Brinker International Inc.®

Annual Report 2006


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BRINKER INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

  Fiscal Years
  2006   2005   2004
Cash Flows from Operating Activities:
Net income
   $ 212,395         $ 160,219         $ 150,918     
Adjustments to reconcile net income to net cash provided by operating
    activities of continuing operations:
        Depreciation and amortization
  190,206     179,908     167,802  
        Restructure charges and other impairments   1,950     61,855     69,236  
        Stock-based compensation   32,200     2,127     2,702  
        Deferred income taxes   (34,219   (14,852   1,467  
        Gain on sale of assets   (19,278   (6,314   (2,452
        Amortization of deferred costs   (39   3,113     7,548  
        Loss (income) from discontinued operations, net of taxes   1,555     (1,763   1,265  
        Gain on extinguishment of debt       (1,750    
        Changes in assets and liabilities, excluding effects of acquisitions
            and dispositions:
            Receivables
  (8,948   (5,821   (4,203
            Inventories   8,474     (12,500   (13,800
            Prepaid expenses and other   (3,773   (3,867   1,562  
            Other assets   19,198     (3,422   (3,162
            Income taxes payable   11,994     (4,844   34,115  
            Accounts payable   18,120     27,301     (2,273
            Accrued liabilities   54,016     36,541     35,376  
            Other liabilities   (13,346   9,430     21,917  
            Net cash provided by operating activities of continuing
                operations
  470,505     425,361     468,018  
Cash Flows from Investing Activities:
Payments for property and equipment
  (354,607   (322,713   (304,482
Proceeds from sale of assets   48,462     38,928     22,235  
Payments for purchases of restaurants   (23,095        
Proceeds from disposition of equity method investee   1,101          
Purchases of short-term investments           (254,175
Proceeds from sale of short-term investments       179,325     74,850  
Net payments to affiliates           (2,252
            Net cash used in investing activities of continuing operations   (328,139   (104,460   (463,824
Cash Flows from Financing Activities:
Purchases of treasury stock
  (305,714   (170,210   (322,615
Net borrowings on credit facilities   80,300     62,900      
Proceeds from issuances of treasury stock   53,808     71,112     41,587  
Payments of dividends   (25,417        
Excess tax benefits from stock-based compensation   2,107     6,628     4,749  
Payments on long-term debt   (1,581   (301,364   (17,120
Net proceeds from issuance of debt           296,075  
            Net cash (used in) provided by financing activities of continuing
                operations
  (196,497   (330,934   2,676  
Cash Flows from Discontinued Operations (Revised):
Net cash provided by operating activities of discontinued operations
  5,042     12,324     17,952  
Net cash provided by (used in) investing activities of discontinued
    operations
  62,845     (7,471   (10,877
            Net cash provided by discontinued operations   67,887     4,853     7,075  
Net change in cash and cash equivalents   13,756     (5,180   13,945  
Cash and cash equivalents at beginning of year   41,859     47,039     33,094  
Cash and cash equivalents at end of year $ 55,615   $ 41,859   $ 47,039  

See accompanying notes to consolidated financial statements.

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