Plantronics 2010 Annual Report Download - page 48

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Cash flows from operating activities in fiscal 2009 were $99.2 million and consisted of our net loss of $64.9 million offset by non-
cash charges of $147.6 million and working capital sources of cash of $16.4 million. Non-cash charges consisted primarily of $117.5
million related to the AEG impairment of goodwill and long-lived assets recorded in discontinued operations, $25.8 million of
depreciation and amortization, $15.7 million of stock-based compensation, $11.4 million of provisions for excess and obsolete
inventory, and $2.7 million of provisions for sales allowances and doubtful accounts offset in part by a $26.9 million benefit from
deferred income taxes. Working capital sources of cash consisted primarily of a decrease in accounts receivable of $50.7 million due
to cash collections and lower revenues. Days Sales Outstanding as of March 31, 2009 was 59 days compared to 64 as of March 31,
2008. Working capital uses of cash consisted primarily of decreases in accounts payable and accrued liabilities as we reduced our
spending during the fiscal year, decreases in gross inventory as we improved management of our inventory levels, and increases in
other assets. Inventory turns decreased slightly to 3.1 as of March 31, 2009 from 3.2 as of March 31, 2008 as a result of our higher
inventory balances and lower revenues.
Cash flows from operating activities in fiscal 2008 were $102.9 million and consisted of net income of $68.4 million, non-cash
charges of $44.7 million and working capital uses of cash of $10.2 million. Non-cash charges consisted primarily of $28.5 million of
depreciation and amortization, $16.0 million of stock-based compensation, provision for excess and obsolete inventory of $7.8 million
and restructuring and other related charges of $1.6 million. Non-cash charges were partially offset by a $9.3 million non-cash benefit
related to deferred income taxes. Working capital uses of cash consisted primarily of increases in inventory and accounts
receivable. Inventory increased to support higher overall volumes and the transition of manufacturing of consumer headsets to our
manufacturing facility in Suzhou, China. Inventory turns remained relatively flat at 3.1 for fiscal 2007 and 3.2 for fiscal 2008.
Accounts receivable increased due to higher net revenues. Days Sales Outstanding as of March 31, 2008 was 64 days compared to 59
days as of March 31, 2007. Working capital sources of cash consisted primarily of increases in accrued liabilities and income taxes
payable which fluctuate with the timing of when we make payments.
We expect that cash provided by operating activities may fluctuate in future periods as a result of a number of factors including
fluctuations in our net revenues and operating results, collection of accounts receivable, changes to inventory levels and timing of
payments.
Cash Flows from Investing Activities
In fiscal 2010, net cash flows provided from investing activities were $67.9 million, consisting primarily of net maturities and sales of
short-term investments of $64.0 million and $9.1 million in net proceeds from the sale of Altec Lansing offset in part by capital
expenditures of $6.3 million. Capital expenditures during fiscal 2010 primarily related to tooling and various IT projects.
In fiscal 2009, net cash flows used for investing activities were $83.2 million, consisting primarily of capital expenditures of $23.7
million and net purchases of short-term investments of $59.9 million. Significant capital expenditures during fiscal 2009 primarily
related to $4.3 million in costs to complete construction of the new corporate data center in our Santa Cruz, California headquarters,
$3.2 million for the construction of our engineering center in Santa Cruz, California and $2.3 million for various IT projects.
In fiscal 2008, net cash flows used for investing activities were $42.2 million, consisting of capital expenditures of $23.3 million and
net purchases of short-term investments of $18.9 million. Significant capital expenditures during fiscal 2008 primarily related to
building improvements at our Santa Cruz, California headquarters, which includes $2.7 million to complete the industrial design wing
and $1.2 million for work on the construction of the new corporate data center, along with $2.0 million for various IT projects.
We anticipate our capital expenditures in fiscal 2011 to be in the range of $11.0 million to $13.0 million primarily consisting of IT
related expenditures and tooling for new products which represents an increase from fiscal 2010 expenditures but significantly lower
than the expenditures in fiscal 2009. We will continue to evaluate new business opportunities and new markets; as a result, future
growth within the existing business or new opportunities and markets may dictate the need for additional facilities and capital
expenditures to support that growth.
Cash Flows from Financing Activities
Net cash flows used for financing activities in fiscal 2010 were $21.0 million and consisted of $49.7 million related to repurchases of
common stock and $9.8 million in dividend payments, which were partially offset by $32.6 million in proceeds from the exercise of
employee stock options, $3.6 million in proceeds from the sale of treasury stock related to employee stock plan purchases and $2.2
million of excess tax benefits from stock-based compensation.