AutoNation 2003 Annual Report Download - page 37

Table of Contents
Property operating lease buy-outs were $9.8 million, $19.8 million and $7.1 million for the years ended December 31, 2003, 2002 and
2001, respectively. We continue to analyze certain of our higher cost operating leases and evaluate alternatives in order to lower the effective
financing costs. From January 1, 2004 through March 5, 2004, we have executed $77.3 million in lease buy-outs.
Proceeds from the disposal of assets held for sale were $23.1 million, $34.8 million and $71.9 million during the years ended
December 31, 2003, 2002 and 2001, respectively. These amounts are primarily from the sales of megastore and other properties held for
sale.
Cash used in business acquisitions, net of cash acquired, was $49.1 million, $166.5 million and $92.0 million for the years ended
December 31, 2003, 2002 and 2001, respectively. During 2003, the Company acquired thirteen automotive retail franchises and other
related assets. Cash used in business acquisitions during 2003, 2002 and 2001 includes $3.2 million, $8.1 million and $22.3 million in
deferred purchase price for certain prior year automotive retail acquisitions. See discussion under the heading “Business Acquisitions and
Divestitures” and in Note 18, Acquisitions and Divestitures, of Notes to Consolidated Financial Statements.
In 2001, we received $59.0 million of cash from the divestiture of our New Jersey-based Flemington dealership group. As part of our
restructuring activities in 2001 we divested of certain non-core franchised automotive stores for which we received $2.2 million of cash. See
further discussion under the heading “Business Acquisitions and Divestitures” and in Note 18, Acquisitions and Divestitures, of Notes to
Consolidated Financial Statements.
Collections of installment loan receivables and other related items totaled $27.0 million, $86.7 million and $551.5 million for the years
ended December 31, 2003, 2002 and 2001, respectively. In December 2001, we decided to exit the business of underwriting retail
automobile loans for customers at our stores, which we determined was not a part of our core automotive retail business. We continue to
provide automotive loans and leases for our customers through unrelated third-party finance sources. In July 2003, we sold all of our finance
receivables portfolio to a third party and received proceeds equal to the net carrying value of the finance receivables and servicing liabilities at
the closing date of the transaction totaling $52.4 million, resulting in no gain or loss on the transaction.
In September 2002, one of our captive insurance companies terminated a reinsurance agreement with a third-party insurance company
and transferred our risk pertaining to certain extended warranty products under the reinsurance agreement back to such insurance company.
We transferred $66.6 million of restricted assets to the third-party insurance company in exchange for the assumption of the related
insurance reserves. During 2001, we moved various restricted cash deposits related to certain insurance programs to a series of restricted
investments. See Note 4, Restricted Assets and Reinsurance, of Notes to Consolidated Financial Statements for additional information.
During 2003, we sold all of our interest in an equity-method investment in LKQ Corporation, an auto parts recycling business, for
$38.3 million, resulting in a pre-tax gain of $16.5 million.
Cash Flows from Financing Activities
Cash flows from financing activities primarily include treasury stock purchases, proceeds from mortgage facilities and stock option
exercises.
We have repurchased approximately 39.2 million, 30.7 million and 27.3 million shares of our common stock during the years ended
December 31, 2003, 2002 and 2001, respectively, for an aggregate price of $575.2 million, $389.9 million and $256.8 million, respectively,
under our Board-approved share repurchase programs. We are targeting 2004 combined spending on acquisitions and share repurchases of
approximately $400 million.
During the years ended December 31, 2003, 2002 and 2001, we drew amounts totaling $183.6 million, $7.3 million and
$153.3 million, respectively, under our mortgage facilities.
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