E-Z-GO 2013 Annual Report Download - page 45

Download and view the complete annual report

Please find page 45 of the 2013 E-Z-GO annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 102

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102

Textron Inc. Annual Report • 2013 32
Cash flows from operating activities decreased $122 million during 2013 as compared with 2012, largely due to a $133 million
impact related to working capital requirements and lower earnings, which were partially offset by a $206 million impact of lower
contributions to our pension plans in 2013. Significant changes within working capital included a $138 million unfavorable
impact resulting from net taxes paid between the periods as net tax payments were $174 million and $36 million in 2013 and 2012,
respectively, and $264 million of cash outflows related to changes in accounts receivable and accounts payable. These cash
outflows were partially offset by $198 million of cash inflows related to changes in inventory levels, largely at Cessna, and a $141
million impact from lower captive finance receivables.
Cash flows from operating activities decreased during 2012 as compared with 2011, as higher earnings were offset by changes in
working capital, which included lower net cash receipts from our captive financing activities of $140 million and an increase in
pre-owned inventory in the Cessna segment largely due to higher trade-in activities, resulting in a cash reduction of $117 million.
Our use of cash for working capital requirements was partially offset by $237 million in lower cash pension contributions made in
2012.
Cash flows from investing activities included capital expenditures of $444 million, $480 million, and $423 million in 2013, 2012
and 2011, respectively. Collections on finance receivables and proceeds from sales of finance receivables and other finance assets
totaled $368 million in 2013, $848 million in 2012 and $1.4 billion in 2011. Cash flows from investing activities also included
$196 million of cash used in 2013 for acquisitions of four businesses within our Textron Systems and Industrial segments and two
service centers in our Cessna segment.
Financing activities primarily consisted of the repayment of outstanding long-term debt of $1.3 billion, $0.6 billion and $1.4
billion in 2013, 2012 and 2011, respectively, partially offset by proceeds from the issuance of long-term debt of $448 million,
$106 million and $926 million, in 2013, 2012 and 2011, respectively. Cash used in financing activities also included $272 million
of share repurchases in 2012 and repayments of $1.4 billion against the outstanding balance on our bank credit lines in 2011.
Captive Financing and Other Intercompany Transactions
The Finance group finances retail purchases and leases for new and used aircraft and equipment manufactured by our
Manufacturing group, otherwise known as captive financing. In the Consolidated Statements of Cash Flows, cash received from
customers or from the sale of receivables is reflected as operating activities when received from third parties. However, in the
cash flow information provided for the separate borrowing groups, cash flows related to captive financing activities are reflected
based on the operations of each group. For example, when product is sold by our Manufacturing group to a customer and is
financed by the Finance group, the origination of the finance receivable is recorded within investing activities as a cash outflow in
the Finance group’s statement of cash flows. Meanwhile, in the Manufacturing group’s statement of cash flows, the cash received
from the Finance group on the customer’s behalf is recorded within operating cash flows as a cash inflow. Although cash is
transferred between the two borrowing groups, there is no cash transaction reported in the consolidated cash flows at the time of
the original financing. These captive financing activities, along with all significant intercompany transactions, are reclassified or
eliminated from the Consolidated Statements of Cash Flows.
Reclassification and elimination adjustments included in the Consolidated Statement of Cash Flows are summarized below:
(In millions) 2013 2012 2011
Reclassifications from investing activities:
Finance receivable originations for Manufacturing group inventory sales $ (248) $ (309) $ (284)
Cash received from customers and the sale of receivables 485 405 520
Other capital contributions made to Finance group — —(60)
Other 27 (16) 11
Total reclassifications from investing activities 264 80 187
Reclassifications from financing activities:
Capital contribution paid by Manufacturing group to Finance group 1 240 182
Dividends received by Manufacturing group from Finance group (175) (345) (179)
Other capital contributions made to Finance group — —60
Other (1) (3) (8)
Total reclassifications from financing activities (175) (108) 55
Total reclassifications and adjustments to cash flow from operating activities $ 89 $ (28) $ 242