next 12 months. However, we may experience lower than expected cash generated from operating activities,
revenue that is lower than we anticipate, or greater than expected cost of revenue or operating expenses. Our
revenue and operating results could be lower than we anticipate if, among other reasons, our wireless carrier
partners, two of which we are substantially dependent upon for a large portion of our revenue, were to limit or
terminate our relationships with them; we were to fail to successfully compete in our highly competitive market,
including against competitors who offer their services for free; our wireless carrier partners were to elect not to
market and distribute our LBS to end users; our wireless carrier partners were to elect to lower the prices charged
to their subscribers for our service; or if we were to experience a decline in our ARPU without a proportionate
decrease in the average cost per end user. In the future, we may acquire complementary businesses or
technologies or license technologies from third parties, and we may decide to raise additional capital through
debt or equity financing to the extent we believe this is necessary to successfully complete these acquisitions or
license these technologies. However, additional financing may not be available to us on favorable terms, if at all,
at the time we make such determinations, which could have a material adverse affect on our business, operating
results, financial condition and liquidity and cash position.
Net cash provided by (used in) operating activities. Net cash provided by (used in) operating activities was
$(286,000), $23.0 million and $44.5 million in fiscal 2008, 2009 and 2010, respectively. The improvement in
cash provided by operating activities was primarily due to the increased number of end users of our services and
related revenue generated from those end users, offset to a lesser extent by increases in our operating costs. Cash
provided by or used in operating activities has historically been affected by growth in our end user base and
increases in our operating costs, which are primarily due to increased headcount and royalty payments for
portions of the content provided in our services. In fiscal 2010, cash provided by operating activities was
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