LIQUIDITY AND CAPITAL RESOURCES
Net cash flows provided by operating activities were $15,337 and $14,581 in first quarter 2021 and 2020, respectively, a favorable increase of $756. The increase in first quarter 2021 cash flows from operating activities principally reflects changes in inventories partially offset by a decrease in accounts receivable which reflects the timing of net product sales and collections of accounts receivable trade, as well as changes in accounts payable and accrued liabilities, and income taxes payable in the comparative periods.
Net cash from (used in) investing activities was $(26,528) in first quarter 2021 compared to $8,261 in first quarter 2020. Cash flows used in investing activities reflect $30,031 and $21,312 of purchases of available for sale securities during first quarter 2021 and 2020, respectively, and $8,543 and $35,217 of sales and maturities of available for sale securities during first quarter 2021 and 2020, respectively. First quarter 2021 and 2020 investing activities include capital expenditures of $3,787 and $3,737, respectively. Company management has committed approximately $25,000 to a rehabilitation upgrade and expansion of one of its manufacturing plants in the U.S.A. The Company spent approximately $6,000 and $2,000 in 2020 and 2019, respectively. Company management expects cash outlays for this project to approximate $17,000 in 2021. All capital expenditures are to be funded from the Company’s cash flow from operations and internal sources including available for sale securities.
The Company’s consolidated financial statements include bank borrowings of $965 and $781 at March 31, 2021 and 2020, respectively, all of which relates to its Spanish subsidiary. The Company had no other outstanding bank borrowings at March 31, 2021.
Financing activities include Company common stock purchases and retirements of $7,423 and $8,809 in first quarter 2021 and 2020, respectively. Cash dividends of $11,874 and $11,703 were paid in first quarter 2021 and 2020, respectively.
The Company’s current ratio (current assets divided by current liabilities) was 4.4 to 1 at March 31, 2021 compared to 4.6 to 1 at December 31, 2020 and 4.3 to 1 at March 31, 2020. Net working capital was $226,391 at March 31, 2021 compared to $250,851 and $257,104 at December 31, 2020 and March 31, 2020, respectively. The aforementioned net working capital amounts are principally reflected in aggregate cash and cash equivalents and short-term investments of $178,687 at March 31, 2021 compared to $208,931 and $216,577 at December 31, 2020 and March 31, 2020, respectively. In addition, long term investments, principally debt securities comprising corporate bonds, were $243,749 at March 31, 2021, as compared to $220,020 and $153,287 at December 31, 2020 and March 31, 2020, respectively. Aggregate cash and cash equivalents and short and long-term investments were $422,436, $428,951, and $369,864, at March 31, 2021, December 31, 2020 and March 31, 2020, respectively. The aforementioned includes $78,271, $73,828, and $68,717 at March 31, 2021, December 31, 2020 and March 31, 2020, respectively, relating to trading securities which are used as an economic hedge for the Company’s deferred compensation liabilities. Investments in available for sale securities, primarily high quality corporate bonds, that matured during first quarter 2021 and 2020 were generally used to purchase the Company’s common stock or were replaced with debt securities of similar maturities.
The Company periodically contributes to a VEBA trust, managed and controlled by the Company, to fund the estimated future costs of certain employee health, welfare and other benefits. The Company is currently using these VEBA funds to pay the actual cost of such benefits through most of 2022. The VEBA trust held $7,543, $8,272 and $11,762 of aggregate cash and cash equivalents at March 31, 2021, December 31, 2020 and March 31, 2020, respectively. This asset value is included in prepaid expenses and long-term other assets in the Company’s Consolidated Statement of Financial Position. These assets are categorized as Level 2 within the fair value hierarchy.
ACCOUNTING PRONOUNCEMENTS
See Note 1 of the Company’s Condensed Consolidated Financial Statements.
FORWARD-LOOKING STATEMENTS
This discussion and certain other sections contain forward-looking statements that are based largely on the Company’s current expectations and are made pursuant to the safe harbor provision of the Private Securities Litigation Reform