CONSOLIDATED STATEMENTS  OF CASH FLOWS Years Ended December 31, (in millions) 2002 2001 2000 Cash flows provided by operating activities Net income (loss) $ 55.7 $ (11.4) $ (271.7) Income charges (credits) not affecting cash: Dispositions and write-downs of assets and other non-recurring charges, net 68.9 89.4 333.4 Depreciation and amortization 40.4 57.4 74.1 Deferred income taxes (13.8) (29.7) (1.0) Other 5.7 (7.4) 14.3 Changes in operating assets and liabilities, net of effect from  ownership change of Japan business (Notes 1 and 3): Accounts and other receivables (32.0) (4.7) (8.1) Inventories 13.3 (7.7) 0.3 Accounts payable and accrued liabilities (17.6) 7.0 2.3 Other — 8.3 (5.9) Net cash provided by operating activities 120.6 101.2 137.7 Cash flows from investing activities Capital expenditures (40.7) (37.5) (46.0) Acquisition of joint venture in Japan (19.0) — — Proceeds from sale of business — 45.0 — Purchase of convertible debentures — — (13.0) Investments in unconsolidated affiliates (5.7) (10.6) (28.0) Proceeds from asset dispositions 4.1 9.7 12.3 Investments in intangible assets (7.0) (8.0) (1.0) Other — (2.5) — Net cash used in investing activities (68.3) (3.9) (75.7) Cash flows from financing activities Proceeds from issuance of short-term debt 0.4 26.1 219.9 Payments on short-term debt (1.5) (86.3) (68.6) Proceeds from issuance of long-term debt 150.9 180.0 448.6 Payments on long-term debt (231.9) (211.2) (158.6) Proceeds from accounts receivable securitization, net 29.9 5.2 32.0 Purchases of treasury stock (30.8) (0.7) — Payments to Baxter International Inc., net — — (511.0) Proceeds from stock plans 13.7 8.9 4.1 Other (0.2) (0.6) (3.0) Net cash used in financing activities (69.5) (78.6) (36.6) Effect of currency exchange rate changes on cash and cash equivalents 3.7 0.9 2.7 Net (decrease) increase in cash and cash equivalents (13.5) 19.6 28.1 Cash and cash equivalents at beginning of year 47.7 28.1 — Cash and cash equivalents at end of year $ 34.2 $ 47.7 $ 28.1 Supplemental disclosures: Cash paid during the year for: Interest $ 9.8 $ 19.2 $ 17.0 Income taxes 10.4 10.2 6.0 Non-cash transactions: De-consolidation of Japan business (Notes 1 and 3) $ — $ — $ 43.0 Sale of inventory in exchange for note receivable (Note 4) — — 14.0 Net assets sold in consideration for convertible preferred stock (Note 4) — — 13.0 The accompanying notes are an integral part of these consolidated financial statements.  S52 Edwards Lifesciences Corporation