Name: O’Reilly Automotive Inc. (NASDAQ:ORLY) | Cash Flow Statement
Creator: Stock Analysis on Net

Cash Flow Statement

The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.

The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.

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O’Reilly Automotive Inc., consolidated cash flow statement

US$ in thousands

12 months ended:	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Net income	2,164,685)	1,752,302)	1,391,042)	1,324,487)	1,133,804)
Depreciation and amortization of property, equipment and intangibles	328,217)	314,635)	270,875)	258,937)	233,845)
Amortization of debt discount and issuance costs	4,388)	4,580)	3,916)	3,470)	2,871)
Deferred income taxes	20,383)	12,381)	21,158)	20,160)	(4,593)
Share-based compensation programs	24,656)	22,747)	21,921)	20,176)	19,401)
Other	2,128)	4,686)	7,529)	9,895)	11,790)
Accounts receivable	(47,427)	(20,515)	(15,577)	18,138)	(27,742)
Inventory	(32,634)	(198,864)	(239,912)	(163,367)	(231,802)
Accounts payable	510,911)	580,608)	213,423)	177,676)	253,265)
Income taxes payable	152,339)	197,739)	(20,139)	22,903)	14,220)
Accrued payroll	18,714)	(11,941)	14,296)	9,373)	5,430)
Accrued benefits and withholdings	9,214)	189,332)	16,868)	28,022)	3,042)
Other	51,736)	(11,087)	23,079)	(2,315)	(9,844)
Changes in operating assets and liabilities	662,853)	725,272)	(7,962)	90,430)	6,569)
Adjustments to reconcile net income to net cash provided by operating activities	1,042,625)	1,084,301)	317,437)	403,068)	269,883)
Net cash provided by operating activities	3,207,310)	2,836,603)	1,708,479)	1,727,555)	1,403,687)
Purchases of property and equipment	(442,853)	(465,579)	(628,057)	(504,268)	(465,940)
Proceeds from sale of property and equipment	9,494)	15,770)	7,118)	4,784)	4,464)
Investment in tax credit equity investments	(180,333)	(164,111)	(33,781)	—)	—)
Other	(1,928)	(975)	(142,026)	(34,818)	(2,747)
Net cash used in investing activities	(615,620)	(614,895)	(796,746)	(534,302)	(464,223)
Proceeds from borrowings on revolving credit facility	—)	1,162,000)	2,708,000)	2,414,000)	3,101,000)
Payments on revolving credit facility	—)	(1,423,000)	(2,734,000)	(2,473,000)	(2,755,000)
Proceeds from the issuance of long-term debt	—)	997,515)	499,955)	498,660)	748,800)
Principal payments on long-term debt	(300,000)	(500,000)	—)	—)	—)
Payment of debt issuance costs	(3,412)	(7,929)	(3,990)	(3,923)	(7,590)
Repurchases of common stock	(2,476,048)	(2,087,194)	(1,432,791)	(1,714,013)	(2,172,530)
Net proceeds from issuance of common stock	84,915)	62,284)	60,206)	72,146)	45,762)
Other	(313)	(253)	(191)	(2,156)	(156)
Net cash used in financing activities	(2,694,858)	(1,796,577)	(902,811)	(1,208,286)	(1,039,714)
Effect of exchange rate changes on cash	(359)	103)	169)	—)	—)
Net increase (decrease) in cash and cash equivalents	(103,527)	425,234)	9,091)	(15,033)	(100,250)
Cash and cash equivalents at beginning of the period	465,640)	40,406)	31,315)	46,348)	146,598)
Cash and cash equivalents at end of the period	362,113)	465,640)	40,406)	31,315)	46,348)

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

Net income demonstrates a consistent upward trajectory over the five-year period, growing from 1.13 billion USD in 2017 to 2.16 billion USD in 2021. This growth is mirrored in the net cash provided by operating activities, which increased from 1.40 billion USD to 3.21 billion USD over the same interval. The acceleration in operating cash flow is particularly pronounced in 2020 and 2021, where significant contributions from changes in operating assets and liabilities amplified the cash generated beyond the growth in net income.

Operating Cash Flow Drivers: Depreciation and amortization remained a steady non-cash add-back, increasing incrementally from 233.8 million USD in 2017 to 328.2 million USD in 2021. A notable shift occurred in working capital management during 2020, where a substantial increase in accounts payable (580.6 million USD) and income taxes payable (197.7 million USD) contributed to a peak in cash provided by operating activities.

Investing activities are characterized by consistent capital expenditures and a growing commitment to tax credit equity investments. Net cash used in investing activities fluctuated between 464 million USD and 797 million USD annually, indicating a steady reinvestment strategy into the business infrastructure.

Capital Expenditure Trends: Purchases of property and equipment peaked in 2019 at 628 million USD before moderating to 442.8 million USD by 2021. Simultaneously, investment in tax credit equity investments emerged in 2019 and expanded rapidly, reaching 180.3 million USD in 2021, representing a diversifying trend in the company's investment portfolio.

Financing activities show a primary focus on shareholder returns through aggressive share repurchases, funded by operating cash flow and strategic debt utilization. The net cash used in financing activities increased from 1.04 billion USD in 2017 to 2.69 billion USD in 2021.

Shareholder Returns and Debt Management: Repurchases of common stock served as the dominant financing outflow, totaling 2.48 billion USD in 2021 alone. To support these activities and operational needs, the company utilized a revolving credit facility with high volumes of both proceeds and payments between 2017 and 2020. By 2021, the reliance on the revolving credit facility ceased in the provided data, shifting instead toward principal payments on long-term debt.

The overall cash position remained lean relative to the scale of operations, with cash and cash equivalents ending 2021 at 362.1 million USD. The financial pattern suggests a strategy of maximizing capital efficiency by deploying nearly all operating cash flow into capital investments and the reduction of outstanding shares.

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