CORE LABORATORIES N.V.  CONSOLIDATED STATEMENTS OF CASH FLOWS 39 The accompanying notes are an integral part of these Consolidated Financial Statements. For the Years Ended December 31, (In thousands) 2013 2012 2011 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 243,194 $ 216,612 $ 184,644 Adjustments to reconcile net income to net cash provided by operating activities: Stock-based compensation 20,526 18,381 17,165 Depreciation and amortization 25,471 22,917 23,303 Non-cash interest expense 480 479 5,956 (Increase) decrease in value of life insurance policies (5,112) (1,636) 285 Deferred income taxes 6,790 3,605 (6,549) Other non-cash items 237 263 346 Changes in assets and liabilities, net of effects of acquisitions: Accounts receivable (16,312) (16,664) (12,082) Inventories 1,291 3,224 (16,033) Prepaid expenses and other current assets 13,915 (12,904) (1,228) Other assets (867) 426 680 Accounts payable (6,339) (3,672) 11,969 Accrued expenses 2,998 4,871 (13,754) Other long-term liabilities 11,865 1,300 9,424 Net cash provided by operating activities 298,137 237,202 204,126 CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (35,416) (31,151) (29,927) Patents and other intangibles (3,530) (1,648) (220) Acquisitions, net of cash acquired — (556) (18,821) Cash in escrow — 2,188 (2,179) Investment in non-consolidated affiliates (98) (322) — Proceeds from sale of assets 1,036 667 900 Proceeds from insurance recovery 1,385 101 1,300 Premiums on life insurance (6,575) (3,283) (3,071) Net cash used in investing activities (43,198) (34,004) (52,018) CASH FLOWS FROM FINANCING ACTIVITIES: Repayment of debt borrowings (134,046) (112,346) (348,564) Proceeds from debt borrowings 167,000 121,000 417,426 Stock options exercised 83 5 297 Excess tax benefits from stock-based payments 3,744 5,226 2,559 Debt financing costs — (7) (2,014) Settlement of warrants — — (219,451) Non-controlling interest - contributions — 1,800 1,194 Non-controlling interest - dividend — (300) (251) Dividends paid (58,642) (52,950) (46,027) Repurchase of common shares (227,216) (175,732) (61,825) Net cash used in financing activities (249,077) (213,304) (256,656) NET CHANGE IN CASH AND CASH EQUIVALENTS 5,862 (10,106) (104,548) CASH AND CASH EQUIVALENTS, beginning of year 19,226 29,332 133,880 CASH AND CASH EQUIVALENTS, end of year $ 25,088 $ 19,226 $ 29,332