Humana 2007 Annual Report Download - page 75

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Humana Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the year ended December 31,
2007 2006 2005
(in thousands)
Cash flows from operating activities
Net income ............................................................ $ 833,684 $ 487,423 $ 296,730
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization ......................................... 184,812 148,598 128,858
Stock-based compensation ............................................ 42,132 32,558 30,153
(Gain) loss on sale of property and equipment, net ......................... (13,597) 1,153 152
Gain on sale of investment securities, net ................................. (11,668) (67,496) (18,323)
(Benefit) provision for deferred income taxes ............................. (32,736) 70,062 (39,007)
Provision for doubtful accounts ........................................ 28,922 20,901 4,566
Changes in operating assets and liabilities, net of effect of businesses acquired:
Receivables .................................................... 60,745 37,653 (161,314)
Other assets .................................................... 105,689 (365,454) (63,962)
Benefits payable ................................................ 245,397 540,067 421,922
Other liabilities ................................................. (317,855) 752,032 53,992
Unearned revenues .............................................. 64,482 29,870 (45,610)
Other ............................................................. 34,255 (655) 1,925
Net cash provided by operating activities ............................. 1,224,262 1,686,712 610,082
Cash flows from investing activities
Acquisitions, net of cash acquired .......................................... (493,493) (28,062) (402,844)
Purchases of property and equipment ........................................ (239,244) (193,151) (165,846)
Proceeds from sales of property and equipment ................................ 26,514 9,623 4,497
Purchases of investment securities .......................................... (3,488,631) (4,269,221) (3,717,916)
Maturities of investment securities .......................................... 1,387,967 1,664,332 1,761,588
Proceeds from sales of investment securities .................................. 1,670,555 1,742,793 1,723,015
Change in securities lending collateral ....................................... (709,059) (580,380) 30,230
Net cash used in investing activities ................................. (1,845,391) (1,654,066) (767,276)
Cash flows from financing activities
Receipts from CMS contract deposits ........................................ 2,866,170 2,002,451 —
Withdrawals from CMS contract deposits .................................... (3,051,241) (2,124,717) —
Borrowings under credit agreement ......................................... 1,685,000 550,000 494,000
Repayments under credit agreement ......................................... (1,335,000) (300,000) (294,000)
Proceeds from issuance of senior notes ...................................... — 498,545 —
Repayment of senior notes ................................................ — (300,000) —
Debt issue costs ......................................................... — (5,980) —
Change in book overdraft ................................................. (24,379) 13,600 87,945
Change in securities lending payable ........................................ 709,059 580,380 (30,230)
Common stock repurchases ............................................... (27,412) (26,211) (2,364)
Tax benefit from stock-based compensation .................................. 37,443 38,839 15,545
Proceeds from stock option exercises and other ................................ 61,638 48,735 38,235
Net cash provided by financing activities ............................. 921,278 975,642 309,131
Increase in cash and cash equivalents ............................................ 300,149 1,008,288 151,937
Cash and cash equivalents at beginning of year .................................... 1,740,304 732,016 580,079
Cash and cash equivalents at end of year ......................................... $2,040,453 $ 1,740,304 $ 732,016
Supplemental cash flow disclosures:
Interest payments ....................................................... $ 67,954 $ 66,579 $ 45,258
Income tax payments, net ................................................. $ 443,904 $ 160,233 $ 179,300
Details of businesses acquired in purchase transactions:
Fair value of assets acquired, net of cash acquired .............................. $1,315,492 $ 63,961 $ 508,443
Less: Fair value of liabilities assumed ....................................... (821,999) (35,899) (105,599)
Cash paid for acquired businesses, net of cash acquired ......................... $ 493,493 $ 28,062 $ 402,844
The accompanying notes are an integral part of the consolidated financial statements.
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