drugstore.com inc. Achieves GAAP Profitability in the Fourth Quart...(t (759352) ...),Health

Total stockholders' equity 96,868 92,678

Total liabilities and stockholders' equity $175,408 $168,322

drugstore.com, inc.

Consolidated Statements of Cash Flows

(in thousands)

Three Months Ended Twelve Months Ended

December 30, December 31, December 30, December 31,

2007 2006 2007 2006

(unaudited) (unaudited) (audited)

Operating activities:

Net income (loss) $156 $(2,947) $(9,011) $(13,026)

Adjustments to reconcile

net loss to net cash

provided by (used in)

operating activities:

Depreciation 1,761 1,540 7,504 6,040

Amortization of

marketing and sales

agreements 573 573 2,290 2,290

Amortization of

intangible assets 244 468 1,234 2,060

Stock-based

compensation 1,687 1,705 8,801 6,721

Other, net 2 - 14 24

Changes in:

Accounts receivable (2,759) (1,178) (1,375) (2,474)

Inventories (9,001) (4,513) (5,032) (3,001)

Prepaid marketing

expenses and other 62 (483) (929) 5

Accounts payable,

accrued expenses and

other liabilities 8,021 4,731 4,282 278

Net cash provided by

(used in) operating

activities 746 (104) 7,778 (1,083)

Investi
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