Banana Republic 2015 Annual Report Download - page 34

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25
• an increase of $132 million related to lease incentives and other long-term liabilities primarily due to the receipt
of an upfront payment in fiscal 2014 related to the amendment of our credit card program agreement with the
third-party financing company, which is being amortized into income over the term of the contract; and
• an increase of $184 million related to merchandise inventory primarily due to timing of receipts; partially offset
by
• a decrease of $146 million related to accounts payable primarily due to timing of payments;
• a decrease of $28 million related to accrued expenses and other current liabilities primarily due to timing of
payments; and
• a decrease of $18 million in net income.
We fund inventory expenditures during normal and peak periods through cash flows from operating activities and
available cash. Our business follows a seasonal pattern, with sales peaking during the end-of-year holiday period.
The seasonality of our operations may lead to significant fluctuations in certain asset and liability accounts
between fiscal year-end and subsequent interim periods.
Cash Flows from Investing Activities
Net cash used for investing activities during fiscal 2015 increased $134 million compared with fiscal 2014,
primarily due to the following:
• $121 million of proceeds from the sale of a building owned but no longer occupied by the Company in fiscal
2014; and
• $12 million more property and equipment purchases.
Net cash used for investing activities during fiscal 2014 decreased $28 million compared with fiscal 2013,
primarily due to the following:
• $121 million of proceeds from the sale of a building owned but no longer occupied by the Company in fiscal
2014; partially offset by
• $50 million less maturities of short-term investments; and
• $44 million more property and equipment purchases.
In fiscal 2015, cash used for purchases of property and equipment was $726 million. In fiscal 2016, we expect
cash spending for purchases of property and equipment to be about $650 million.
Cash Flows from Financing Activities
Net cash used for financing activities during fiscal 2015 decreased $517 million compared with fiscal 2014,
primarily due to the following:
• $400 million proceeds from the issuance of short-term debt in fiscal 2015; and
• $164 million less repurchases of common stock; partially offset by
• $4 million net cash out flows for fiscal 2015 compared with $38 million net cash inflows for fiscal 2014 related to
issuance under share-based compensation plans and withholding tax payments related to vesting of stock
units.
Net cash used for financing activities during fiscal 2014 increased $503 million compared with fiscal 2013,
primarily due to the following:
• $200 million more repurchases of common stock;
• $144 million proceeds from issuance of long-term debt in fiscal 2013;
• $62 million more cash dividends paid; and
• $59 million less net cash inflows for fiscal 2014 related to issuances under share-based compensation plans
and withholding tax payments related to vesting of stock units.