through its operations in Canada, China, India, South Korea, Mexico, the Philippines, Spain, Taiwan and the United Kingdom. The division sells the company’s product lines and certain non- competing complementary product lines throughout the world. For a local country distributor or dealer, the company is able  to provide a centralized source of foodservice equipment with complete export management and product support services. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The chief decision maker evaluates individual segment performance based on operating income. Management believes that intersegment sales are made at established arms length transfer prices. The following table summarizes the results of operations  for the company’s business segments$^{1}$: ovens. Principal product lines of the core cooking equipment product group include the Southbend product line of ranges, steamers, convection ovens, broilers and steam cooking equip- ment, the Blodgett product line of ranges, convection ovens and combi ovens, MagiKitch’n charbroilers and catering equipment and the Pitco Frialator product line of fryers. The counterline cooking and warming equipment product group includes toasters, hot food servers, foodwarmers and griddles distributed under the Toastmaster brand name. The international specialty equipment product group is primarily comprised of food preparation tables, undercounter refrigeration systems, ventilation systems and component parts for the U.S. manufacturing operations. The International Distribution Division provides integrated design, export management, distribution and installation services Cooking International Corporate (dollars in thousands) Systems Group Distribution and Other (2) Eliminations (3) Total 2004  Net sales  $ 257,510 $ 46,146 — $ (32,541) $ 271,115 Operating income  54,990 1,908 (19,751) (775) 36,372 Depreciation expense  3,267 156 (273) — 3,150 Net capital expenditures  888 197 114 — 1,199 Total assets 177,271 24,439 14,485 (6,520) 209,675 Long-lived assets (4) 121,529 412 3,722 — 125,663 2003  Net sales  $ 229,402 $ 42,698 — $ (29,900) $ 242,200 Operating income  40,968 2,182 (6,491) (1,643) 35,016 Depreciation expense  3,698 148 (263) — 3,583 Net capital expenditures  869 36 98 — 1,003 Total assets 170,233 20,690 6,854 (3,157) 194,620 Long-lived assets (4) 123,910 509 3,234 — 127,653 2002 Net sales  $ 223,675 $ 36,162 — $ (24,690) $ 235,147 Operating income  31,635 1,323 (1,925) (1,302) 29,731 Depreciation expense  4,077 163 (273) — 3,967 Net capital expenditures  647 265 175 — 1,087 Total assets 178,775 22,709 11,009 (4,531) 207,962 Long-lived assets (4) 126,729 459 2,983 — 130,171 (1) Non-operating expenses are not allocated to the operating segments. Non-operating expenses consist of interest expense and deferred financing  amortization, gains and losses on acquisition financing derivatives, and other income and expenses items outside of income from operations. (2) Includes corporate and other general company assets and operations. (3) Includes elimination of intercompany sales, profit in inventory, and intercompany receivables. Intercompany sale transactions are predominantly  from the Cooking Systems Group to the International Distribution Division. (4) Long-lived assets of the Cooking Systems Group includes assets located in the Philippines which amounted to $2,184, $2,379 and  $2,611 in 2004, 2003 and 2002, respectively. 32 MIDDLEBY CORPORATION AND SUBSIDIARIES