42 4342
H O N  I N D U S T R I E S  I n c .  a n d  S U B S I D I A R I E S
(Amounts in thousands) For the Years 2003                                 2002                                 2001
N E T  C A S H  F L O W S  F R O M  ( T O )  O P E R A T I N G  A C T I V I T I E S :
 Net income $ 98,105 $ 91,360 $ 74,407
 Noncash items included in net income:
  Depreciation and amortization  72,772  68,755  81,385
  Other postretirement and postemployment benefits  2,166  2,246  1,757
  Deferred income taxes  (3,314)  2,321  6,962
  Loss on sales, retirements and impairments of property, 
   plant and equipment  5,415  8,976  16,200
  Stock issued to retirement plan  4,678  5,750  —
  Other — net  391  2,613  109
 Changes in working capital, excluding acquisition and disposition:
  Receivables  1,006  (19,414)  47,897
  Inventories  (3,004)  2,348  35,048
  Prepaid expenses and other current assets  1,508  2,431  (1,661)
  Accounts payable and accrued expenses  (35,288)  37,857  (26,149)
  Income taxes  2,218  (2,370)  (5,957)
 Increase (decrease) in other liabilities  (5,379)  (482)  (2,198)
   Net cash flows from (to) operating activities  141,274  202,391  227,800
N E T  C A S H  F L O W S  F R O M  ( T O )  I N V E S T I N G  A C T I V I T I E S :
 Capital expenditures  (34,842)  (25,885)  (36,851)
 Proceeds from sale of property, plant and equipment  1,808  —  —
 Capitalized software  (2,666)  (65)  (1,757)
 Additional purchase consideration  (5,710)  —  (8,748)
 Short-term investments — net  (49,326)  (16,377)  —
 Purchase of long-term investments   (5,742)  (22,493)  —
 Sales or maturities of long-term investments   15,000  —  —
 Other — net  –  924  343
   Net cash flows from (to) investing activities  (81,478)  (63,896)  (47,013)
N E T  C A S H  F L O W S  F R O M  ( T O )  F I N A N C I N G  A C T I V I T I E S :
 Purchase of HON INDUSTRIES common stock  (21,512)  (15,736)  (35,059)
 Proceeds from long-term debt  761  825  36,218
 Payments of note and long-term debt  (20,992)  (35,967)  (87,365)
 Proceeds from sale of HON INDUSTRIES common stock   12,063  2,096  9,449
 Dividends paid  (30,299)  (29,386)  (28,373) 
   Net cash flows from (to) financing activities  (59,979)  (78,168)  (105,130)
Net increase (decrease) in cash and cash equivalents  (183)  60,327  75,657
Cash and cash equivalents at beginning of year  139,165  78,838  3,181
Cash and cash equivalents at end of year  138,982  139,165  78,838
S U P P L E M E N T A L  D I S C L O S U R E S  O F  C A S H  F L O W  I N F O R M A T I O N :
 Cash paid during the year for:
 Interest $  3,408   $ 5,062 $ 8,646
 Income taxes $  53,855 $  48,598 $  40,916
The accompanying notes are an integral part of the consolidated financial statements.
C O N S O L I D A T E D  S T A T E M E N T S  O F C A S H  F L O W S