Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)
(Amounts in Millions, Except Per Share Amounts)
Operating income increased during 2015 when compared to 2014 due to an increase in revenue of $8.1 and a decrease in office and general expenses of $22.5, partially offset by an increase in salaries and related expenses of $27.7. The decrease in office and general expenses was primarily due to lower production expenses related to pass-through costs, which are also reflected in revenue, for certain projects in which we acted as principal that decreased in size or did not recur during the current year. The increase in salaries and related expenses was due to increases in our workforce, most notably at our public relations business, to support business growth and increases due to acquisitions.
Operating income increased during 2014 when compared to 2013 due to an increase in revenue of $111.3, partially offset by increases in salaries and related expenses of $69.6 and office and general expenses of $18.0. The increase in salaries and related expenses was due to an increase in base salaries, benefits and temporary help, primarily attributable to increases in our workforce, most notably at our public relations business, to support business growth, as well as increases due to acquisitions in 2014. Office and general expenses increased primarily due to higher occupancy costs, increased spending to support new business activity and increases due to acquisitions during 2014.
CORPORATE AND OTHER
Certain corporate and other charges are reported as a separate line item within total segment operating income and include corporate office expenses, as well as shared service center and certain other centrally managed expenses that are not fully allocated to operating divisions. Salaries and related expenses include salaries, long-term incentives, annual bonuses and other miscellaneous benefits for corporate office employees. Office and general expenses primarily include professional fees related to internal control compliance, financial statement audits and legal, information technology and other consulting services that are engaged and managed through the corporate office. Office and general expenses also include rental expense and depreciation of leasehold improvements for properties occupied by corporate office employees. A portion of centrally managed expenses are allocated to operating divisions based on a formula that uses the planned revenues of each of the operating units. Amounts allocated also include specific charges for information technology-related projects, which are allocated based on utilization.
Corporate and other expenses decreased during 2015 by $7.7 to $141.8 compared to 2014, primarily due to lower temporary help. Corporate and other expenses increased during 2014 by $8.7 to $149.5 compared to 2013, primarily due to higher incentive awards expense resulting from improved financial performance and higher employee insurance costs due to increased claims and regulatory changes, partially offset by lower occupancy costs.
LIQUIDITY AND CAPITAL RESOURCES
CASH FLOW OVERVIEW
The following tables summarize key financial data relating to our liquidity, capital resources and uses of capital.
Years ended December 31,
Cash Flow Data
Net income, adjusted to reconcile net income to net cash
provided by operating activities 1
Net cash used in working capital 2
Changes in other non-current assets and liabilities using cash
Net cash provided by operating activities
Net cash used in investing activities
Net cash used in financing activities
Reflects net income adjusted primarily for depreciation and amortization of fixed assets and intangible assets, amortization of restricted stock and other non-cash compensation, non-cash (gain) loss related to early extinguishment of debt, losses on sales of businesses and deferred income taxes.
Reflects changes in accounts receivable, expenditures billable to clients, other current assets, accounts payable and accrued liabilities.
Net cash provided by operating activities during 2015 was $674.0, which was an improvement of $4.5 as compared to 2014, primarily as a result of an improvement in working capital usage of $13.6. Due to the seasonality of our business, we typically generate cash from working capital in the second half of a year and use cash from working capital in the first half of a year, with the largest impacts in the first and fourth quarters. Our net working capital usage in 2015 was primarily attributable to our media businesses.