UNIVERSAL ELECTRONICS INC

Previous wording

All statements in this report are made as of the date this Form 10-Q is filed with the U.S. Securities and Exchange Commission (the "SEC"). We undertake no obligation to publicly update or revise these statements, whether as a result of new information, future events or otherwise. We make forward-looking statements in Management's Discussion and Analysis of Financial Condition and Results of Operations and elsewhere in this report based on the beliefs and assumptions of our management and on information available to us through the date this Form 10-Q is filed with the SEC. Forward-looking statements include supply chain issues; other future demand and recovery trends and expectations; the delay by or failure of our customers to order products from us; continued availability of cash through borrowing under our revolving lines of credit; the effects of natural or other events beyond our control, including the effects of political unrest, war, terrorist activities, other hostilities, or the outbreak of infectious diseases may have on us or the economy; the economic environments, including increases in interest rates and recessionary effects on us or our customers; the effects of doing business internationally, including expanded use of tariffs, pertaining to the importation of our products, particularly in light of the recent U.S. Presidential election; our expectations regarding our ability to meet our liquidity requirements; our capital expenditures and other investment spending expectations; and other statements that are preceded by, followed by, or include the words "believes," "expects," "anticipates," "intends," "plans," "estimates," "foresees," or similar expressions; and similar statements concerning anticipated future events and expectations that are not historical facts.

Current wording

All statements in this report are made as of the date this Form 10-Q is filed with the U.S. Securities and Exchange Commission (the "SEC"). We undertake no obligation to publicly update or revise these statements, whether as a result of new information, future events or otherwise. We make forward-looking statements in Management's Discussion and Analysis of Financial Condition and Results of Operations and elsewhere in this report based on the beliefs and assumptions of our management and on information available to us through the date this Form 10-Q is filed with the SEC. Forward-looking statements include supply chain issues; other future demand and recovery trends and expectations; the delay by or failure of our customers to order products from us; continued availability of cash through borrowing under our revolving lines of credit; the effects of natural or other events beyond our control, including the effects of political unrest, war, terrorist activities, other hostilities, or the outbreak of infectious diseases may have on us or the economy; the economic environments, including increases in interest rates and recessionary effects on us or our customers; the effects of doing business internationally, including expanded use of tariffs, pertaining to the importation of our products, particularly in light of the recent U.S. presidential administrative actions and the responsive retaliatory actions of foreign governments; our expectations regarding our ability to meet our liquidity requirements; our capital expenditures and other investment spending expectations; and other statements that are preceded by, followed by, or include the words "believes," "expects," "anticipates," "intends," "plans," "estimates," "foresees," or similar expressions; and similar statements concerning anticipated future events and expectations that are not historical facts.

Previous wording

We design, develop, manufacture, ship and support control and sensor technology solutions and a broad line of universal control systems, audio-video ("AV") accessories, wireless security and smart home products that are used by the world's leading brands in the video services, consumer electronics, climate control, security, home automation and home appliance markets. Our product and technology offerings include:

Current wording

We design, develop, manufacture, ship and support climate control solutions, wireless sensor and smart home control products, home entertainment control products, technology and software solutions and audio-video ("AV") accessories, that are used by the world's leading brands in the climate control, security, home automation, home appliance, home entertainment and consumer electronics markets. Our channel offerings include:

Previous wording

•proprietary and standards-based RF sensors designed for residential security, safety and home automation applications;

Current wording

•Smart Home and Security Products: We offer proprietary and standards-based radio frequency ("RF") wireless remote controls and sensors designed for residential security, safety and a broad variety of home automation applications, such as smart lighting and motorized shades.

Previous wording

•software, firmware and technology solutions that can enable devices such as Smart TVs, hybrid set-top boxes, audio systems, smart speakers, game consoles and other consumer electronic and smart home devices to wirelessly connect and interoperate within home networks to enable control and delivery of home entertainment, smart home services and device or system information;

Current wording

•Software and Cloud Services: Our software, firmware and technology solutions enable devices such as smart TVs, hybrid set-top boxes, game consoles and other consumer electronic and smart home devices to wirelessly connect and interoperate on the home network. These solutions support control and delivery of home entertainment application services and content, smart home services and device or system information. New features include private, on-premise user presence and occupancy detection to enhance user experiences and extend user engagement on connected devices.

Previous wording

•integrated circuits ("ICs"), on which our software and universal device control database is embedded, sold primarily to OEMs, video service providers, and private label customers;

Current wording

•Intellectual Property and Licensing: We license our intellectual property primarily to OEMs and video service providers. Our cloud-enabled software provides reliable firmware update provisioning and digital rights management validation services to major consumer electronics brands. We offer regular control library database and software updates to our licensing customers to ensure their systems are compatible with the latest devices entering the home. Our integrated circuits, on which our software and universal control database is embedded, are sold primarily to OEMs, video service providers, smart home dealers and private label customers.

Previous wording

We operate as one business segment. We have one domestic subsidiary and 24 international subsidiaries located in Brazil, British Virgin Islands, France, Germany, Hong Kong (3), India, Italy, Japan, Korea, Mexico (2), the Netherlands, People's Republic of China (the "PRC") (6), Singapore, Spain, United Kingdom and Vietnam.

Current wording

We operate as one business segment. We have 24 international subsidiaries located in Brazil, British Virgin Islands, France, Germany, Hong Kong (3), India, Italy, Japan, Korea, Mexico (2), the Netherlands, People's Republic of China (the "PRC") (6), Singapore, Spain, United Kingdom and Vietnam.

Previous wording

•Operating expenses, as a percentage of net sales, decreased to 29.7% for the three months ended September 30, 2024 from 32.2% for the three months ended September 30, 2023.

Current wording

•Operating expenses, as a percentage of net sales, decreased to 32.3% for the three months ended March 31, 2025 from 35.8% for the three months ended March 31, 2024.

Previous wording

•Our operating income was $0.4 million for the three months ended September 30, 2024 compared to operating loss of $14.0 million for the three months ended September 30, 2023. Our operating income percentage was 0.4% for the three months ended September 30, 2024, compared to an operating loss percentage of 13.1% for the three months ended September 30, 2023.

Current wording

•Our operating loss was $3.8 million for the three months ended March 31, 2025 compared to $6.9 million for the three months ended March 31, 2024. Our operating loss percentage was 4.1% for the three months ended March 31, 2025 compared to 7.5% for the three months ended March 31, 2024.

Previous wording

•seek acquisitions or strategic partners that complement and strengthen our existing business; and

Current wording

•Seek potential acquisitions or strategic partners that complement and strengthen our existing commercial footprint, add new capabilities, and offer strong synergies; and

Previous wording

The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, we evaluate our estimates and judgments, including those related to revenue recognition, inventory valuation, impairment of long-lived assets, intangible assets and income taxes. Actual results may differ from these judgments and estimates, and they may be adjusted as more information becomes available. Any adjustment may be significant and may have a material impact on our consolidated financial statements.

Current wording

The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, we evaluate our estimates and judgments, including those related to revenue recognition, inventory valuation and income taxes. Actual results may differ from these judgments and estimates, and they may be adjusted as more information becomes available. Any adjustment may be significant and may have a material impact on our consolidated financial statements.

Previous wording

An accounting estimate is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, if different estimates reasonably may have been used, or if changes in the estimate that are reasonably likely to occur may materially impact the financial statements. We do not believe that there have been any significant changes during the nine months ended September 30, 2024 to the items that we disclosed as our critical accounting policies and estimates in Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" contained in our 2023 Form 10-K.

Current wording

An accounting estimate is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, if different estimates reasonably may have been used, or if changes in the estimate that are reasonably likely to occur may materially impact the financial statements. We do not believe that there have been any significant changes during the three months ended March 31, 2025 to the items that we disclosed as our critical accounting policies and estimates in Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" contained in our 2024 Form 10-K.

Previous wording

Gross profit. Gross profit for the nine months ended September 30, 2024 was $82.7 million compared to $69.7 million for the nine months ended September 30, 2023. Gross profit as a percentage of sales increased to 29.1% for the nine months ended September 30, 2024 from 21.6% for the nine months ended September 30, 2023. The execution of our factory footprint optimization plan has resulted in a significant reduction of excess manufacturing capacity, yielding a gross margin rate improvement of approximately 360 basis points. During the nine months ended September 30, 2023, we took a charge of $7.7 million for the impairment of fixed assets related to the execution of our factory footprint optimization plan, which negatively impacted the gross profit rate for that period by 240 basis points. In addition, favorable product mix and a stronger U.S. dollar resulted in a 90 basis point and 60 basis point improvement, respectively, in our gross margin rate.

Current wording

Gross profit. Gross profit for the three months ended March 31, 2025 was $26.1 million compared to $26.0 million for the three months ended March 31, 2024. Gross profit as a percentage of sales was consistent at 28.3% for the three months ended March 31, 2025 and March 31, 2024. A stronger U.S. dollar resulted in a 70 basis point improvement, offset by an unfavorable product mix.

Previous wording

Research and development ("R&D") expenses. R&D expenses decreased to $7.3 million for the three months ended September 30, 2024 from $7.7 million for the three months ended September 30, 2023 due primarily to reduced third-party product development costs and a reduction in headcount.

Current wording

Research and development ("R&D") expenses. R&D expenses decreased to $7.2 million for the three months ended March 31, 2025 from $7.8 million for the three months ended March 31, 2024 due primarily to reduced third-party product development costs and a reduction in headcount.

Previous wording

Selling, general and administrative ("SG&A") expenses. SG&A expenses decreased slightly to $22.9 million for the three months ended September 30, 2024 from $23.1 million for the three months ended September 30, 2023, due primarily to a decrease in variable expenses associated with lower sales volume.

Current wording

Selling, general and administrative ("SG&A") expenses. SG&A expenses decreased to $22.6 million for the three months ended March 31, 2025 from $24.0 million for the three months ended March 31, 2024, due primarily to a decrease in professional services costs of $0.6 million, a stronger U.S. dollar resulting in $0.5 million of savings, and a decrease of $0.3 million in payroll and benefits due to a reduction in headcount.

Previous wording

Factory restructuring charges. During the three months ended September 30, 2024, we recorded $0.1 million in expense, including severance and moving costs associated with the streamlining of our factory in Mexico. During the three months ended September 30, 2023, we recorded $3.7 million in expense, which included severance and non-severance closure expenses in our southern China factory, as well as expenses to move equipment from our Mexico factory to our Vietnam factory.

Current wording

Factory restructuring charges. During the three months ended March 31, 2024, we recorded $1.1 million in expense, which included severance and moving costs associated with the closure of our southern China factory and the streamlining of our factory in Mexico.

Previous wording

Interest income (expense), net. Interest expense, net decreased to $0.9 million for the three months ended September 30, 2024 from $1.2 million for the three months ended September 30, 2023, primarily as a result of a lower average loan balance.

Current wording

Interest income (expense), net. Interest expense, net decreased to $0.4 million for the three months ended March 31, 2025 from $0.9 million for the three months ended March 31, 2024, as a result of a lower average loan balance and lower interest rates.

Previous wording

Other income (expense), net. Other income, net was $0.1 million for the nine months ended September 30, 2024 compared to other expense, net $1.8 million for the nine months ended September 30, 2023. The improvement was primarily due to a reduction in net foreign currency losses.

Current wording

Other income (expense), net. Other income, net was $0.1 million for the three months ended March 31, 2025 compared to other expense, net $0.1 million for the three months ended March 31, 2024. The improvement was primarily due to a reduction in net foreign currency losses.

Previous wording

Provision for income taxes. Income tax expense was $2.5 million for the three months ended September 30, 2024, relative to a pre-tax loss of $0.2 million, compared to income tax expense of $3.3 million for the three months ended September 30, 2023, relative to a pre-tax loss of $16.1 million. Consistent with 2023, we expect the U.S. to be in a pre-tax loss position without benefit for the full year 2024, resulting in an elevated effective tax rate.

Current wording

Provision for income taxes. Income tax expense was $2.2 million for the three months ended March 31, 2025, relative to a pre-tax loss of $4.1 million, compared to income tax expense of $0.7 million for the three months ended March 31, 2024, relative to a pre-tax loss of $7.9 million. Consistent with 2024, we expect the U.S. to be in a pre-tax loss position without benefit for the full year 2025, resulting in an elevated effective tax rate.

Previous wording

Historically, we have utilized cash provided from operations as our primary source of liquidity, as internally generated cash flows have been sufficient to support our business operations, capital expenditures and discretionary share repurchases. In addition, we have utilized our credit line to fund share repurchases and past acquisitions. We anticipate that we will continue to utilize both cash flows from operations and our revolving lines of credit to support ongoing business operations, capital expenditures, expenses associated with our long-term factory planning strategy, future discretionary share repurchases and potential future acquisitions. We believe our current cash balances, anticipated cash flow to be generated from operations and available borrowing resources will be sufficient to cover expected cash outlays for at least the next twelve months and for the foreseeable future thereafter; however, because our cash is located in various jurisdictions throughout the world, we may at times need to increase borrowing from our revolving lines of credit or take on additional debt until we are able to transfer cash among our various entities.

Current wording

We anticipate that we will continue to utilize both cash flows from operations and our revolving lines of credit to support ongoing business operations, capital expenditures, discretionary share repurchases and potential acquisitions. We believe our current cash balances, anticipated cash flow to be generated from operations and available borrowing resources will be sufficient to cover expected cash outlays for at least the next twelve months and for the foreseeable future thereafter; however, because our cash is located in various jurisdictions throughout the world, we may at times need to increase borrowing from our revolving lines of credit or take on additional debt until we are able to transfer cash among our various entities.

Previous wording

Cash and cash equivalents– On September 30, 2024, we had $2.2 million, $10.7 million, $2.7 million, $5.7 million and $5.0 million of cash and cash equivalents in North America, the PRC, Asia (excluding the PRC), Europe, and South America, respectively. We attempt to mitigate our exposure to liquidity, credit and other relevant risks by placing our cash and cash equivalents with financial institutions we believe are high quality.

Current wording

Cash and cash equivalents– On March 31, 2025, we had $2.7 million, $7.5 million, $3.6 million, $7.1 million and $6.5 million of cash and cash equivalents in North America, the PRC, Asia (excluding the PRC), Europe, and South America, respectively. We attempt to mitigate our exposure to liquidity, credit and other relevant risks by placing our cash and cash equivalents with financial institutions we believe are high quality.

Previous wording

Available Borrowing Resources – Our Second Amended and Restated Credit Agreement ("Second Amended Credit Agreement") with U.S. Bank National Association ("U.S. Bank") provides for a revolving line of credit ("U.S. Credit Line") that expires on April 30, 2025. We expect to renew our credit agreement with U.S. Bank prior to its expiration; however no assurance can be given that future financing will be available or, if available, that we will be offered terms satisfactory to us. The U.S. Credit Line has a maximum availability up to $100.0 million, subject to meeting certain financial conditions, including an accounts receivable coverage ratio ("AR Ratio"). This AR Ratio is calculated monthly and adjusts the current U.S. Credit Line total availability. At September 30, 2024, the U.S. Credit Line total availability was $65.6 million based upon the AR Ratio. At October 11, 2024, the U.S. Credit Line total availability was $67.0 million based upon the AR Ratio.

Current wording

Available Borrowing Resources – Our Second Amended and Restated Credit Agreement ("Second Amended Credit Agreement") with U.S. Bank National Association ("U.S. Bank") provides for a revolving line of credit ("U.S. Credit Line") that expires on April 30, 2026. We expect to renew the U.S. Credit Line prior to its expiration; however, no assurance can be given that future financing will be available or, if available, that we will be offered terms satisfactory to us. The U.S. Credit Line has a maximum availability up to $75.0 million, subject to meeting certain financial conditions, including an accounts receivable coverage ratio ("AR Ratio"). This AR Ratio is calculated monthly and adjusts the current U.S. Credit Line total availability. At March 31, 2025, the U.S. Credit Line total availability was $56.1 million based upon the AR Ratio. At April 14, 2025, the U.S. Credit Line total availability was $59.1 million based upon the AR Ratio.

Previous wording

The U.S. Credit Line may be used for working capital and other general corporate purposes including acquisitions, share repurchases and capital expenditures. Amounts available for borrowing under the U.S. Credit Line are reduced by the balance of any outstanding letters of credit, of which there were none at September 30, 2024. At September 30, 2024, we had an outstanding balance of $37.0 million on our U.S. Credit Line and $28.6 million of availability.

Current wording

The U.S. Credit Line may be used for working capital and other general corporate purposes including acquisitions, share repurchases and capital expenditures. Amounts available for borrowing under the U.S. Credit Line are reduced by the balance of any outstanding letters of credit, of which there were none at March 31, 2025. At March 31, 2025, we had an outstanding balance of $20.0 million on our U.S. Credit Line and $36.1 million of availability.

Previous wording

Our subsidiary, Gemstar Technology (Yangzhou) Co. Ltd. ("GTY"), has a Line of Credit Agreement ("Line of Credit Agreement") with the Bank of China, which provides for a revolving line of credit ("China Credit Line" and, together with the U.S. Credit Line, "Credit Lines") through July 24, 2025. We expect to renew the Line of Credit Agreement with the Bank of China prior to its expiration; however, no assurance can be given that future financing will be available or, if available, that we will be offered terms satisfactory to us. The China Credit Line has a maximum availability up to RMB 80.0 million (approximately $11.4 million), subject to meeting certain financial conditions.

Current wording

Our subsidiary, Gemstar Technology (Yangzhou) Co. Ltd. ("GTY"), has a Line of Credit Agreement ("Line of Credit Agreement") with the Bank of China, which provides for a revolving line of credit ("China Credit Line" and, together with the U.S. Credit Line, "Credit Lines") through July 24, 2025. We expect to renew the Line of Credit Agreement with the Bank of China prior to its expiration; however, no assurance can be given that future financing will be available or, if available, that we will be offered terms satisfactory to us. The China Credit Line has a maximum availability up to RMB 80.0 million (approximately $11.0 million), subject to meeting certain financial conditions.

Previous wording

The China Credit Line may be used for working capital purposes. Amounts available for borrowing under the China Credit Line are reduced by the balance of any outstanding letters of credit, of which there were none at September 30, 2024. At September 30, 2024, we had an outstanding balance of RMB 20.0 million (approximately $2.9 million) on our China Credit Line and RMB 60.0 million (approximately $8.6 million) of availability.

Current wording

The China Credit Line may be used for working capital purposes. Amounts available for borrowing under the China Credit Line are reduced by the balance of any outstanding letters of credit, of which there were none at March 31, 2025. At March 31, 2025, we had an outstanding balance of RMB 80.0 million (approximately $11.0 million) on our China Credit Line and no remaining availability.

Previous wording

Net cash provided by operating activities was $8.3 million during the nine months ended September 30, 2024 compared to $20.1 million during the nine months ended September 30, 2023. Net loss was $19.5 million for the nine months ended September 30, 2024 compared to net loss of $91.1 million for the nine months ended September 30, 2023, which includes the impairment of goodwill of $49.1 million and long-lived assets of $7.8 million. Depreciation and amortization was $13.5 million for the nine months ended September 30, 2024 compared to $17.5 million for the nine months ended September 30, 2023, due to decreased purchases of property, plant and equipment over recent years. Inventories increased by $0.5 million during the nine months ended September 30, 2024 compared to a decrease of $45.0 million during the nine months ended September 30, 2023. The significant decrease in inventories during the nine months ended September 30, 2023 is primarily the result of cord cutting, as there was less demand for our video service products. In addition, lead times for components and raw materials have normalized, enabling more efficient production planning. Our inventory turns increased to 3.2 turns at September 30, 2024 from 2.9 turns at September 30, 2023. Changes in accounts receivable and contract assets resulted in cash inflows of $5.4 million during the nine months ended September 30, 2024, largely as a result of a decrease in sales. Days sales outstanding were 91 days at September 30, 2024 compared to 92 days at September 30, 2023. Changes in accounts payable and accrued liabilities resulted in cash outflows of $0.1 million during the nine months ended September 30, 2024 due to a decrease in inventory purchases and timing of payments throughout the quarter. Changes in accounts payable and accrued liabilities resulted in cash outflows of $21.3 million during the nine months ended September 30, 2023 due primarily to a decrease in inventory purchases.

Current wording

Net cash provided by operating activities was $9.0 million during the three months ended March 31, 2025 compared to net cash used for operating activities of $2.8 million during the three months ended March 31, 2024. Net loss was $6.3 million for the three months ended March 31, 2025 compared to net loss of $8.6 million for the three months ended March 31, 2024. Depreciation and amortization was $4.1 million for the three months ended March 31, 2025 compared to $4.7 million for the three months ended March 31, 2024, due to decreased purchases of property, plant and equipment over recent years. Inventories decreased by $3.0 million during the three months ended March 31, 2025 compared to a decrease of $4.1 million during the three months ended March 31, 2024. The decrease in inventories is primarily the result of improved inventory management. Our inventory turns increased to 3.2 turns at March 31, 2025 from 3.1 turns at March 31, 2024. A decrease in accounts receivable and contract assets caused mainly by lower demand in our home entertainment channel resulted in cash inflows of $10.5 million and $11.0 million during the three months ended March 31, 2025 and March 31, 2024, respectively. Days sales outstanding were 83 days at March 31, 2025 compared to 93 days at March 31, 2024. A decrease in accounts payable and accrued liabilities caused mainly by a decrease in inventory purchases and timing of payments throughout the quarter resulted in cash outflows of $5.3 million and $12.5 million during the three months ended March 31, 2025 and March 31, 2024, respectively.

Previous wording

Net cash used for investing activities during the nine months ended September 30, 2024 was $6.7 million, of which $3.5 million and $3.2 million was used for capital expenditures and the development of patents, respectively. Net cash used for investing activities during the nine months ended September 30, 2023 was $11.5 million, of which $6.8 million and $4.7 million was used for capital expenditures and the development of patents, respectively.

Current wording

Net cash used for investing activities during the three months ended March 31, 2025 was $1.9 million, of which $1.3 million, $1.0 million and $0.7 million was used for the purchase of Blue Chip Swap securities, capital expenditures and the development of patents, respectively. Offsetting these amounts was $1.1 million received upon the sale of Blue Chip Swap securities. Net cash used for investing activities during the three months ended March 31, 2024 was $2.4 million, of which $1.4 million and $1.0 million was used for capital expenditures and the development of patents, respectively.

Previous wording

Future cash flows used for investing activities are largely dependent on the timing and amount of capital expenditures. We estimate that we will incur between $1.0 million and $2.0 million during the remainder of 2024.

Current wording

Future cash flows used for investing activities are largely dependent on the timing and amount of capital expenditures and the development of patents, respectively. We estimate that we will incur between $7.0 million and $9.0 million during the remainder of 2025.

Previous wording

Net cash used for financing activities was $17.1 million during the nine months ended September 30, 2024 compared to $13.9 million during the nine months ended September 30, 2023. The primary financing activities during the nine months ended September 30, 2024 and 2023 were borrowings and repayments on our Credit Lines and repurchases of shares of our common stock. Net repayments on our Credit Lines were $15.2 million during the nine months ended September 30, 2024 compared to $13.0 million during the nine months ended September 30, 2023. During the nine months ended September 30, 2024, we repurchased 200,552 shares of our common stock at a cost of $1.9 million compared to our repurchase of 61,298 shares at a cost of $0.9 million during the nine months ended September 30, 2023.

Current wording

Net cash used for financing activities was $6.4 million during the three months ended March 31, 2025 compared to $10.2 million during the three months ended March 31, 2024. The primary financing activities during the three months ended March 31, 2025 and 2024 were borrowings and repayments on our Credit Lines and repurchases of shares of our common stock. Net repayments on our Credit Lines were $6.0 million during the three months ended March 31, 2025 compared to $9.0 million during the three months ended March 31, 2024. During the three months ended March 31, 2025, we repurchased 40,710 shares of our common stock at a cost of $0.4 million compared to our repurchase of 140,136 shares at a cost of $1.2 million during the three months ended March 31, 2024.

Previous wording

We anticipate meeting our material cash commitments with our cash generated from operations and available borrowing resources, including our Credit Lines.

Current wording

We anticipate meeting our material cash commitments with our cash generated from operations and available borrowing on our Credit Lines.