EX-99.1 2 w73927exv99w1.htm PRESS RELEASE exv99w1
Exhibit 99.1
         
(AIRGAS LOGO)
  News Release   Airgas, Inc.
259 N. Radnor-Chester Road
Suite 100
Radnor, PA 19087-5283
www.airgas.com
     
Media Contact:   Investor Contact:
Jay Worley (610) 902-6206   Barry Strzelec (610) 902-6256
jay.worley@airgas.com   barry.strzelec@airgas.com
For release:                Immediately
Airgas Reports Fourth Quarter EPS of $0.68 and Fiscal 2009 EPS of $3.12
  Fourth quarter diluted EPS of $0.68, down 11%
 
  Record full year diluted EPS of $3.12, up 17%
 
  Fourth quarter sales down 9%, same-store sales down 13%
 
  Full year sales up 8%, same-store sales up 1%
 
  Record free cash flow: fourth quarter $157 million; full year $328 million
RADNOR, PA — May 5, 2009 — Airgas, Inc. (NYSE: ARG), the largest U.S. distributor of industrial, medical, and specialty gases, and welding, safety, and related products, today reported solid performance in earnings and cash flow, relative to the weak sales environment, for its fourth quarter ended March 31, 2009.
Quarterly earnings declined 11% to $0.68 per diluted share, compared to $0.76 per diluted share in the prior year. Fourth quarter sales were $1.0 billion compared to $1.1 billion in the prior year, a decline of 9%. Total same-store sales declined 13% in the quarter, with hardgoods down 20% and gas and rent down 8%. Acquisitions contributed 4% sales growth in the quarter.
“Most of our customer segments were under significant pressure this quarter, with manufacturing suffering the deepest declines,” said Airgas Chairman and CEO Peter McCausland. “Given the difficult sales environment, we moved quickly to curtail costs and capital spending. As a result, our operating margin in the quarter held up relatively well, declining modestly to 11.5% from 12.1% last year.”
Free cash flow* in the fourth quarter was a strong $157 million compared to $63 million last year, with a large part of the improvement driven by reductions in working capital. Return on capital* was 12.7% compared to 13.2% in the prior year.


 

 

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For the full year, sales increased 8% to $4.3 billion. Acquisitions contributed 7% sales growth in the year, while total same-store sales grew 1%, with hardgoods down 4% and gas and rent up 4%. The Company completed 14 acquisitions in fiscal 2009, adding more than $205 million in historic annual revenue. Earnings for the year grew 17% from $2.66 per diluted share in the prior year to $3.12, marking another record year of earnings. The strong performance was driven by good sales growth in the first half of the year and effective management of costs in response to the slowing economy in the second half of the year. The prior year included $0.06 of integration expense primarily associated with the June 30, 2007 acquisition of Linde’s U.S. packaged gas business, a one-time non-cash charge of $0.03 related to the conversion of National Welders Supply Company from a joint venture to a wholly owned subsidiary, and a $0.01 tax benefit related to a change in state tax law. Adjusted cash from operations* was a record $660 million, up from $482 million the previous year, helping to drive strong free cash flow* of $328 million for the year, up from $225 million the previous year.
“The current environment puts a damper on what was a record year for Airgas in earnings and cash flow, but we’re using this time to strengthen our operations so that we are well-positioned for growth when the economy begins to recover,” said McCausland. “The fourth quarter trend of low sales volumes continued in April, and with few signs of recovery in the near term, we are cautious in our outlook for fiscal 2010. The resilient nature of our business model, including our flexible cost structure and ability to generate strong free cash flow, should prove beneficial even if conditions deteriorate further.”
The Company expects earnings per diluted share of $0.62 to $0.67 for the first quarter, a decline of 23% to 17% from the strong first quarter results in the prior year. For the full year 2010, the Company expects earnings per diluted share of $2.60 to $2.90, a decline of 17% to 7%.
Prevailing economic conditions offer limited visibility into future sales and earnings, which should be taken into consideration when evaluating the Company’s guidance.
The Company will conduct an earnings teleconference at 11:00 a.m. Eastern Time on Wednesday, May 6. The teleconference will be available by calling (877) 719-9796. The presentation materials (this press release, slides to be presented during the Company’s teleconference and information about how to access a live and on-demand webcast of the teleconference) are available in the “Investor Information” section on the Company’s Internet site at www.airgas.com. A webcast of the teleconference will be available live and on demand through June 5 at http://investor.shareholder.com/arg/events.cfm. A replay of the teleconference will be available through May 15. To listen, call (888) 203-1112 and enter passcode 4293724.


 

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*   See attached reconciliations and calculations of the non-GAAP adjusted cash from operations, free cash flow, and return on capital financial measures.
About Airgas, Inc.
Airgas, Inc. (NYSE: ARG), through its subsidiaries, is the largest U.S. distributor of industrial, medical, and specialty gases, and hardgoods, such as welding equipment and supplies. Airgas is also one of the largest U.S. distributors of safety products, the largest U.S. producer of nitrous oxide and dry ice, the largest liquid carbon dioxide producer in the Southeast, and a leading distributor of process chemicals, refrigerants, and ammonia products. More than 14,000 employees work in over 1,100 locations, including branches, retail stores, gas fill plants, specialty gas labs, production facilities, and distribution centers. Airgas also distributes its products and services through eBusiness, catalog, and telesales channels. Its national scale and strong local presence offer a competitive edge to its diversified customer base. For more information, please visit www.airgas.com.


 

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#  #  #
Forward-Looking Statements
This press release may contain statements that are forward looking, as that term is defined by the Private Securities Litigation Reform Act of 1995 or by the Securities and Exchange Commission in its rules, regulations and releases. These statements include, but are not limited to: expectations for first quarter fully diluted earnings per share to be in the range of $0.62 to $0.67 and full year earnings per share for fiscal 2010 to be in the range of $2.60 to $2.90; our seeing few signs of recovery in the near term; our cautious outlook for fiscal 2010; and the resilient nature of our business model, including our flexible cost structure and ability to generate strong free cash flow, and that these characteristics should prove beneficial if conditions deteriorate further. We intend that such forward-looking statements be subject to the safe harbors created thereby. All forward-looking statements are based on current expectations regarding important risk factors and should not be regarded as a representation by us or any other person that the results expressed therein will be achieved. Important factors that could cause actual results to differ materially from those contained in any forward-looking statement include: adverse changes in customer buying patterns resulting from further deterioration in current economic conditions; weakening operating and financial performance of our customers, which can negatively impact our sales and our ability to collect our accounts receivables; postponement of projects due to the recession; customer acceptance of price increases; the success of implementing and continuing our cost reduction programs; our ability to achieve anticipated acquisition synergies; supply cost pressures; increased industry competition; our ability to successfully identify, consummate, and integrate acquisitions; our continued ability to access credit markets on satisfactory terms; significant fluctuations in interest rates; increases in energy costs and other operating expenses eroding the planned cost savings; higher than expected implementation costs of the SAP system; conversion problems related to the SAP system that disrupt the Company’s business and negatively impact customer relationships; the impact of tightened credit markets on our customers; the impact of changes in tax and fiscal policies and laws; the potential for increased expenditures relating to compliance with environmental regulatory initiatives; the impact of new environmental, healthcare, tax, accounting, and other regulation; potential liability under the Multiemployer Pension Plan Amendments Act of 1980 with respect to our participation in multiemployer pension plans for our union employees; the extent and duration of current recessionary trends in the U.S. economy; the effect of catastrophic events; political and economic uncertainties associated with current world events; and other factors described in the Company’s reports, including its March 31, 2008 Form 10-K, subsequent Forms 10-Q, and other forms filed by the Company with the Securities and Exchange Commission.
Consolidated statements of earnings, condensed consolidated balance sheets, consolidated statements of cash flows, and reconciliations of non-GAAP financial measures follow.


 

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AIRGAS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Amounts in thousands, except per share data)
                                 
    (Unaudited)     (Unaudited)  
    Three Months Ended     Year Ended  
    March 31,     March 31,  
    2009     2008     2009     2008  
Net sales
  $ 992,100     $ 1,086,597     $ 4,349,455     $ 4,017,024  
 
                       
 
                               
Costs and expenses:
                               
Cost of products sold (excl. deprec.)
    447,729       523,715       2,045,020       1,929,263  
Selling, distribution and administrative expenses
    372,324       383,189       1,558,772       1,422,162  
Depreciation
    51,266       46,235       198,033       175,802  
Amortization
    6,275       2,398       22,762       13,973  
 
                       
Total costs and expenses
    877,594       955,537       3,824,587       3,541,200  
 
                       
 
                               
Operating income
    114,506       131,060       524,868       475,824  
 
                               
Interest expense, net
    (20,002 )     (21,699 )     (84,395 )     (89,485 )
Discount on securitization of trade receivables (b)
    (1,697 )     (4,295 )     (10,738 )     (17,031 )
Other income (expense), net
    89       564       (382 )     1,454  
 
                       
Earnings before income tax expense and minority interest
    92,896       105,630       429,353       370,762  
 
                               
Income tax expense
    (36,415 )     (41,417 )     (168,265 )     (144,184 )
Minority interest in earnings of consolidated affiliate (d)
                      (3,230 )
 
                       
Net earnings
  $ 56,481     $ 64,213     $ 261,088     $ 223,348  
 
                       
 
                               
Net earnings per common share (e):
                               
 
                               
Basic earnings per share
  $ 0.69     $ 0.78     $ 3.19     $ 2.74  
 
                       
 
                               
Diluted earnings per share
  $ 0.68     $ 0.76     $ 3.12     $ 2.66  
 
                       
 
                               
Weighted average shares outstanding (e):
                               
Basic
    81,329       82,476       81,926       81,402  
Diluted
    82,666       84,613       83,816       84,235  
See attached Notes.


 

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AIRGAS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
                 
    (Unaudited)        
    March 31,     March 31,  
    2009     2008  
ASSETS
               
Cash
  $ 47,188     $ 43,048  
Trade accounts receivable, net (b)
    184,739       183,569  
Inventories, net
    390,445       330,732  
Deferred income tax asset, net
    34,760       22,258  
Prepaid expenses and other current assets
    60,838       67,110  
 
           
TOTAL CURRENT ASSETS
    717,970       646,717  
 
               
Plant and equipment, net
    2,366,526       2,194,870  
Goodwill
    1,063,370       969,059  
Other intangible assets, net
    216,070       148,998  
Other non-current assets
    35,601       27,620  
 
           
TOTAL ASSETS
  $ 4,399,537     $ 3,987,264  
 
           
 
               
LIABILITIES AND STOCKHOLDERS’ EQUITY
               
Accounts payable, trade
  $ 156,838     $ 185,111  
Accrued expenses and other current liabilities
    264,564       288,883  
Current portion of long-term debt
    11,058       40,400  
 
           
TOTAL CURRENT LIABILITIES
    432,460       514,394  
 
               
Long-term debt (excluding current portion) (c)
    1,750,308       1,539,648  
Deferred income tax liability, net
    565,783       439,782  
Other non-current liabilities
    79,231       80,104  
 
               
Stockholders’ equity
    1,571,755       1,413,336  
 
           
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
  $ 4,399,537     $ 3,987,264  
 
           
See attached Notes.


 

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AIRGAS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
                 
    (Unaudited)        
    Year Ended     Year Ended  
    March 31, 2009     March 31, 2008  
CASH FLOWS FROM OPERATING ACTIVITIES
               
Net earnings
  $ 261,088     $ 223,348  
Adjustments to reconcile net earnings to net cash provided by operating activities:
               
Depreciation
    198,033       175,802  
Amortization
    22,762       13,973  
Deferred income taxes
    103,280       74,725  
(Gain) loss on sales of plant and equipment
    (964 )     714  
Minority interest (d)
          3,230  
Stock-based compensation expense
    20,635       16,629  
Changes in assets and liabilities, excluding effects of business acquisitions:
               
Securitization of trade receivables
    (48,600 )     95,600  
Trade receivables, net
    77,209       (23,308 )
Inventories, net
    441       (37,079 )
Prepaid expenses and other current assets
    4,362       1,693  
Accounts payable, trade
    (40,239 )     8,053  
Accrued expenses and other current liabilities
    (15,097 )     (749 )
Other non-current assets
    (673 )     (81 )
Other non-current liabilities
    530       (2,624 )
 
           
Net cash provided by operating activities
    582,767       549,926  
 
           
 
               
CASH FLOWS FROM INVESTING ACTIVITIES
               
Capital expenditures
    (351,912 )     (267,378 )
Proceeds from sales of plant and equipment
    14,360       9,345  
Business acquisitions and holdback settlements (a)
    (273,750 )     (480,096 )
Other, net
    1,378       (1,316 )
 
           
Net cash used in investing activities
    (609,924 )     (739,445 )
 
           
 
               
CASH FLOWS FROM FINANCING ACTIVITIES
               
Proceeds from borrowings
    1,364,423       1,162,452  
Repayment of debt
    (1,188,675 )     (953,749 )
Purchase of treasury stock
    (120,219 )     (17,010 )
Financing costs
    (9,201 )      
Minority interest in earnings
          (711 )
Tax benefit realized from the exercise of stock options
    11,846       13,327  
Stock issued for the employee stock purchase plan
    16,507       14,091  
Proceeds from the exercise of stock options
    16,188       20,381  
Dividends paid to stockholders
    (45,766 )     (31,828 )
Change in cash overdraft
    (13,806 )     (317 )
 
           
Net cash provided by financing activities
    31,297       206,636  
 
           
 
               
Change in cash
  $ 4,140     $ 17,117  
Cash — Beginning of period
    43,048       25,931  
 
           
Cash — End of period
  $ 47,188     $ 43,048  
 
           
See attached Notes.


 

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Notes:
 
(a)   During fiscal 2009, the Company purchased fourteen businesses, including eleven associated with the distribution of packaged gases and related hardgoods, one associated with the rental of safety equipment, one associated with refrigerant gases and one international acquisition related to the rental of welding equipment. The fourteen acquired businesses historically generated aggregate annual revenues greater than $205 million. A total of $274 million was paid for the acquisitions and the settlement of holdback liabilities associated with prior acquisitions.
 
(b)   The Company participates in a securitization agreement with three commercial banks to sell up to $345 million ($360 million in March 2008) of qualified trade receivables. Net proceeds from the securitization were used to reduce borrowings under the Company’s revolving credit facilities. The amount of outstanding receivables sold under the agreement was $311 million and $360 million at March 31, 2009 and March 31, 2008, respectively. The “Discount on securitization of trade receivables” in the accompanying Consolidated Statements of Earnings represents the difference between the proceeds from the sale of trade receivables and the carrying value of those receivables.
 
(c)   The Company maintains a $1.7 billion senior credit facility with a syndicate of lenders. Approximately $266 million was available to the Company under this facility on March 31, 2009.
 
(d)   On July 3, 2007, the preferred stockholders of the National Welders joint venture exchanged their preferred stock for common stock of Airgas (the “NWS Exchange Transaction”). The Company issued 2.471 million shares of Airgas common stock to the preferred stockholders in exchange for all 3.2 million preferred shares of National Welders. As part of the negotiated exchange, the Company issued an additional 144 thousand shares (included in the 2.471 million shares) of Airgas common stock to the preferred shareholders, which resulted in a one-time net after-tax charge of $2.5 million, or $0.03 per diluted share.
 
(e)   The tables below present the computation of basic and diluted earnings per share:


 

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    (Unaudited)     (Unaudited)  
    Three Months Ended     Year Ended  
    March 31,     March 31,  
(In thousands, except per share amounts)   2009     2008     2009     2008  
Basic Earnings per Share Computation
                               
Numerator
                               
Net earnings
  $ 56,481     $ 64,213     $ 261,088     $ 223,348  
 
                       
 
                               
Denominator
                               
Basic shares outstanding
    81,329       82,476       81,926       81,402  
 
                       
 
Basic earnings per share
  $ 0.69     $ 0.78     $ 3.19     $ 2.74  
 
                       
 
                               
Diluted Earnings per Share Computation
                               
 
                               
Numerator
                               
Net earnings
  $ 56,481     $ 64,213     $ 261,088     $ 223,348  
Plus: Preferred stock dividends (1)
                      711  
Plus: Income taxes on earnings of National Welders (1)
                      245  
 
                       
Net earnings assuming preferred stock conversion
  $ 56,481     $ 64,213     $ 261,088     $ 224,304  
 
                       
 
                               
Denominator
                               
Basic shares outstanding
    81,329       82,476       81,926       81,402  
 
                               
Incremental shares from assumed exercises and conversions:
                               
Stock options and options under the employee stock purchase plan
    1,337       2,137       1,890       2,242  
Preferred stock of National Welders (1)
                      591  
 
                       
Diluted shares outstanding
    82,666       84,613       83,816       84,235  
 
                       
 
                               
Diluted earnings per share
  $ 0.68     $ 0.76     $ 3.12     $ 2.66  
 
                       
 
(1)   Prior to the July 3, 2007 NWS Exchange Transaction (see (d) above), the preferred stockholders of National Welders had the option to exchange their 3.2 million preferred shares of National Welders either for cash at a price of $17.78 per share or for approximately 2.3 million shares of Airgas common stock. If Airgas common stock had a market value of $24.45 per share or greater, exchange of the preferred stock was assumed because it provided greater value to the preferred stockholders. Based on the assumed exchange of the preferred stock for Airgas common stock, the 2.3 million shares were included in the diluted shares outstanding.
 
    The National Welders preferred stockholders earned a 5% dividend, recognized as “Minority interest in earnings of consolidated affiliate” on the consolidated statement of earnings. Upon the exchange of the preferred stock for Airgas common stock, the dividend was no longer paid to the preferred stockholders, resulting in additional net earnings for Airgas. For the period in which the exchange was assumed, the 5% preferred stock dividend was added back to net earnings in the diluted earnings per share computation.
 
    For periods prior to the NWS Exchange Transaction, the earnings of National Welders for tax purposes were treated as a deemed dividend to Airgas, net of an 80% dividend exclusion. Upon the exchange of National Welders preferred stock for Airgas common stock, National Welders became a 100% owned subsidiary of Airgas. As a 100% owned subsidiary, the net earnings of National Welders are not subject to additional tax at the Airgas level. For the period in which the exchange was assumed, the additional tax was added back to net earnings in the diluted earnings per share computation.
 
    The diluted earnings per share computation for the year ended March 31, 2008 includes the effect of the items described above, with the exchange shares being weighted to reflect the impact of the exchange transaction.


 

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(f)   Certain reclassifications have been made to the prior period consolidated financial statements to conform to the current presentation. These reclassifications principally resulted in increasing cost of products sold (excluding depreciation) and reducing selling, distribution and administrative expenses. Additionally, some revenue was reclassified between Gas and Rent and Hardgoods. These reclassifications were the result of conforming the accounting policies of National Welders to the Company’s accounting policies and were not material. Consolidated net sales and net earnings for prior periods were not impacted by the reclassifications.
 
(g)   During the fourth quarter of fiscal 2009, the Company changed the operating practices and organization of its air separation production facilities and national specialty gas labs. As a result of these changes, these businesses are now reflected in the Distribution reporting segment because they are vertically integrated suppliers to the Company’s distribution companies. Also, as a result of an organizational realignment, Airgas National Welders is now part of the Distribution reporting segment. Segment information from fiscal 2008 has been restated to reflect these changes. Business segment information for the Company’s Distribution and All Other Operations segments is shown below:

                                                                 
    (Unaudited)     (Unaudited)  
    Three Months Ended     Three Months Ended  
    March 31, 2009     March 31, 2008  
            All                             All              
            Other                             Other              
(In thousands)   Dist.     Ops.     Elim.     Total     Dist.     Ops.     Elim.     Total  
Gas and rent
  $ 534,739     $ 102,521     $ (5,424 )   $ 631,836     $ 554,684     $ 95,370     $ (4,724 )   $ 645,330  
Hardgoods
    359,228       1,038       (2 )     360,264       440,441       831       (5 )     441,267  
 
                                               
Total net sales
    893,967       103,559       (5,426 )     992,100       995,125       96,201       (4,729 )     1,086,597  
 
                                                               
Cost of products sold, excluding deprec. expense
    395,609       57,546       (5,426 )     447,729       474,169       54,275       (4,729 )     523,715  
Selling, distribution and administrative expenses
    340,463       31,861             372,324       355,552       27,637             383,189  
Depreciation
    47,857       3,409             51,266       42,926       3,309             46,235  
Amortization
    4,743       1,532             6,275       1,822       576             2,398  
 
                                               
Operating income
  $ 105,295     $ 9,211     $     $ 114,506     $ 120,656     $ 10,404     $     $ 131,060  
 
                                               
                                                                 
    (Unaudited)     (Unaudited)  
    Year Ended     Year Ended  
    March 31, 2009     March 31, 2008  
            All                             All              
            Other                             Other              
(In thousands)   Dist.     Ops.     Elim.     Total     Dist.     Ops.     Elim.     Total  
Gas and rent
  $ 2,239,724     $ 452,037     $ (26,236 )   $ 2,665,525     $ 2,048,070     $ 339,455     $ (15,003 )   $ 2,372,522  
Hardgoods
    1,678,652       5,292       (14 )     1,683,930       1,640,896       3,791       (185 )     1,644,502  
 
                                               
Total net sales
    3,918,376       457,329       (26,250 )     4,349,455       3,688,966       343,246       (15,188 )     4,017,024  
 
                                                               
Cost of products sold, excluding deprec. expense
    1,813,125       258,145       (26,250 )     2,045,020       1,770,000       174,451       (15,188 )     1,929,263  
Selling, distribution and administrative expenses
    1,432,105       126,667             1,558,772       1,317,717       104,445             1,422,162  
Depreciation
    184,991       13,042             198,033       163,470       12,332             175,802  
Amortization
    18,267       4,495             22,762       11,857       2,116             13,973  
 
                                               
Operating income
  $ 469,888     $ 54,980     $     $ 524,868     $ 425,922     $ 49,902     $     $ 475,824  
 
                                               


 

Page 11 of 11

Reconciliations of Non-GAAP Financial Measures (Unaudited)
     Return on Capital
     Reconciliations and computations of return on capital:
                 
(Amounts in thousands)   March 31, 2009     March 31, 2008  
Operating Income — Trailing Four Quarters
  $ 524,868     $ 475,824  
 
           
 
               
Five Quarter Average of Total Assets
  $ 4,239,658     $ 3,710,066  
Five Quarter Average of Securitized Trade Receivables
    350,280       310,880  
Five Quarter Average of Current Liabilities (exclusive of debt)
    (456,154 )     (423,266 )
 
           
Five Quarter Average of Capital Employed
  $ 4,133,784     $ 3,597,680  
 
           
 
               
 Return on Capital
    12.7 %     13.2 %
 
           
The Company believes this return on capital computation helps investors assess how effectively the Company uses the capital invested in its operations. Our management uses return on capital as one of the metrics for determining employee compensation. Non-GAAP numbers should be read in conjunction with GAAP financial measures, as non-GAAP metrics are merely a supplement to, and not a replacement for, GAAP financial measures. It should be noted as well that our return on capital computation information may be different from the return on capital computations provided by other companies.
Free Cash Flow and Adjusted Cash from Operations
Reconciliations and computations of free cash flow and adjusted cash from operations:
                                 
    Three Months Ended     Year Ended  
(Amounts in thousands)   March 31, 2009     March 31, 2008     March 31, 2009     March 31, 2008  
Net cash provided by operating activities
  $ 169,329     $ 127,669     $ 582,767     $ 549,926  
 
                               
Adjustments to cash provided by operating activities:
                               
Cash used (provided) by the securitization of trade receivables
    48,600             48,600       (95,600 )
Stock issued for employee stock purchase plan
    4,272       3,922       16,507       14,091  
Tax benefit realized from exercise of stock options
    1,316       3,248       11,846       13,327  
 
                       
Adjusted cash from operations
  $ 223,517     $ 134,839     $ 659,720     $ 481,744  
 
                       
 
                               
Capital expenditures
  $ (69,626 )   $ (74,841 )   $ (351,912 )   $ (267,378 )
 
                               
Adjustments to capital expenditures:
                               
Operating lease buyouts
                5,575       979  
Proceeds from sales of plant & equipment
    2,762       2,958       14,360       9,345  
 
                       
Adjusted capital expenditures
  $ (66,864 )   $ (71,883 )   $ (331,977 )   $ (257,054 )
 
                       
 
                               
 Free Cash Flow
  $ 156,653     $ 62,956     $ 327,743     $ 224,690  
 
                       
The Company believes that free cash flow and adjusted cash from operations provide investors meaningful insight into the Company’s ability to generate cash from operations, which is available for servicing debt obligations and for the execution of its business strategy, including acquisitions, the prepayment of debt, or to support other investing and financing activities. Non-GAAP numbers should be read in conjunction with GAAP financial measures, as non-GAAP metrics are merely a supplement to, and not a replacement for, GAAP financial measures. It should be noted as well that our free cash flow and adjusted cash from operations metrics may be different from free cash flow and adjusted cash from operations metrics provided by other companies.