| Ashland Inc. and Consolidated Subsidiaries | Page 3 | |||||||||
| STATEMENTS OF CONSOLIDATED CASH FLOWS | ||||||||||
| (In millions - unaudited) | ||||||||||
| Year ended | ||||||||||
| September 30 | ||||||||||
| 2003 | 2002 | |||||||||
| CASH FLOWS FROM OPERATIONS | ||||||||||
| Income from continuing operations | $ | 94 | $ | 115 | ||||||
| Expense (income) not affecting cash | ||||||||||
| Depreciation, depletion and amortization (a) | 204 | 208 | ||||||||
| Deferred income taxes | 49 | (121) | ||||||||
| Equity income from affiliates | (301) | (181) | ||||||||
| Distributions from equity affiliates | 203 | 201 | ||||||||
| Other items | 1 | - | ||||||||
| Change in operating assets and liabilities (b) | (8) | (59) | ||||||||
| 242 | 163 | |||||||||
| CASH FLOWS FROM FINANCING | ||||||||||
| Proceeds from issuance of long-term debt | - | 55 | ||||||||
| Proceeds from issuance of common stock | 2 | 11 | ||||||||
| Repayment of long-term debt | (216) | (140) | ||||||||
| Repurchase of common stock | - | (42) | ||||||||
| Increase (decrease) in short-term debt | (10) | 10 | ||||||||
| Dividends paid | (75) | (76) | ||||||||
| (299) | (182) | |||||||||
| CASH FLOWS FROM INVESTMENT | ||||||||||
| Additions to property, plant and equipment (a) | (110) | (174) | ||||||||
| Purchase of operations - net of cash acquired | (5) | (15) | ||||||||
| Proceeds from sale of operations | 7 | - | ||||||||
| Other - net | 11 | 27 | ||||||||
| (97) | (162) | |||||||||
| CASH USED BY CONTINUING OPERATIONS | (154) | (181) | ||||||||
| Cash provided by discontinued operations | 287 | 35 | ||||||||
| INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | $ | 133 | $ | (146) | ||||||
| DEPRECIATION, DEPLETION AND AMORTIZATION | ||||||||||
| APAC | $ | 108 | $ | 114 | ||||||
| Ashland Distribution | 19 | 21 | ||||||||
| Ashland Specialty Chemical | 40 | 38 | ||||||||
| Valvoline | 26 | 24 | ||||||||
| Corporate | 11 | 11 | ||||||||
| $ | 204 | $ | 208 | |||||||
| ADDITIONS TO PROPERTY, PLANT AND EQUIPMENT | ||||||||||
| APAC | $ | 47 | $ | 107 | ||||||
| Ashland Distribution | 5 | 12 | ||||||||
| Ashland Specialty Chemical | 34 | 27 | ||||||||
| Valvoline | 16 | 21 | ||||||||
| Corporate | 8 | 7 | ||||||||
| $ | 110 | $ | 174 | |||||||
| __________ | ||||||||||
| (a) | Excludes amounts related to equity affiliates. Ashland's 38 percent share of MAP's DD&A was $139 million in 2003 and | |||||||||
| $138 million in 2002, and its share of MAP's capital expenditures was $296 million in 2003 and $199 million in 2002. | ||||||||||
| (b) | Excludes changes resulting from operations acquired or sold. | |||||||||