The Gap 2008 Annual Report Download - page 52

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THE GAP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Fiscal Year
($ in millions) 2008 2007 2006
Cash flows from operating activities:
Netearnings ............................................................................. $ 967 $ 833 $ 778
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciationandamortization(a) ..................................................... 568 547 530
Share-basedcompensation ........................................................... 55 52 54
Taxbenefitfromexerciseofstockoptionsandvestingofstockunits ..................... 5825
Excesstaxbenefitfromexerciseofstockoptionsandvestingofstockunits ............... (6) (7) (23)
Non-cashandotheritems ............................................................ 61 54 11
Deferredincometaxes................................................................ 10 (51) (41)
Changes in operating assets and liabilities:
Merchandiseinventory ........................................................... 51 252 (97)
Othercurrentassetsandotherlong-termassets ................................... 34 18 12
Accountspayable ................................................................ (4) 199 (6)
Accrued expenses and other current liabilities ...................................... (284) 32 56
Incometaxespayable,netofprepaidandothertax-relateditems .................... (94) (4) (102)
Lease incentives and other long-term liabilities ..................................... 49 148 53
Netcashprovidedbyoperatingactivities ................................................... 1,412 2,081 1,250
Cash flows from investing activities:
Purchasesofpropertyandequipment ...................................................... (431) (682) (572)
Proceedsfromsaleofpropertyandequipment.............................................. 11122
Purchasesofshort-terminvestments ...................................................... (75) (894) (1,460)
Maturitiesofshort-terminvestments ...................................................... 251 1,287 1,841
Acquisitionofbusiness,netofcashacquired................................................ (142) — —
Changeinrestrictedcash ................................................................. (1) 7 11
Changeinotherlong-termassets .......................................................... (1) (3) 8
Netcashusedforinvestingactivities ....................................................... (398) (274) (150)
Cash flows from financing activities:
Paymentsoflong-termdebt............................................................... (138) (326) —
Proceedsfromshare-basedcompensation,net.............................................. 75 125 190
Repurchasesofcommonstock............................................................. (705) (1,700) (1,050)
Excesstaxbenefitfromexerciseofstockoptionsandvestingofstockunits ................... 6723
Cashdividendspaid ...................................................................... (243) (252) (265)
Netcashusedforfinancingactivities....................................................... (1,005) (2,146) (1,102)
Effectofexchangeratefluctuationsoncash ................................................ (18) 33 (3)
Netdecreaseincashandcashequivalents .................................................. (9) (306) (5)
Cashandcashequivalentsatbeginningofperiod ........................................... 1,724 2,030 2,035
Cashandcashequivalentsatendofperiod ................................................. $ 1,715 $ 1,724 $ 2,030
Supplemental disclosure of cash flow information:
Cashpaidforinterestduringtheperiod .................................................... $17$39$40
Cashpaidforincometaxesduringtheperiod ............................................... $ 674 $ 535 $ 575
(a) Depreciation and amortization is net of the amortization of lease incentives of $85 million, $88 million, and $84 million for fiscal 2008,
2007, and 2006, respectively.
See Notes to the Consolidated Financial Statements
40 Gap Inc. Form 10-K