Wendy's 2011 Annual Report Download - page 55

• $10.5 million decrease in impairment of long-lived assets due to the level of impairment charges taken in
prior periods; and
• $8.2 million decrease in depreciation and amortization primarily due to an adjustment of $6.5 million in the
prior year for a one-time increase in depreciation as a result of refinements to the purchase price allocation
(including long-lived assets) for the merger with Wendy’s;
partially offset by the following:
• a $38.4 million favorable impact in accounts payable resulting from a decrease in accounts payable of $14.2
million during the year ended January 2, 2011 compared to a decrease in accounts payable of $52.6 million
during the year ended January 3, 2010. The changes for the comparable periods were primarily due to the
following: (1) a decrease in the 2009 amounts payable for non-recurring items more typically included in
accrued expenses rather than accounts payable with no comparable amounts in 2010, (2) a decrease in the
volume of transactions processed as received from third parties, due in part to the decrease in sales in 2010 as
compared to 2009, (3) a reduction in amounts paid to the Wendy’s national advertising cooperative in 2010
as compared to 2009 due to changes in the timing of royalty payments to them and a shift of product testing
to the advertising co-op, and (4) amounts paid in 2009 associated with certain outstanding 2008 lease
payments which did not recur in 2010.
Additionally, for the year ended January 2, 2011, the Companies had the following significant sources and uses
of cash other than from operating activities:
• Proceeds from the Term Loan of $497.5 million;
• Repayments of $250.8 million of Wendy’s Restaurants amended senior secured term loan;
• Payment of $215.0 million, including a premium of $15.0 million, to redeem the Wendy’s 6.25% senior
notes;
• Cash capital expenditures totaling $148.0 million, which included $50.1 million for the remodeling of
restaurants, $10.9 million for the construction of new restaurants, and $87.0 million for various capital
projects;
• Deferred financing costs of $16.4 million;
(The Wendy’s Company)
• Repurchase of common stock of $167.7 million, including commissions of $0.7 million and excluding $5.8
million of 2009 purchases that were not settled until 2010;
• Proceeds of $30.8 million, excluding interest, from the repayment and cancellation of the DFR Notes;
• Dividend payments of $27.6 million; and
(Wendy’s Restaurants)
• Intercompany dividend payments of $443.7 million to The Wendy’s Company.
The net cash used in continuing operations before the effect of exchange rate changes on cash was
approximately $80.8 million and $341.8 million for The Wendy’s Company and Wendy’s Restaurants, respectively.
Sources and Uses of Cash for 2012
Our anticipated consolidated sources of cash and cash requirements for 2012 exclusive of operating cash flow
requirements consist principally of:
• Capital expenditures of approximately $225.0 million as discussed below in “Capital Expenditures;”
• Potential restaurant acquisitions and dispositions;
• The costs of any potential financing activities;
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