Global Sources LTD /bermuda 6-K Global Sources LTD.

EXHIBIT 2

GLOBAL SOURCES LTD. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)

	At		At
	March 31		December 31
	2008		2007
	(Unaudited)
ASSETS
Current Assets:
Cash and cash equivalents	$	206,957	$	197,825
Available-for-sale securities		6,431		—
Accounts receivable, net		5,714		6,665
Receivables from sales representatives		13,711		12,303
Inventory		957		1,108
Prepaid expenses and other current assets		22,734		15,333
Deferred tax assets		46		46
Total Current Assets		256,550		233,280
Property and equipment, net		35,085		35,352
Long term investments		100		100
Bonds held to maturity, at amortized cost		100		99
Deferred tax assets — long term		196		196
Other assets		3,119		2,781
Total Assets	$	295,150	$	271,808
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	6,018	$	5,577
Deferred income and customer prepayments		90,285		78,141
Accrued liabilities		13,812		12,546
Income taxes payable		850		694
Total Current Liabilities		110,965		96,958
Deferred income and customer prepayments — long term		5,820		4,934
Deferred tax liability		294		283
Total Liabilities		117,079		102,175
Minority interest		5,567		4,940
Shareholders’ equity:
Common shares, US$0.01 par value; 75,000,000 shares authorized; 46,702,092 (2007: 46,572,092) shares issued and outstanding		467		466
Additional paid in capital		133,295		133,987
Retained earnings		37,034		28,829
Accumulated other comprehensive income		1,708		1,411
Total Shareholders’ Equity		172,504		164,693
Total Liabilities and Shareholders’ Equity	$	295,150	$	271,808

GLOBAL SOURCES LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)

	Three months ended March 31,
	2008			2007
	(Unaudited)			(Unaudited)
Revenue:
Online and other media services (Note 1)	$	33,532		$	29,045
Exhibitions		5,961			4,816
Miscellaneous		1,121			1,086
		40,614			34,947
Operating Expenses:
Sales (Note 2)		12,316			11,136
Event production		1,005			613
Community (Note 2)		6,043			5,273
General and administrative (Note 2)		11,228			9,953
Online services development (Note 2)		1,479			1,286
Amortization of software costs		40			40
Total Operating Expenses		32,111			28,301
Income from Operations		8,503			6,646
Interest and dividend income		1,297			1,392
Foreign exchange gains (losses), net		(256	)		(274	)
Income before Income Taxes		9,544			7,764
Income Tax Expense		(233	)		(219	)
Net Income before Minority Interest	$	9,311		$	7,545
Minority interest		(1,106	)		(1,017	)
Net Income	$	8,205		$	6,528
Basic net income per common share	$	0.18		$	0.14
Diluted net income per common share	$	0.17		$	0.14
Common shares used in basic net income per common share calculations		45,370,391			44,935,549
Common shares used in diluted net income per common share calculations		45,441,544			45,047,140
Basic net income per non-vested restricted share	$	0.18		$	0.14
Diluted net income per non-vested restricted share	$	0.17		$	0.14
Non-vested restricted shares used in basic net income per non-vested restricted share calculations		1,247,923			1,589,756
Non-vested restricted shares used in diluted net income per non-vested restricted share calculations		1,884,369			1,600,003

Note : 1. Online and other media services consists of:

	Three months ended March 31,
	2008		2007
	(Unaudited)		(Unaudited)
Online services	$	21,930	$	17,270
Print services		11,602		11,775
	$	33,532	$	29,045

Note : 2. Non-cash compensation expenses associated with the employee equity compensation plans and Directors Purchase Plan included under various categories of expenses are as follows:

	Three months ended March 31,
	2008			2007
	(Unaudited)			(Unaudited)
Sales	$	(1,393	)	$	(133	)
Community		15			85
General administrative		(247	)		509
Online services development		48			62
	$	(1,577	)	$	523

GLOBAL SOURCES LTD. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In U.S. Dollars Thousands, Except Number of Shares and Per Share Data)

	Three months ended March 31,
	2008			2007
	(Unaudited)			(Unaudited)
Cash flows from operating activities:
Net income	$	8,205		$	6,528
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		1,269			1,072
Accretion of U.S. Treasury strips zero % coupons		(1	)		(4	)
Provision for doubtful debts (written back)		(64	)		100
Non-cash compensation expense (credit)		(1,577	)		523
Income attributable to minority shareholder		1,106			1,017
Equipment written off		—			4
Exchange rate realignment		(123	)		—
		8,815			9,240
Changes in assets and liabilities:
Accounts receivables		1,015			(14	)
Receivables from sales representatives		(1,404	)		(4,095	)
Inventory		151			(123	)
Prepaid expenses and other current assets		(7,377	)		(5,939	)
Long term assets		(333	)		(1,051	)
Accounts payable		407			(254	)
Accrued liabilities and liabilities for incentive and bonus plans		1,231			(2,260	)
Deferred income and customer prepayments		13,021			12,309
Tax liability		142			143
Net cash provided by operating activities		15,668			7,956
Cash flows from investing activities:
Purchase of property and equipment		(569	)		(592	)
Purchase of available-for-sale securities		(6,467	)		—
Proceeds fromsale of available-for-sale securities		—			7
Payment of dividend to minority shareholder by a subsidiary		(479	)		—
Net cash used in investing activities		(7,515	)		(585	)
Cash flows from financing activities:
Amount received towards directors purchase plan		886			422
Net cash generated from financing activities		886			422
Effect of exchange rate changes on cash equivalents		93			—
Net increase in cash and cash equivalents		9,039			7,793
Cash and cash equivalents, beginning of the period		197,825			135,093
Cash and cash equivalents, end of the period	$	206,957		$	142,886
Supplemental cash flow disclosures:
Income tax paid	$	66		$	76