Supercuts 2004 Annual Report Download - page 47

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Table of Contents
During fiscal year 2004, deferred income taxes increased primarily due to differences in the book and tax treatment of depreciation and
amortization methodologies associated with property and equipment and goodwill. During fiscal year 2003, inventories increased resulting
from additional needs due to growth through acquisitions and new construction, as well as same-store product sales increasing at a slower rate
of 2.9 percent during fiscal year 2003, compared to 7.1 percent in the prior year.
Investing Activities
Net cash used in investing activities of $173.4 and $143.1 million in fiscal year 2004 and 2003, respectively, was the result of the following:
We constructed 452 company-owned salons and acquired 411 company-owned salons (206 of which were franchise buybacks) during fiscal
year 2004. We constructed 397 company
-owned salons and acquired 560 company-owned salons (97 of which were franchise buybacks)
during fiscal year 2003. The company-owned constructed and acquired salons consisted of the following number of salons in each concept:
Additionally, we completed 169 and 179 major remodeling projects during fiscal years 2004 and 2003, respectively.
Financing Activities
Net cash used in financing activities was $16.8 and $36.3 million during fiscal year 2004 and 2003, resulting from the following:
The proceeds from the issuance of common stock were related to the exercise of stock options. In the third quarter of fiscal year 2004, the
quarterly dividend was increased from its historical rate of $0.03 per share to $0.04 per share.
Investing Cash Flows
For the Years Ended June 30,
(Dollars in thousands)
2004
2003
Capital expenditures for remodels or other additions
$
(36,192
)
$
(32,339
)
Capital expenditures for new salon construction
(28,542
)
(28,418
)
Capital expenditures for the corporate office (including all technology
-
related expenditures)
(9,342
)
(16,703
)
Business and salon acquisitions
(99,734
)
(66,880
)
Proceeds from the sale of assets
432
1,273
$
(173,378
)
$
(143,067
)
Years Ended June 30,
2004
2003
Constructed
Acquired
Constructed
Acquired
Regis Salons
33
10
53
73
MasterCuts
34
3
47
—
Trade Secret
26
14
34
10
SmartStyle
174
61
168
14
Strip Center
166
295
85
446
International
19
28
10
17
452
411
397
560
Financing Cash Flows
For the Years Ended June 30,
(Dollars in thousands)
2004
2003
Repurchase of common stock
$
(22,548
)
$
(21,694
)
Net (payments) borrowings of long
-
term debt
(12,224
)
18,529
Dividend payments
(6,166
)
(5,202
)
Net borrowings (payments) on revolving credit facilities
6,625
(32,225
)
Proceeds from the issuance of common stock
17,347
7,051
Other
118
(2,720
)
$
(16,848
)
$
(36,261
)