WeightWatchers 2003 Annual Report Download - page 59

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WEIGHT WATCHERS INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE FISCAL YEARS ENDED
(IN THOUSANDS)
January 3, December 28, December 29,
2004 2002 2001
(53 Weeks) (52 Weeks) (52 Weeks)
Operating activities:
Net income ........................................ $143,941 $143,694 $147,187
Adjustments to reconcile net income to cash provided by
operating activities:
Depreciation and amortization ........................... 5,894 4,738 13,243
Amortization of deferred financing costs .................... 1,248 1,313 2,097
Restricted stock compensation expense ..................... 53 — —
Loss on settlement of hedge ............................ 5,381 — —
Deferred tax provision (benefit) .......................... 16,906 4,566 (71,069)
Unrealized (gain) loss on derivative instruments ............... (5,097) (174) 1,125
Accounting for equity investment ......................... (5,000) — 17,344
Allowance for doubtful accounts .......................... 552 233 6,330
Reserve for inventory obsolescence, other ................... 4,627 2,754 2,718
Foreign currency exchange rate loss (gain) ................... 7,271 17,224 (6,496)
Early extinguishment of debt ............................ 47,368 — 4,659
Tax benefit of stock options exercised ...................... 7,319 6,331 —
Other items, net .................................... (63) (156) 191
Changes in cash due to:
Receivables ...................................... 861 (5,099) 231
Inventories ....................................... 1,149 (12,443) (11,895)
Prepaid expenses .................................. (1,555) (9,131) (5,605)
Accounts payable .................................. (563) 1,594 5,201
Accrued liabilities .................................. (3,469) 1,965 3,143
Deferred revenue .................................. (42) 2,126 7,290
Income taxes ..................................... 6,318 5,403 5,870
Cash provided by operating activities ..................... 233,099 164,938 121,564
Investing activities:
Capital expenditures .................................. (5,029) (4,889) (3,834)
Advances, repayments and interest in equity investment .......... 5,000 — (17,344)
Cash paid for acquisitions .............................. (210,470) (68,148) (97,877)
Other items, net .................................... (1,121) (827) (1,063)
Cash used for investing activities ........................ (211,620) (73,864) (120,118)
Financing activities:
Net increase in short-term borrowings ...................... 998 254 748
Proceeds from borrowings .............................. 85,000 — 35,042
Payment of dividends ................................. — (1,249) (1,500)
Payments on long-term debt ............................ (58,447) (35,338) (25,813)
Proceeds from new term loan ........................... 227,326 — —
Repayment of high-yield loan ............................ (244,919) — —
Proceeds from settlement of hedge ........................ 2,710 — —
Premium paid on extinguishment of debt and other costs ......... (42,980) — —
Redemption of redeemable preferred stock .................. — (25,000) —
Deferred financing cost ................................ (2,366) — (2,406)
Purchase of treasury stock .............................. (28,815) — (27,132)
Cost of public equity offering ............................ — (850) (1,017)
Proceeds from sale of common stock ...................... — — 525
Proceeds from stock options exercised ...................... 2,003 1,694 198
Cash used for financing activities ........................ (59,490) (60,489) (21,355)
Effect of exchange rate changes on cash and cash equivalents and other 3,923 3,607 (1,254)
Net (decrease) increase in cash and cash equivalents ............. (34,088) 34,192 (21,163)
Cash and cash equivalents, beginning of fiscal year ............... 57,530 23,338 44,501
Cash and cash equivalents, end of fiscal year ................... $23,442 $ 57,530 $ 23,338
The accompanying notes are an integral part of the consolidated financial statements.
F-5