Waste Management 2008 Annual Report Download - page 83
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Please find page 83 of the 2008 Waste Management annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.decrease in proceeds from divestitures in 2008 was largely a result of having fewer underperforming
operations to sell as part of our fix-or-seek-exit initiative.
•Capital expenditures — We used $1,221 million during 2008 for capital expenditures, compared with
$1,211 million in 2007 and $1,329 million in 2006. Capital expenditures in 2006 were higher than either
2007 or 2008 due to relatively high levels of fleet capital spending done in advance of significant mandated
changes in heavy-duty truck engines beginning in January 2007.
•Purchases and sales of short-term investments — Net sales of short-term investments provided $184 million
of cash in 2007, compared with $122 million during 2006. We used proceeds from the sale of our short-term
investments to provide cash that we used to fund our common stock repurchases, dividend payments and
debt repayments, which are discussed below. We did not hold any short-term investments during 2008.
•Net receipts from restricted funds — Net funds received from our restricted trust and escrow accounts, which
are largely generated from the issuance of tax-exempt bonds for our capital needs, contributed $178 million
to our investing activities in 2008 compared with $120 million in 2007 and $253 million in 2006.
Net Cash Used in Financing Activities — The most significant items affecting the comparison of our financing
cash flows for the periods presented are summarized below:
•Share repurchases and dividend payments — Our 2008, 2007 and 2006 share repurchases and dividend
payments have been made in accordance with capital allocation programs approved by our Board of
Directors.
We paid $410 million for share repurchases in 2008 as compared with $1,421 million in 2007 and
$1,072 million in 2006. We repurchased approximately 12 million, 40 million and 31 million shares of our
common stock in 2008, 2007 and 2006, respectively. The significant decline in share repurchases during
2008 is largely attributable to the suspension of our share repurchases in connection with our proposal to
acquire all of the outstanding stock of Republic Services, Inc. When the proposal was withdrawn in October
2008, we determined that, given the state of the financial markets, it would be prudent to suspend
repurchases for the foreseeable future.
We paid an aggregate of $531 million in cash dividends during 2008 compared with $495 million in 2007
and $476 million in 2006. The increase in dividend payments is due to our quarterly per share dividend
increasing from $0.22 in 2006, to $0.24 in 2007 and to $0.27 in 2008. The impact of the year-over-year
increases in the per share dividend has been partially offset by a reduction in the number of our outstanding
shares as a result of our share repurchase program.
In December 2008, our Board of Directors approved a new capital allocation program that includes the
authorization for up to $1.3 billion in combined cash dividends, common stock repurchases, debt reduction
and acquisitions in 2009. At this time, the Board of Directors also announced that it expects future quarterly
dividend payments will be $0.29 per share. All future dividend declarations are at the discretion of the Board
of Directors, and depend on various factors, including our net earnings, financial condition, cash required for
future prospects and other factors the Board may deem relevant.
•Proceeds and tax benefits from the exercise of options and warrants — The exercise of common stock
options and warrants and the related excess tax benefits generated a total of $44 million of financing cash
inflows during 2008 compared with $168 million during 2007 and $340 million in 2006. We believe the
relatively large impact of stock option and warrant exercises in 2006 was due to the substantial increase in
the market value of our common stock during 2006 and the accelerated vesting of all outstanding stock
options in December 2005 because the acceleration made additional options available for exercise.
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