Cabela's 2005 Annual Report Download - page 59

We believe that we will have sufficient capital available from current cash on hand, operations, additional
monetization of our economic development bonds, our revolving credit facility and other borrowing sources,
including the private placement of debt we completed on February 27, 2006, to fund our existing operations and
growth plan for the next twelve to eighteen months.
Operating, Investing and Financing Activities
Cash provided by operating activities was $72.6 million in fiscal 2005 as compared with $46.7 million in
fiscal 2004. Cash increased primarily due to an increase in cash provided by accounts payable of $42.7 million.
The increase in accounts payable was primarily due to a difference in accrued payment for our third party
processor of $30.0 million at our bank. The increased activity on our credit cards and timing of the last day of the
year being on a Saturday resulted in the amount of the third party processor payable increase. Accrued costs
related to our catalogs also increased accounts payable by $5.9 million due to timing of production work on
catalogs. Cash increased due to the sale of interests in credit card loans in connection with securitization
transactions in excess of cash used to originate credit card loans by $22.3 million. Cash used for income taxes
payable increased by $20.3 million. This was partially offset by an increase in our deferred income tax balance.
Sales of land held for sale increased our cash by $8.4 million in fiscal 2005 compared to fiscal 2004. In addition,
accrued compensation and benefits increased by $7.5 million attributed to the increase in retail payroll and
timing of when it was paid. Gift certificates and credit card reward points increased by $7.2 million. These
increases were partially offset by increases in uses of cash. Cash used for inventory increased by $33.4 million
related to the stocking of four new destination retail stores. Cash used for other current assets increased by $12.9
million primarily due to an increase in the prepaid amount for VISA interchange funding and an increase in
prepaid expenses of $11.5 million primarily related to the timing of catalog production costs.
Cash provided by operating activities was $46.7 million in fiscal 2004 as compared with $63.3 million in
fiscal 2003. Cash decreased primarily due to an increase in cash used to originate credit card loans in excess of
cash received from the sale of interests in credit card loans in connection with securitization transactions of $49.6
million. We increased the amount of cash spent for inventory by $5.4 million. Total inventory was up $50.2
million in fiscal 2004 compared to an increase of $44.9 million in fiscal 2003. Retail inventory increased $12.3
million primarily due to our new destination retail store, which added $8.5 million. The remainder of the retail
inventory increase is attributable to a build up in inventory for our credit card club events that ran from the week
after Christmas to January 9, 2005. These credit card club events did not take place in this same time frame in
fiscal 2003. The remainder of the overall increase is attributable to an increase in special buys and Cabela’s
branded inventory, which increase our lead times and are purchased and held in inventory in larger quantities.
These two increased uses of cash were offset by the difference in net payouts under our deferred compensation
plan of $31.0 million. In 2003, related to our recapitalization, we had a net pay out of $29.6 million, while in
2004 we had a net increase in our deferred compensation plan of $1.4 million.
Cash used in investing activities was $204.9 million in fiscal 2005 as compared with $126.8 million in fiscal
2004. The increase in cash used was primarily due to the increase in capital expenditures of $142.1 million due to
our retail expansion efforts. The increase in capital expenditures was partially offset by the retirement of
economic development bonds. Local governments retired the bonds we owned related to our Kansas City, Kansas
store and bonds related to our Prairie Du Chien, Wisconsin store for $60.1 million in principal.
Cash used in investing activities was $126.8 million in fiscal 2004 as compared with $89.7 million in fiscal
2003. The increase in cash used was primarily due to an increase in the purchase of economic development bonds
of $56.3 million related to our destination retail stores. An additional increase in cash used for investing activities
was due to increased credit card loans receivable of $5.3 million. These credit card loans are related to our new
third party loans carried by our bank. These credit card loans receivable are currently not included in our
securitization programs and therefore are held on our books. These two increases in cash used for investing
activities were offset by a decrease in our capital expenditures of $20.4 million and the proceeds from our sale of
our investment in Great Wolf Lodge, LLC of $8.8 million.
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