Reliant FORM 10-K manual 572 111 648 206

Supplemental Consolidating Statements of Cash Flows for the year ended December 31, 2001:

		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	$	(23,255)	$	(11,006)	$	(12,885)	$	(14,696)	$	38,572	$	(23,270)
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		–		191		2,608		2,866		–		5,665
In-process research and development expense		–		–		–		15		–		15
Non-cash portion of special charges and related asset write
downs		–		88		1,459		11,213		–		12,760
Equity in net loss of associated companies		23,220		11,171		4,744		(7)		(38,978)		150
Current and deferred stock option compensation		–		–		–		248		–		248
Deferred income taxes		(3)		(537)		(797)		(176)		–		(1,513)
Other liabilities		–		(73)		85		(21)		–		(9)
(Gain) loss on sale or write-down of investments and businesses		–		69		253		184		–		506
Other — net		(139)		(458)		(371)		(588)		27		(1,529)
Change in operating assets and liabilities		43		522		5,227		1,391		–		7,183
Intercompany/related party activity		153		(2,539)		1,788		219		379		–
Net cash from (used in) operating activities of continuing operations		19		(2,572)		2,111		648		–		206
Cash flows from (used in) investing activities
Expenditures for plant and equipment		–		(317)		(833)		(152)		–		(1,302)
Proceeds on disposals of plant and equipment		–		23		185		–		–		208
Acquisitions of investments and businesses — net of cash acquired		–		(13)		(76)		10		–		(79)
Proceeds on sale of investments and businesses		–		6		403		195		–		604
Investments in subsidiaries		–		–		–		–		–		–
Net cash from (used in) investing activities of continuing operations		–		(301)		(321)		53		–		(569)
Cash flows from (used in) financing activities
Dividends on preferred shares		(123)		(27)		–		–		27		(123)
Dividends paid by subsidiaries to minority interests		–		–		–		–		(27)		(27)
Increase (decrease) in notes payable — net		–		12		(281)		39		–		(230)
Proceeds from long-term debt		1,756		1,500		10		20		–		3,286
Proceeds from Parent		(1,800)		1,800		–		–		–		–
Repayments of long-term debt		–		(250)		(12)		(208)		–		(470)
Repayments of capital leases payable		–		(3)		(18)		(5)		–		(26)
Issuance of common shares		146		–		–		–		–		146
Net cash from (used in) financing activities of continuing operations		(21)		3,032		(301)		(154)		–		2,556
Effect of foreign exchange rate changes on cash and cash equivalents		–		1		(7)		(4)		–		(10)
Net cash from (used in) continuing operations		(2)		160		1,482		543		–		2,183
Net cash from (used in) discontinued operations		–		(108)		(200)		(23)		–		(331)
Net increase (decrease) in cash and cash equivalents		(2)		52		1,282		520		–		1,852
Cash and cash equivalents at beginning of year		20		(93)		1,024		671		–		1,622
Cash and cash equivalents at end of year	$	18	$	(41)	$	2,306	$	1,191	$	–	$	3,474

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