Jack In The Box 2013 Annual Report Download - page 28

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As is common in the restaurant industry, we maintain relatively low levels of accounts receivable and inventories and our vendors grant trade credit for
purchases such as food and supplies. We also continually invest in our business through the addition of new units and refurbishment of existing units, which
are reflected as long-term assets and not as part of working capital. As a result, we may at times maintain current liabilities in excess of current assets, which
results in a working capital deficit.

The table below summarizes our cash flows from operating, investing and financing activities for each of the past three fiscal years ( in thousands):



Total cash provided by (used in):
Operating activities
$198,872
$136,730
$124,260
Investing activities
(33,939)
(81,516)
(35,802)
Financing activities
(163,762)
(58,169)
(87,641)
Effect of exchange rate changes
4
—
—
Increase (decrease) in cash and cash equivalents
$1,175
$(2,955)
$ 817
. Operating cash flows increased $62.1 million in 2013 compared with 2012 due to reductions in working capital expenditures
primarily related to the outsourcing of our distribution business ( $29.9 million), a decrease in payments for property rent related to fluctuations in the timing
of payments for the month of October ($25.1 million), as well as an increase in net income adjusted for non-cash items ( $26.0 million). The impact of these
increases in cash flows were partially offset by a higher bonus payout in fiscal 2013 versus 2012 ( $11.2 million) and an increase in income tax payments
($7.6 million).
In 2012, operating cash flows increased $12.5 million compared with 2011 due primarily to reductions in payments for income taxes ($11.8 million), an
increase in minimum rent receipts from franchisees attributable to the timing of collections for October rents ($13.9 million) as well as an increase in net
income adjusted for non-cash items ($19.6 million). The impact of these increases in cash flows were partially offset by an increase in payments for property
rent related to fluctuations in the timing of payments for the month of October ($19.0 million) and pension contributions ($15.5 million).
. Cash flows used in investing activities decreased $47.6 million in 2013 compared with 2012 due primarily to decreases in cash used
to acquire Qdoba franchise-operated restaurants and assets which were held for sale and leaseback, as well as an increase in proceeds from assets held for sale
and leaseback. The impact of these decreases in cash flows were partially offset by a decrease in proceeds from the sale of Jack in the Box restaurants to
franchisees and an increase in capital expenditures. In 2012, cash flows used in investing activities increased $45.7 million compared with 2011 due
primarily to lower proceeds from the sale of Jack in the Box restaurants to franchisees and collections of notes receivables related to prior years’ refranchising
activity, as well as an increase in cash used to acquire Qdoba franchise-operated restaurants. The impact of these decreases in cash flows were partially offset
by a decrease in capital expenditures.
Capital Expenditures — The composition of capital expenditures in each year follows ( in thousands):
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

Jack in the Box:
New restaurants
$5,887
$12,984
$13,248
Restaurant facility expenditures
40,670
32,961
73,758
Other, including corporate
8,664
10,634
18,070
$55,221
$56,579
$105,076
Qdoba:
New restaurants
$22,672
$17,437
$18,384
Other, including corporate
6,797
6,184
5,852
$29,469
$23,621
$24,236
Consolidated capital expenditures
$84,690
$80,200
$129,312
Our capital expenditure program includes, among other things, investments in new locations, restaurant remodeling, new equipment and information
technology enhancements. In 2013, capital expenditures increased $4.5 million due primarily to an increase in spending related to the exteriors of Jack in the
Box restaurants as well as new Qdoba restaurants, partially offset by a decline in spending related to new Jack in the Box restaurants. In 2012, capital
expenditures decreased $49.1 million compared with 2011 due primarily to a decline in spending related to our Jack in the Box restaurant re-image and new
logo program which was substantially complete in 2011, as well as lower spending for capital maintenance activities and corporate technology.
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