First Data 2008 Annual Report Download - page 80

FIRST DATA CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
Other Investing Activities
The use of cash from other investing activities in 2008 related mostly to $12.3 million in illiquid money market funds reclassified from cash and cash
equivalents in December 2008 and other items not individually significant. These were mostly offset by a source of cash related to proceeds from the sale of
merchant portfolios and the redemption of VISA stock. Due to volatility in the global credit and capital markets, certain of the Company's portfolio holdings
within settlement assets lack liquidity or are otherwise impaired. Refer to Note 20 to the Consolidated Financial Statements included in Item 8 of this Form
10-K for a description of the impacted securities. The Company does not anticipate the need to liquidate the securities currently lacking liquidity until after
2009.
The source of cash from other investing activities in the 2007 successor period related most significantly to $49.5 million from activity associated with
the Company's First Financial Bank which was dissolved prior to December 31, 2007, $44.3 million from the sale of strategic investments and a decrease of
$34.6 million in regulatory, restricted and escrow cash balances. These sources were partially offset by a use related to $20.2 million in payments for
termination of interest rate and cross currency swaps. The use of cash in the 2007 predecessor period related to sources of $75.0 million in distributions from
certain strategic investments, proceeds from the sale of merchant portfolios and proceeds from the sale of investments as well as $48.6 million related to
activity associated with the Company's First Financial Bank. Offsetting these sources were uses related to $85.2 million in payments for termination of
interest rate and cross currency swaps, a $31.1 million increase in regulatory, restricted and escrow cash balances and the distribution of $27.6 million to a
minority holder of proceeds received from the sale of Taxware.
The source of cash for other investing activities in 2006 related to $168.9 million in activity from the date of acquisition for FDD related to a reduction
in settlement cash, a $162.2 million reduction in regulatory, restricted and escrow cash balances, $56.2 million of proceeds from the sale of investments and
other activity and proceeds of $27.1 million from the sale of corporate aircraft. Partially offsetting these sources were uses related to a contingent payment of
$29.9 million related to the 2004 disposition of NYCE (all but $1.6 million of which was accrued at December 31, 2005), a net cash outflow of $32.6 million
associated with the sale of a facility related to the Concord merger, $101.6 million in payments related to certain derivative financial instruments, and a use of
$47.7 million resulting from the purchase of investments related to the Company's First Financial Bank and other activity.
Cash Flows from Financing Activities from Continuing Operations
Successor Predecessor
Source/(use) (in millions)
Year ended
December 31,
2008
Period from
September 25
through
December 31,
2007
Period from
January 1
through
September 24,
2007
Year ended
December 31,
2006
Short-term borrowings, net $ (41.9) $ 238.5 $ 26.3 $ 176.0
Principal payments on long-term debt (326.8) (2,033.3) (126.6) (2,412.8)
Proceeds from issuance of long-term debt 100.4 21,245.7 — —
Proceeds from issuance of common stock — 7,224.4 187.4 729.8
Capital contributed by Parent 126.8 — — —
Excess tax benefit from share-based payment arrangement 13.1 — 219.8 124.2
Purchase of treasury shares — — (371.8) (1,252.5)
Cash dividends (1.8) — (67.7) (183.6)
Net cash (used in) provided by financing activities from continuing operations $ (130.2) $ 26,675.3 $ (132.6) $ (2,818.9)
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