ST-3. Neff Industries Free Cash Flows for the Year Ended December 31, 2003 FREE CASH FLOWS: OPERATING

ST-3.

Neff Industries Free Cash Flows for the Year Ended December 31, 2003 

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FREE CASH FLOWS: OPERATING PERSPECTIVE Operating income Plus depreciation expense Less tax expense Less change in income tax payable After-tax cash flows from operations Change in net operating working capital Change in cash $ 17,000 10,000 (5,450) 0 $ 21,550 $ (8,500) Change in accounts receivable Change in inventories 3,500 16,500 Change in accounts payable (11,500) Change in net operating working capital $ 0 Change in fixed assets and land Purchase of buildings and equipment Purchase of land Change in fixed assets and land Free cash flows (operating perspective) FREE CASH FLOWS: FINANCING PERSPECTIVE Increase in short-term notes Decrease in long-term notes Dividends Interest expense Free cash flows (financing perspective) $ 30,000 6,000 $ 36,000 $(14,450) $ 30,000 (5,800) (3,650) (6,100) $ 14,450