Reliant FORM 10-K manual 182

NORTEL NETWORKS S.A.

(a Subsidiary of Nortel Networks Limited)

Consolidated Statements of Operations for the years ended December 31

(thousands of Euros)	2003	2002	2001
		As restated*	As restated*
Revenues — external	344,008	356,316	767,713
— related parties	515,478	458,918	439,072
	859,486	815,234	1,206,785
Cost of revenues	657,128	600,367	1,116,766
Gross profit	202,358	214,867	90,019
Selling, general and administrative expense	70,274	69,482	175,433
Research and development expense	236,967	264,275	249,603
Amortization of intangibles
Acquired technology and other	255	–	–
Goodwill	–	–	3,434
Special charges
Goodwill impairment	–	–	20,607
Other special charges	24,563	83,427	74,772
(Gain) loss on sale of businesses and assets	13,883	16,171	(10,243)
Operating earnings (loss)	(143,584)	(218,488)	(423,587)
Other income (expense) — net	2,015	23,038	53,998
Foreign exchange gain (loss)	1,043	(5,531)	(1,710)
Interest expense	(3,221)	(9,885)	(11,286)
Earnings (loss) before income taxes and minority interest	(143,747)	(210,866)	(382,585)
Minority interest	(756)	3,052	8,973
Income tax benefit	5,614	1,640	34,073
Net earnings (loss)	(138,889)	(206,174)	(339,539)

* See note 3

The accompanying notes are an integral part of these financial statements

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