Autodesk 2005 Annual Report Download - page 45

of revenues. In addition, we receive cash proceeds from the exercise of employee stock options and the purchase
of employee stock purchase plan shares and use cash to repurchase outstanding Autodesk shares under our share
repurchase program.
At January 31, 2005, our principal sources of liquidity were cash and marketable securities totaling $532.7
million and net accounts receivable of $196.8 million. During fiscal 2005, we generated $373.1 million of cash from
operating activities as compared to $220.1 million in fiscal 2004. Working capital sources of cash included
increases in accrued compensation of $51.3 million related to bonus and other incentive compensation accruals
as well as a $51.4 million increase in current deferred revenues reflecting higher subscription sales. Working capital
uses of cash included an increase of $30.0 million in accounts receivable primarily due to higher revenue. Our
days sales outstanding improved to 50 days at January 31, 2005 compared to 51 days at the end of fiscal 2004.
In addition, cash from operations benefited from the significant movements in our deferred taxes resulting from
the DRD Legislation and future tax benefits associated with employee stock option exercises.
During fiscal 2005, we generated $175.6 million of cash from investing activities compared to net cash used
of $59.0 million during fiscal 2004. The net generation of cash from investing activities during fiscal 2005 was
due to significantly higher net sales of available-for-sale marketable securities offset in part by slightly higher
capital and other expenditures related to business combinations and a customer information and customer
support software implementation, as compared to fiscal 2004. This implementation is expected to provide us
with improved operational efficiencies worldwide, enable strategic decision making and drive customer
satisfaction and future sales. The total charges incurred in fiscal 2005 were $24.7 million, of which $20.5 million
were capitalized. The total charges in fiscal 2004 were $7.6 million, of which $4.6 million were capitalized. We
implemented the customer information and customer support software in certain geographies in March 2005
and expect to incur $5.6 million in fiscal 2006 to complete the implementation worldwide. A larger portion of
our internal-use software application development costs, including those described above, were required to be
capitalized under generally accepted accounting principles during fiscal 2005 which resulted in a reduction of
our IT-related project expenses. Certain marketable securities were liquidated to fund our repurchase of 25.9
million shares of our common stock, as discussed below.
We used $317.7 million in net cash for financing activities during fiscal 2005, compared to $76.5 million during
fiscal 2004. The major financing uses of cash in both periods were for the repurchase of our common stock and
the payment of dividends. During fiscal 2005, we repurchased 25.9 million shares for $546.4 million and during
fiscal 2004 we repurchased 18.1 million shares for $178.5 million. At January 31, 2005, approximately 32.2 million
shares remained available for repurchase under the existing repurchase authorization of the Board of Directors.
We expect to continue our stock repurchase programs. Dividend payments were $13.6 million in fiscal 2005 and
$13.4 million in fiscal 2004. As announced in December 2004, we discontinued the payment of cash dividends
after the dividend for the fourth quarter of fiscal 2005, which will be paid in April 2005. Proceeds from the issuance
of common stock under our stock option and stock purchase plans continue to be a principal source of cash from
financing activities and amounted to $242.2 million in fiscal 2005 and $115.4 million in fiscal 2004.
During fiscal 2004, we had a U.S. line of credit available that permitted unsecured short-term borrowings
of up to $40.0 million. This credit facility expired in February 2004. We did not renew this facility as we believe
our existing cash, cash equivalents, marketable securities and cash generated from operations will be sufficient
to satisfy our currently anticipated short-term and long-term cash requirements. Long-term cash requirements,
other than normal operating expenses, are anticipated for the development of new software products and
incremental product offerings resulting from the enhancement of existing products; financing anticipated
growth; the share repurchase program; the acquisition of businesses, software products, or technologies
complementary to our business; and capital expenditures, including the purchase and implementation of
internal-use software applications.
At January 31, 2005 approximately 10% of our consolidated cash, cash equivalents and marketable securities
were held with financial institutions in the United States; the remaining balances are held with financial
institutions outside the United States. As a result of the passage of the Dividends Received Deduction Legislation
in October 2004, we intend to repatriate up to $500 million of accumulated foreign earnings from our foreign
operations to the U.S. during fiscal 2006, where we can more effectively manage our cash and invest in our
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