Exhibit 99.2
GLOBAL SOURCES LTD.
CONSOLIDATED BALANCE SHEETS
(IN U.S. DOLLARS THOUSANDS, EXCEPT NUMBER OF SHARES AND PER SHARE DATA)
AT AT
DECEMBER 31 MARCH 31
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2000 2001
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(UNAUDITED)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 12,727 $ 12,329
Accounts receivable, net 7,803 7,272
Receivables from sales representatives 3,994 3,684
Inventory of paper 1,213 1,075
Prepaid expenses and other current assets 1,768 1,988
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TOTAL CURRENT ASSETS 27,505 26,348
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Property and equipment, net 23,205 21,662
Intangible assets, net 373 281
Long term investments 1,250 1,250
Bonds held to maturity, at amortized cost 2,027 2,058
Other assets 1,346 1,389
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TOTAL ASSETS $ 55,706 $ 52,988
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LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 5,536 $ 3,106
Deferred income and customer prepayments 15,888 16,133
Accrued liabilities 5,879 6,554
Short-term loan 4,000 4,000
Income taxes payable 158 200
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TOTAL CURRENT LIABILITIES 31,461 29,993
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Liabilities for incentive and bonus plan 1,794 1,795
Amount due to parent company 11,404 11,404
Minority interest 2,432 2,499
Deferred tax liability 454 472
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TOTAL LIABILITIES 47,545 46,163
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SHAREHOLDER'S EQUITY:
Ordinary shares, US$0.01 par value; 50,000,000 shares authorized;
26,303,949 (2000: 26,303,949) shares issued and outstanding 263 263
Additional paid in capital (Note 1) 81,726 86,998
Shareholders' note receivable (6,000) (6,000)
Retained earnings (62,762) (64,848)
Less : Unearned compensation (Note 2) (5,066) (9,588)
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TOTAL SHAREHOLDERS' EQUITY 8,161 6,825
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 55,706 $ 52,988
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Note: 1. Reflects the non-cash compensation associated with the
transfer of shares from the parent company to the chairman and
chief executive officer of the Company, employee equity
compensation plans, the non-cash listing expenses incurred by
The Fairchild Corporation, interest in a joint venture and
amount received from a director in February 2001 for the
shares subscribed by him in the directors stock option plan.
2. Reflects the remaining unearned non-cash compensation at the
balance sheet date associated with the employee equity
compensation plans. The Company will recognize non-cash
compensation expense over the vesting period of the ECP plans.
GLOBAL SOURCES LTD.
CONSOLIDATED STATEMENTS OF INCOME
(IN U.S. DOLLARS THOUSANDS, EXCEPT NUMBER OF SHARES AND PER SHARE DATA)
THREE MONTHS ENDED
MARCH 31,
-----------------------------------
2000 2001
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(UNAUDITED) (UNAUDITED)
REVENUES:
Online marketplace services $ 11,130 $ 14,789
Transaction software and services 107 75
Complementary media services 12,978 8,606
Other 1,119 1,563
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25,334 25,033
OPERATING EXPENSES:
Sales 8,648 9,270
Circulation 3,060 3,053
General and administrative 8,489 9,970
Online services development 897 3,131
Non-cash compensation expense (Note 1) 8,933 586
Amortization of intangibles/Software development cost 93 869
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TOTAL OPERATING EXPENSES 30,120 26,879
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LOSS FROM OPERATIONS (4,786) (1,846)
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Interest expense (30) (76)
Interest income 77 220
Foreign exchange gains (losses), net 383 37
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LOSS BEFORE INCOME TAXES (4,356) (1,665)
INCOME TAX PROVISION (261) (354)
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NET LOSS BEFORE MINORITY INTEREST (4,617) (2,019)
Minority interest -- (67)
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NET LOSS $ (4,617) $ (2,086)
RETAINED EARNINGS AT BEGINNING OF THE PERIOD $ 5,459 $ (62,762)
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RETAINED EARNINGS AT END OF THE PERIOD $ 842 $ (64,848)
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BASIC AND DILUTED NET LOSS PER SHARE $ (0.18) $ (0.08)
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SHARE USED IN BASIC AND DILUTED NET LOSS PER SHARE CALCULATIONS (NOTE 2) 25,051,380 26,303,949
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Note : 1. Reflects the non-cash compensation expenses associated with
the transfer of shares from the parent company to the chairman
and chief executive officer of the Company and the employee
equity compensation plans.
2. The March 2000 number was restated for the effects of the
Share Exchange that occurred on April 14, 2000, similar to a
2505 to 1 stock split.
GLOBAL SOURCES LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN U.S. DOLLARS THOUSANDS, EXCEPT NUMBER OF SHARES AND PER SHARE DATA)
THREE MONTHS MARCH 31
2000 2001
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(UNAUDITED) (UNAUDITED)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss (4,617) (2,086)
Adjustments to reconcile net income to net cash provided by
(used for) operating activities
Depreciation and amortization 648 2,191
(Profit)/Loss on sale of property and equipment (6) 2
Accretion of U.S. Treasury strips zero % coupon (31) (31)
Bad debt expense 291 298
Non-cash compensation expense 8,933 586
Income attributable to minority shareholder -- 67
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5,218 1,027
CHANGES IN ASSETS AND LIABILITIES:
Accounts receivables 249 233
Receivables from sales representatives (1,338) 310
Inventory of paper 56 138
Prepaid expenses and other current assets 700 (220)
Loan to chief executive officer (5,009) --
Long term assets 9 (43)
Accounts payable (1,094) (2,430)
Accrued liabilities and liabilities for incentive and bonus plans (1,799) 676
Deferred income and customer prepayments 34 245
Amount due to parent company -- --
Tax liability 119 60
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NET CASH PROVIDED BY OPERATING ACTIVITIES (2,855) (4)
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CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of long term investments (10,000) --
Purchase of property and equipment (1,194) (562)
Proceeds from sales of property and equipment 6 4
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NET CASH USED FOR INVESTING ACTIVITIES (11,188) (558)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Amount received towards directors stock option plan -- 164
Short-term borrowings 13,260 --
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NET CASH (USED FOR) GENERATED FROM FINANCING ACTIVITIES 13,260 164
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Net decrease in cash and cash equivalents (783) (398)
Cash and cash equivalents, beginning of the year 15,433 12,727
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CASH AND CASH EQUIVALENTS, END OF THE YEAR 14,650 12,329
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SUPPLEMENTAL CASH FLOW DISCLOSURES:
Income tax paid 142 294
Interest paid 30 36
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