FlyBoeingJets
YES, that's NICE
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Liquidity and Capital Resources
Net cash provided by operating activities was $1.3 billion for the nine months ended September 30, 2006, compared to $2.1 billion in the same prior year period. The operating cash flows in both years were largely impacted by fluctuations in counterparty deposits associated with the Company’s fuel hedging program. There was a decrease in counterparty deposits of $270 million for the nine months ended September 30, 2006, versus an increase of $865 million during the nine months ended September 30, 2005. The decrease in these deposits during 2006 has been due to the decline in fair value of the Company’s fuel derivative portfolio from $1.7 billion at December 31, 2005, to $1.3 billion at September 30, 2006. The increase during 2005 was primarily due to a large increase in the fair value of the Company’s fuel derivative instruments, as a result of escalating energy prices during the first nine months of 2005. Cash flows from operating activities for the nine months ended September 30, 2006, were also driven by the $319 million increase in Air traffic liability, as a result of seasonal bookings for future travel, and the $442 million in net income. See Item 3, and Notes 5 and 8 to the unaudited condensed consolidated financial statements. Net cash provided by operating activities is primarily used to finance capital expenditures.
Net cash flows used in investing activities during the nine months ended September 30, 2006, totaled $1.1 billion compared to $876 million in 2005. Investing activities in both years consisted primarily of payments for new 737-700 aircraft delivered to the Company and progress payments for future aircraft deliveries. In addition, investing activities for both periods was impacted by changes in the balance of the Company’s short-term investments, namely auction rate securities. During the nine months ended September 30, 2006 and 2005, the Company’s short-term investments increased by $103 million and decreased by $72 million, respectively.
Net cash used in financing activities during the nine months ended September 30, 2006, was $468 million compared to $169 million generated from financing activities for the same period in 2005. During the nine months ended September 30, 2006, the Company repurchased $600 million of its Common Stock and redeemed $137 million of its debt on scheduled maturity dates. These outflows were partially offset by $226 million received from the exercise of Employee stock options. In the prior year, the Company generated $300 million from the February 2005 issuance of senior unsecured Notes due 2017. This was partially offset by cash used to redeem $100 million senior unsecured 8% Notes, $36 million used to repay other long-term and capital lease obligations, and to repurchase $55 million of the Company’s Common Stock.
Liquidity and Capital Resources
Net cash provided by operating activities was $1.3 billion for the nine months ended September 30, 2006, compared to $2.1 billion in the same prior year period. The operating cash flows in both years were largely impacted by fluctuations in counterparty deposits associated with the Company’s fuel hedging program. There was a decrease in counterparty deposits of $270 million for the nine months ended September 30, 2006, versus an increase of $865 million during the nine months ended September 30, 2005. The decrease in these deposits during 2006 has been due to the decline in fair value of the Company’s fuel derivative portfolio from $1.7 billion at December 31, 2005, to $1.3 billion at September 30, 2006. The increase during 2005 was primarily due to a large increase in the fair value of the Company’s fuel derivative instruments, as a result of escalating energy prices during the first nine months of 2005. Cash flows from operating activities for the nine months ended September 30, 2006, were also driven by the $319 million increase in Air traffic liability, as a result of seasonal bookings for future travel, and the $442 million in net income. See Item 3, and Notes 5 and 8 to the unaudited condensed consolidated financial statements. Net cash provided by operating activities is primarily used to finance capital expenditures.
Net cash flows used in investing activities during the nine months ended September 30, 2006, totaled $1.1 billion compared to $876 million in 2005. Investing activities in both years consisted primarily of payments for new 737-700 aircraft delivered to the Company and progress payments for future aircraft deliveries. In addition, investing activities for both periods was impacted by changes in the balance of the Company’s short-term investments, namely auction rate securities. During the nine months ended September 30, 2006 and 2005, the Company’s short-term investments increased by $103 million and decreased by $72 million, respectively.
Net cash used in financing activities during the nine months ended September 30, 2006, was $468 million compared to $169 million generated from financing activities for the same period in 2005. During the nine months ended September 30, 2006, the Company repurchased $600 million of its Common Stock and redeemed $137 million of its debt on scheduled maturity dates. These outflows were partially offset by $226 million received from the exercise of Employee stock options. In the prior year, the Company generated $300 million from the February 2005 issuance of senior unsecured Notes due 2017. This was partially offset by cash used to redeem $100 million senior unsecured 8% Notes, $36 million used to repay other long-term and capital lease obligations, and to repurchase $55 million of the Company’s Common Stock.
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