Under Armour 2014 Annual Report Download - page 48

C
ash Flows
The followin
g
table presents the ma
j
or components of net cash flows used in and provided b
y
operatin
g,
investin
g
and financin
g
activities for the periods presented
:
Year Ended December
31,
(In thousands
)
2014
2013
2012
N
et cas
h
prov
id
e
dby
(use
di
n):
O
peratin
g
activities $ 219,033 $ 120,070 $199,76
1
Investin
g
activities (152,312) (238,102) (46,931)
Financin
g
activities 182,306 126,795 12,297
E
ff
ect o
f
exc
h
an
g
e rate c
h
an
g
es on cas
h
an
d
cas
h
e
q
uivalents (3,341) (3,115) 1,330
N
et increase in cash and cash e
q
uivalents
$
245,686
$
5,648
$
166,457
Operatin
gA
ctivitie
s
Operating activities consist primarily of net income adjusted for certain non-cash items. Adjustments to ne
t
income for non-cash items include depreciation and amortization, unrealized foreign currency exchange rat
e
gains and losses, losses on disposals of property and equipment, stock-based compensation, deferred income
taxes and changes in reserves and allowances. In addition, operating cash flows include the effect of changes i
n
o
perating assets and liabilities, principally inventories, accounts receivable, income taxes payable and receivable,
p
repaid expenses and other assets, accounts payable and accrued expenses.
Cash provided by operating activities increased
$
98.9 million to
$
219.0 million in 2014 from
$
120.1 million
in 2013. The increase in cash provided by operating activities was due to adjustments to net income for non-cash
items, which increased
$
57.5 million and an increase in net income of
$
45.7 million, partially offset by decreased
net cash flows from operating assets and liabilities of
$
4.3 million year over year
.
A
djustments to net income for non-cash items increased in 2014 as compared to 2013 primarily due to
higher depreciation and amortization related to acquired intangible assets and increased capital expenditure
,
along with a higher net increase in reserves and allowances in 2014 as compared to 2013
.
The decrease in net cash flows related to changes in operating assets and liabilities period over period was
p
rimarily driven by the following:
•
a decrease in inventor
y
investments of $72.2 million due to earl
y
deliveries of product and incremental
i
nventor
y
investments in the prior
y
ear.
This decrease was partiall
y
offset b
y
:
•
a lar
g
er increase in accounts receivable of $65.1 million in 2014 as compared to 2013, primaril
y
due to
a high
er proport
i
on o
f
sa
l
es to our
i
nternat
i
ona
l
customers w
i
t
hl
on
g
er pa
y
ment terms compare
d
to t
he
p
r
i
or
y
ear.
Cash provided b
y
operatin
g
activities decreased $79.7 million to $120.1 million in 2013 fro
m
$
199.8 million in 2012. The decrease in cash provided b
y
operatin
g
activities was due to decreased net cash
f
lows from operatin
g
assets and liabilities of $142.4 million, partiall
y
offset b
y
an increase in net income of
$
33.6 million and ad
j
ustments to net income for non-cash items, which increased $29.1 million
y
ear over
y
ear
.
Th
e
i
ncrease
i
n net cas
hfl
ows re
l
ate
d
to c
h
an
g
es
i
n operat
i
n
g
assets an
dli
a
bili
t
i
es per
i
o
d
over per
i
o
d
was
p
r
i
mar
ily d
r
i
ven
by
t
h
e
f
o
ll
ow
i
n
g
:
•
an increase in inventory investments of
$
161.6 million. Inventory grew in 2013 at a rate higher than
r
evenue growth primarily due to supplier delivery challenges experienced in 2012, early deliveries of
38