The minority interest in joint venture represents  the minority investor’s share of the Diodes-China joint  venture’s income for the period. The increase in the joint  venture earnings for 2003 is primarily the result of in- creased sales. The joint venture investment is eliminated  in consolidation of the Company’s financial statements,  and the activities of Diodes-China are included therein.  As of December 31, 2003, the Company had a 95% con- trolling interest in the joint venture.  The Company generated net income of $10.1 million  (or $0.79 basic earnings per share and $0.70 diluted  earnings per share) in 2003, as compared to $5.8 million  (or $0.47 basic earnings per share and $0.44 diluted  earnings per share) for 2002. This 74.0% increase is due  primarily to the 18.2% sales increase at gross profit  margins of 26.7% compared to gross profit margins of  23.1% in 2002. The Company’s liquidity requirements arise from the  funding of its working capital needs, primarily inven- tory, work-in-process and accounts receivable, as well as  capital expenditures. The Company’s primary sources  for working capital and capital expenditures are cash  flow from operations and borrowings under the Com- pany’s bank credit facilities. Any withdrawal of support  from its banks could have adverse consequences on the  Company’s liquidity. The Company’s liquidity depends,  in part, on customers paying within credit terms, and  any extended delays in payments or changes in credit  terms given to major customers may have an impact  on the Company’s cash flow. In addition, any abnormal  product returns or pricing adjustments may also affect  the Company’s source of short-term funding. At December 31, 2004 the Company had cash and  cash equivalents totaling $19.0 million, an increase of  $6.1 million from December 31, 2003. Cash provided by  operating activities in 2004 was $29.3 million compared  to $18.8 million in 2003 and $20.0 million in 2002. The  primary sources of cash flows from operating activities  in 2004 were net income of $25.6 million and deprecia- tion and amortization of $13.2 million. The primary  sources in 2003 were depreciation and amortization of  $11.1 million and net income of $10.1 million. The pri- mary sources of cash flows from operating activities in  2002 were depreciation and amortization of $9.7 million  and net income of $5.8 million. The primary use of cash  flows from operating activities in 2004 was an increase  in accounts receivable of $13.2 million and an increase  of inventory of $6.1 million. The primary use of cash  flows from operating activities in 2003 was an increase  in accounts receivable of $8.5 million. The primary use  of cash flows from operating activities in 2002 was an  increase in accounts receivable of $4.8 million. For the year ended December 31, 2004, accounts receivable increased 43.2% compared to the 35.6%  increase in sales, as days sales outstanding increased  from 70 to 82 days due primarily to a trend in longer  payment terms, primarily from Far East customers as  well as major distributors. The Company continues to  closely monitor its credit terms, while at times providing  extended terms as required. The ratio of the Company’s  current assets to current liabilities on December 31, 2004  was 2.16 to 1, compared to a ratio of 1.67 to 1 and 1.69 to  1 as of December 31, 2003 and 2002, respectively. Cash used by investing activities was $26.1 million in  2004, compared to $15.3 million in 2003 and $6.8 million  in 2002. The primary investments were for additional  manufacturing equipment and expansion at the Diodes- China and Diodes-Shanghai manufacturing facilities,  and to a lesser extent, for capacity increases at Diodes- FabTech. On December 1, 2000, the Company purchased all the  outstanding capital stock of FabTech Incorporated, a  5-inch wafer foundry located in Lee’s Summit, Missouri  from LSC, the Company’s largest stockholder. The  acquisition purchase price consisted of approximately $5  million in cash, plus FabTech was obligated to repay an  aggregate of approximately $19 million of debt, consist- ing of (i) an approximately $13.6 million note payable  to LSC, (ii) an approximately $2.6 million note payable  to the Company, and (iii) an approximately $3.0 million  note payable to a financial institution (which was repaid  on December 4, 2000 with the proceeds of a capital  contribution by the Company). The acquisition was  financed internally and through bank credit facilities. Financial Condition Liquidity and Capital Resources 23