THQ 2004 Annual Report Download - page 60

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Year Ended March 31, Transition Years Ended December 31,
(In thousands) 2004 2003 2002 2001
Cash flows from operating activities:
Net income (loss) $ 35,839 $ (7,686) $ 12,994 $ 36,013
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation and amortization 7,227 1,956 6,385 5,416
Amortization of licenses and software development 126,686 13,323 91,677 35,335
Loss on disposal of property and equipment 258 — 137 117
Stock compensation 84 530 436 299
Tax benefit related to the exercise of employee stock options 2,367 181 5,124 10,923
Deferred income taxes 2,464 (1,180) (730 ) 11,338
Other than temporary impairment on investments —2,403 — —
Write-off of Network Interactive Sports Ltd. —— 3,006 —
Changes in operating assets and liabilities:
Accounts receivable, net (21,766) 111,022 (15,371) (9,709)
Inventory 3,427 233 (12,112) 743
Licenses (24,072) (4,027) (33,918 ) (22,596)
Software development (80,803) (19,305) (75,049 ) (53,095)
Prepaid expenses and other current assets 2,318 771 (2,101 ) (2,901)
Accounts payable (343) (20,374) 11,067 5,517
Accrued expenses 970 (12,543) 14,203 (1,171)
Accrued payment to venture partner 70 (5,169) (626) (3,026)
Accrued royalties 15,012 (18,181) 8,834 6,952
Income taxes 1,416 (3,479) 2,374 (6,336)
Net cash provided by operating activities 71,154 38,475 16,330 33,237
Cash flows provided by (used in) investing activities:
Proceeds from sale of property and equipment ———65
Proceeds from sales and maturities of short-term investments 42,500 65,019 90,732 —
Purchases of short-term investments (32,155) (28,809) (110,072 ) (35,124)
Acquisition of property and equipment (7,638) (2,099) (7,794 ) (5,750)
Acquisitions, net of cash acquired (2,300) — (9,373) —
Investment in Network Interactive Sports Ltd. —— (221) (3,325)
Purchases of long-term marketable securities (24,320) ———
(Increase) decrease in other long-term assets (70) 1,510 (1,422) 50
Net cash provided by (used in) investing activities (23,983) 35,621 (38,150 ) (44,084)
Cash flows provided by (used in) financing activities:
Net decrease in short-term borrowings —— — (15,473)
Repurchase of common stock (10,994) (7,758) (25,005 ) —
Principal payments on long-term debt —— — (1,806)
Proceeds from issuance of common stock —— 52 154,605
Proceeds from exercise of warrants and options 7,121 1,408 7,750 16,721
Net cash provided by (used in) financing activities (3,873) (6,350) (17,203) 154,047
Effect of exchange rate changes on cash 4,079 (784) 862 (139)
Net increase (decrease) in cash and cash equivalents 47,377 66,962 (38,161 ) 143,061
Cash and cash equivalents — beginning of period 199,860 132,898 171,059 27,998
Cash and cash equivalents — end of period $ 247,237 $ 199,860 $ 132,898 $ 171,059
THQ INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
See notes to consolidated financial statements.