MCCORMICK & COMPANY 2004 ANNUAL REPORT Q&A with Bob Lawless What are your most significant  opportunities to grow sales? I’ve read that Americans are eating out more.  Are they cooking less? How does concern about health and wellness  impact your business?  Costs for many basic food ingredients such as  soy oil and dairy products can fluctuate year to year.  How does this affect your business? On average, we expect to grow sales 5% annually, within a  3-7% range. We do this through innovation, acquisitions and extending our geographic reach. New products will continue to be a vital part of our sales growth. In recent years, at least 10% of annual sales came from new products launched in the prior three years. We continue to pursue acquisitions as an important avenue of growth. Geographically, we are excited about opportunities to further expand our branded products in China and to countries in Europe where we do not yet have a leading share. bread, cereal and wholesome snack foods. All too often, diets that call for low-fat, low-salt or low-calorie are often low in flavor. And that’s where McCormick steps in – to add great taste.  In October 2004, USA Today reported that 77% of meals are made at home based on research conducted by NPD. And the Food Marketing Institute has indicated that 84% of consumers ate a home-cooked meal at least three times a week compared to 74% in 2001. At the same time, Americans would like prepa- ration time to be less than thirty minutes according to Parade Magazine’s “What America Eats” issue. McCormick makes cooking quick and easy with products like GrillMates, seafood sauces, and new seasoning mixes that offer both convenience and great flavor. We’re delivering flavor in new ways too, with grinders, salad products and dessert toppings that add taste at the table.  For many of those occasions when people prefer to eat out, grab a snack or heat up a prepared meal, McCormick continues to deliver the flavor! Through our industrial business, we add taste to the products offered in leading restaurants, food service distributors and food processors. In fact, whether you are at home or eating out you can enjoy something flavored by McCormick. In summary, sales growth will vary year to year based on acquisition activity, foreign currency exchange rates and other factors. However, over time we expect annual sales growth from the following sources: 2-3% from the base business, 1-2% from new products, 1-2% from acquisitions, 0-1% from distribu- tion expansion and 0-1% from pricing actions.  Consumers are invited to visit www.mccormick.com where they will find healthy recipe and meal ideas in our new “Taste for Health” section. As a supplier of a broad range of flavors, McCormick can add taste to a variety of diets. For consumers on a low-carb diet who are eating more meat, poultry and seafood, we provide coatings, marinades and grilling seasonings. If one’s interest is in whole grains, we offer products that flavor We strive to maintain stability in costs and pricing. In our indus- trial business, many customers accept price adjustments that pass through commodity cost changes. In our consumer busi- ness, increases and decreases in the costs of spices, herbs and 16