2007 Annual Report - Ameristar Casinos, Inc.

Liquidity and Capital ResourcesCash Flows — SummaryOur cash flows consisted of the following:Years ended December 31,2007 2006 2005(Amounts in Thousands)Net cash provided by operating activities............................................... $ 202,746 $ 169,538 $ 197,459Cash flows from investing activities:Net cash paid for Resorts East Chicago acquisition................................ (671,420) — —Capital expenditures ............................................................................... (277,312) (249,123) (177,789)Increase in construction contracts payable.............................................. 5,582 16,157 4,437Proceeds from sale of assets ................................................................... 338 1,368 896Increase in deposits and other non-current assets ................................... (11,475) (6,083) (3,393)Net cash used in investing activities ........................................................ (954,287) (237,681) (175,849)Cash flows from financing activities:Debt borrowings ..................................................................................... 782,000 485,000 410,000Principal payments of debt ..................................................................... (19,384) (384,346) (396,554)Premium on early redemption of senior subordinated notes................... — (20,425) —Cash dividends paid................................................................................ (23,389) (21,068) (17,425)Proceeds from stock option exercises ..................................................... 17,448 7,878 7,125Purchases of treasury stock..................................................................... (9,660) (8,014) —Excess tax benefit from stock option exercises....................................... 5,587 4,266 —Debt issuance costs ................................................................................. (3,703) (153) (5,134)Net cash provided by (used in) financing activities................................ 748,899 63,138 (1,988)Net (decrease) increase in cash and cash equivalents ............................ $ (2,642) $ (5,005) $ 19,622Our business is primarily conducted on a cash basis. Accordingly, operating cash flows tend to follow trends inour operating income. The increase in operating cash flows from 2006 to 2007 was mostly attributable tocontributions to consolidated operating income by our East Chicago and Black Hawk properties and positivechanges in several of our working capital assets and liabilities. The decline in operating cash flows from 2005 to2006 was attributable in part to increases in income tax cash payments and debt service payments and the decreasein net income as discussed above.Capital expenditures during 2007 and 2006 were primarily related to our expansion at Ameristar St. Charles,Ameristar Black Hawk capital improvement projects, our expansion at Ameristar Vicksburg and the acquisition ofslot machines. During 2005, capital expenditures mostly related to the Ameristar Black Hawk capital improvementprojects, long-lived assets relating to various capital maintenance projects at all our properties, slot purchases, thehotel room renovations at our Council Bluffs and Kansas City properties and the Ameristar St. Charles expansion.The following table summarizes our capital spending activity for the years ended December 31, 2007, 2006 and2005 and our construction in progress as of December 31, 2007:Capital Expenditures by ProjectYear EndedDecember 31,2007Year EndedDecember 31,2006Year EndedDecember 31,2005Construction inProgress atDecember 31,2007(In Thousands)St. Charles expansion ............................................... $ 138,413 $ 94,283 $ 14,577 $ 228,033Black Hawk expansion ............................................. 29,061 21,434 3,910 60,099Vicksburg expansion ................................................ 20,727 21,454 4,417 42,692Council Bluffs and Kansas City hotel renovations... — 135 19,346 —Other construction projects....................................... 29,705 55,870 72,120 19,694Total construction projects ................................... 217,906 193,176 114,370 350,518Slot machines............................................................ 14,692 33,294 33,204 —Other fixed asset purchases ...................................... 44,714 22,653 30,215 10,157Total capital expenditures..................................... $ 277,312 $ 249,123 $ 177,789 $ 360,67546