Travelzoo 2013 Annual Report Download - page 77

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42
Year Ended December 31,
2013 2012 2011
( In thousands)
Net cash provided by operating activities $ 16,852 $ 36,700 $ 15,631
Net cash used in investing activities (3,675)(3,693)(2,460)
Net cash used in financing activities (8,452)(11,510)(14,815)
Effect of exchange rate changes on cash and cash equivalents 329 928 (796)
Net increase (decrease) in cash and cash equivalents $ 5,054 $ 22,425 $ (2,440)
Net cash provided by operating activities is net income adjusted for certain non-cash items and changes in assets and
liabilities. Net cash provided by operating activities was $16.8 million for 2013, which consisted of a net loss of $5.0 million,
adjustments for non-cash items of $5.1 million and a $16.8 million increase in cash from changes in working capital.
Adjustments for non-cash items primarily consisted of $3.0 million of stock-based compensation expense and $1.4 million of
depreciation and amortization expense on property and equipment. In addition, the increase in cash from changes in working
capital activities primarily consisted of $9.7 million in accrued expenses for unexchanged promotional shares, $4.0 million in
income taxes receivable and $2.8 million in accounts payable.
Net cash provided by operating activities was $36.7 million for 2012, which consisted of a net income of $18.2 million,
adjustments for non-cash items of $1.7 million and a $16.8 million increase in cash from changes in working capital.
Adjustments for non-cash items primarily consisted of $1.2 million of stock-based compensation expense and $2.5 million of
depreciation and amortization expense on property and equipment, offset by $2.2 million of deferred income taxes. In addition,
the increase in cash from changes in working capital activities primarily consisted of $6.5 million in accounts payable, $5.6
million in accrued expenses and $5.2 million in income taxes receivable.
Net cash provided by operating activities was $15.6 million for 2011, which consisted of a net income of $3.3 million,
adjustments for non-cash items of $3.0 million and a $9.3 million increase in cash from changes in working capital.
Adjustments for non-cash items primarily consisted of $2.7 million of depreciation and amortization expense on property and
equipment. In addition, the increase in cash from changes in working capital activities primarily consisted of $12.1 million in
accounts payable, offset by $3.1 million in income taxes receivable.
Cash paid for income tax was in 2013, 2012 and 2011 was $2.6 million, $4.9 million and $15.0 million, respectively.
Net cash used in investing activities for 2013, 2012 and 2011 was $3.7 million, $3.7 million and $2.5 million,
respectively. The cash used in investing activities in 2013 was due primarily to $5.5 million in purchases of property and
equipment, offset by $1.8 million release of restricted cash. Net cash used in investing activities in 2012 and 2011 were due
primarily to purchases of property and equipment.
Net cash used in financing activities for 2013, 2012 and 2011was $8.5 million, $11.5 million and $14.8 million,
respectively, which was due primarily to repurchases of our common stock.
In April 2011, the Company entered into an agreement which required a $20.0 million cash payment to the State of
Delaware resolving all claims relating to the State of Delaware’s unclaimed property review, which related primarily to the
Company’s unexchanged promotional shares contingency. In addition, based on multiple other state claims and settlements
with the Company regarding the unexchanged promotional shares contingency, the Company made a $12.3 million cash
payment to the settled states after completion of the required due diligence in the year ended December 31, 2013. The
Company has maintained estimated reserves related to the remaining states for potential claims and future settlements.
The Company is continuing its program under which it makes cash payments to people who establish that they satisfied
the conditions to receive shares of Travelzoo.com Corporation, and who failed to submit requests to convert their shares into
shares of Travelzoo Inc. within the required time period.
See Note 1 to the accompanying consolidated financial statements for further information on the unexchanged
promotional shares contingency and related cash program.