Seagate 2004 Annual Report Download - page 38

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Table of Contents
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$157 million to expand our Woodlands thin-film media operations in Singapore;
•
$149 million for manufacturing facilities and equipment for our recording head operations in the United States, the Far East and
Northern Ireland;
•
$85 million to upgrade the capabilities of our thin-film media operations in the United States, Singapore and Northern Ireland; and
Until required for other purposes, our cash and cash equivalents are maintained in highly liquid investments with remaining maturities of
90 days or less at the time of purchase. Our short-term investments consist primarily of readily marketable debt securities with remaining
maturities of more than 90 days at the time of purchase.
Net cash provided by operating activities was $1.428 billion for fiscal year 2005, $635 million for fiscal year 2004 and $882 million for
fiscal year 2003. Net cash provided by operating activities for fiscal year 2005 was primarily attributable to net income as adjusted for non-
cash
expenses for depreciation and amortization combined with an increase in our working capital. Net cash provided by operating activities for
fiscal year 2004 was primarily attributable to net income as adjusted for non-cash expenses for depreciation and amortization and the non-cash
benefit for the reversal of tax indemnification amounts. Net cash provided by operating activities for fiscal year 2003 was primarily attributable
to net income as adjusted for non-cash expenses for depreciation and amortization and deferred compensation payments.
Net cash used in investing activities was $1.069 billion for fiscal year 2005, $962 million for fiscal year 2004 and $754 million for fiscal
year 2003. Net cash used in investing activities for fiscal years 2005, 2004 and 2003 was primarily attributable to expenditures for property,
equipment and leasehold improvements and the purchases of short-term investments in excess of maturities and sales thereof.
Net cash used in financing activities was $35 million for fiscal year 2005 and $0 million for fiscal year 2004 while $9 million of cash was
provided by financing activities in fiscal year 2003. Net cash used in financing activities for fiscal year 2005 was primarily attributable to
dividends to our shareholders and principal payments on our senior secured credit facilities offset by cash provided by employee stock option
exercises and employee stock purchases. Net cash used in financing activities for fiscal year 2004 was zero and was primarily attributable to
dividends to our shareholders and principal payments on our senior secured credit facilities completely offset by cash provided by employee
stock option exercises and employee stock purchases. Net cash provided by financing activities for fiscal year 2003 was primarily attributable
to cash provided from the sale of our common shares partially offset by dividends to our shareholders.
Liquidity Sources and Cash Requirements and Commitments
•
$35 million for other purposes.
On March 4, 2005, our board of directors approved the increase of our quarterly distribution from $0.06 per share to no more than $0.08
per share (up to $0.32 per share annually). We are restricted in our ability to pay dividends by the covenants contained in the indenture
governing our senior notes and the credit agreement governing our senior secured credit facilities. Our declaration of dividends is also subject
to Cayman Islands law and the discretion of our board of directors. In deciding whether or not to declare quarterly dividends, our directors will
take into account such factors as general business conditions within the disc drive industry, our financial results, our capital requirements,
contractual and legal restrictions on the payment of dividends by our subsidiaries to us or by us to our shareholders, the impact of paying
dividends on our credit ratings and such other factors as our board of directors may deem relevant.
During fiscal year 2005, we paid dividends aggregating approximately $122 million, or $0.26 per share, to our common shareholders of
record as of August 6, 2004, November 5, 2004, February 4, 2005, and May 6, 2005. On July 19, 2005, we declared a quarterly dividend of
$0.08 per share to be paid on or before August 19, 2005 to our common shareholders of record as of August 5, 2005.
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