Supercuts 2009 Annual Report Download - page 64

Table of Contents
Investing Activities
Net cash used in investing activities during the twelve months ended June 30, 2009, 2008 and 2007 was the result of the following:
Cash used by investing activities was lower during fiscal year 2009 compared to fiscal year 2008 due to the planned reduction in
acquisitions and capital expenditures. Acquisitions during fiscal year 2009 were primarily funded by a combination of operating cash flows and
debt. Additionally, the Company completed 280 major remodeling projects during fiscal year 2009, compared to 186 and 222 during fiscal years
2008 and 2007, respectively. We constructed 182 company-owned salons, eight hair restoration centers and acquired 177 company-
owned salons
(83 of which were franchise buybacks) and two hair restoration centers, all of which were franchise buybacks. In addition during fiscal year
2008, there was a $36.4 million loan to Empire Education Group, Inc. and a transfer of $10.9 million in cash related to the deconsolidation of our
schools and European franchise salon business.
Acquisitions during fiscal year 2008 were primarily funded by a combination of operating cash flows and debt. Additionally the Company
completed 186 major remodeling projects during fiscal year 2008, compared to 222 and 170 during fiscal years 2007 and 2006, respectively. We
constructed 325 company-owned salons, three hair restoration centers and acquired 382 company-owned salons (150 of which were franchise
buybacks) and six hair restoration centers, all of which were franchise buybacks. Investing activities also included a $36.4 million loan to
Empire Education Group, Inc. In addition, there was $10.9 million in cash held by the schools and European salon businesses that were
deconsolidated.
Acquisitions during fiscal year 2007 were primarily funded by a combination of operating cash flows and debt. Additionally, 222 major
remodeling projects were completed during fiscal year 2007, compared to 170 and 205 during fiscal years 2006 and 2005, respectively. We
constructed 420 company-owned salons and two beauty schools and acquired 354 company-owned salons (97 of which were franchise
buybacks), one beauty school and two hair restoration centers (one of which was a franchise buyback) during fiscal year 2007. During fiscal year
2007, loans and investments, net, included $9.9 million related to an equity investment the Company made in October 2006, $8.2 million related
to a cost method investment made in April 2007, $3.1 million related to the cost method investment made in April 2007 and $4.0 million related
to a note receivable issued under a credit agreement with the entity that is the majority corporate investor of an entity in which we hold a
minority interest.
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Investing Cash Flows
For the Years Ended June 30,
2009 2008 2007
(Dollars in thousands)
Business and salon acquisitions
$
(40,051
)
$
(132,971
)
$
(68,747
)
Capital expenditures for remodels or other additions
(35,081
)
(35,212
)
(35,299
)
Capital expenditures for the corporate office (including all technology
-
related expenditures)
(13,113
)
(18,310
)
(21,452
)
Capital expenditures for new salon construction
(25,380
)
(32,277
)
(33,328
)
Proceeds from loans and investments
19,008
10,000
5,250
Disbursements for loans and investments
(20,971
)
(46,400
)
(30,673
)
Transfer of cash related to contribution of schools and European franchise salon operations
—
(
10,906
)
—
Net investment hedge settlement
—
—
(
8,897
)
Proceeds from sale of assets
77
47
97
$
(115,511
)
$
(266,029
)
$
(193,049
)