ServiceMagic 2010 Annual Report Download - page 46

Table of Contents
FINANCIAL POSITION, LIQUIDITY AND CAPITAL RESOURCES
As of December 31, 2010, the Company had $742.1 million of cash and cash equivalents, $564.0 million of marketable securities and
$95.8 million in long-term debt. Long-term debt consists of $80.0 million in Liberty Bonds due September 1, 2035 and $15.8 million in Senior
Notes.
During 2010 and 2009, the Company purchased 23.1 million and 32.1 million shares of IAC common stock for aggregate consideration, on
a trade date basis, of $530.9 million and $554.2 million, respectively. In addition on December 1, 2010, the Company completed the tax-free
exchange of Evite, Gifts.com, IAC Advertising Solutions and $217.9 million in cash for substantially all of Liberty's equity stake in IAC,
representing 8.5 million shares of Class B common stock and 4.3 million shares of IAC common stock. On February 26, 2010, the Company's
Board of Directors authorized the repurchase of up to 20 million shares of IAC common stock. At January 28, 2011, IAC had approximately
7.2 million shares remaining in its share repurchase authorization. IAC may purchase shares over an indefinite period of time, depending on
those factors IAC management deems relevant at any particular time, including, without limitation, market conditions, share price and future
outlook.
Net cash provided by operating activities attributable to continuing operations was $340.7 million and $348.5 million in 2010 and 2009,
respectively. The decrease of $7.8 million in net cash provided by operating activities attributable to continuing operations is primarily due to the
payment of the 2009 cash bonuses in 2010, whereas the 2008 cash bonuses were paid in the fourth quarter of 2008, and lower net income tax
refunds in 2010.
Net cash used in investing activities attributable to continuing operations in 2010 of $118.1 million includes $74.8 million related to the net
purchases, sales and maturities of marketable debt securities, capital expenditures of $39.8 million and acquisitions, net of cash acquired, of
$17.3 million, partially offset by the dividend received from Meetic of $11.4 million and proceeds of $5.3 million from the sale of the
Company's remaining shares of OpenTable. Net cash used in investing activities attributable to continuing operations in 2009 of $422.6 million
includes $356.7 million related to the net purchases, sales and maturities of marketable debt securities, acquisitions, net of cash acquired, of
$85.5 million and capital expenditures of $33.9 million, partially offset by the proceeds of $64.0 million from the sales of long-
term investments,
primarily the sale of 2.0 million common shares of OpenTable.
Net cash used in financing activities attributable to continuing operations in 2010 of $717.2 million includes the purchase of treasury stock
of $539.6 million and $217.9 million in cash as part of the Liberty Exchange, partially offset by proceeds related to the issuance of common
stock, net of withholding taxes, of $25.9 million and the excess tax benefits from stock-based awards of $14.3 million. Net cash used in
financing activities attributable to continuing operations in 2009 of $405.8 million includes the purchase of treasury stock of $545.5 million and
the settlement of vested stock-based awards denominated in a subsidiary's equity of $14.3 million, partially offset by the proceeds related to the
issuance of common stock, net of withholding taxes, of $151.9 million. Included in the proceeds related to the issuance of common stock are
aggregate proceeds of $150.9 million from the exercise of warrants to acquire 11.5 million shares of IAC common stock that were due to expire
on February 4, 2009. The strike price of the warrants was $13.09 per share.
IAC anticipates that it will need to make capital and other expenditures in connection with the development and expansion of its operations.
The Company may make a number of acquisitions which could result in the reduction of its cash and/or marketable securities balance or the
incurrence of debt. IAC expects that 2011 capital expenditures will be slightly less than 2010. IAC believes that its cash on hand along with its
anticipated operating cash flows in 2011 and its access to capital markets are sufficient to fund its operating needs, capital, investing and other
commitments and contingencies for the foreseeable future.
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