Mondelez 2014 Annual Report Download - page 47

Table of Contents
Liquidity and Capital Resources
We believe that cash from operations, our $4.5 billion revolving credit facility and our authorized long-term financing will provide
sufficient liquidity for our working capital needs, planned capital expenditures, future contractual obligations, share repurchases and
payment of our anticipated quarterly dividends. We expect to maintain investment grade credit ratings on our debt. We continue to
utilize our commercial paper program, primarily uncommitted international credit lines and long-term debt issuances for regular
funding requirements. We also use intercompany loans with our international subsidiaries to improve financial flexibility. Overall, we
do not expect any negative effects to our funding sources that would have a material effect on our liquidity, including the indefinite
reinvestment of our earnings outside of the United States. In Venezuela, we consider all undistributed earnings to be indefinitely
reinvested and access to cash of $278 million in Venezuela to be limited due to the uncertain economic and political environment.
We do not expect this limitation to have a material adverse effect on our liquidity. Refer to Note 1, Summary of Significant
Accounting Policies
– Currency Translation and Highly Inflationary Accounting , for additional information.
The cash flow activity of the Kraft Foods Group, Inc. discontinued operation, which was divested on October 1, 2012, is included
within our consolidated cash flow results for periods prior to October 1, 2012.
Net Cash Provided by Operating Activities:
Operating activities provided net cash of $3,562 million in 2014, $6,410 million in 2013 and $3,923 million in 2012. The decrease in
operating cash flows in 2014 relative to 2013 was primarily related to our receipt of $2.6 billion of net cash from the resolution of the
Starbucks arbitration in 2013 and higher related income taxes paid in 2014 and lower relative working capital cash improvements
than in 2013, as we decreased our cash conversion cycle (a metric that measures working capital efficiency and utilizes days sales
outstanding, days inventory on hand and days payables outstanding) by 10 days in 2014 as compared to a 13 day reduction in
2013. These year-over-year decreases were partially offset by lower interest payments in 2014 following the debt refinancing in the
first quarter of 2014 and the fourth quarter of 2013. The increase in operating cash flows in 2013 relative to 2012 was primarily
related to the receipt of the $2.6 billion from the Starbucks arbitration resolution, lower spending on Spin-Off Costs and the 2012-
2014 Restructuring Program, lengthening of days payables outstanding, increased collection of receivables and lower interest
payments.
Net Cash Used in Investing Activities:
Net cash used in investing activities was $1,642 million in 2014, $1,483 million in 2013 and $1,687 million in 2012. The increase in
net cash used in investing activities in 2014 relates to lower cash inflows in 2014 to offset higher capital expenditures in 2014. In
2013, we received higher cash proceeds from property sales, net proceeds from divestitures and cash from Kraft Foods Group,
Inc.
in connection with the Spin-Off, partially offset by cash we paid for an acquisition in Morocco. The decrease in net cash used in
investing activities in 2013 relative to 2012 related to payments made to Kraft Foods Group, Inc. in 2012 in connection with the
Spin-Off, partially offset by cash we paid for the acquisition in Morocco and lower proceeds from divestitures in 2013.
Capital expenditures were $1,642 million in 2014, $1,622 million in 2013 and $1,610 million in 2012. The 2014 capital expenditures
were funded from operating activities and were made primarily to modernize manufacturing facilities and support new product and
productivity initiatives. We expect 2015 capital expenditures to be up to $1.8 billion, including capital expenditures required for
investments in systems and the 2014-2018 Restructuring Program. We expect to continue to fund these expenditures from
operations.
Net Cash (Used in) / Provided by Financing Activities:
Net cash used in or provided by financing activities was $2,688 million used in 2014, $6,687 million used in 2013 and $204 million
provided in 2012. The decrease in net cash used in financing activities in 2014 relative to 2013 was primarily due to significantly
lower long-term debt repayments and lower share repurchases in 2014, offset in part by decreased proceeds from the issuance of
long-term debt and other short-term borrowings and higher dividend payments in 2014. The decrease in net cash provided by
financing activities in 2013 relative to 2012 was primarily due to lower net proceeds from the issuance of long-term debt, higher re-
payment of long-term debt and repurchases of Common Stock, partially offset by lower dividend payments reflecting our new
capital structure and dividend rate following the Spin-Off and higher short-term borrowings.
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