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During 2000, we experienced a 29.5% growth in net revenues
during a period of increased competition. Data and Internet
revenues grew substantially, although these services have
always been subject to competition. These results demonstrate
our ability to compete in more open markets. At the same time,
we experienced significant increases in sales, general and
administrative expenses, or SG&A. This was largely attributable
to increased bad debt expenses due to difficulties in billing
and collections. Bad debt expenses increased to 5.4% of net
revenues in 2000 from 2% of net revenues in 1999. If this
trend in our billing and collections should persist or worsen,
we believe that such expenses would put significant pressures
on our earnings and cash flow.
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