Creative 2002 Annual Report Download - page 18

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16
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
Cash and cash equivalents at June 30, 2002 were $166.9 million, a decrease of $1.3 million compared to the balance of
$168.2 million at June 30, 2001.
Operating Activities:
Net cash generated from operating activities during fiscal 2002 was $89.2 million compared with $76.9 million in fiscal
2001. The cash generated during fiscal 2002 primarily resulted from the net loss of $19.7 million offset by net adjustments
of $105.7 million for non-cash items including depreciation and amortization of $29.9 million, write off of in-process
technology acquired from 3Dlabs amounting to $26.1 million (see Note 15 of “Notes to Consolidated Financial Statements”),
investments and other non-current asset write downs of $49.3 million, and net gain from investments of $5.3 million.
Also contributing to the cash generated from operating activities were net decreases in accounts receivable of $18.2
million and inventory of $50.6 million which is in line with the management’s decision to maintain a lower inventory
level. However, the positive cash flow was offset partially by a net reduction in accounts payable, other accrued liabilities
and income taxes payable of $69.2 million, resulting in the net cash generated of $89.2 million.
Net cash generated from operating activities during fiscal 2001 was $76.9 million compared with $160.2 million in fiscal
2000. The cash generated during fiscal 2001 primarily resulted from the net loss of $130.4 million being more than offset
by net adjustments of $196.5 million for non-cash items including depreciation and amortization of $27.0 million,
investments and other non-current asset write downs of $214.8 million, and net gain from investments of $49.9 million.
Also contributing to the cash generated from operating activities were net decreases in marketable securities of $17.6
million, other assets and prepaids of $15.7 million, and inventory of $75.1 million which is in line with the management’s
decision to maintain a lower inventory level. However, the positive cash flow was offset partially by a net reduction in
accounts payable, other accrued liabilities and income taxes payable of $101.9 million, resulting in the net cash generated
of $76.9 million.
Investing Activities:
Net cash used for investing activities during fiscal 2002 was $49.8 million compared with $69.1 million in fiscal 2001.
The amount used in fiscal 2002 comprises $25.8 million for the acquisition of 3Dlabs, net of cash acquired (see Note 15
of “Notes to Consolidated Financial Statements”), purchase of investments of $9.2 million, capital expenditures of $8.1
million, and the acquisition of other non current assets of $20.6 million. The cash used in investing activities was offset
in part by the proceeds from sale of quoted investments amounting to $13.9 million.
Net cash used for investing activities during fiscal 2001 was $69.1 million compared with $104.3 million in fiscal 2000.
The amount used in fiscal 2001 comprises the purchase of investments of $110.4 million, capital expenditures of $34.5
million, and the acquisition of other non current assets of $13.1 million, including assets from Aureal. The cash used
in investing activities was offset in part by the proceeds from sale of quoted investments amounting to $88.9 million.