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Electronics sales are forecast to grow, partly on the strength of a cyclical recovery and also due to new product introductions. We are continuing to strengthen our capabilities in the areas of advanced deposition materials, advanced components and specialized services.
One of the key elements for success in all our markets is the concentration of all employees — from the topmost management level down — on knowing our business in great detail and, at the same time, clearly understanding the needs of our customers. This allows us to quickly identify the good opportunities, mitigate risks and seal the best deals.
Our commitment to safety and integrity underlies everything we do. We gained good recognition over the past year for our strong governance practices, and Praxair was included in the Dow Jones Sustainability Index, which evaluates companies based on a wide range of environmental, social and economic factors.
In safety, we were able to sharply reduce the number of vehicle accidents in our North American bulk-gases fleet, the result of employee focus and a series of training programs initiated during the year. However, personnel safety performance slipped after three years of steady improvement. Although our safety record is still much better than the industry average, we are not satisfied, and have taken action to move the trend back in the right direction.
As always, Praxair’s board of directors gave valuable guidance to our management team throughout the year. At the end of 2003, Dale Frey retired from the board and we thank him for his advice and wise counsel on a wide range of business issues over the 10 years of his service.
As 2004 begins, I remain cautiously optimistic about the pace and sustainability of the economic recovery and I believe Praxair is well placed to accelerate its growth as the global economy strengthens. Our solid performance in 2003 demonstrates that all Praxair people — regardless of where they work in the organization — fully understand the task at hand. They embrace the principles of innovative thinking and disciplined execution and are pulling together in the right direction — toward revenue and earnings growth, increased return on capital, and cash flow. It’s the direction that leads to increased value for our shareholders.
DENNIS H. REILLEY
Chairman, President & Chief Executive Officer
February 11, 2004
