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Table of Contents
AOL Inc.
Consolidated Statements of Cash Flows
(In millions)
Years ended December 31,
2009 2008 2007
Operations
Net income (loss) $ 248.5 $ (1,526.6) $ 1,395.4
Adjustments for non-cash and non-operating items:
Depreciation and amortization 406.2 477.2 498.6
Asset impairments 23.1 2,240.0 16.2
Gain on disposal of assets and consolidated businesses, net — (0.3) (682.6)
Equity-based compensation 12.5 19.6 32.3
Amounts related to securities litigation and government investigations, net of recoveries 27.9 20.8 171.4
Other non-cash adjustments 7.7 (1.7) (6.7)
Deferred income taxes (6.7) (49.5) 102.2
Changes in operating assets and liabilities, net of acquisitions:
Receivables 51.6 73.2 (86.9)
Accrued expenses 125.9 (282.9) (151.3)
Deferred revenue (28.2) (21.7) (123.9)
Other balance sheet changes 39.7 (14.5) 38.6
Adjustments relating to discontinued operations (a) — — (186.7)
Cash provided by operations 908.2 933.6 1,016.6
Investing Activities
Investments and acquisitions, net of cash acquired (18.1) (1,035.4) (881.4)
Proceeds from disposal of assets and consolidated businesses, net — 126.9 1,034.8
Capital expenditures and product development costs (135.8) (172.2) (280.2)
Investment activities from discontinued operations — — 261.0
Other investment proceeds 2.1 8.4 8.0
Cash provided (used) by investing activities (151.8) (1,072.3) 142.2
Financing Activities
Debt repayments — (54.0) (25.9)
Principal payments on capital leases (31.1) (25.1) (36.1)
Excess tax benefits on stock options — 2.1 34.4
Net contribution from (distribution to) Time Warner (709.3) 210.4 (1,390.3)
Other (9.2) 1.5 (7.4)
Cash provided (used) by financing activities (749.6) 134.9 (1,425.3)
Effect of exchange rate changes on cash and equivalents 5.5 (13.4) 16.9
Increase (decrease) in cash and equivalents 12.3 (17.2) (249.6)
Cash and equivalents at beginning of period 134.7 151.9 401.5
Cash and equivalents at end of period $ 147.0 $ 134.7 $ 151.9
Supplemental disclosures of cash flow information
Cash paid for interest $ 7.3 $ 10.5 $ 9.7
Cash paid for taxes (b) $ 216.8 $ 516.6 $ 741.9
(a) The year ended December 31, 2007 included net income from discontinued operations of $182.1 million. After considering non-cash expenses, the net
gain on sale reported in discontinued operations and working capital related adjustments relating to discontinued operations, net operational cash used by
discontinued operations was $4.6 million for the year ended December 31, 2007.
(b) The amount of cash paid for taxes includes $210.8 million, $504.2 million and $704.4 million for the years ended December 31, 2009, 2008 and 2007,
respectively, paid to Time Warner under the tax matters agreement. See "Note 13: Related Party Transactions" for further information on the tax matters
agreement.
See accompanying notes.
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