FORM 20-F THOMSON multimedia - Technicolor

In evaluating our cash flow performance, we pay particular attention to items directly linked to
operations. Operational cash flow amounted to 0 1,418 million in 2001 compared with 0 679 million
in 2000. This significant increase was due principally to cash generated through the improvement in
working capital.
In 2001, the cash flow generated by improved management of ‘‘operating working capital’’,
defined as inventories (excluding exceptional depreciation on inventories as set forth in Note 3 to our
consolidated financial statements) plus customer receivables minus payables to suppliers and
excluding the impact of securitization and receipt of cash related to DIRECTV payments, reached
0 524 million compared to the use of 0 119 million in 2000. This improvement reflects the successful
actions we implemented in our Consumer Products and Digital Media Solutions divisions. Our ratio
of operating working capital to net sales decreased significantly compared to 2000, mainly as a
result of a decrease in our ratio of net inventories to net sales. This trend reflects reductions in
component inventories (through the vendor management/inventory/consignment process implemented
with suppliers) and finished good inventories (through daily replenishment of customer
orders). We intend to continue our efforts to reduce inventories and customer receivables across all
of our divisions and to implement a common policy for every company we acquire.
Cash flow used in investing activities
Cash flow used in investing activities totaled 0 1,173 million in 2001, compared with
0 398 million in 2000. This increase reflects the acquisitions made in 2001, primarily Technicolor.
Net capital expenditures amounted to 0 336 million in 2001, compared with 0 276 million
in 2000.
Capital expenditures amounted to 0 499 million in 2001, compared with 0 442 million in 2000.
Our principal investments related mainly to our Digital Media Solutions division (primarily with the
aim of increasing DVD production capacity) and to a lesser extent to our Displays and Components
Division.
Proceeds from fixed asset disposals totaled 0 163 million in 2001, compared with 0 166 million
in 2000. In 2001, disposals of fixed assets included the 0 138 million positive cash impact from the
lease-back arranged for the tube manufacturing equipment at its Polkolor plant located at Piaseczno,
Poland. Further details on this lease-back transaction are provided in ‘‘— Financial resources’’ below
and in Note 23 to our consolidated financial statements.
Financial investments reached 0 1,022 million in 2001, compared with 0 158 million in 2000. The
increase in financial investments was primarily attributable to the cash payments in connection with
the acquisition of Technicolor.
Cash flow from financing activities
Cash flow used by financing activities was 0 34 million in 2001, compared with 0 1,413 million
provided by financing activities in 2000. In 2001, the amount primarily reflects repayment of our
short-term debt of 0 446 million and new short term borrowings of 0 449 million. The amount in 2000
mainly represents the proceeds from our share and convertible/exchangeable bond (2000
OCEANEs) offering.
Financial resources
We expect to fund the continued active development of our strategic repositioning through
capital expenditures and additional acquisitions using our available cash, cash flow from operating
activities and, if and to the extent appropriate, through borrowings from our available credit facilities
and by accessing the capital markets with the sale of equity or debt securities in amounts that
cannot now be determined. We intend to use the proceeds (approximately 0 600 million) of the 1%
convertible/exchangeable bonds that we issued on March 12, 2002 and due in 2008 (obligations à
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