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SEC Filings

10-Q
INTERPUBLIC GROUP OF COMPANIES, INC. filed this Form 10-Q on 04/21/2017
Entire Document
 

Management’s Discussion and Analysis of Financial Condition and Results of Operations - (continued)
(Amounts in Millions, Except Per Share Amounts)
(Unaudited)


liabilities. Our assets include both cash received and accounts receivable from clients for these pass-through arrangements, while our liabilities include amounts owed on behalf of clients to media and production suppliers.
Our accrued liabilities are also affected by the timing of certain other payments. For example, while annual cash incentive awards are accrued throughout the year, they are generally paid during the first quarter of the subsequent year.
Investing Activities
Net cash used in investing activities during the first quarter of 2017 primarily consists of payments for capital expenditures of $24.8, related mostly to leasehold improvements and computer hardware and software.
Financing Activities
Net cash provided by financing activities during the first quarter of 2017 is primarily driven by an increase in short-term borrowings of $224.8, partially offset by the payment of dividends of $70.9 and the repurchase of 2.3 shares of our common stock for an aggregate cost of $55.0, including fees.
Foreign Exchange Rate Changes
The effect of foreign exchange rate changes on cash, cash equivalents and restricted cash included in the unaudited Consolidated Statements of Cash Flows resulted in a net increase of $20.0 during the first quarter of 2017, primarily a result of the U.S. Dollar weakening against several foreign currencies, primarily the Australian Dollar and Indian Rupee, as of March 31, 2017 as compared to December 31, 2016.
Balance Sheet Data
March 31,
2017
 
December 31,
2016
 
March 31,
2016
Cash, cash equivalents and marketable securities
$
778.1

 
$
1,100.6

 
$
680.3

 
 
 
 
 
 
Short-term borrowings
$
310.8

 
$
85.7

 
$
119.4

Current portion of long-term debt
324.1

 
323.9

 
2.0

Long-term debt
1,281.9

 
1,280.7

 
1,609.9

Total debt
$
1,916.8

 
$
1,690.3

 
$
1,731.3

LIQUIDITY OUTLOOK
We expect our cash flow from operations, cash and cash equivalents to be sufficient to meet our anticipated operating requirements at a minimum for the next twelve months. We also have a committed corporate credit facility as well as uncommitted lines of credit available to support our operating needs. We continue to maintain a disciplined approach to managing liquidity, with flexibility over significant uses of cash, including our capital expenditures, cash used for new acquisitions, our common stock repurchase program and our common stock dividends.
From time to time, we evaluate market conditions and financing alternatives for opportunities to raise additional funds or otherwise improve our liquidity profile, enhance our financial flexibility and manage market risk. Our ability to access the capital markets depends on a number of factors, which include those specific to us, such as our credit rating, and those related to the financial markets, such as the amount or terms of available credit. There can be no guarantee that we would be able to access new sources of liquidity on commercially reasonable terms, or at all.
Funding Requirements
Our most significant funding requirements include our operations, non-cancelable operating lease obligations, capital expenditures, acquisitions, common stock dividends, taxes and debt service. Additionally, we may be required to make payments to minority shareholders in certain subsidiaries if they exercise their options to sell us their equity interests.
Notable funding requirements include:
Debt service - We currently have short-term borrowings of $310.8 from our uncommitted lines of credit used primarily to fund seasonal working capital needs. Our 2.25% Senior Notes in aggregate principal amount of $300.0 mature on November 15, 2017, and a $22.6 note classified within our Other notes payable is due on June 30, 2017. We expect to refinance the outstanding 2.25% Senior Notes upon maturity. The remainder of our debt is primarily long-term, with maturities scheduled through 2024.

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