Management’s Discussion and Analysis of Results of Operations and Financial Condition The following table presents EMCOR’s operating income, and operating income as a percentage of segment revenues, for the years ended December 31, 2000, 1999 and 1998: Operating income % of % of % of Segment Segment Segment (In millions, except for percentages) 2000 Revenues 1999 Revenues 1998 Revenues Operating income (loss): United States electrical construction and facilities services $ 58.6 4.3% $ 38.5 3.9% $ 36.3 4.1% United States mechanical construction and facilities services 36.4 2.9% 37.8 3.6% 21.0 3.5% United States other (6.0) – (4.4) – (4.8) – Total United States operations 89.0 3.2% 71.9 3.4% 52.5 3.5% Canada construction and facilities services 5.2 2.2% 4.0 2.0% 5.0 2.5% United Kingdom construction and facilities services 6.0 1.4% 3.2 0.6% (0.9) – Other international construction and facilities services 0.5 – (0.3) – (1.3) – Corporate administration (21.8) – (20.7) – (18.1) – Total worldwide operations 78.9 2.3% 58.1 2.0% 37.2 1.7% Other corporate items: Interest expense (9.7) (10.5) (11.1) Interest income 2.4 2.1 3.6 Income before taxes and extraordinary item $ 71.6 $ 49.7 $ 29.7 development costs of the consulting and maintenance services operations. These operating losses for 1999 compared to 1998 decreased by $0.4 million primarily due to operating income from certain related businesses acquired during 1999 and 1998, partially offset by costs of development for the consulting and maintenance service operations. Operating income increased for the United States electrical construction and facilities services operations for 2000 compared to 1999. The dollar increase in operating income for 2000 of $20.1 million, or 52.2%, as compared to 1999, was attributable to the continuing favorable market conditions due to increased  renovation projects as well as new construction spending, particularly in Eastern and Western United States. As a percentage of revenues, operating income increased by 0.4% for 2000 as  compared to 1999. Operating income for 1999 for the United States electrical construction and facilities services operations increased $2.2 million, or 6.0%, from 1998 levels due to the effect of businesses acquired during 1999 and 1998 as well as growth  from the balance of EMCOR’s operations. Canada construction and facilities services operations  operating income increased by $1.2 million for 2000 compared to 1999 principally due to an increased level of activities in Eastern Canada. Operating income as a percentage of revenues increased 0.2% in 2000 compared to 1999 due to the jobs available in 2000 having higher gross profit margins. The 0.5% decrease in operating income as a percentage of revenues for 1999 compared to 1998 was primarily due to the decrease in revenues from Eastern Canada operations, attributable, among other things, to the delay in  commencing certain projects in 1999 caused by delays in the  bidding process for certain jobs. United Kingdom construction and facilities services operating income increased by $2.8 million for 2000 compared to 1999. The improvement was primarily attributable to the commencement  of new projects that have resulted in higher gross profits in 2000 than in previous years due to improved market conditions. For 1999, operating income increased to $3.2 million as  compared to operating losses of $0.9 million for 1998. This increase was attributable to growth in selected construction and facilities services markets in the United Kingdom. United States mechanical construction and facilities services operations operating income decreased $1.4 million for 2000, a 3.7% decrease over 1999 amounts. The decrease was primarily  due to losses on jobs in the South and North Carolina markets undertaken by EMCOR’s Poole & Kent subsidiary prior to its acquisition by EMCOR offsetting the increased operating income for most of the operations in this segment. For 1999 compared with 1998, operating income increased $16.9 million, or 80.5%, primarily due to growth of EMCOR’s businesses and operating income contributed by businesses acquired during 1999 and 1998. As a percentage of revenues, operating income increased 0.1% from 1998 to 1999 and decreased 0.7% from 1999 to 2000, principally due to the reasons cited above. United States other operating losses increased $1.6 million  for 2000 as compared to 1999 primarily due to the continuing EMCOR, 2000 Annual Report 20