American Express 2005 Annual Report Download - page 66

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CONSOLIDATED STATEMENTS OF CASH FLOWS
American Express Company
Years Ended December 31, (Millions) 2005 2004 2003
Cash Flows from Operating Activities
Net income $ 3,734 $ 3,445 $ 2,987
Less: Income from discontinued operations, net of tax (513) (830) (665)
Add: Cumulative effect of accounting change related to discontinued operations,
net of tax —71 13
Income from continuing operations 3,221 2,686 2,335
Adjustments to reconcile income from continuing operations to net cash provided
by operating activities:
Provisions for losses and benefits 2,816 2,399 2,451
Depreciation and amortization 602 600 563
Deferred taxes, acquisition costs and other (226) 934 (196)
Stock-based compensation 254 181 103
Changes in operating assets and liabilities, net of effects of acquisitions
and dispositions:
Accounts receivable and accrued interest (623) (716) (411)
Other operating assets 528 304 48
Accounts payable and other liabilities 1,243 854 650
(Decrease) increase in Travelers Cheques outstanding (111) 468 187
Net cash flow provided by (used in) operating activities attributable to
discontinued operations 341 1,433 (3,192)
Net cash provided by operating activities 8,045 9,143 2,538
Cash Flows from Investing Activities
Sale of investments 3,795 4,884 1,063
Maturity and redemption of investments 7,545 3,348 6,029
Purchase of investments (11,824) (10,623) (5,987)
Net increase in cardmember loans/receivables (12,459) (7,656) (7,021)
Proceeds from cardmember receivable securitizations 1,197 ——
Maturities of cardmember receivable securitizations (1,750) (1,050) (2,085)
Proceeds from cardmember loan securitizations 5,386 3,888 3,442
Maturities of cardmember loan securitizations (4,463) (3,000) (1,000)
Loan operations and principal collections, net (399) (489) (883)
Purchase of land, buildings and equipment (608) (616) (888)
Sale of land, buildings and equipment 248 252 80
Dispositions (acquisitions), net of cash sold/acquired (136) 1,347 (749)
Cash spun-off to Ameriprise (3,678) ——
Net cash used in investing activities attributable to discontinued operations (113) (1,895) (4,362)
Net cash used in investing activities (17,259) (11,610) (12,361)
Cash Flows from Financing Activities
Net increase (decrease) in customers’ deposits 5,331 (488) 2,267
Sale of investment certificates 5,728 4,579 4,139
Redemption of investment certificates (4,296) (3,561) (3,988)
Net decrease in debt with maturities of three months or less (339) (3,453) (712)
Issuance of debt 14,389 19,791 18,952
Principal payments on debt (14,426) (9,449) (16,498)
Redemption of preferred beneficial interests securities —— (500)
Issuance of American Express common shares and other 1,129 1,055 348
Repurchase of American Express common shares (1,853) (3,578) (1,391)
Dividends paid (597) (535) (471)
Net cash provided by financing activities attributable to discontinued operations 1,377 1,815 3,695
Net cash provided by financing activities 6,443 6,176 5,841
Effect of exchange rate changes on cash (10) 42 (150)
Net (decrease) increase in cash and cash equivalents (2,781) 3,751 (4,132)
Cash and cash equivalents at beginning of year includes cash of discontinued
operations: 2005, $2,099; 2004, $2,189; 2003, $6,349 9,907 6,156 10,288
Cash and cash equivalents at end of year includes cash of discontinued
operations: 2004, $2,099; 2003, $2,189 $ 7,126 $ 9,907 $ 6,156
See Notes to Consolidated Financial Statements.
Consolidated
Statements of
Cash Flows
AXP / AR.2005
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