Gap (GPS)

Cash Flows from Financing Activities

Our cash outflows from financing activities consist primarily of the repayment of debt, repurchases of our common stock, and dividend payments, while cash inflows typically consist of proceeds from share-based compensation. Net cash used for financing activities during the first quarter of fiscal 2009 decreased $65 million compared with the prior year comparable period primarily due to the following:

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Cash Flows from Financing Activities

Our cash outflows from financing activities consist primarily of the repurchases of our common stock, dividend payments, and the repayment of debt, while cash inflows typically consist of proceeds from share-based compensation. Net cash used for financing activities for fiscal 2008 decreased $1.1 billion compared with fiscal 2007 primarily due to the following:

Net cash used for financing activities for fiscal 2007 increased $1.0 billion compared with fiscal 2006 primarily due to the following:

Cash Flows from
Financing Activities

Our cash outflows from financing activities consist primarily of the repurchases of our common stock, dividend payments, and the repayment
of debt, while cash inflows typically consist of proceeds from share-based compensation. Net cash used for financing activities for fiscal 2008 decreased $1.1 billion compared with fiscal 2007 primarily due to the following:

Cash Flows from Financing Activities

During the thirty-nine weeks ended November 1, 2008, we used $777 million less cash for financing activities than the prior year comparable period. During the thirty-nine weeks ended November 1, 2008, we repurchased approximately 33 million shares of common stock for $593 million, compared with repurchases of approximately 59 million shares for $1.1 billion for the thirty-nine weeks ended November 3, 2007. We also paid $326 million related to the maturity of our 6.90 notes payable during the third quarter of fiscal 2007.

Cash Flows from Financing Activities

During the first half of fiscal 2008, we used $303 million more cash for financing activities than the prior year comparable period. During the first half of fiscal 2008, we repurchased approximately 28 million shares of common stock for $500 million, compared with repurchases of approximately 11 million shares for $200 million for the first half of fiscal 2007.

Cash Flows from Financing Activities

During the first quarter of fiscal 2008, we used $186 million more cash for financing activities than the prior year comparable period. During the first quarter of fiscal 2008, we repurchased approximately 11 million shares of common stock for $216 million, of which $196 million was paid for as of May 3, 2008. There were no share repurchases in the first quarter of fiscal 2007.

Cash Flows from Financing Activities

Our cash outflows related to financing activities consist primarily of the repurchase of our common stock, repayment of debt, and dividend payments, while cash inflows typically consist of proceeds from share-based compensation. During fiscal 2007, we paid $1.7 billion for the repurchase of approximately 89 million shares compared with repurchases of approximately 58 million shares for $1.1 billion in fiscal 2006. We also repaid our 6.90 percent notes payable of $326 million in September 2007.

For fiscal 2006, cash flows used for financing activities decreased $938 million compared with fiscal 2005 driven by repurchases of $1.0 billion less common stock than in fiscal 2005.

Cash Flows from Financing Activities

Cash Flows from Financing Activities

During the first three quarters of fiscal year 2007, we used $619 million more cash for financing activities than the prior year comparable period. For the thirty-nine weeks ended November 3, 2007, we paid $1.1 billion for the repurchase of 59 million treasury shares compared with repurchases of 44 million shares for $771 million in the prior year comparable period. We also repaid our 6.90 percent notes payable of $326 million in September 2007.

Cash Flows from Financing Activities

During the first half of fiscal year 2007, we used $290 million less cash for financing activities than the prior year comparable period. During the first half of fiscal year 2007, we repurchased 11 million shares for approximately $200 million, compared to repurchases of 28 million shares for approximately $500 million in the first half of fiscal year 2006.

Cash Flows from Financing Activities

During the first quarter of fiscal year 2007, cash flows used for financing activities decreased $375 million from the prior year comparable period. During the first fiscal quarter of fiscal year 2007, we did not repurchase any common stock compared to repurchases of approximately $389 million in the prior year comparable period, of which $382 million was paid by the end of the quarter.

Cash Flows from Financing Activities

Our cash outflows related to financing activities consist primarily of the repurchase of our common stock, while cash inflows typically consist of proceeds from share-based compensation. For fiscal 2006, cash flows used for financing activities decreased $938 million compared with fiscal 2005, driven by us repurchasing approximately $1.0 billion less common stock than last year.

For fiscal 2005, cash flows used for financing activities increased $244 million compared with fiscal 2004. In fiscal 2005, we repurchased $2.0 billion of common stock and received $139 million of proceeds from share-based compensation. In fiscal 2004, we repurchased $1.0 billion of common stock and received $154 million of proceeds from share-based compensation. In addition, we made $871 million of payments for long-term debt in fiscal 2004.

Cash Flows from Financing Activities

During the first thirty-nine weeks of fiscal 2006, cash flows used for financing activities decreased $865 million compared to the first thirty-nine weeks of fiscal 2005 driven primarily by the decrease in cash used for share repurchases. During the first thirty-nine weeks of fiscal 2006, we utilized $771 million to repurchase common stock under our share repurchase program and reissued $13 million of treasury stock, mainly under our employee stock purchase program, as compared to the first thirty-nine weeks of fiscal 2005, where we utilized $1.7 billion to repurchase common stock under our share repurchase program and reissued $13 million of treasury stock.

The increase in cash dividends paid reflects the declaration and accelerated payment schedule of our fiscal 2006 first, second, and third quarter dividends at the increased $0.08 per share amount compared to $0.045 per share in each quarter in fiscal 2005.

Cash Flows from Financing Activities

During the first half of fiscal 2006, cash flows used for financing activities decreased $948 million compared with the first half of fiscal 2005 driven primarily by the decrease in cash used for share repurchases. During the first half of fiscal 2006, we utilized $500 million to repurchase common stock under our share repurchase program and reissued $13 million of treasury stock, mainly under our employee stock purchase program, as compared to the first half of fiscal 2005, where we utilized $1.5 billion to repurchase common stock under our share repurchase program.

The increase in cash dividends paid reflects the declaration and accelerated payment schedule of our fiscal 2006 first and second quarter dividends at the increased $0.08 per share amount.

Cash Flows from Financing Activities

During the first quarter of fiscal 2006, cash flows used for financing activities decreased $118 million compared with the first quarter of fiscal 2005. During the first fiscal quarter of 2006, we utilized $382 million to repurchase common stock under our share repurchase program compared to $488 million in the first fiscal quarter of 2005.

The increase in cash dividends paid reflects the declaration and payment of our fiscal 2006 first quarter dividend at the new $0.08 per share amount.

Cash Flows from Financing Activities

For fiscal 2005, cash flows used for financing activities increased $244 million compared with fiscal 2004 and increased $1.2 billion in fiscal 2004 compared to fiscal 2003. In fiscal 2005, we repurchased $2.0 billion of common stock and reissued $27 million of treasury stock for Employee Stock Purchase Plans. We also received $110 million from the issuance of common and treasury stock. In addition, we completed the redemption of our Senior Convertible notes as of March 31, 2005 and approximately $0.5 million was paid in cash redemption. See Note B to the accompanying Consolidated Financial Statements.

In fiscal 2004, we repurchased $1.0 billion of common stock and reissued $23.5 million of treasury stock for Employee Stock Purchase Plans. We received $130 million from the issuance of common and treasury stock. In addition, we repurchased $596 million of domestic notes in the open market, including the early retirement of our 2005 notes and we paid off the remaining outstanding balance of our €227 million 5-year euro bond ($275 million), which was due on September 30, 2004.

Cash Flows from Financing Activities

Net cash used for financing activities for the thirty-nine weeks ended October 29, 2005 was $1.7 billion, an increase of $623 million compared with the same period in the prior year. During the first thirty-nine weeks of fiscal 2005, we utilized $1.7 billion to repurchase common stock under our share repurchase program and reissued $15 million of treasury stock, mainly under our employee stock purchase program. During the first thirty-nine weeks of fiscal 2004, we repurchased and extinguished early an aggregate of $871 million in principal amount of our notes.

The increase in cash dividends paid reflects the declaration and accelerated payment schedule of our fiscal 2005 first, second and third quarter dividends at the increased $0.045 per share amount. In addition, the dividend declared on January 25, 2005 of $0.0222 per share was paid on February 23, 2005.

Cash Flows from Financing Activities

During the first half of fiscal 2005, cash flows used for financing activities increased $1.1 billion compared with the first half of fiscal 2004. During the first half of fiscal 2005, we utilized $1.5 billion to repurchase common stock under our share repurchase program and reissued $15 million of treasury stock, mainly under our employee stock purchase program. During the first half of fiscal 2004, we repurchased and extinguished early an aggregate of $473 million in principal amount of our notes, for a total reduction in our domestic debt of $473 million.

The increase in cash dividends paid reflects the declaration and accelerated payment schedule of our fiscal 2005 first and second quarter dividends at the increased $0.045 per share amount. In addition, the dividend declared on January 25, 2005 of $0.0222 per share was paid on February 23, 2005.

Cash Flows from Financing Activities

During the first quarter of fiscal 2005, cash flows used for financing activities increased $365 million compared with the first quarter of fiscal 2004. During fiscal 2005, we utilized $489 million to repurchase common stock under our share repurchase program and reissued $0.6 million of treasury stock. Differences between cash used in financing activities related to purchase of common stock and the comparable change in shareholders’ equity of $67 million is due to the timing difference between the recognition of common stock purchases and the cash settlement of the common stock purchases. During the first quarter of fiscal 2004, we repurchased and extinguished early an aggregate of $47 million in principal amount of our bonds due 2005, $49 million in principal amount of our bonds due 2007 and $74 million in principal amount of our bonds due 2008, for a total reduction in our domestic debt of $170 million.

The increase in cash dividends paid reflects the declaration and accelerated payment schedule of our fiscal 2005 first quarter dividend at the new $0.045 per share amount. In addition, the dividend declared on January 25, 2005 of $0.0222 per share was paid on February 23, 2005.

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Cash Flows from Financing Activities

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GAP INC. FINANCIALS 2004

For fiscal 2004, cash flows used for financing activities increased $1.2 billion compared with fiscal 2003 and increased $2.0 billion in fiscal 2003 compared to fiscal 2002. In fiscal 2004, we repurchased $1.0 billion of common stock and reissued $23.5 million of treasury stock for Employee Stock Purchase Plans. We also received $130 million from the issuance of common and treasury stock. In addition, we repurchased $596 million of domestic notes in the open market, including the early retirement of our 2005 notes and we paid off the remaining outstanding balance of our €227 million 5-year euro bond ($275 million), which was due on September 30, 2004.

The increase in fiscal 2003 compared to fiscal 2002 was primarily due to the net issuance of senior convertible notes in March 2002, offset by payments on our long-term debt during fiscal 2003. In the first quarter of 2003, we repaid a maturing $500 million two-year note. Additionally, in the third quarter of fiscal 2003, we repurchased €23 million ($27 million) of euro bond, and in the fourth quarter of fiscal 2003, we repurchased $141 million of domestic debt in the open market.