Internal Growth Management believes that a comparison of “same store” growth is critical in the evalu- ation of the quality and extent of the Company’s internally generated growth. This “same store” analysis isolates the financial contributions from offices that have been included in the Company’s operating results for at least one full year. The table below presents “same store” comparisons on a year-over-year basis for the years ended De- cember 31, 2002, 2001 and 2000. Same store comparisons for the years ended December 31, 2002 2001 2000 Net revenues 12% 7% 23% Operating income 16% 13% 36% Liquidity and Capital Resources The Company’s principal source of liquidity is cash generated from operating activi- ties. Net cash provided by operating activities for the year ended December 31, 2002 was approximately $116 million, as compared with $168 million for 2001. This $52 million decrease is principally due to increased accounts receivable, offset by increased net earnings and increased accounts payable, accrued expenses and taxes payable. The Company’s business is subject to seasonal fluctuations. Cash flow fluctuates as a result of this seasonality. Historically, the first quarter shows an excess of customer collections over customer billings. This results in positive cash flow. The increased activity associated with peak season (typically commencing late second or early third quarter) causes an excess of customer billings over customer collections. This cyclical growth in customer receivables consumes available cash. In the past, the Company has utilized short-term borrowings to satisfy normal operating expenditures when tempo- rary cash outflows exceed cash inflows. These short-term borrowings have been repaid when the trend reverses and customer collections exceed customer billings. During 2002, short-term borrowings were not required in the United States; the market where cash flow pressures are most intense due to funds advanced in association with cus- toms brokerage activity. 82 expd 02 MD&A