World Fuel Services 2013 Annual Report Download - page 37

Investing Activities. For 2013, net cash used in investing activities was $174.6 million as compared to $246.6 million for 2012. The
$72.0 million decrease in cash used in investing activities was principally due to a $140.8 million reduction in cash used for acquisitions
and other investments in 2013 as compared to 2012, which was partially offset by a $54.3 million increase in capital expenditures for
the upgrade and expansion of certain inventory storage and transloading facilities in 2013.
Financing Activities. For 2013, net cash provided by financing activities was $29.5 million as compared to $66.9 million for 2012. The
$37.4 million decrease in cash provided by financing activities was principally due to purchases of common stock of $35.0 million.
2012 compared to 2011
Operating Activities.For 2012, net cash provided by operating activities was $145.8 million as compared to net cash used in operating
activities of $142.5 million for 2011. The $288.3 million increase in operating cash flows was principally due to favorable year-over-year
changes in working capital.
Investing Activities. For 2012, net cash used in investing activities was $246.6 million as compared to $144.6 million for 2011. The
$102.0 million increase in cash used in investing activities was principally due to an increase in cash used for the acquisition of
businesses in 2012 as compared to 2011.
Financing Activities. For 2012, net cash provided by financing activities was $66.9 million as compared to $222.6 million for 2011. The
$155.7 million decrease in financing cash flows was principally due to borrowings under our Credit Facility of $100.5 million in 2012 as
compared to Term Loan borrowings of $250.0 million in 2011.
Other Liquidity Measures
Cash and Cash Equivalents. As of December 31, 2013 and 2012, we had cash and cash equivalents of $292.1 million and
$172.7 million, respectively, of which $39.7 million and $172.7 million, respectively, was available for use by our U.S. subsidiaries
without incurring additional costs. Our primary uses of cash and cash equivalents are to fund accounts receivable, purchase inventory
and make strategic investments, primarily acquisitions. We are usually extended unsecured trade credit from our suppliers for our fuel
purchases; however, certain suppliers require us to either prepay or provide a letter of credit. Increases in oil prices can negatively
affect liquidity by increasing the amount of cash needed to fund fuel purchases as well as reducing the amount of fuel which we can
purchase on an unsecured basis from our suppliers.
Credit Facility and Term Loans. We have a Credit Facility which permits borrowings of up to $1.1 billion with a sublimit of $400.0 million
for the issuance of letters of credit and bankers’ acceptances. Under the Credit Facility, we have the right to request increases in
available borrowings up to an additional $150.0 million, subject to the satisfaction of certain conditions. The Credit Facility matures in
October 2018. We had outstanding borrowings under our Credit Facility totaling $200.0 million and $100.5 million as of December 31,
2013 and 2012, respectively. Our issued letters of credit under the Credit Facility totaled $7.4 million and $47.4 million as of
December 31, 2013 and 2012, respectively. We also had $242.5 million and $247.5 million in Term Loans outstanding as of
December 31, 2013 and 2012, respectively.
Our liquidity consisting of cash and cash equivalents and availability under the Credit Facility fluctuates based on a number of factors,
including the timing of receipts from our customers and payments to our suppliers as well as commodity prices. Our Credit Facility and
our Term Loans contain certain financial covenants with which we are required to comply. Our failure to comply with the financial
covenants contained in our Credit Facility and our Term Loans could result in an event of default. An event of default, if not cured or
waived, would permit acceleration of any outstanding indebtedness under the Credit Facility and our Term Loans, trigger cross-
defaults under other agreements to which we are a party and impair our ability to borrow and issue letters of credit, which would have
a material adverse effect on our business, financial condition, results of operations and cash flows. As of December 31, 2013, we were
in compliance with all financial covenants contained in our Credit Facility and our Term Loans.
Other Credit Lines. Additionally, we have other uncommitted credit lines primarily for the issuance of letters of credit, bank guarantees
and bankers’ acceptances. These credit lines are renewable on an annual basis and are subject to fees at market rates. As of
December 31, 2013 and 2012, our outstanding letters of credit and bank guarantees under these credit lines totaled $150.6 million and
$184.2 million, respectively. We also have Receivables Purchase Agreements (‘‘RPAs’’) that allow for the sale of up to an aggregate of
$325.0 million of our accounts receivable. As of December 31, 2013, we had sold accounts receivable of $95.7 million under the RPAs.
Short-Term Debt. As of December 31, 2013, our short-term debt of $14.6 million represents the current maturities (within the next
twelve months) of certain promissory notes related to acquisitions, capital lease obligations and Term Loan borrowings.
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