Years ended December 31, 2002  2003  2004 Net Sales $115,821,000  $136,905,000  $185,703,000  Cost of Goods Sold 89,111,000  100,377,000  124,968,000  Gross profit  26,710,000  36,528,000  60,735,000  Operating Expenses Selling, general and administrative  16,228,000  19,586,000  23,503,000  Research and development  1,472,000  2,049,000  3,422,000  Impairment of fixed assets  –  1,000,000  – Loss on disposal of fixed assets  43,000  37,000  14,000  Total operating expenses  17,743,000  22,672,000  26,939,000  Income from operations  8,967,000  13,856,000  33,796,000  Other Income (Expenses) Interest expense, net  (1,183,000)  (860,000)  (637,000) Other  67,000  (5,000)  (418,000) Total other expenses  (1,116,000)  (865,000)  (1,055,000) Income before income taxes and minority interest  7,851,000  12,991,000  32,741,000  Income Tax Provision (1,729,000)  (2,460,000)  (6,514,000) Income before minority interest  6,122,000  10,531,000  26,227,000  Minority Interest in Earnings of Joint Venture (320,000)  (436,000)  (676,000) Net Income $ 5,802,000  $ 10,095,000  $ 25,551,000  Earnings Per Share Basic  $ 0.47  $ 0.79  $ 1.91  Diluted  $ 0.44  $ 0.70  $ 1.65  Number of shares used in computation Basic  12,276,899  12,730,808  13,404,276  Diluted  13,297,490  14,406,054  15,471,438  The accompanying notes are an integral part of these financial statements. 29 consolidated statements of income Diodes Incorporated and Subsidiaries