Cash America 2011 Annual Report Download - page 104

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73
Cash Flows
The Company’s cash flows and other key indicators of liquidity are summarized as follows (dollars in
thousands):
Year Ended December 31,
2011 2010 2009
Cash flows provided by operating activities $448,856 $351,306 $263,560
Cash flows used in investing activities
Pawn loans $(50,771) $(4,393) $545
Consumer loans (297,029) (217,022) (153,481)
Acquisitions (49,539) (82,263) (43,615)
Property and equipment additions (75,049) (59,697) (44,101)
Investment in equity securities (5,000) (5,652) -
Other investing (515) 822 1,031
Total cash flows used in investing activities $(477,903) $(368,205) $(239,621)
Cash flows provided by (used in) financing activities $51,643 $10,222 $(12,765)
Working capital $644,891 $491,298 $414,450
Current ratio 4.8 x 4.8 x 4.1 x
Merchandise turnover 3.0 x 3.0 x 2.9 x
Debt to adjusted EBITDA ratio(a) 1.8 x 1.8 x 2.0 x
(
a
)
Non-GAAP measure. See “Adjusted EBITDA” section above for a reconciliation of adjusted EBITDA to net income attributable to the
Company.
Cash flows from operating activities. Net cash provided by operating activities increased $97.6 million, or
27.8%, from $351.3 million for the year ended December 31, 2010 to $448.9 million for the year ended December 31,
2011. A significant component of the increase in net cash provided by operating activities was a $19.9 million increase
in net income during 2011. An additional $43.3 million of net cash provided by operating activities during 2011 was
generated by an increase in the consumer loan loss provision, a non-cash expense, primarily as a result of increased loan
volume in the e-commerce segment. An increase in consumer loan volume causes an increase in the loan balance,
which immediately requires an increase in the balance sheet reserve for potential loan losses, that generates consumer
loan loss provision, a non-cash expense, during the period. The related cash expense for uncollectible loans is captured
as the difference in consumer loans made or purchased and consumer loans repaid for those loans that are uncollectible.
These amounts are reflected in cash flows from investing activities. Increases in current income taxes payable and
deferred income taxes provided cash of $34.4 million in 2011 compared to 2010. The increase was primarily due to the
implementation in 2011 of a change in the timing of tax deductions related to internally developed software as well as
the impact of the increased bonus depreciation rules in effect for all of 2011.
Net cash provided by operating activities increased $87.7 million, or 33.3%, from $263.6 million for the year
ended December 31, 2009 to $351.3 million for the year ended December 31, 2010. A significant component of the
increase in net cash provided by operating activities was a $17.3 million increase in net income during 2010. An
additional $51.6 million of net cash provided by operating activities during 2010 was generated by an increase in the
consumer loan loss provision, a non-cash expense, primarily as a result of increased loan volume in the e-commerce
segment. Changes in merchandise held for disposition also provided cash of $16.0 million, due to lower purchases of
merchandise from customers and third party vendors in 2010 compared to 2009. Changes in prepaid expense and other
assets increased cash from operations by $18.4 million, primarily due to decreases in receivables related to the