Nutrisystem 2007 Annual Report Download - page 49

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NUTRISYSTEM, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Year Ended December 31,
2007 2006 2005
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income ......................................................................... $104,152 $ 85,130 $ 21,015
Adjustments to reconcile net income to net cash provided by operating activities-
Loss on discontinued operation ...................................................... 795 548 691
Depreciation and amortization ...................................................... 5,812 2,464 700
Loss on disposal of fixed assets ..................................................... 303 17 9
Share–based expense ............................................................. 4,270 5,507 137
Deferred income tax (benefit) expense ................................................ (2,163) 3,488 (3,005)
Tax benefit from stock option exercises ............................................... — — 16,105
Equity loss ...................................................................... 800 — —
Changes in operating assets and liabilities
Accrued interest income ........................................................... 590 (343) (266)
Receivables ..................................................................... (1,886) (9,746) (6,457)
Inventories ...................................................................... (10,110) (38,213) (30,474)
Other assets ..................................................................... (3,878) (7,342) (3,056)
Accounts payable ................................................................ 779 19,637 21,389
Accrued payroll and related benefits ................................................. 547 442 566
Income taxes .................................................................... 6,004 — —
Other accrued expenses and liabilities ................................................ 1,381 4,725 (54)
Net cash provided by operating activities of continuing operations ...................... 107,396 66,314 17,300
Net cash provided by operating activities of discontinued operation ..................... 829 526 327
Net cash provided by operating activities .......................................... 108,225 66,840 17,627
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of marketable securities ................................................... (178,800) (119,350) (41,800)
Sales of marketable securities ....................................................... 243,250 94,950 —
Capital additions ................................................................. (18,703) (5,881) (5,338)
Purchase of equity investment ...................................................... (14,258) — —
Net cash provided by (used in) investing activities of continuing operations .............. 31,489 (30,281) (47,138)
Net cash provided by (used in) investing activities of discontinued operation .............. 1,650 (1,679) (96)
Net cash provided by (used in) investing activities .................................. 33,139 (31,960) (47,234)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common shares, net of offering costs ....................................... — — 25,399
Exercise of stock options .......................................................... 1,931 3,632 4,135
Tax benefit from stock option exercises ............................................... 7,317 17,939 —
Debt issuance costs ............................................................... (814) — —
Repurchase and retirement of common stock ........................................... (121,777) (45,368) —
Net cash (used in) provided by financing activities of continuing operations .............. (113,343) (23,797) 29,534
Net cash used in financing activities of discontinued operation ......................... (300) — (150)
Net cash (used in) provided by financing activities .................................. (113,643) (23,797) 29,384
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ....................... 27,721 11,083 (223)
CASH AND CASH EQUIVALENTS, beginning of year ..................................... 13,469 2,702 4,125
CASH AND CASH EQUIVALENTS, end of year .......................................... 41,190 13,785 3,902
LESS CASH AND CASH EQUIVALENTS OF DISCONTINUED OPERATION, end of year ....... 511 316 1,200
CASH AND CASH EQUIVALENTS OF CONTINUING OPERATIONS, end of year ............. $ 40,679 $ 13,469 $ 2,702
The accompanying notes are an integral part of these consolidated financial statements.
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