Reliant FORM 10-K manual 818 592 487 525 768

Supplemental Consolidating Statements of Cash Flows for the year ended December 31, 2002:

			Nortel		Nortel				Non-
			Networks	Networks			Guarantor		Guarantor
(millions of U.S. dollars)	Corporation				Limited	Subsidiaries		Subsidiaries		Eliminations			Total
Cash flows from (used in) operating activities
Net earnings (loss) from continuing operations	$	(2,893)		$	(2,163)	$	(1,250)	$	(1,076)	$	4,489	$	(2,893)
Adjustments to reconcile net earnings (loss) from continuing
operations to net cash from (used in) operating activities, net of
effects from acquisitions and divestitures of businesses:
Amortization and depreciation			–		87		402		212		–		701
Non-cash portion of special charges and related asset write
downs			–		199		464		479		–		1,142
Equity in net loss of associated companies		3,485			789		773		10		(5,040)		17
Current and deferred stock option compensation			–		–		–		110		–		110
Deferred income taxes		16			(417)		(137)		113		–		(425)
Other liabilities			–		(4)		18		(16)		–		(2)
(Gain) loss on repurchases of outstanding debt securities			–		(60)		–		–		–		(60)
(Gain) loss on sale or write-down of investments and businesses			–		17		18		(17)		–		18
Other — net		64			447		(553)		(175)		26		(191)
Change in operating assets and liabilities		(202)			(578)		904		691		–		815
Intercompany/related party activity		348			91		(152)		(287)		–		–
Net cash from (used in) operating activities of continuing operations		818			(1,592)		487		44		(525)		(768)
Cash flows from (used in) investing activities
Expenditures for plant and equipment			–		(65)		(242)		(45)		–		(352)
Proceeds on disposals of plant and equipment			–		16		390		–		–		406
Acquisitions of investments and businesses — net of cash acquired			–		(5)		(24)		–		–		(29)
Proceeds on sale of investments and businesses			–		23		33		48		–		104
Investments in subsidiaries		(2,287)			–		–		–		2,287		–
Net cash from (used in) investing activities of continuing operations		(2,287)			(31)		157		3		2,287		129
Cash flows from (used in) financing activities
Dividends on preferred shares			–		(26)		–		–		26		–
Dividends paid by subsidiaries to minority interests			–		–		–		–		(26)		(26)
Decrease in notes payable — net			–		–		(174)		(159)		–		(333)
Proceeds from long-term debt			–		–		1		32		–		33
Repayments of long-term debt			–		(460)		(138)		(13)		–		(611)
Repayments of capital leases payable			–		(3)		(13)		(1)		–		(17)
Issuance of common shares		863			2,287		–		–		(2,287)		863
Issuance of prepaid forward purchase contracts		623			–		–		–		–		623
Stock option fair value increment			–		–		(525)		–		525		–
Net cash from (used in) financing activities of continuing operations		1,486			1,798		(849)		(141)		(1,762)		532
Effect of foreign exchange rate changes on cash and cash equivalents			–		13		45		16		–		74
Net cash from (used in) continuing operations		17			188		(160)		(78)		–		(33)
Net cash from (used in) discontinued operations			–		104		246		(1)		–		349
Net increase (decrease) in cash and cash equivalents		17			292		86		(79)		–		316
Cash and cash equivalents at beginning of year		18			(41)		2,306		1,191		–		3,474
Cash and cash equivalents at end of year	$	35	$	251	$	2,392	$	1,112	$	–	$	3,790

F-91