38 Consolidated Statement of Income In thousands, except per share data For the years ended December 31, 2002, 2001 and 2000 2002 2001 2000 Operating revenue $263,151 $246,820 $244,806 Operating expenses: Operations: Purchased water 76,672 73,174 73,768 Purchased power 22,897 21,130 15,136 Pump taxes 6,344 5,910 6,275 Administrative and general 37,646 36,521 32,974 Other 34,073 34,109 32,308 Maintenance 11,587 12,131 11,592 Depreciation and amortization 21,238 19,226 18,368 Income taxes 12,568 9,728 11,571 Property and other taxes 9,829 9,740 9,618 Total operating expenses 232,854 221,669 211,610 Net operating income 30,297 25,151 33,196 Other income and expenses: Non-regulated income, net 2,637 1,979 1,413 Gain on the sale of non-utility property 2,980 3,864 Total other income and expenses 5,617 5,843 1,413 Income before interest expense 35,914 30,994 34,609 Interest expense: Long-term debt interest 15,554 14,187 12,901 Other interest 1,287 1,842 1,745 Total interest expense 16,841 16,029 14,646 Net income $ 19,073 $ 14,965 $ 19,963 Earnings per share: Basic $ 1.25 $ 0.98 $ 1.31 Diluted $ 1.25 $ 0.97 $ 1.31 Weighted average number of common shares outstanding: Basic 15,182 15,182 15,126 Diluted 15,185 15,186 15,129 See accompanying Notes to Consolidated Financial Statements. CALIFORNIA WATER SERVICE GROUP