Wendy's 2012 Annual Report Download - page 47

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Liquidity and Capital Resources
The Company’s discussion below regarding its liquidity and capital resources includes the discontinued
operations of Arby’s. Arby’s cash flows prior to its sale (for the period from January 3, 2011 through July 3, 2011 and
for the year ended January 2, 2011) have been included in and not separately reported from our cash flows. The
consolidated statements of cash flows for the years ended December 30, 2012 and January 1, 2012 also include the
effects of the sale of Arby’s. The tables included throughout Liquidity and Capital Resources present dollars in
millions.
Net Cash Provided by Operating Activities
2012 Compared with 2011
Cash provided by operating activities decreased $56.3 million during the year ended December 30, 2012 as
compared to the year ended January 1, 2012, primarily due to the following:
• a $54.0 million unfavorable impact in accrued expenses and other current liabilities for the comparable
periods. This unfavorable impact was primarily due to (1) an increase in payments and a decrease in charges
for Arby’s transaction related costs and facilities relocation and transition costs related to the relocation of the
Company’s Atlanta restaurant support center to Ohio, (2) a decrease in interest expense and the
corresponding accrual primarily due to the purchase and redemption of the Senior Notes, as further
discussed below and (3) a decrease in accrued income taxes; and
• a $20.6 million unfavorable impact in accounts payable for the comparable periods. This unfavorable impact
was primarily due to (1) higher payments in 2012 in comparison to 2011 for capital expenditures accrued at
the end of 2011 and 2010, respectively and (2) changes in accounts payable due to the timing of payments
between the comparable periods.
These decreases were partially offset by increases in cash related to accounts and notes receivable of
$6.7 million, prepaid expenses and other current assets of $6.2 million and a cash dividend received from our
investment in Arby’s of $4.6 million in 2012.
Additionally, for the year ended December 30, 2012, the Company had the following significant sources and
uses of cash other than from operating activities:
• Proceeds from the sale of our cost investment in Jurlique of $27.3 million;
• $40.6 million for the acquisition of franchised restaurants;
• Cash capital expenditures totaling $197.6 million, including $71.9 million for reimaged and new Image
Activation restaurants, $13.5 million for other remodeled and new restaurants, $28.0 million for restaurant
point-of-sale equipment, $23.2 million for the construction of a new building at our corporate headquarters,
in part related to the relocation of our Atlanta restaurant support center, and the renovation of portions of
the corporate headquarters and $61.0 million for various capital projects;
• Proceeds from the Term Loan of $1,113.8 million;
• Repayments of $1,044.3 million of long-term debt, primarily related to the 2010 Term Loan and Senior
Notes;
• Financing cost payments related to the Credit Agreement;
• Premium payments on the redemption/purchase of the Senior Notes of $43.2 million; and
• Dividend payments of $39.0 million.
The net cash used in our business before the effect of exchange rate changes on cash was approximately
$23.1 million.
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