The Gap 2013 Annual Report Download - page 48

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24
Net cash provided by operating activities during fiscal 2012 increased $573 million compared with fiscal 2011,
primarily due to the following:
• an increase in net income of $302 million in fiscal 2012 compared with fiscal 2011;
• an increase of $237 million related to income taxes payable, net of prepaid income taxes and other tax-related
items, in fiscal 2012 compared with fiscal 2011 primarily due to the timing of tax payments;
• an increase of $113 million related to accrued expenses and other current liabilities in fiscal 2012 compared
with fiscal 2011 primarily due to a higher bonus accrual in fiscal 2012 compared with fiscal 2011; and
• an increase of $80 million related to accounts payable in fiscal 2012 compared with fiscal 2011 primarily due to
the volume and timing of payments; partially offset by
• an increase of $147 million related to merchandise inventory in fiscal 2012 compared with fiscal 2011 primarily
due to the timing of inventory receipts.
We fund inventory expenditures during normal and peak periods through cash flows from operating activities and
available cash. Our business follows a seasonal pattern, with sales peaking over a total of about eight weeks
during the end-of-year holiday period. The seasonality of our operations may lead to significant fluctuations in
certain asset and liability accounts between fiscal year-end and subsequent interim periods.
In fiscal 2014, we expect depreciation and amortization, net of amortization of lease incentives, to be about $520
million.
Cash Flows from Investing Activities
Our cash outflows from investing activities are primarily for capital expenditures and purchases of investments,
while cash inflows are primarily proceeds from maturities of investments. Net cash used for investing activities
during fiscal 2013 decreased $220 million compared with fiscal 2012, primarily due to the following:
• $129 million used for the acquisition of Intermix in fiscal 2012; and
• $50 million of maturities of short-term investments in fiscal 2013 compared with $50 million of net purchases in
fiscal 2012.
Net cash used for investing activities during fiscal 2012 increased $390 million compared with fiscal 2011,
primarily due to the following:
• $50 million of net purchases of short-term investments in fiscal 2012 compared with $100 million of net
maturities in fiscal 2011;
• $129 million used for the acquisition of Intermix in fiscal 2012; and
• $111 million more property and equipment purchases in fiscal 2012 compared with fiscal 2011.
In fiscal 2013, cash used for purchases of property and equipment was $670 million. In fiscal 2014, we expect
cash spending for purchases of property and equipment to be about $750 million.
Cash Flows from Financing Activities
Our cash outflows from financing activities consist primarily of repurchases of our common stock, repayments of
debt, and dividend payments. Cash inflows primarily consist of proceeds from the issuance of debt and proceeds
from issuances under share-based compensation plans, net of withholding tax payments. Net cash used for
financing activities during fiscal 2013 decreased $477 million compared with fiscal 2012, primarily due to the
following:
• $419 million of payments of debt in fiscal 2012;
• $144 million of proceeds from issuance of long-term debt in fiscal 2013; and
• $51 million less repurchases of common stock in fiscal 2013 compared with fiscal 2012, partially offset by
• $81 million more dividends paid in fiscal 2013 compared with fiscal 2012; and