Fiscal 2002 as Compared with Fiscal 2001”); and (ii) a $20.6 million charge, equal to $.08 per diluted common share, in connection with the cumulative effect of a change in accounting principle upon adoption of SFAS No. 142, “Goodwill and Other Intangible Assets” (see Note 2 “Summary of Significant Accounting Policies” in the accompanying Consolidated Financial Statements). The restructuring charges were related to repositioning certain businesses as part of a globalization and reorganization initiative and are described in greater detail in Note 5 to Notes to Consolidated Financial Statements. The restructuring and the adoption of the new accounting pronouncement were not considered part of our core business operations in fiscal 2002. Management also excludes the related charges in evaluating its performance when comparing fiscal 2002 to future periods. The table below reconciles the fiscal 2001 results as reported and results prior to adjustment for (i) pre-tax restructuring and special charges of $63.0 million, or $40.3 million after-tax, equal to $.17 per diluted common share (see “Results of Operations — Fiscal 2002 as Compared with Fiscal 2001”); (ii) $13.4 million after-tax adjustment, equal to $.06 per diluted common share, to reflect the retroactive impact of the adoption of SFAS No. 142, “Goodwill and Other Intangible Assets” (see Note 2 “Summary of Significant Accounting Policies” in the accompanying Consolidated Financial Statements); and  (iii) a one-time charge of $2.2 million after-tax, or $.01 per diluted common share, attributable to the cumulative effect of adopting SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities.” We adopted a restructuring plan in the fourth quarter of fiscal 2001, our first since the initial public offering in 1995. The particular restructuring and special charges relating to the plan are described in Note 5 to Notes to Consolidated Financial Statements. These costs, as well as those resulting from the adoption of new accounting standards, were not considered part of our core business in fiscal 2001. Management also excludes the related charges in evaluating its performance when comparing fiscal 2001 to future periods. 43 THEEST{E LAUDER COMPANIES INC. YEAR ENDED JUNE 30, 2001 Results as Reported Reconciling Items Non-GAAP Results (In millions, except per share data) Net sales $4,667.7 $ 8.0 $4,675.7 Cost of sales 1,226.4 1.1 1,225.3 Gross profit 3,441.3 9.1 3,450.4 Gross margin  73.7% 73.8% Operating expenses 2,945.7 53.9 2,891.8 Operating expense margin 63.1% 61.9% Operating income 495.6 63.0 558.6 Operating income margin 10.6% 11.9% Provision (benefit) for income taxes 174.0 (22.7) 196.7 Net earnings before accounting change 307.4 40.3 347.7 2001 amortization of goodwill, net of tax — 13.4 13.4 Cumulative effect of a change in accounting  principle, net of tax (2.2) 2.2 — Net earnings $ 305.2 $ 55.9 $ 361.1 Diluted net earnings per common share $ 1.16 $ .23 $ 1.39 YEAR ENDED JUNE 30, 2002 Results as Reported Reconciling Items Non-GAAP Results (In millions, except per share data) Net sales $4,743.7 $ 6.2 $4,749.9 Cost of sales 1,273.4 0.8 1,272.6 Gross profit 3,470.3 7.0 3,477.3 Gross margin  73.2% 73.2% Operating expenses 3,128.9 110.4 3,018.5 Operating expense margin 66.0% 63.5% Operating income 341.4 117.4 458.8 Operating income margin 7.2% 9.7% Provision (benefit) for income taxes 114.4 (40.5) 154.9 Net earnings before accounting change 212.5 76.9 289.4 Cumulative effect of a change in accounting principle (20.6) 20.6 — Net earnings $ 191.9 $ 97.5 $ 289.4 Diluted net earnings per common share $ .70 $ .40 $ 1.10