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our discontinued operations and recorded any resulting gains or losses in net earnings (loss) from discontinued operations in the period in
which they occurred.
As of December 31, 2003, there was no change to the initial disposal strategy or intent to exit the business which was approved by the Board of
Directors on June 14, 2001. However, the prolonged deterioration in the industry and market conditions during 2002 and 2003 delayed certain
disposal activities beyond the original planned timeframe of one year. In particular, actions involving negotiations with customers, who were
also affected by industry conditions, took longer than expected. Although disposal activities continued beyond the one-year period, we
continue to present the access solutions operations as discontinued operations in the accompanying consolidated financial statements. As of
December 31, 2003, we had substantially completed the wind-down of our access solutions operations. Net earnings from discontinued
operations of $184 (net of tax) primarily related to a number of transactions in 2003 as follows, as well as gains of $68 associated with
provision reassessments:
Following the March 2003 Arris Group transactions, we reduced our interest in Arris Group to 18.8%, and ceased equity accounting for the
investment. As a result, we reclassified our remaining ownership interest in Arris Group as an available-for-sale investment within continuing
operations effective in the second quarter of 2003. We continued to dispose of our interest in Arris Group in 2003 and the gain or loss on the
sale of shares subsequent to the first quarter of 2003 was included in other income (expense) — net. We sold 9 million common shares of Arris
Group on November 24, 2003. As of December 31, 2003, we owned 5 million Arris Group common shares or 6.6% of Arris Group’s
outstanding common shares.
For additional information, see “Discontinued operations” in note 20 of the accompanying consolidated financial statements and “Other
income (expense) — net”.
Liquidity and capital resources
Cash flows
The following table summarizes our cash flows by activity and cash on hand as of December 31:
73
• a gain of $14 on the sale of certain assets related to our fixed wireless access operations to Airspan Networks, Inc. for cash
consideration of $13 on December 23, 2003;
• a gain of $17 in the fourth quarter of 2003 associated with a cash settlement of $17 related to a certain note receivable which had
been previously reserved;
• a gain of $12 on March 24, 2003 from the sale of 8 million common shares of Arris Group, back to Arris Group for cash
consideration of $28 pursuant to a March 11, 2003 agreement. In addition, on March 18, 2003, we assigned our membership
interest in Arris Interactive LLC, or Arris, to ANTEC Corporation, an Arris Group company, for cash consideration of $88,
resulting in a loss of $2. Also in connection with these transactions, we received $11 upon the settlement of a sales representation
agreement with Arris Group and recorded a gain of $11; and
• a gain of $66 in the first quarter of 2003 from the settlement of certain trade and customer financing receivables, the majority of
which was previously provisioned.
2003 2002
Net cash from (used in) operating activities of continuing operations $ 85 $ (768)
Net cash from (used in) investing activities of continuing operations (85) 129
Net cash from (used in) financing activities of continuing operations (359) 532
Effect of foreign exchange rate changes on cash and cash equivalents 176 74
Net cash from (used in) continuing operations (183) (33)
Net cash from (used in) discontinued operations 390 349
Net increase (decrease) in cash and cash equivalents 207 316
Cash and cash e
q
uivalents at be
g
innin
g
of
p
eriod 3,790 3,474
Cash and cash equivalents at end of period $ 3,997 $ 3,790