Enom 2012 Annual Report Download - page 72

Download and view the complete annual report

Please find page 72 of the 2012 Enom 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 127

  • 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
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127

67
Cash Flow from Investing Activities
Year ended December 31, 2010, 2011 and 2012
Net cash used in investing activities was $67.5 million, $98.5 million and $66.3 million during the years ended
December 31, 2012, 2011 and 2010, respectively. Cash used in investing activities during the year ended December 31, 2012,
2011 and 2010 included investments in our intangible assets of $13.2 million, $49.3 million and $47.2 million, respectively,
primarily comprising media content. Cash used in investing activities included investments in property and equipment of $17.7
million, $18.2 million and $21.4 million during the year ended December 31, 2012, 2011 and 2010. These expenditures
included investments in servers and IT equipment, fixtures and fittings, leasehold improvements and internally developed
software. Cash flows from investing activities in 2012 also included $16.2 million related to business acquisitions made in
2012 as described in Note 13 (Business Acquisitions) to our consolidated financial statements, as well as $1.3 million of
deferred consideration for acquisitions made in prior years. Business acquisitions made during the year ended December 31,
2012 included Name.com for total anticipated purchase consideration of $18.0 million. Name.com was acquired to expand our
registrar platform as we prepare for the historic release of new gTLDs. Business acquisitions made during the year ended
December 31, 2011 included RSS Graffiti for total purchase consideration of $16.3 million and IndieClick Media Group for
total purchase consideration of $13.0 million. RSS Graffiti was acquired to enhance our social media service offering and the
IndieClick Media Group was acquired to expand our sales organization with particular focus on online properties in the
entertainment, music, film, fashion and comedy categories. Cash invested in purchases of intangible assets and property and
equipment, including internally developed software, was largely to support the growth of our business and infrastructure during
these periods.
Cash Flow from Financing Activities
Year ended December 31, 2010, 2011 and 2012
Net cash provided by (used in) financing activities was $(6.6) million, $66.9 million and $(10.5) million during the years
ended December 31, 2012, 2011 and 2010, respectively. During the years ended December 31, 2012 and 2011, we repurchased
1.1 million and 2.3 million shares of common stock at a cost of $8.9 million and $17.1 million, respectively, under our share
repurchase plan. During the years ended December 31, 2012 and 2011 we received proceeds of $12.5 million and $7.6 million
from the exercise of employee stock options and contributions from participants in our Employee Stock Purchase Plan and we
incurred $9.5 million and $0.7 million of costs related to net taxes paid on employee stock options exercises and RSUs vesting.
Cash provided from financing activities in the year ended December 31, 2011 included $78.5 million in net proceeds from our
IPO net of issuance costs of $3.3 million paid in that period. We also incurred $1.0 million of costs related to the replacement
of our previous credit facility with our Credit Agreement in 2011 which provides for a $105 million, five year revolving loan
facility, with the right (subject to certain conditions) to increase such facility by up to $75 million in the aggregate. The
syndicate of commercial banks under the Credit Agreement has no obligation to fund any increase in the size of the facility.
During the year ended December 31, 2010 we paid down the remaining $10.0 million outstanding under our revolving
credit facility at that time.
From time to time, we expect to receive cash from the exercise of employee stock options in our common stock. Proceeds
from the exercise of employee stock options will vary from period to period based upon, among other factors, fluctuations in
the market value of our common stock relative to the exercise price of such stock options.
Off Balance Sheet Arrangements
As of December 31, 2012, we did not have any off balance sheet arrangements.
Capital Expenditures
For the years ended December 31, 2010, 2011 and 2012, we used $21.4 million, $18.2 million and $17.7 million in cash to
fund capital expenditures to create internally developed software and purchase equipment. We currently anticipate making
capital expenditures of between $20 million and $30 million during the year ending December 31, 2013.