Graco 2005 Annual Report Download - page 22

Operating income for 2004 was $33.0 million, a decrease of $11.4 million, or 25.7%, from
$44.4 million in 2003. The decrease in operating income is primarily the result of raw material inÖation
and charges related to the liquidation of certain product lines in the segment.
Other
Net sales for 2004 were $965.4 million, a decrease of $18.9 million, or 1.9%, from $984.3 million in
2003. The decrease in net sales was primarily attributable to the sale of Cosmolab in March 2003, which
contributed $10 million in sales in 2003, and sales declines experienced in the Graco business.
Operating income for 2004 was $92.0 million, a decrease of $22.8 million, or 19.9%, from
$114.8 million in 2003. The decrease in operating income was due primarily to the sales decrease at Graco
and raw material inÖation in resin based products.
Liquidity and Capital Resources
Cash and cash equivalents (decreased) increased as follows for the year ended December 31, (in
millions):
2005 2004 2003
Cash provided by operating activities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 641.6 $660.0 $773.2
Cash (used in)/provided by investing activities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (766.7) 189.6 (716.1)
Cash (used in)/provided by Ñnancing activities ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (257.2) (494.1) 31.4
Exchange eÅect on cash and cash equivalents ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (7.8) 5.7 0.8
(Decrease) Increase in cash and cash equivalents ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $(390.1) $361.2 $ 89.3
Sources
The Company's primary sources of liquidity and capital resources include cash provided by operations,
proceeds from divestitures and use of available borrowing facilities.
Cash provided by operating activities for the year ended December 31, 2005 was $641.6 million
compared to $660.0 million for the comparable period of 2004. Net cash provided by operating activities
before working capital changes decreased in 2005, which was partially oÅset by improvements in working
capital.
In 2005, the Company received cash proceeds of $65.5 million related to the sale of businesses and
other non-current assets, compared to $318.1 million in 2004. In 2005, the Company received cash
proceeds of $64.3 million related to the sale of other non-current assets, compared to $55.3 million in
2004. In 2005, the Company sold the Curver business. Businesses sold in 2004 include Panex Brazilian
low-end cookware, European picture frames, U.S. picture frames (Burnes), Anchor Hocking glassware,
Mirro cookware and Little Tikes Commercial Playground Systems.
In 2005, the Company received proceeds from the issuance of debt of $337.0 million compared to
$33.9 million in 2004. Most of the increase in 2005 was due to the issuance of commercial paper related
to the funding of the November 2005 DYMO acquisition.
The Company has short-term foreign and domestic uncommitted lines of credit with various banks
that are available for short-term Ñnancing. Borrowings under the Company's uncommitted lines of credit
are subject to the discretion of the lender. The Company's lines of credit do not have a material impact on
the Company's liquidity. Borrowings under the Company's lines of credit at December 31, 2005 and 2004
totaled $4.0 million and $21.3 million, respectively.
In November 2005, the Company entered into a $750.0 million syndicated revolving credit facility
(the ""Revolver'') pursuant to a Ñve-year credit agreement. The Revolver, which expires in November
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