Our financial results tell the story of the transformed Timken  Company: We achieved record sales of $5.2 billion in 2011, up 28 percent over last year, far outpacing the broader economy. igniting growth in diverse industrial markets around the world, we increased our Process industries sales by expanding our portfolio with many new products and capabilities. We also drove aftermarket sales to an all-time high, beating by nearly 7 percent the previous record set in 2008. in 2011, we pursued numerous strategic opportunities, investing in resources to serve the high demand and expanding in the critical markets of energy and infrastructure development. in particular, we focused on opportunities where Timken outperforms the competition: in the most challenging In 2000, 96 percent of the company’s Process Industries  sales were from tapered roller bearings. Since then, Timken tripled the segment’s sales and dramatically  diversified its product portfolio. applications and harshest environments, from deep within the Earth to the outer reaches of the universe. The more extreme the engineering challenge, the more grueling the conditions, the more value our customers find in Timken. That value drove record earnings. in 2011, we earned $4.59 per diluted share, which raised our operating income margin to a high of 14.1 percent of sales. The company grew bigger and also substantially stronger. Significant improvements made  across our supply chain allowed us to drive more to the bottom line and manage working capital  more efficiently. With higher cash-generation capacity, we supported strategic acquisitions  and expansion for profitable growth, while also addressing our legacy pension and retiree  medical obligations. Mobile Industries  achieved a record 13.7 percent operating return on $1.8 billion in sales. Despite our concern that some automotive contracts were drawing to a close, we ultimately retained customers and replaced foregone business with a more profitable mix of opportunities in  growing markets. GrOWiNG AND PErFOrMiNG BEYOND ExPECTATiONS  Ward J.Timken, Jr., chairman (left),  and James W. Griffith, president and chief executive officer 2011 Tapered Roller Bearings Spherical Roller Bearings Cylindrical Roller Bearings Housed Units Other Bearings  Services Non-Bearing Products Product Sales 56% 3