Sales in the Company’s industrial business area were up 11 percent for the year as a result of the acquisition of the IFF business. The IFF acquisition contributed approxi- mately $13 million to domestic sales and $0.06 per share to earnings during the year. Sales in the beverage busi- ness area were up seven percent over 2001, due primarily to increased sales of  R.W. Knudsen Family and  Santa Cruz Organic  products.  In the international business area, the Company’s Canadian business continued to perform well, with sales increasing four percent in the local currency. Export sales increased three percent and sales in the Company’s Mexican market increased 22 percent over 2001. Approximately $1.9 million of the $3.5 million increase in international sales was due to the addition of that por- tion of the business acquired from IFF that is located in Brazil. In Australia, the Henry Jones Foods business was up one percent in local currency compared to 2001. The impact of the strong U.S. dollar as compared primarily to the local currencies in Australia, Brazil, and Canada resulted in 2002 sales being approximately $5.4 million less than they would have been had exchange rates remained constant with exchange rates in 2001.  Company operating income was $54.8 million in 2002 com- pared to $49.2 million in 2001, an increase of 11 percent. The gross profit margin was 32.7 percent in 2002, com- pared to 31.8 percent in 2001. The cost of products sold for the majority of the Company’s businesses was consistent with 2001, as raw material costs remained essentially flat. SD&A costs were 24.0 percent of sales, the same as 2001. The dollar increase in SD&A expenses was primarily due to higher amortization charges associated with pre- viously capitalized information systems implementation costs. Marketing expenses were down one percent from 2001, due to lower expenditures in the beverage and con- sumer direct business areas.  Interest expense increased $1.4 million over 2001 as the long-term debt placement that was completed during the second quarter of 2001 was on the books for a full year in 2002. The Company capitalized approximately $0.5 mil- lion in interest during 2002 that was associated with the Company’s information technology reengineering project. Also during the year, the Company entered into interest rate swap agreements in order to manage interest rate exposure and lower financing costs. The interest rate swaps reduced interest expense by approximately  $0.6 million in 2002. Assuming there are no other material acquisitions or other significant investments, the Company believes that cash on hand, together with cash generated by oper- ations and existing lines of credit totaling $120 million, will be sufficient to meet 2004 cash requirements, includ- ing the payment of dividends and interest on outstand- ing debt. Looking towards 2004, capital expenditures are expected to increase to approximately $80 million with the majority of the spending attributed to the cost of the new Uncrustables manufacturing facility currently under con- struction in Scottsville, Kentucky. Other primary uses of cash are dividends, estimated at $46 million next year, and payments related to the Company’s restructuring activities. Cash used for investing activities more than doubled the previous year as 2003 capital expenditures were  $49.5 million, up from $23.5 million in 2002. The Company also incurred approximately $10.8 million of capitalized merger costs. This was in addition to the $10.5 million that was expensed during the year. Cash used for financ- ing also increased significantly due mostly to an increase in the payment of dividends to $0.77 per share, or $33.6 million.  The financial position of the Company continues to be strong, as cash and cash equivalents have increased  to record levels. Cash and cash equivalents increased $89.3 million during the year with cash generated from operations of $166.0 million. The increase in cash is pri- marily the result of strong cash flows generated by the  Jif and  Crisco businesses. The ratio of working capital, less cash and cash equivalents, to sales has also been favor- ably impacted by the merger, decreasing from 15.6 percent last year to 9.0 percent at April 30, 2003.  Capital Resources and Liquidity Financial Condition — Liquidity and Capital Resources Year Ended April 30, (Dollars in thousands) 2003 2002 2001 Net cash provided by operating activities $165,965 $67,000 $88,196 Net cash used for  investing activities 52,979 20,510 27,612 Net cash used for  financing activities 26,784 5,808 32,325 14