BLAKE INTERNATIONAL FINANCIAL STATEMENT

INCOME STATEMENTS ($ MILLIONS)

1999 2000

Sales $ 3,481 $ 3,479

Cost of goods sold 2,083 2,109
Gross profit $ 1,398 $ 1,370
Selling, general, and administrative expense 999 1,065
Depreciation 35 40
Operating profit $ 364 $ 265
Interest expense 26 42
Non-operating income/expense 10 15
Special items (72) ###
Pretax income $ 276 $ 238
Total income taxes 100 84
Minority interest 11 15
Net income $ 165 $ 139

BALANCE SHEETS ($ MILLIONS)

1999 2000

ASSETS

Cash and equivalents $ 80 $ 232

Net receivables 507 591
Inventories 635 545
Other current assets 121 95
Total current assets $ 1,343 $ 1,463
Gross, plant, property, and equipment 336 357
Accumulated depreciation 144 172
Net plant, property, and equipment $ 192 $ 185
Other assets 121 138
Total assets $ 1,656 $ 1,786

LIABILITIES
 Long-term debt due in one year $ 1 $ 53
Notes payable 67 33
Accounts payable 166 196
Taxes payable 53 66
Accrued expenses 145 169
Total current liabilities $ 432 $ 517
Long-term debt 254 854
Minority interest 31 34
Other liabilities ― ―
Total liabilities $ 717 $ 1,405

EQUITY

Preferred stock $ 44 $ ―
Common stock 1 1
Retained earnings 1,497 998
Less: treasury stock 603 618
Total equity $ 939 $ 381
Total liabilities and equity $ 1,656 $ 1,786
ANCIAL STATEMENTS, 1999-2003

ENTS ($ MILLIONS)

2001 2002 2003

$ 3,644 $ 3,225 $ 2,900 Sales

2,255 1,997 1,746 Cost of goods sold
$ 1,389 $ 1,228 $ 1,154 Gross profit
1,070 1,043 972 Selling, general, and administ
43 45 43 Depreciation
$ 276 $ 140 $ 139 Operating profit
64 61 50 Interest expense
5 (8) 1 Non-operating income/expens
(59) (34) (62) Special items
$ 158 $ 37 $ 28 Pretax income
12 12 10 Total income taxes
10 1 7 Preferred dividends
$ 136 $ 24 $ 11 Net income

ETS ($ MILLIONS)

2001 2002 2003

ASSETS

$ 210 $ 180 $ 282 Cash and equivalents

562 518 417 Net receivables
564 535 415 Inventories
129 129 129 Prepaid expenses
$ 1,465 $ 1,362 $ 1,243 Other current assets
354 399 422 Total current assets
197 226 244 Gross plant, property, and equ
$ 157 $ 173 $ 178 Accumulated depreciation
134 205 143 Net plant, property, and equip
$ 1,756 $ 1,740 $ 1,564 Intagibles
Other assets
Total assets

LIABILITIES
$ 121 $ 87 $ 185 Long-term debt due in one ye
41 48 28 Notes payable
192 203 154 Accounts payable
4 82 8 Taxes payable
219 192 249 Accrued expenses
$ 577 $ 612 $ 624 Total current liabilities
639 554 370 Long-term debt
33 33 ― Deferred taxes
― ― 41 Other liabilities
$ 1,249 $ 1,199 $ 1,035 Total liabilities

EQUITY

$ ― $ 17 $ ― Common Stock
1 1 1 Capital Surplus
1,124 1,141 1,146 Retained earnings
618 618 618 Total equity
$ 507 $ 541 $ 529 Total liabilities and equity
$ 1,756 $ 1,740 $ 1,564
 SCOTT CORPORATION FINANCIAL STATEMENTS, 1999-2003

INCOME STATEMENTS ($ MILLIONS)

1999 2000 2001

$ 4,761 $ 6,471 $ 9,187

Cost of goods sold 2,806 3,825 5,365
$ 1,955 $ 2,646 $ 3,822
Selling, general, and administrative expense 1,210 1,589 2,304
Depreciation 84 119 158
rating profit $ 661 $ 938 $ 1,360
Interest expense 24 40 55
Non-operating income/expense 24 1 8
Special items (11) ― (18)
$ 650 $ 899 $ 1,295
l income taxes 250 346 499
erred dividends ### ### ###
$ 400 $ 553 $ 796

BALANCE SHEETS ($ MILLIONS)

1999 2000 2001

Cash and equivalents $ 216 $ 262 $ 445

Net receivables 1,053 1,346 1,754
630 931 1,339
Prepaid expenses 74 94 157
Other current assets 73 94 136
l current assets $ 2,046 $ 2,727 $ 3,831
Gross plant, property, and equipment 891 1,047 1,425
Accumulated depreciation 336 404 503
Net plant, property, and equipment $ 555 $ 643 $ 922
496 476 464
Other assets 46 106 144
$ 3,143 $ 3,952 $ 5,361
Long-term debt due in one year $ 32 $ 7 $ 2
Notes payable 397 445 553
Accounts payable 298 455 687
Taxes payable 36 79 54
Accrued expenses 345 481 571
l current liabilities $ 1,108 $ 1,467 $ 1,867
Long-term debt 11 10 296
Deferred taxes 18 2 5
Other liabilities 41 41 37
$ 1,178 $ 1,520 $ 2,205

Common Stock $ 3 $ 3 $ 3
Capital Surplus 123 155 211
Retained earnings 1,839 2,274 2,942
$ 1,965 $ 2,432 $ 3,156
l liabilities and equity $ 3,143 $ 3,952 $ 5,361
NTS, 1999-2003

S)

2002 2003

$ 9,553 $ 8,777
5,881 5,295
$ 3,672 $ 3,482
2,624 2,427
204 218
$ 844 $ 837
67 51
5 (10)
(129) (30)
$ 653 $ 746
253 295
### ###
$ 400 $ 451

2002 2003

$ 109 $ 198
1,674 1,556
1,397 1,199
196 191
157 121
$ 3,533 $ 3,265
1,820 2,002
667 736
$ 1,153 $ 1,266
435 427
276 290
$ 5,397 $ 5,248
$ 2 $ 1
480 419
585 373
29 ―
608 654
$ 1,704 $ 1,447
379 386
― ―
53 80
$ 2,136 $ 1,913

$ 3 $ 3
263 334
2,995 2,998
$ 3,261 $ 3,335
$ 5,397 $ 5,248
 BLAKE INTERNATIONAL FINANCIAL ST

INCOME STATEMENTS ($ MIL

1999 2000

SALES $ 3,481 100.00% $ 3,479

Cost of goods sold $ 2,083 59.84% $ 2,109
Gross profit 1,398 40.16% 1,370
Selling, general, and administrative expense $ 999 28.70% $ 1,065
Depreciation 35 1.01% 40
Interest expense 26 0.75% 42
Non-operating income/expense 10 (0.29)% 15
Special items (72) 2.07% 0
Total income taxes 100 2.87% 84
Minority interest 11 0.32% 15
Net income 165 4.74% 139

BALANCE SHEETS ($ MILLI

1999 2000

ASSETS

Cash and equivalents $ 80 4.83% $ 232

Net receivables 507 30.62% 591
Inventories 635 38.35% 545
Other current assets 121 7.31% 95
Total current assets $ 1,343 81.10% $ 1,463

Gross, plant, property, and equipment $ 336 20.29% $ 357

Accumulated depreciation 144 (8.70)% 172
Net plant, property, and equipment $ 192 11.59% $ 185

Other assets 121 7.31% 138

TOTAL ASSETS $ 1,656 100.00% $ 1,786

LIABILITIES
 Long-term debt due in one year $ 1 0.06% $ 53
Notes payable 67 4.05% 33
Accounts payable 166 10.02% 196
Taxes payable 53 3.20% 66
Accrued expenses 145 8.76% 169

Total current liabilities $ 432 26.09% $ 517

Long-term debt 254 15.34% 854

Minority interest 31 1.87% 34
Other liabilities ― 0.00% ―

TOTAL LIABILITIES $ 717 43.30% $ 1,405

EQUITY

Preferred stock $ 44 2.66% $ ―

Common stock 1 0.06% 1
Retained earnings 1,497 90.40% 998
Less: treasury stock 603 (36.41)% 618

TOTAL EQUITY $ 939 56.70% $ 381

TOTAL LIABILITIES AND EQUITY $ 1,656 100.00% $ 1,786

ONAL FINANCIAL STATEMENTS, 1999-2003

ME STATEMENTS ($ MILLIONS)

2000 2001 2002 2003

100.00% $ 3,644 100.00% $ 3,225 100.00% $ 2,900 100.00%

60.62% $ 2,255 61.88% $ 1,997 61.92% $ 1,746 60.21%
39.38% 1,389 38.12% 1,228 38.08% 1,154 39.79%
30.61% $ 1,070 29.36% $ 1,043 32.34% $ 972 33.52%
1.15% 43 1.18% 45 1.40% 43 1.48%
1.21% 64 1.76% 61 1.89% 50 1.72%
(0.43)% 5 (0.14)% (8) 0.25% 1 (0.03)%
0.00% (59) 1.62% (34) 1.05% (62) 2.14%
2.41% 12 0.33% 12 0.37% 10 0.34%
0.43% 10 0.27% 1 0.03% 7 0.24%
4.00% 136 3.73% 24 0.74% 11 0.38%

ANCE SHEETS ($ MILLIONS)

2000 2001 2002 2003

12.99% $ 210 11.96% $ 180 10.34% $ 282 18.03%

33.09% 562 32.00% 518 29.77% 417 26.66%
30.52% 564 32.12% 535 30.75% 415 26.53%
5.32% 129 7.35% 129 7.41% 129 8.25%
81.91% $ 1,465 83.43% $ 1,362 78.28% $ 1,243 79.48%

19.99% $ 354 20.16% $ 399 22.93% $ 422 26.98%

(9.63)% 197 (11.22)% 226 (12.99)% 244 (15.60)%
10.36% $ 157 8.94% $ 173 9.94% $ 178 11.38%

7.73% 134 7.63% 205 11.78% 143 9.14%

100.00% $ 1,756 100.00% $ 1,740 100.00% $ 1,564 100.00%

 2.97% $ 121 6.89% $ 87 5.00% $ 185 11.83%
1.85% 41 2.33% 48 2.76% 28 1.79%
10.97% 192 10.93% 203 11.67% 154 9.85%
3.70% 4 0.23% 82 4.71% 8 0.51%
9.46% 219 12.47% 192 11.03% 249 15.92%

28.95% $ 577 32.86% $ 612 35.17% $ 624 39.90%

47.82% 639 36.39% 554 31.84% 370 23.66%

1.90% 33 1.88% 33 1.90% ― 0.00%
0.00% ― 0.00% ― 0.00% 41 2.62%

78.67% $ 1,249 71.13% $ 1,199 68.91% $ 1,035 66.18%

0.00% $ ― 0.00% $ 17 0.98% $ ― 0.00%

0.06% 1 0.06% 1 0.06% 1 0.06%
55.88% 1,124 64.01% 1,141 65.57% 1,146 73.27%
(34.60)% 618 (35.19)% 618 (35.52)% 618 (39.51)%

21.33% $ 507 28.87% $ 541 31.09% $ 529 33.82%

100.00% $ 1,756 100.00% $ 1,740 100.00% $ 1,564 100.00%

 SCOTT CORPORATION FINANCIAL ST

INCOME STATEMENTS ($ MILLIO

1999 2000

SALES $ 4,761 100.00% $ 6,471

Cost of goods sold $ 2,806 58.94% $ 3,825
Gross profit 1,955 41.06% 2,646
Selling, general, and administrative expense $ 1,210 25.41% $ 1,589
Depreciation 84 1.76% 119
Interest expense 24 0.50% 40
Non-operating income/expense 24 (0.50)% 1
Special items (11) 0.23% ―
Total income taxes 250 5.25% 346
Preferred dividends 0 0.00% 0
Net income 400 8.40% 553

BALANCE SHEETS ($ MILLIONS

1999 2000

ASSETS

Cash and equivalents $ 216 6.87% $ 262

Net receivables 1,053 33.50% 1,346
Inventories 630 20.04% 931
Prepaid expenses 74 2.35% 94
Other current assets 73 2.32% 94
Total current assets $ 2,046 65.10% $ 2,727

Gross plant, property, and equipment 891 28.35% 1,047

Accumulated depreciation 336 (10.69)% 404
Net plant, property, and equipment $ 555 17.66% $ 643

Intagibles 496 15.78% 476

Other assets 46 1.46% 106

TOTAL ASSETS $ 3,143 100.00% $ 3,952

LIABILITIES
 Long-term debt due in one year $ 32 1.02% $ 7
Notes payable 397 12.63% 445
Accounts payable 298 9.48% 455
Taxes payable 36 1.15% 79
Accrued expenses 345 10.98% 481

Total current liabilities $ 1,108 35.25% $ 1,467

Long-term debt 11 0.35% 10

Deferred taxes 18 0.57% 2
Other liabilities 41 1.30% 41

TOTAL LIABILITIES $ 1,178 37.48% $ 1,520

EQUITY

Common Stock $ 3 0.10% $ 3

Capital Surplus 123 3.91% 155
Retained earnings 1,839 58.51% 2,274
TOTAL EQUITY $ 1,965 62.52% $ 2,432

TOTAL LIABILITIES AND EQUITY $ 3,143 100.00% $ 3,952

TION FINANCIAL STATEMENTS, 1999-2003

TATEMENTS ($ MILLIONS)

2000 2001 2002 2003

100.00% $ 9,187 100.00% $ 9,553 100.00% $ 8,777 100.00%

59.11% $ 5,365 58.40% $ 5,881 61.56% $ 5,295 60.33%
40.89% 3,822 41.60% 3,672 38.44% 3,482 39.67%
24.56% $ 2,304 25.08% $ 2,624 27.47% $ 2,427 27.65%
1.84% 158 1.72% 204 2.14% 218 2.48%
0.62% 55 0.60% 67 0.70% 51 0.58%
(0.02)% 8 (0.09)% 5 (0.05)% (10) (0.11)%
0.00% (18) 0.20% (129) 1.35% (30) 0.34%
5.35% 499 5.43% 253 2.65% 295 3.36%
0.00% 0 0.00% 0 0.00% 0 0.00%
8.55% 796 8.66% 400 4.19% 451 5.14%

E SHEETS ($ MILLIONS)

2001 2002 2003

6.63% $ 445 8.30% $ 109 2.02% $ 198 3.77%

34.06% 1,754 32.72% 1,674 31.02% 1,556 29.65%
23.56% 1,339 24.98% 1,397 25.88% 1,199 22.85%
2.38% 157 2.93% 196 3.63% 191 3.64%
2.38% 136 2.54% 157 2.91% 121 2.31%
69.00% $ 3,831 71.46% $ 3,533 65.46% $ 3,265 62.21%

26.49% 1,425 26.58% 1,820 33.72% 2,002 38.15%

(10.22)% 503 (9.38)% 667 (12.36)% 736 (14.02)%
16.27% $ 922 17.20% $ 1,153 21.36% $ 1,266 24.12%

12.04% 464 8.66% 435 8.06% 427 8.14%

2.68% 144 2.69% 276 5.11% 290 5.53%

100.00% $ 5,361 100.00% $ 5,397 100.00% $ 5,248 100.00%

 0.18% $ 2 0.04% $ 2 0.04% $ 1 0.02%
11.26% 553 10.32% 480 8.89% 419 7.98%
11.51% 687 12.81% 585 10.84% 373 7.11%
2.00% 54 1.01% 29 0.54% ― 0.00%
12.17% 571 10.65% 608 11.27% 654 12.46%

37.12% $ 1,867 34.83% $ 1,704 31.57% $ 1,447 27.57%

0.25% 296 5.52% 379 7.02% 386 7.36%

0.05% 5 0.09% ― 0.00% ― 0.00%
1.04% 37 0.69% 53 0.98% 80 1.52%

38.46% $ 2,205 41.13% $ 2,136 39.58% $ 1,913 36.45%

0.08% $ 3 0.06% $ 3 0.06% $ 3 0.06%

3.92% 211 3.94% 263 4.87% 334 6.36%
57.54% 2,942 54.88% 2,995 55.49% 2,998 57.13%
61.54% $ 3,156 58.87% $ 3,261 60.42% $ 3,335 63.55%

100.00% $ 5,361 100.00% $ 5,397 100.00% $ 5,248 100.00%

 BLAKE INTERNATIONAL FINANCIA

INCOME STATEMENTS (

Increase or (Decrease)
2000 Amount ($) Percent (%)
1999 ($) ($) from base year from base year

Sales 3,481 3,479 (2) (0.06)%

Cost of goods sold 2,083 2,109 26 1.25%

Gross profit 1,398 1,370 (28) (2.00)%

Selling, general, and administrative expense 999 1,065 66 6.61%

Depreciation 35 40 5 14.29%

Operating profit 364 265 (99) (27.20)%

Interest expense 26 42 16 61.54%

Non-operating income/expense 10 15 5 50.00%
Special items (72) ### (72) 100.00%

Pretax income 276 238 (38) (13.77)%

Total income taxes 100 84 (16) (16.00)%

Minority interest 11 15 4 36.36%

Net income 165 139 (26) (15.76)%

TREND AN
Sa l es Gros s profit O

120%

104.68
99.94% 99.36%
100% ###
1999; 100.00% 98.00% 2000
###
Sales ### 99.94%
###
84.24% 82.42%
Gross profit
### 98.00%
###
80%
Operating ###
pro72.80%72.80%
### 75.82%

Net income### 84.24%

###
60%

40%

20%
 60%

40%

20%

0%
1999 2000 2001

BALANCE SHEETS ($ MI

Increase or (Decrease)
2000 Amount ($) Percent (%)
ASSETS 1999 ($) ($) from base year from base year

Cash and equivalents 80 232 152 190.00%

Net receivables 507 591 84 16.57%
Inventories 635 545 (90) (14.17)%
Other current assets 121 95 (26) (21.49)%

Total current assets 1,343 1,463 120 8.94%

Gross, plant, property, and equipment 336 357 21 6.25%

Accumulated depreciation 144 172 28 19.44%

Net plant, property, and equipment 192 185 (7) (3.65)%

Other assets 121 138 17 14.05%

Total assets 1,656 1,786 130 7.85%

Increase or (Decrease)
2000 Amount ($) Percent (%)
LIABILITIES 1999 ($) ($) from base year from base year

Long-term debt due in one year 1 53 52 5200%

Notes payable 67 33 (34) (50.75)%
Accounts payable 166 196 30 18.07%
Taxes payable 53 66 13 24.53%
Accrued expenses 145 169 24 16.55%

Total current liabilities 432 517 85 19.68%

Long-term debt 254 854 600 236.22%
Minority interest 31 34 3 9.68%
Other liabilities ― ― ― ―

Total liabilities 717 1,405 688 95.96%

EQUITY

Preferred stock 44 ― (44) 0.00%

Common stock 1 1 0 0.00%
Retained earnings 1,497 998 (499) (33.33)%
Less: treasury stock 603 618 15 2.49%

Total equity 939 381 (558) (59.42)%

Total liabilities and equity 1,656 1,786 130 7.85%

TIONAL FINANCIAL STATEMENTS, 1999-2003

COME STATEMENTS ($ MILLIONS)

Increase or (Decrease) Increase or (Decrease) Increase or (Decrease)

Amount ($) Percent (%) Amount ($) Percent (%) Amount ($)
2001 ($) from base year from base year 2002 ($) from base year from base year 2003 ($) from base year

3,644 163 4.68% 3,225 (256) (7.35)% 2,900 (581)

2,255 172 8.26% 1,997 (86) (4.13)% 1,746 (337)

1,389 (9) (0.64)% 1,228 (170) (12.16)% 1,154 (244)

1,070 71 7.11% 1,043 44 4.40% 972 (27)

43 8 22.86% 45 10 28.57% 43 8

276 (88) (24.18)% 140 (224) (61.54)% 139 (225)

64 38 146.15% 61 35 134.62% 50 24
5 (5) (50.00)% (8) (2) (20.00)% 1 (9)
(59) (13) (18.06)% (34) (38) (52.78)% (62) (10)

158 (118) (42.75)% 37 (239) (86.59)% 28 (248)

12 (88) (88.00)% 12 (88) (88.00)% 10 (90)

10 (1) (9.09)% 1 (10) (90.91)% 7 (4)

136 (29) (17.58)% 24 (141) (85.45)% 11 (154)

TREND ANALYSIS
a l es Gros s profit Operating profit Net i ncome

104.68%
4% 99.36%
2002
###
92.64%
92.64%
### 87.84%
4% 83.30%
82.55%
### 82.42%
87.84%
0% ### 75.82%
38.46%
14.54%
###

38.46%
38.19%

14.54%
 38.46%
38.19%

14.54%

6.66%

0 2001 2002 2003

BALANCE SHEETS ($ MILLIONS)

Increase or (Decrease) Increase or (Decrease) Increase or (Decrease)

Amount ($) Percent (%) Amount ($) Percent (%) Amount ($)
2001 ($) from base year from base year 2002 ($) from base year from base year 2003 ($) from base year

210 130 162.50% 180 100 125.00% 282 202

562 55 10.85% 518 11 2.17% 417 (90)
564 (71) (11.18)% 535 (100) (15.75)% 415 (220)
129 8 6.61% 129 8 6.61% 129 8

1,465 122 9.08% 1,362 19 1.41% 1,243 (100)

354 18 5.36% 399 63 18.75% 422 86

197 53 36.81% 226 82 56.94% 244 100

157 (35) (18.23)% 173 (19) (9.90)% 178 (14)

134 13 10.74% 205 84 69.42% 143 22

1,756 100 6.04% 1,740 84 5.07% 1,564 (92)

Increase or (Decrease) Increase or (Decrease) Increase or (Decrease)

Amount ($) Percent (%) Amount ($) Percent (%) Amount ($)
2001 ($) from base year from base year 2002 ($) from base year from base year 2003 ($) from base year

121 120 12000% 87 86 8600.00% 185 184

41 (26) (38.81)% 48 (19) (28.36)% 28 (39)
192 26 15.66% 203 37 22.29% 154 (12)
4 (49) (92.45)% 82 29 54.72% 8 (45)
219 74 51.03% 192 47 32.41% 249 104

577 145 33.56% 612 180 41.67% 624 192

 639 385 151.57% 554 300 118.11% 370 116
33 2 6.45% 33 2 6.45% ―
― ― ― ― ― ― 41 41

1,249 532 74.20% 1,199 482 67.22% 1,035 318

― (44) 0.00% 17 (27) (61.36)% ― (44)

1 0 0.00% 1 0 0.00% 1 0
1,124 (373) (24.92)% 1,141 (356) (23.78)% 1,146 (351)
618 15 2.49% 618 15 2.49% 618 15

507 (432) (46.01)% 541 (398) (42.39)% 529 (410)

1,756 100 6.04% 1,740 84 5.07% 1,564 (92)

 SCOTT CORPORATION

INCOME ST

Increase or (Decrease) Increase or (Decrease)

Percent (%) 2000 Amount ($)
from base year 1999 ($) ($) from base year

(16.69)% Sales 4,761 6,471 1,710

(16.18)% Cost Cost of goods sold 2,806 3,825 1,019

(17.45)% Gross profit 1,955 2,646 691

(2.70)% Selling, general, and administrative expense 1,210 1,589 379

22.86% Depreciation 84 119 35

(61.81)% Operating profit 661 938 277

92.31% Interest expense 24 40 16

(90.00)% Non-operating income/expense 24 1 (23)
(13.89)% Special items (11) ― 11

(89.86)% Pretax income 650 899 249

(90.00)% Total income taxes 250 346 96

(36.36)% Preferred dividends ### ### 0

(93.33)% Net income 400 553 153

Sal es

250%

200%

150% 141.91%
135.92%
138.25% 135

100% 1999; 100.00%

50%
 138.25% 135

100% 1999; 100.00%

50%

0%
1999 2000

BALANC

Increase or (Decrease) Increase or (Decrease)

Percent (%) 2000 Amount ($)
from base year ASSETS 1999 ($) ($) from base year

252.50% Cash and equivalents 216 262 46

(17.75)% Net receivables 1,053 1,346 293
(34.65)% Inventories 630 931 301
6.61% Prepaid expenses 74 94 20
Other current assets 73 94 21
(7.45)%

25.60% Total current assets 2,046 2,727 681

69.44%
Gross plant, property, and equipment 891 1,047 156
(7.29)% Accumulated depreciation 336 404 68

18.18% Net plant, property, and equipment 555 643 88

(5.56)% Intagibles 496 476 (20)

Other assets 46 106 60

Total assets 3,143 3,952 809

Increase or (Decrease) Increase or (Decrease)

Percent (%) 2000 Amount ($)
from base year LIABILITIES 1999 ($) ($) from base year

18400% Long-term debt due in one year 32 7 (25)

(58.21)% Notes payable 397 445 48
(7.23)% Accounts payable 298 455 157
(84.91)% Taxes payable 36 79 43
71.72% Accrued expenses 345 481 136

44.44% Total current liabilities 1,108 1,467 359

 45.67% Long-term debt 11 10 (1)
Deferred taxes 18 2 (16)
410.00% Other liabilities 41 41 ―

44.35% Total liabilities 1,178 1,520 342

EQUITY

0.00% Common Stock 3 3 ―

0.00% Capital Surplus 123 155 32
(23.45)% Retained earnings 1,839 2,274 435
2.49%
Total equity 1,965 2,432 467
(43.66)%
Total liabilities and equity 3,143 3,952 809
(5.56)%
CORPORATION FINANCIAL STATEMENTS, 1999-2003

INCOME STATEMENTS ($ MILLIONS)

Increase or (Decrease) Increase or (Decrease) Increase or (Decrease)

Percent (%) Amount ($) Percent (%) Amount ($) Percent (%)
from base year 2001 ($) from base year from base year 2002 ($) from base year from base year 2003 ($)

35.92% 9,187 4,426 92.96% 9,553 4,792 100.65% 8,777

36.32% 5,365 2,559 91.20% 5,881 3,075 109.59% 5,295

35.35% 3,822 1,867 95.50% 3,672 1,717 87.83% 3,482

31.32% 2,304 1,094 90.41% 2,624 1,414 116.86% 2,427

41.67% 158 74 88.10% 204 120 142.86% 218

41.91% 1,360 699 105.75% 844 183 27.69% 837

66.67% 55 31 129.17% 67 43 179.17% 51

(95.83)% 8 (16) (66.67)% 5 19 (79.17)% (10)
100.00% (18) (29) (63.64)% (129) (118) (1073)% (30)

38.31% 1,295 645 99.23% 653 3 0.46% 746

38.40% 499 249 99.60% 253 3 1.20% 295

### 0 0 ### ### 0 ### 0

38.25% 796 396 99.00% 400 0 0.00% 451

TREND ANALYSIS
Sal es Gros s profit Operating profit Net i ncome
### 2000### 2002
###
Sales ### 135.92% ### 200.65%
###
Gross profit### 135.35%### 187.83%
###
Operating pro
### 141.91% ### 127.69%
###
205.75%
200.65%
Net income### 138.25% ### 195.50%
192.96%
100.00%
###
199.00% 187.83% 184.35%
178.11%

141.91%
135.92%
138.25% 135.35% 127.69% 126.63%

112.75%
1999; 100.00% 100.00%
 138.25% 135.35% 127.69% 126.63%

112.75%
1999; 100.00% 100.00%

2000 2001 2002 2003

BALANCE SHEETS ($ MILLIONS)

Increase or (Decrease) Increase or (Decrease) Increase or (Decrease)

Percent (%) Amount ($) Percent (%) Amount ($) Percent (%)
from base year 2001 ($) from base year from base year 2002 ($) from base year from base year 2003 ($)

21.30% 445 229 106.02% 109 (107) (49.54)% 198

27.83% 1,754 701 66.57% 1,674 621 58.97% 1,556
47.78% 1,339 709 112.54% 1,397 767 121.75% 1,199
27.03% 157 83 112.16% 196 122 164.86% 191
28.77% 136 63 86.30% 157 84 115.07% 121

33.28% 3,831 1,785 87.24% 3,533 1,487 72.68% 3,265

17.51% 1,425 534 59.93% 1,820 929 104.26% 2,002

20.24% 503 167 49.70% 667 331 98.51% 736

15.86% 922 367 66.13% 1,153 598 107.75% 1,266

(4.03)% 464 (32) (6.45)% 435 (61) (12.30)% 427

130.43% 144 98 213.04% 276 230 500.00% 290

25.74% 5,361 2,218 70.57% 5,397 2,254 71.71% 5,248

Increase or (Decrease) Increase or (Decrease) Increase or (Decrease)

Percent (%) Amount ($) Percent (%) Amount ($) Percent (%)
from base year 2001 ($) from base year from base year 2002 ($) from base year from base year 2003 ($)

(78.13)% 2 (30) (93.75)% 2 (30) (93.75)% 1

12.09% 553 156 39.29% 480 83 20.91% 419
52.68% 687 389 130.54% 585 287 96.31% 373
119.44% 54 18 50.00% 29 (7) (19.44)% ―
39.42% 571 226 65.51% 608 263 76.23% 654

32.40% 1,867 759 68.50% 1,704 596 53.79% 1,447

 (9.09)% 296 285 2590.91% 379 368 3345.45% 386
(88.89)% 5 (13) (72.22)% ― ― 0.00% ―
0.00% 37 (4) (9.76)% 53 12 29.27% 80

29.03% 2,205 1,027 87.18% 2,136 958 81.32% 1,913

0.00% 3 ― 0.00% 3 ― 0.00% 3

26.02% 211 88 71.54% 263 140 113.82% 334
23.65% 2,942 1,103 59.98% 2,995 1,156 62.86% 2,998

23.77% 3,156 1,191 60.61% 3,261 1,296 65.95% 3,335

25.74% 5,361 2,218 70.57% 5,397 2,254 71.71% 5,248

 Increase or (Decrease)
Amount ($) Percent (%)
from base year from base year

4,016 84.35%
2,489 88.70%

1,527 78.11%

1,217 100.58%
134 159.52%

176 26.63%

27 112.50%
(14) (58.33)%
(19) (172.73)%

96 14.77%

45 18.00%
0 ###

51 12.75%
 Increase or (Decrease)
Amount ($) Percent (%)
from base year from base year

(18) (8.33)%
503 47.77%
569 90.32%
117 158.11%
48
65.75%

1,219 59.58%

1,111 124.69%
400 119.05%

711 128.11%

(69) (13.91)%
244 530.43%

2,105 66.97%

Increase or (Decrease)
Amount ($) Percent (%)
from base year from base year

(31) (96.88)%
22 5.54%
75 25.17%
― 0.00%
309 89.57%

339 30.60%
 375 3409.09%
― 0.00%
39 95.12%

735 62.39%

― 0.00%
211 171.54%
1,159 63.02%

1,370 69.72%

2,105 66.97%
 RATIO ANALYSIS OF FINANCIAL STATEMENTS

SOLVENCY RATIOS

LIQUIDITY RATIO

CURRENT RATIO 1999 2000

Blake International
Current assets $ 1,343 $ 1,463 $
Current liabilities 432 517
Current ratio ### ###

Scott Corporation
Current assets $ 2,046 $ 2,727 $
Current liabilities 1,108 1,467
Current ratio ### ###

QUICK, OR ACID TEST, RATIO 1999 2000

Blake International
Current assets $ 1,343 $ 1,463 $
Inventories 635 545
Current liabilities 432 517
Quick, or acid test, ratio 1.64 1.78

Scott Corporation
Current assets $ 2,046 $ 2,727 $
Inventories 630 931
Current liabilities 1,108 1,467
Quick, or acid test, ratio 1.28 1.22

CASH RATIO 1999 2000

Blake International
Cash and cash equivalents $ 80 $ 232 $
Current liabilities 432 517
Cash ratio 0.19 0.45

Scott Corporation
Cash and cash equivalents $ 216 $ 262 $
Current liabilities 1,108 1,467
Cash ratio 0.19 0.18

TIMES INTEREST EARNED RATIO 1999 2000

Blake International
Operating income $ 364 $ 265 $
Interest Expense 26 42
Times interest earned ratio 14.00 6.31

Scott Corporation
Operating income $ 661 $ 938 $
Interest Expense 24 40
Times interest earned ratio 27.54 23.45

TURNOVER RATIO

RECEIVABLES TURNOVER RATIO 1999 2000

Blake International
Sales $ 3,481 $ 3,479 $
Receivables 507 591
Receivables turnover ratio ### ###

Scott Corporation
Sales $ 4,761 $ 6,471 $
Receivables 1,053 1,346
Receivables turnover ratio ### ###

DAYS RECEIVABLE 1999 2000

Blake International
Receivables $ 507 $ 591 $
Average sales per day 10 10
Days receivable 53 62

Scott Corporation
Receivables $ 1,053 $ 1,346 $
Average sales per day 13 18
Days receivable 81 76

INVENTORY TURNOVER RATIO 1999 2000

Blake International
Cost of goods sold $ 2,083 $ 2,109 $
Inventory 635 545
Inventory turnover ratio 3.28 3.87

Scott Corporation
Cost of goods sold $ 2,806 $ 3,825 $
Inventory 630 931
Inventory turnover ratio 4.45 4.11
DAYS INVENTORY 1999 2000

Blake International
Inventory $ 635 $ 545 $
Average cost of goods sold per day 6 6
Days inventory 111 94

Scott Corporation
Inventory $ 630 $ 931 $
Average cost of goods sold per day 8 10
Days inventory 82 89

ACCOUNTS PAYABLE TURNOVER 1999 2000

Blake International
Cost of goods sold $ 2,083 $ 2,109 $
Beginning inventory ### ###
Ending inventory 635 545
Purchases $ 1,448 $ 1,564 $
Accounts payable 166 196
Accounts payable turnover 8.72 7.98

Scott Corporation
Cost of goods sold $ 2,806 $ 3,825 $
Beginning inventory ### ###
Ending inventory 630 931
Purchases $ 2,176 $ 2,894 $
Accounts payable 298 455
Accounts payable turnover 7.30 6.36

DAYS PAYABLE 1999 2000

Blake International
Accounts payable $ 166 $ 196 $
Average purchases per day 4 4
Days payable 42 46

Scott Corporation
Accounts payable $ 298 $ 455 $
Average purchases per day 6 8
Days payable 50 57

CASH CONVERSION CYCLE 1999 2000

Blake International
Receivable days 53 62
Inventory days 111 94
Payable days 42 46
Cash conversion cycle (days) 123 111

Scott Corporation
Receivable days 81 76
Inventory days 82 89
Payable days 50 57
Cash conversion cycle (days) 113 107
AL STATEMENTS FORMULA

2001 2002 2003

1,465 $ 1,362 $ 1,243

577 612 624
### ### ###
𝑪𝒖𝒓𝒓𝒆𝒏𝒕 𝒓𝒂𝒕𝒊�= (𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑎𝑠𝑠𝑒𝑡𝑠)/(𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠)

3,831 $ 3,533 $ 3,265

1,867 1,704 1,447
### ### ###

2001 2002 2003

1,465 $ 1,362 $ 1,243

564 535 415
577 612 624
1.56 1.35 1.33
■8(𝑸𝒖𝒊𝒄𝒌, �𝒓 𝒂𝒄𝒊𝒅@𝒕𝒆𝒔𝒕, 𝒓𝒂𝒕𝒊�)= (𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑎𝑠𝑠𝑒𝑡𝑠 −𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑖𝑒𝑠)/(𝐶𝑢𝑟𝑟𝑒

3,831 $ 3,533 $ 3,265

1,339 1,397 1,199
1,867 1,704 1,447
1.33 1.25 1.43

2001 2002 2003

210 $ 180 $ 282

577 612 624
0.36 0.29 0.45
𝑪𝒂𝒔𝒉 𝒓𝒂𝒕𝒊�= (𝐶𝑎𝑠ℎ 𝑎𝑛𝑑 𝑐𝑎𝑠ℎ 𝑒𝑞𝑢𝑖𝑣𝑎𝑙𝑒𝑛𝑡𝑠)/(𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖

445 $ 109 $ 198

1,867 1,704 1,447
0.24 0.06 0.14

2001 2002 2003

 276 $ 140 $ 139
64 61 50
4.31 2.30 2.78
■8(𝑻𝒊𝒎𝒆𝒔 𝒊𝒏𝒕𝒆𝒓𝒆𝒔𝒕@𝒆𝒂𝒓𝒏𝒆𝒅 𝒓𝒂𝒕𝒊�)= (𝑂𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝑖𝑛𝑐𝑜𝑚𝑒)/(𝐼𝑛𝑡𝑒𝑟𝑒

1,360 $ 844 $ 837

55 67 51
24.73 12.60 16.41

2001 2002 2003

3,644 $ 3,225 $ 2,900

562 518 417
### ### ###
■8(𝑹𝒆𝒄𝒆𝒊𝒗𝒂𝒃𝒍𝒆𝒔@𝑻𝒖𝒓𝒏�𝒗𝒆𝒓)= 𝑆𝑎𝑙𝑒𝑠/𝑅𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒𝑠

9,187 $ 9,553 $ 8,777

1,754 1,674 1,556
### ### ###

2001 2002 2003

562 $ 518 $ 417 ■8(𝑨𝒗𝒆𝒓𝒂𝒈𝒆 𝒔𝒂𝒍𝒆𝒔@𝒑𝒆𝒓 𝒅𝒂𝒚)= (𝐴𝑛𝑛𝑢𝑎𝑙 𝑆𝑎𝑙𝑒𝑠)/365

10 9 8
56 59 52

■8(𝑫𝒂𝒚𝒔@𝑹𝒆𝒄𝒆𝒊𝒗𝒂𝒃𝒍𝒆)= 𝑅𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒𝑠/(𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑠𝑎𝑙𝑒𝑠 𝑝𝑒𝑟

1,754 $ 1,674 $ 1,556
25 26 24
70 64 65

2001 2002 2003

2,255 $ 1,997 $ 1,746

564 535 415
4.00 3.73 4.21
■8(𝑰𝒏𝒗𝒆𝒏𝒕�𝒓𝒚@𝑻𝒖𝒓𝒏�𝒗𝒆𝒓)= (𝐶𝑜𝑠𝑡 𝑜𝑓 𝑔𝑜𝑜𝑑𝑠 𝑠𝑜𝑙𝑑)/𝐼𝑛𝑣𝑒𝑛

5,365 $ 5,881 $ 5,295

1,339 1,397 1,199
4.01 4.21 4.42
2001 2002 2003

564 $ 535 $ ■8(𝑨𝒗𝒆𝒓𝒂𝒈𝒆 𝒄�𝒔𝒕 �𝒇@𝒈��𝒅𝒔 𝒔�𝒍𝒅 𝒑𝒆𝒓 𝒅𝒂𝒚)= ■(𝐴𝑛𝑛𝑢𝑎𝑙 𝑐𝑜𝑠𝑡 𝑜𝑓 @𝑔
415
6 5 5
91 98 87

1,339 $ 1,397 $ 1,199 ■8(𝑫𝒂𝒚𝒔@𝒊𝒏𝒗𝒆𝒏𝒕�𝒓𝒚)= 𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦/■(𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑔𝑜𝑜𝑙𝑑𝑠@𝑠𝑜

15 16 15
91 87 83

2001 2002 2003

2,255 $ 1,997 $ 𝑷𝒖𝒓𝒄𝒉𝒂𝒔𝒆𝒔=■8(𝐶𝑜𝑠𝑡

1,746 𝑜𝑓 𝑔𝑜𝑜𝑑𝑠 𝑠𝑜𝑙𝑑@■(+ 𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 𝑝𝑟𝑒𝑣. 𝑦𝑒𝑎𝑟 @− 𝑖𝑛𝑣𝑒𝑛𝑡
### ### ###
564 535 415
1,691 $ 1,462 $ 1,331
192 203 154
8.81 7.20 8.64

■8(𝑨𝒄𝒄�𝒖𝒏𝒕𝒔 𝒑𝒂𝒚𝒂𝒃𝒍𝒆@𝑻𝒖𝒓𝒏�𝒗𝒆𝒓)= 𝑃𝑢𝑟𝑐ℎ𝑎𝑠𝑒𝑠/(𝐴𝑐𝑐𝑜𝑢𝑛𝑡𝑠 𝑝

5,365 $ 5,881 $ 5,295

### ### ###
1,339 1,397 1,199
4,026 $ 4,484 $ 4,096
687 585 373
5.86 7.66 10.98

2001 2002 2003

192 $ 203 $ 154 ■8(𝑨𝒗𝒆𝒓𝒂𝒈𝒆 𝒑𝒖𝒓𝒄𝒉𝒂𝒔𝒆𝒔@𝒑𝒆𝒓 𝒅𝒂𝒚)= (𝐴𝑛𝑛𝑢𝑎𝑙 𝑝𝑢𝑟𝑐ℎ𝑎𝑠𝑒𝑠)

5 4 4
41 51 42

■8(𝑫𝒂𝒚𝒔@𝒑𝒂𝒚𝒂𝒃𝒍𝒆)= (𝐴𝑐𝑐𝑜𝑢𝑛𝑡𝑠 𝑝𝑎𝑦𝑎𝑏𝑙𝑒)/(𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑝𝑢𝑟𝑐ℎ𝑎𝑠𝑒𝑠

687 $ 585 $ 373
11 12 11
62 48 33

2001 2002 2003

56 59 52
91 98 87
41 51 42
■8(𝑪𝒂𝒔𝒉 𝒄�𝒏𝒗𝒆𝒓𝒔𝒊�𝒏@𝒄𝒚𝒄𝒍𝒆)=■8( 𝑅𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒 𝑑𝑎𝑦𝑠@■( + 𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 𝑑
 ■8(𝑪𝒂𝒔𝒉 𝒄�𝒏𝒗𝒆𝒓𝒔𝒊�𝒏@𝒄𝒚𝒄𝒍𝒆)=■8( 𝑅𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒 𝑑𝑎𝑦𝑠@■( + 𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 𝑑
106 106 97

70 64 65
91 87 83
62 48 33
98 103 114
A

CONTENTS:
SOLVENCY RATIO
- Liquidity ratio
Current ratio
Quick ratio
Cash ratio
- Turnover ratio
Receivables turnover ratio
Days receivable
Inventory turnover ratio
Days inventory
Accounts payable turnover ratio
Days payable
Cash conversion cycle
OPERATING PERFORMANCE
𝑠)/(𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠)

𝑒𝑡𝑠 −𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑖𝑒𝑠)/(𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠)

𝑒𝑛𝑡𝑠)/(𝐶𝑢𝑟𝑟𝑒𝑛𝑡 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠)
𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝑖𝑛𝑐𝑜𝑚𝑒)/(𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 𝑒𝑥𝑝𝑒𝑛𝑠𝑒)

𝒓)= 𝑆𝑎𝑙𝑒𝑠/𝑅𝑒𝑐𝑒𝑖𝑣𝑎𝑏𝑙𝑒𝑠

= (𝐴𝑛𝑛𝑢𝑎𝑙 𝑆𝑎𝑙𝑒𝑠)/365

𝑙𝑒𝑠/(𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑠𝑎𝑙𝑒𝑠 𝑝𝑒𝑟 𝑑𝑎𝑦)

𝑠𝑡 𝑜𝑓 𝑔𝑜𝑜𝑑𝑠 𝑠𝑜𝑙𝑑)/𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦
= ■(𝐴𝑛𝑛𝑢𝑎𝑙 𝑐𝑜𝑠𝑡 𝑜𝑓 @𝑔𝑜𝑜𝑑𝑠 𝑠𝑜𝑙𝑑)/365

𝑟𝑎𝑔𝑒 𝑐𝑜𝑠𝑡 𝑜𝑓 𝑔𝑜𝑜𝑙𝑑𝑠@𝑠𝑜𝑙𝑑 𝑝𝑒𝑟 𝑑𝑎𝑦)

𝑝𝑟𝑒𝑣. 𝑦𝑒𝑎𝑟 @− 𝑖𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 𝑐𝑢𝑟𝑟𝑒𝑛𝑡 𝑦𝑒𝑎𝑟))

𝑃𝑢𝑟𝑐ℎ𝑎𝑠𝑒𝑠/(𝐴𝑐𝑐𝑜𝑢𝑛𝑡𝑠 𝑝𝑎𝑦𝑎𝑏𝑙𝑒)

= (𝐴𝑛𝑛𝑢𝑎𝑙 𝑝𝑢𝑟𝑐ℎ𝑎𝑠𝑒𝑠)/365

𝑒)/(𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝑝𝑢𝑟𝑐ℎ𝑎𝑠𝑒𝑠 𝑝𝑒𝑟 𝑑𝑎𝑦)

𝑦𝑠@■( + 𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 𝑑𝑎𝑦𝑠@− 𝑃𝑎𝑦𝑎𝑏𝑙𝑒 𝑑𝑎𝑦𝑠))

𝑦𝑠@■( + 𝐼𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 𝑑𝑎𝑦𝑠@− 𝑃𝑎𝑦𝑎𝑏𝑙𝑒 𝑑𝑎𝑦𝑠))
 RATIO ANALYSIS OF FINANCIAL STATEMENTS

OPERATING PERFORMANCE

OPERATING EFFICIENCY RATIOS

TOTAL ASSET TURNOVER RATIO 1999 2000 2001

Blake International
Total sales $ 3,481 $ 3,479 $ 3,644
Total assets 1,656 1,786 1,756
Asset turnover ratio 2.10 1.95 2.08

Scott Corporation
Total sales $ 4,761 $ 6,471 $ 9,187
Total assets 3,143 3,952 5,361
Asset turnover ratio 1.51 1.64 1.71

NET FIXED ASSET TURNOVER RATIO 1999 2000 2001

Blake International
Total sales $ 3,481 $ 3,479 $ 3,644
Net fixed assets 192 185 157
Net fixed asset turnover ratio 18.13 18.81 23.21

Scott Corporation
Total sales $ 4,761 $ 6,471 $ 9,187
Net fixed assets 555 643 922
Net fixed asset turnover ratio 8.58 10.06 9.96

EQUITY TURNOVER RATIO 1999 2000 2001

Blake International
Total sales $ 3,481 $ 3,479 $ 3,644
Shareholder's equity 939 381 507
Equity turnover ratio 3.71 9.13 7.19

Scott Corporation
Total Sales $ 4,761 $ 6,471 $ 9,187
Shareholder's equity 1,965 2,432 3,156
Equity turnover ratio 2.42 2.66 2.91
 OPERATING PROFITABILITY RATIOS

GROSS PROFIT MARGIN 1999 2000 2001

Blake International
Gross profit $ 1,398 $ 1,370 $ 1,389
Sales 3,481 3,479 3,644
Gross profit margin 40.16% 39.38% 38.12%

Scott Corporation
Gross profit $ 1,955 $ 2,646 $ 3,822
Sales 4,761 6,471 9,187
Gross profit margin 41.06% 40.89% 41.60%

OPERATING PROFIT MARGIN 1999 2000 2001

Blake International
Operating profit $ 364 $ 265 $ 276
Sales 3,481 3,479 3,644
Operating profit margin 10.46% 7.62% 7.57%

Scott Corporation
Operating profit $ 661 $ 938 $ 1,360
Sales 4,761 6,471 9,187
Operating profit margin 13.88% 14.50% 14.80%

NET MARGIN 1999 2000 2001

Blake International
Net income $ 165 $ 139 $ 136
Sales 3,481 3,479 3,644
Net margin 4.74% 4.00% 3.73%

Scott Corporation
Net income $ 400 $ 553 $ 796
Sales 4,761 6,471 9,187
Net margin 8.40% 8.55% 8.66%

OPERATING INCOME ROI 1999 2000 2001

Blake International
Operating income $ 364 $ 265 $ 276
Total assets 1,656 1,786 1,756
Operating income return on investment 0.22 0.15 0.16
Scott Corporation
Operating income $ 661 $ 938 $ 1,360
Total assets 3,143 3,952 5,361
Operating income return on investment 0.21 0.24 0.25

RETURN ON TOTAL ASSETS 1999 2000 2001

Blake International
Net income $ 165 $ 139 $ 136
Total assets 1,656 1,786 1,756
Return on total assets 0.10 0.08 0.08

Scott Corporation
Net income $ 400 $ 553 $ 796
Total assets 3,143 3,952 5,361
Return on total assets 0.13 0.14 0.15

RETURN ON TOTAL EQUITY 1999 2000 2001

Blake International
Net income $ 165 $ 139 $ 136
Total equity 939 381 507
Return on total equity 0.18 0.36 0.27

Scott Corporation
Net income $ 400 $ 553 $ 796
Total equity 1,965 2,432 3,156
Return on total equity 0.20 0.23 0.25

RETURN ON EQUITY 1999 2000 2001

Blake International
Net income $ 165 $ 139 $ 136
Shareholder's equity 939 381 507
Return on equity 0.18 0.36 0.27

Scott Corporation
Net income $ 400 $ 553 $ 796
Shareholder's equity 1,965 2,432 3,156
Return on equity 0.20 0.23 0.25

THE DUPONT FORMULA

DUPONT FORMULA - RETURN ON EQUITY 1999 2000 2001

Blake International
Net income $ 165 $ 139 $ 136
Sales 3,481 3,479 3,644
Total assets 1,656 1,786 1,756
Shareholder's equity 939 381 507
Return on equity 0.18 0.36 0.27

Scott Corporation
Net income $ 400 $ 553 $ 796
Sales 4,761 6,471 9,187
Total assets 3,143 3,952 5,361
Shareholder's equity 1,965 2,432 3,156
Return on equity 0.20 0.23 0.25
TEMENTS FORMULA

2002 2003

$ 3,225 $ 2,900
1,740 1,564
1.85 1.85
■8(𝑻�𝒕𝒂𝒍 𝑨𝒔𝒔𝒆𝒕𝒔@𝑻𝒖𝒓𝒏�𝒗𝒆𝒓)= (𝑇𝑜𝑡𝑎𝑙 𝑆𝑎𝑙𝑒𝑠)/(𝑇𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠)

$ 9,553 $ 8,777
5,397 5,248
1.77 1.67

2002 2003

$ 3,225 $ 2,900
173 178
18.64 16.29
■8(𝑵𝒆𝒕 𝒇𝒊𝒙𝒆𝒅 𝑨𝒔𝒔𝒆𝒕𝒔@𝑻𝒖𝒓𝒏�𝒗𝒆𝒓)= (𝑇𝑜𝑡𝑎𝑙 𝑆𝑎𝑙𝑒𝑠)/(𝑁𝑒𝑡 𝑓𝑖𝑥𝑒𝑑 𝑎𝑠𝑠𝑒𝑡𝑠)

$ 9,553 $ 8,777
1,153 1,266
8.29 6.93

2002 2003

$ 3,225 $ 2,900
541 529 ■8(𝑬𝒒𝒖𝒊𝒕𝒚@𝑻𝒖𝒓𝒏�𝒗𝒆𝒓)= (𝑇𝑜𝑡𝑎𝑙 𝑆𝑎𝑙𝑒𝑠)/(𝑆ℎ𝑎𝑟𝑒ℎ𝑜𝑙𝑑𝑒𝑟^′ 𝑠 𝑒𝑞𝑢𝑖𝑡𝑦)
5.96 5.48

$ 9,553 $ 8,777
3,261 3,335
2.93 2.63
IOS

2002 2003

$ 1,228 $ 1,154
3,225 2,900
38.08% 39.79% ■8(𝑮𝒓�𝒔𝒔 𝒑𝒓�𝒇𝒊𝒕@𝑴𝒂𝒓𝒈𝒊𝒏)= (𝐺𝑟𝑜𝑠𝑠 𝑝𝑟𝑜𝑓𝑖𝑡)/𝑆𝑎𝑙𝑒𝑠

$ 3,672 $ 3,482
9,553 8,777
38.44% 39.67%

2002 2003

$ 140 $ 139
3,225 2,900
4.34% 4.79% ■8(𝑶𝒑𝒆𝒓𝒂𝒕𝒊𝒏𝒈 𝒑𝒓�𝒇𝒊𝒕@𝑴𝒂𝒓𝒈𝒊𝒏)= (𝑂𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝑝𝑟𝑜𝑓𝑖𝑡)/𝑆𝑎𝑙𝑒𝑠

$ 844 $ 837
9,553 8,777
8.83% 9.54%

2002 2003

$ 24 $ 11
3,225 2,900
0.74% 0.38% ■8(𝑵𝒆𝒕@𝑴𝒂𝒓𝒈𝒊𝒏)= (𝑁𝑒𝑡 𝑖𝑛𝑐𝑜𝑚𝑒)/𝑆𝑎𝑙𝑒𝑠

$ 400 $ 451
9,553 8,777
4.19% 5.14%

2002 2003

$ 140 $ 139
1,740 1,564
0.08 0.09
■8(𝑶𝒑𝒆𝒓𝒂𝒕𝒊𝒏𝒈 𝒊𝒏𝒄�𝒎𝒆@𝒓𝒆𝒕𝒖𝒓𝒏 �𝒏 𝒊𝒏𝒗𝒆𝒔𝒕𝒎𝒆𝒏𝒕)= (𝑂𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝑖𝑛𝑐𝑜𝑚𝑒)/(𝑇𝑜𝑡𝑎𝑙 𝑎𝑠
 ■8(𝑶𝒑𝒆𝒓𝒂𝒕𝒊𝒏𝒈 𝒊𝒏𝒄�𝒎𝒆@𝒓𝒆𝒕𝒖𝒓𝒏 �𝒏 𝒊𝒏𝒗𝒆𝒔𝒕𝒎𝒆𝒏𝒕)= (𝑂𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝑖𝑛𝑐𝑜𝑚𝑒)/(𝑇𝑜𝑡𝑎𝑙 𝑎𝑠

$ 844 $ 837
5,397 5,248
0.16 0.16

2002 2003

$ 24 $ 11
1,740 1,564
0.01 0.01
■8(𝑹𝒆𝒕𝒖𝒓𝒏 �𝒏@𝑻�𝒕𝒂𝒍 𝒂𝒔𝒔𝒆𝒕𝒔)= (𝑁𝑒𝑡 𝑖𝑛𝑐𝑜𝑚𝑒)/(𝑇𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠)

$ 400 $ 451
5,397 5,248
0.07 0.09

2002 2003

$ 24 $ 11
541 529
0.04 0.02
■8(𝑹𝒆𝒕𝒖𝒓𝒏 �𝒏@𝑻�𝒕𝒂𝒍 𝒆𝒒𝒖𝒊𝒕𝒚)= (𝑁𝑒𝑡 𝑖𝑛𝑐𝑜𝑚𝑒)/(𝑇𝑜𝑡𝑎𝑙 𝑒𝑞𝑢𝑖𝑡𝑦)

$ 400 $ 451
3,261 3,335
0.12 0.14

2002 2003

$ 24 $ 11
541 529
0.04 0.02
■8(𝑹𝒆𝒕𝒖𝒓𝒏 �𝒏@𝑬𝒒𝒖𝒊𝒕𝒚)= (𝑁𝑒𝑡 𝑖𝑛𝑐𝑜𝑚𝑒)/(𝑆ℎ𝑎𝑟𝑒ℎ𝑜𝑙𝑑𝑒𝑟^′ 𝑠 𝑒𝑞𝑢𝑖𝑡𝑦)

$ 400 $ 451
3,261 3,335
0.12 0.14
 2002 2003
𝑹𝑶𝑬= (𝑁𝑒𝑡 𝑖𝑛𝑐𝑜𝑚𝑒)/𝑆𝑎𝑙𝑒𝑠 𝑥 𝑆𝑎𝑙𝑒𝑠/(𝑇𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠) 𝑥 (𝑇𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠)/■(𝐴𝑣𝑒𝑟𝑎𝑔𝑒@𝑠ℎ𝑎𝑟𝑒ℎ𝑜𝑙𝑑𝑒𝑟^′ 𝑠@

$ 24 $ 11
3,225 2,900
1,740 1,564
541 529
0.04 0.02

$ 400 $ 451
9,553 8,777
5,397 5,248
3,261 3,335
0.12 0.14
/(𝑇𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠)

(𝑁𝑒𝑡 𝑓𝑖𝑥𝑒𝑑 𝑎𝑠𝑠𝑒𝑡𝑠)

𝑜𝑙𝑑𝑒𝑟^′ 𝑠 𝑒𝑞𝑢𝑖𝑡𝑦)
𝑔 𝑝𝑟𝑜𝑓𝑖𝑡)/𝑆𝑎𝑙𝑒𝑠

𝑡𝑖𝑛𝑔 𝑖𝑛𝑐𝑜𝑚𝑒)/(𝑇𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠)

𝑡𝑖𝑛𝑔 𝑖𝑛𝑐𝑜𝑚𝑒)/(𝑇𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠)

(𝑇𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠)

)/(𝑇𝑜𝑡𝑎𝑙 𝑒𝑞𝑢𝑖𝑡𝑦)

𝑜𝑙𝑑𝑒𝑟^′ 𝑠 𝑒𝑞𝑢𝑖𝑡𝑦)
𝑒𝑟𝑎𝑔𝑒@𝑠ℎ𝑎𝑟𝑒ℎ𝑜𝑙𝑑𝑒𝑟^′ 𝑠@𝑒𝑞𝑢𝑖𝑡𝑦)
 RATIO ANALYSIS OF FINANCIAL STATEMENTS

RISK ANALYSIS

BUSINESS RISK

OPERATING LEVERAGE 1999 2000 2001

Blake International
% change in Operating income ― -27.20% 24.18%
% change in Sales ― -0.06% 4.68%
Operating leverage ― 473.38 5.16

Scott Corporation
% change in Operating income ― 41.91% 105.75%
% change in Sales ― 35.92% 92.96%
Operating leverage ― 1.17 1.14

FINANCIAL LEVERAGE 1999 2000 2001

Blake International
% change in Net income ― -15.76% -17.58%
% change in Operating income ― -27.20% -24.18%
Financial leverage ― 0.58 0.73

Scott Corporation
% change in Net income ― 38.25% 99.00%
% change in Operating income ― 41.91% 105.75%
Financial leverage ― 0.91 0.94

TOTAL LEVERAGE 1999 2000 2001

Blake International
% change in Net income ― 15.76% 17.58%
% change in sales ― 0.06% 4.68%
Total leverage ― 274.26 3.75

Scott Corporation
% change in Net income ― 38.25% 99.00%
% change in sales ― 35.92% 92.96%
Total leverage ― 1.06 1.06
 FINANCIAL RISK

DEBT RATIO 1999 2000 2001

Blake International
Total liabilities $ 717 $ 1,405 $ 1,249
Total assets 1,656 1,786 1,756
Debt ratio 0.43 0.79 0.71

Scott Corporation
Total liabilities $ 1,178 $ 1,520 $ 2,205
Total assets 3,143 3,952 5,361
Debt ratio 0.37 0.38 0.41

DEBT TO EQUITY RATIO 1999 2000 2001

Blake International
Total debt $ 255 $ 907 $ 760
Shareholder's equity 939 381 507
Debt to equity ratio 0.27 2.38 1.50

Scott Corporation
Total debt $ 43 $ 17 $ 298
Shareholder's equity 1,965 2,432 3,156
Debt to equity ratio 0.02 0.01 0.09

INTEREST COVERAGE 1999 2000 2001

Blake International
Net income $ 165 $ 139 $ 136
Interest expense 26 42 64
Interest coverage 6.35 3.31 2.13

Scott Corporation
Net income $ 400 $ 553 $ 796
Interest expense 24 40 55
Interest coverage 16.67 13.83 14.47
ATEMENTS FORMULAS

2002 2003

-61.54% -61.81%
-7.35% -16.69%
8.37 3.70
■8(𝑶𝒑𝒆𝒓𝒂𝒕𝒊𝒏𝒈@𝒍𝒆𝒗𝒆𝒓𝒂𝒈𝒆)= (% 𝑐ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝑂𝑝𝑒𝑟𝑎𝑡𝑖𝑛𝑔 𝑖𝑛𝑐𝑜𝑚𝑒)/(% 𝑐ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝑆𝑎

27.69% 26.63%
100.65% 84.35%
0.28 0.32

2002 2003

-85.45% -93.33%
-61.54% -61.81%
■8(𝑭𝒊𝒏𝒂𝒏𝒄𝒊𝒂𝒍@𝒍𝒆𝒗𝒆𝒓𝒂𝒈𝒆)= (% 𝑐ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝑁𝑒𝑡 𝑖𝑛𝑐𝑜𝑚𝑒)/(% �ℎ���� �� ��������� ���
1.39 1.51

0.00% 12.75%
27.69% 26.63%
### 0.48

2002 2003

85.45% 93.33%
7.35% 16.69%
11.62 5.59 ■8(𝑻�𝒕𝒂𝒍@𝒍𝒆𝒗𝒆𝒓𝒂𝒈𝒆)= (% 𝑐ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝑁𝑒𝑡 𝑖𝑛𝑐𝑜𝑚𝑒)/(% �ℎ���� �� 𝑆𝑎𝑙𝑒𝑠)

0.00% 12.75%
100.65% 84.35%
### 0.15
 2002 2003

$ 1,199 $ 1,035
1,740 1,564
0.69 0.66 ■8(𝑫𝒆𝒃𝒕 @𝑹𝒂𝒕𝒊�)= (𝑇𝑜𝑡𝑎𝑙 𝑎𝑠𝑠𝑒𝑡𝑠)/(𝑇𝑜𝑡𝑎𝑙 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠)

$ 2,136 $ 1,913
5,397 5,248
0.40 0.36

2002 2003

$ 641 $ 555
541 529
1.18 1.05 ■8(𝑫𝒆𝒃𝒕 𝒕� 𝒆𝒒𝒖𝒊𝒕𝒚@𝒓𝒂𝒕𝒊�)= (𝑇𝑜𝑡𝑎𝑙 𝑑𝑒𝑏𝑡)/(𝑆ℎ𝑎𝑟𝑒ℎ𝑜𝑙𝑑𝑒𝑟^′ 𝑠 𝑒𝑞𝑢𝑖𝑡𝑦)

$ 381 $ 387
3,261 3,335
0.12 0.12

2002 2003

$ 24 $ 11
61 50
0.39 0.22 ■8(𝑰𝒏𝒕𝒆𝒓𝒆𝒔𝒕@𝑪�𝒗𝒆𝒓𝒂𝒈𝒆)= (𝑁𝑒𝑡 𝑖𝑛𝑐𝑜𝑚𝑒)/(𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡 𝑒𝑥𝑝𝑒𝑛𝑠𝑒)

$ 400 $ 451
67 51
5.97 8.84
𝑐𝑜𝑚𝑒)/(% 𝑐ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝑆𝑎𝑙𝑒𝑠)

% �ℎ���� �� ��������� ������)

/(% �ℎ���� �� 𝑆𝑎𝑙𝑒𝑠)

𝑎𝑙 𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑖𝑒𝑠)

𝑟𝑒ℎ𝑜𝑙𝑑𝑒𝑟^′ 𝑠 𝑒𝑞𝑢𝑖𝑡𝑦)

𝑛𝑡𝑒𝑟𝑒𝑠𝑡 𝑒𝑥𝑝𝑒𝑛𝑠𝑒)
 BLAKE INTERNATIONAL FINANCIAL STATEMENTS, 1999-2003

FINANCIAL STATEMENT ANALYSIS - SOLVENCY

1999 2000 2001 2002 2003

LIQUIDITY RATIOS
Current ratio 3.11 2.83 2.54 2.23 1.99
Quick, or acid test, ratio 1.64 1.78 1.56 1.35 1.33
Cash ratio 0.19 0.45 0.36 0.29 0.45
Times interest earned ratio 14.00 6.31 4.31 2.30 2.78

TURNOVER RATIOS
Receivables turnover ratio 6.87 5.89 6.48 6.23 6.95
Days receivable (ACP) 53 62 56 59 52
Inventory turnover ratio 3.28 3.87 4.00 3.73 4.21
Days inventory 111 94 91 98 87
Accounts payable turnover ratio 8.72 7.98 8.81 7.20 8.64
Days payable 42 46 41 51 42
Cash conversion cycle 123 111 106 106 97

FINANCIAL STATEMENT ANALYSIS - PERFORMANCE

1999 2000 2001 2002 2003

OPERATING EFFICIENCY RATIOS

Total asset turnover ratio 2.10 1.95 2.08 1.85 1.85
Net fixed asset turnover ratio 18.13 18.81 23.21 18.64 16.29
Equity turnover ratio 3.71 9.13 7.19 5.96 5.48

OPERATING PROFITABILITY RATIOS

Gross profit margin 40.16% 39.38% 38.12% 38.08% 39.79%
Operating profit margin 10.46% 7.62% 7.57% 4.34% 4.79%
Net margin 4.74% 4.00% 3.73% 0.74% 0.38%
Operating income ROI 0.22 0.15 0.16 0.08 0.09
Return on total assets 0.10 0.08 0.08 0.01 0.01
Return on total equity 0.18 0.36 0.27 0.04 0.02
Return on equity 0.18 0.36 0.27 0.04 0.02
Dupont Formula - ROE 0.18 0.36 0.27 0.04 0.02
 FINANCIAL STATEMENT ANALYSIS - RISK

1999 2000 2001 2002 2003

BUSINESS RISK
Operating leverage ― 473.4 5.16 8.37 3.70
Financial leverage ― 0.58 0.73 1.39 1.51
Total leverage ― 274.3 3.75 11.62 5.59

FINANCIAL RISK
Debt ratio 0.43 0.79 0.71 0.69 0.66
Debt to equity ratio 0.27 2.38 1.50 1.18 1.05
Interest coverage 6.35 3.31 2.13 0.39 0.22
 SCOTT CORPORATION FINANCIAL STATEMENTS, 1999-2003

FINANCIAL STATEMENT ANALYSIS - SOLVENCY

1999 2000 2001 2002 2003

LIQUIDITY RATIOS
Current ratio 1.85 1.86 2.05 2.07 2.26
Quick, or acid test, ratio 1.28 1.22 1.33 1.25 1.43
Cash ratio 0.19 0.18 0.24 0.06 0.14
Times interest earned ratio 27.54 23.45 24.73 12.60 16.41

TURNOVER RATIOS
Receivables turnover ratio 4.52 4.81 5.24 5.71 5.64
Days receivable (ACP) 81 76 70 64 65
Inventory turnover ratio 4.45 4.11 4.01 4.21 4.42
Days inventory 82 89 91 87 83
Accounts payable turnover ratio 7.30 6.36 5.86 7.66 10.98
Days payable 50 57 62 48 33
Cash conversion cycle 113 107 98 103 114

FINANCIAL STATEMENT ANALYSIS - PERFORMANCE

1999 2000 2001 2002 2003

OPERATING EFFICIENCY RATIOS

Total asset turnover ratio 1.51 1.64 1.71 1.77 1.67
Net fixed asset turnover ratio 8.58 10.06 9.96 8.29 6.93
Equity turnover ratio 2.42 2.66 2.91 2.93 2.63

OPERATING PROFITABILITY RATIOS

Gross profit margin 41.06% 40.89% 41.60% 38.44% 39.67%
Operating profit margin 13.88% 14.50% 14.80% 8.83% 9.54%
Net margin 8.40% 8.55% 8.66% 4.19% 5.14%
Operating income ROI 0.21 0.24 0.25 0.16 0.16
Return on total assets 0.13 0.14 0.15 0.07 0.09
Return on total equity 0.20 0.23 0.25 0.12 0.14
Return on equity 0.20 0.23 0.25 0.12 0.14
Dupont Formula - ROE 0.20 0.23 0.25 0.12 0.14
 FINANCIAL STATEMENT ANALYSIS - RISK

1999 2000 2001 2002 2003

BUSINESS RISK
Operating leverage ― 1.17 1.14 0.28 0.32
Financial leverage ― 0.91 0.94 ### 0.48
Total leverage ― 1.06 1.06 ### 0.15

FINANCIAL RISK
Debt ratio 0.37 0.38 0.41 0.40 0.36
Debt to equity ratio 0.02 0.01 0.09 0.12 0.12
Interest coverage 16.67 13.83 14.47 5.97 8.84