CONSOLIDATED STATEMENTS OF CASH FLOWS STRYKER CORPORATION AND SUBSIDIARIES Years Ended December 31 (in thousands) 1995 1994 1993 ________ ________ ________ OPERATING ACTIVITIES Net Earnings $ 87,010 $ 72,400 $ 60,205 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 25,542 18,717 13,048 Amortization 3,112 2,227 3,135 Minority interest 9,183 4,405 Provision for losses on accounts receivable 1,400 2,600 900 Deferred income taxes (credit) 2,484 (3,818) (2,917) Changes in operating assets and liabilities, net of effects of business acquisitions: Decrease (increase) in accounts receivable (13,560) 2,862 (11,305) Decrease (increase) in inventories (1,599) 5,798 2,271 Increase (decrease) in accounts payable (703) (8,594) 4,982 Increase (decrease) in income taxes (5,909) (3,898) 11,092 Other 4,576 4,994 4,691 ________ ________ ________ Net Cash Provided by Operating Activities 111,536 97,693 86,102 INVESTING ACTIVITIES Purchases of property, plant and equipment (36,299) (29,239) (20,160) Sales (purchases) of marketable securities (110,335) 17,661 (54,264) Business acquisitions, net of cash acquired (17,743) (42,557) (34,654) ________ ________ ________ Net Cash Used in Investing Activities (164,377) (54,135) (109,078) FINANCING ACTIVITIES Proceeds from borrowings 9,795 59,919 33,563 Payments on borrowings (5,913) (31,771) (2,016) Dividends paid (3,870) (3,388) (2,898) Proceeds from exercise of stock options 3,814 1,791 1,389 Repurchases of common stock (3,109) Other 1,131 (1,307) (126) ________ ________ ________ Net Cash Provided by Financing Activities 4,957 22,135 29,912 Effect of exchange rate changes on cash and cash equivalents 152 1,376 (315) ________ ________ ________ Increase (Decrease) in Cash and Cash Equivalents (47,732) 67,069 6,621 Cash and cash equivalents at beginning of year 116,781 49,712 43,091 ________ ________ ________ Cash and Cash Equivalents at End of Year $ 69,049 $116,781 $ 49,712 ======== ======== ======== See accompanying notes to consolidated financial statements.