UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended June 30, 2003 Commission File Number 1-7233

STANDEX INTERNATIONAL CORPORATION
(Exact name of Registrant as specified in its Charter)

DELAWARE 31-0596149
(State of incorporation) (I.R.S. Employer Identification No.)

6 MANOR PARKWAY, SALEM, NEW HAMPSHIRE 03079
(Address of principal executive office) (Zip Code)

(603) 893-9701
(Registrant's telephone number, including area code)

SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE
SECURITIES EXCHANGE ACT OF 1934:

Title of Each Class Name of Each Exchange on Which Registered
Common Stock, Par Value $1.50 Per Share New York Stock Exchange

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. YES [X] NO [ ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. [X]

The aggregate market value of the voting and non-voting common equity held by
non-affiliates of the Registrant at the close of business on July 31, 2003 was
approximately $263,000,000. Registrant's closing price as reported on the New
York Stock Exchange for July 31, 2003 was $22.42 per share.

The number of shares of Registrant's Common Stock outstanding on August 29,
2003 was 12,176,299.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Proxy Statement for the Registrant's 2003 Annual Meeting of
Stockholders (Part III) of this report are incorporated by reference.

PART I

ITEM 1. BUSINESS

Standex (1) is a leading, diversified, multi-industry manufacturer. We produce
a variety of products and provide services for selected market segments, with
operations on a global basis in three business segments: Food Service,
Industrial and Consumer. Maintaining our diversification across multiple lines
of business has enabled us to achieve earnings consistency throughout market
and economic cycles. As a result, we have paid dividends each quarter since
Standex became a public corporation in November 1964.

Standex was incorporated in 1975 and is the successor of a corporation
organized in 1955. Its three segments are composed of fifteen operating units
each with its own organization. The management of each operating unit is
responsible for product development, manufacturing, marketing and for achieving
a return on investment in accordance with the standards established by
executive management. Overall supervision, coordination and financial control
are maintained by the executive staff from its corporate headquarters located
at 6 Manor Parkway, Salem, New Hampshire.

Our basic operating strategy is to grow the earnings of our niche businesses
which have high market share, acquire companies that offer strategic fits with
existing businesses, pursue operational and strategic linkages among our
businesses and maintain an efficient corporate structure.

We call our operating strategy "focused diversity" whereby we strive to provide
customer-driven, engineered solutions. This strategy is designed to achieve:

*Long-term growth in sales and earnings
*Continuous improvements in our cost structure and
working capital utilization via lean enterprise and other
management initiatives
*New product development and consistent product
enhancement
*Completion of strategic bolt-on acquisitions which
will deliver tangible synergies to supplement the sales
and earnings growth of the overall Company

We continually assess each of our businesses to determine whether they fit with
our evolving strategic vision, with our primary focus on businesses with strong
fundamentals and growth opportunities.

During the year we consummated three acquisitions: I R International, CIN-TRAN
and Millennium Molds. These acquisitions are more fully described in both the
Management's Discussion and Analysis and the Notes to Consolidated Financial
Statements. Also during the year, we closed, sold and realigned several of our
business units as part of our announced restructuring and realignment plan.
This plan is described in more detail in both the Management's Discussion and
Analysis and the Notes to Consolidated Financial Statements.

Please visit our web site at www.standex.com to learn more about us or to
review our most recent SEC filings. The information on our web site is not
incorporated into this Annual Report on Form 10-K.

The principal products and the major markets for our products and services are
set forth below. Sales are made both directly to customers and by or through
manufacturers' representatives, dealers and distributors. Additional
information regarding the Company's business and financial information about
industry segments is presented in the Notes to Consolidated Financial
Statements under the caption "Industry Segment Information."

(1)References in this Annual Report on Form 10-K to "Standex" or the "Company"
or "we," "our" or "us" shall mean Standex International Corporation and its
subsidiaries.

FOOD SERVICE SEGMENT

Our Food Service businesses are leading broad-line manufacturers of commercial
foodservice products for restaurant, convenience store, supermarket, bakery,
soft drink, espresso, healthcare and institutional foodservice markets.

* Master-Bilt{reg-trade-mark} refrigerated cabinets, cases, display units,
modular structures, coolers and freezers.
* Barbecue King{reg-trade-mark} and BKI{reg-trade-mark} commercial cook and
hold units, rotisseries, pressure fryers, ovens and baking equipment.
* Federal Industries bakery and deli heated and refrigerated display cases.
* USECO food service equipment and patient feeding systems.
* Procon{reg-trade-mark} rotary vane pumps.

INDUSTRIAL SEGMENT

The following describes the businesses of our industrial segment and its
markets, products and/or services:

* Air Distribution Products: Snappy{reg-trade-mark}, ACME and ALCO metal
ducting and fittings for residential heating, ventilating and air conditioning
applications sold through distributors throughout the continental United
States.

* Spincraft{reg-trade-mark} power metal spinning, custom formed components
for aircraft engines, space launch vehicles, gas turbines, nuclear reactors,
military ordnance, commercial satellites and similar products for OEMs, U.S.
Government, energy, aircraft, aerospace and commercial satellite industry and
other commercial industries.

* Jarvis{trademark}, Can-Am Casters and Wheels{trademark} and
PEMCO{reg-trade-mark} casters and wheels and industrial hardware for general
industry, hospitals, supermarkets, hotels and restaurants.

* Standex Engraving: Roehlen{reg-trade-mark} and I R International
embossing rolls, texturizing and laser engraving systems, machines and plates;
Mold-Tech{reg-trade-mark} mold engraving; Mullen{reg-trade-mark} Burst Testers;
Perkins converting and finishing machinery and systems for general industry
(e.g., automotive, plastics, textiles, paper, building products, synthetic
materials, OEMs, converting, textile and paper industry, computer, houseware
and construction industries).

* Custom Hoists single and double acting telescopic and piston rod hydraulic
cylinders for dump trucks and trailers, garbage trucks and related material
handling equipment used in the construction and waste hauling industries.

* Standex Electronics reed switches, electrical connectors, sensors,
toroids and relays, fixed and variable inductors and electronic assemblies,
fluid sensors, tunable inductors, transformers and magnetic components for
telecommunications, consumer electronics, automotive, security systems,
communications equipment, computers, air conditioning and refrigeration
industries.

* James Burn Wire-O{reg-trade-mark} double-looped wire and machinery and
complete binding system for printers, publishers and binders of checkbooks,
calendars, diaries, appointment books, cookbooks, catalogs and manuals.

CONSUMER SEGMENT

The following describes the businesses of our consumer segment and its markets,
products and/or services:

* Standard{reg-trade-mark} Publishing publishes religious periodicals,
curricula, VBS materials, Sunday school literature, children's books and
supplies which are marketed to Sunday schools, churches, vacation Bible
schools and Christian bookstores.

* Berean{reg-trade-mark} Christian Stores, a chain of 19
Berean{reg-trade-mark} Christian bookstores, serving as distribution centers
and retail outlets for religious books and merchandise.

* Standex Direct which includes Frank Lewis{reg-trade-mark} Grapefruit
Club gift packages, Red Cooper{reg-trade-mark} fresh grapefruit, Harry's
Crestview Groves{reg-trade-mark} grapefruit packages, grapefruit juice,
grapefruit sections, onions, melons and other related food products; Red
Cooper's Onion Store and Bland Farms onions for mail order consumer direct
sales.

RAW MATERIALS

Raw materials and components necessary for the fabrication of our products and
the rendering of our services are generally available from numerous sources. A
primary raw material is sheet and rolled steel in various forms. Generally, we
are not dependent on a single source of raw materials and supplies. We do not
foresee any unavailability of materials or supplies which would have any
significant adverse effect on our overall business, nor any of our segments, in
the near term.

SEASONALITY

Typically, the second and fourth quarters represent our best quarters for our
consolidated financial results. Due to the gift-giving holiday season, the
Consumer Segment experiences strong sales benefiting the second quarter
performance. The fourth quarter performance is enhanced by increased activity
in the construction industry.

PATENTS AND TRADEMARKS

We hold approximately 100 United States patents covering processes, methods and
devices. Many counterparts of these patents have also been registered in
various foreign countries. In addition, we have various registered and
unregistered trademarks.

While we believe that many of our patents are important, we credit our
competitive position in our niche markets to engineering capabilities,
manufacturing techniques and skills, marketing and sales promotions, service
and the delivery of quality products.

Due to the diversity of our businesses and the markets served, the loss of any
single patent or trademark would not, in our opinion, materially affect any
individual segment.

CUSTOMERS

No material part of the Company's business is dependent upon a single customer
or very few customers, the loss of any one of which would have a material
adverse effect on the Company's operations.

BACKLOG

Backlog orders believed to be firm at June 30, 2003 and 2002 are as follows (in
thousands):

2003 2002
Food Service.............. $24,971 $19,877
Industrial................ 113,941 100,109
Consumer.................. 4,611 5,150
Total................ 143,523 125,136
Net realizable beyond a year 60,441 43,415
Net realizable within one year $83,082 $81,721

COMPETITION

Standex manufactures and markets products many of which have achieved a unique
or leadership position in their market. However, we encounter competition in
varying degrees in all product groups and for each product line. Competitors
include domestic and foreign producers of the same and similar products. The
principal methods of competition are price, delivery schedule, quality of
services, product performance and other terms and conditions of sale.

INTERNATIONAL OPERATIONS

Substantially all international operations of the Company are related to
domestic operations and are included in the Food Service and Industrial
business segments. International operations are conducted at 32 plants,
principally in Western Europe. See the Notes to Consolidated Financial
Statements for international operations financial data.

RESEARCH AND DEVELOPMENT

Developing new and improved products, broadening the application of established
products, and continuing efforts to improve and develop new methods, processes
and equipment, have driven the Company's success. However, due to the nature
of our manufacturing operations and the types of products manufactured,
expenditures for research and development are not significant to any individual
segment.

ENVIRONMENTAL MATTERS

To the best of our knowledge, the Company believes that it is presently in
substantial compliance with all existing applicable environmental laws and does
not anticipate that such compliance will have a material effect on its future
capital expenditures, earnings or competitive position.

NUMBER OF EMPLOYEES

As of June 30, 2003, the Company employed approximately 4,700 employees of
which 3,300 were in the United States. About 1,300 of these employees were
represented by unions.

LONG-LIVED ASSETS

Long-lived assets are described and discussed in the Notes to Consolidated
Financial Statements

AVAILABLE INFORMATION

This Annual Report on Form 10-K, as well as the Company's reports on Form 10-Q
and current reports on Form 8-K, along with any amendments to those reports,
are made available free of charge, on the Company's website (www.standex.com)
as soon as reasonably practicable after such material is electronically filed
with or furnished to the Securities and Exchange Commission.

ITEM 2. PROPERTIES

At June 30, 2003, we operated a total of 89 principal plants, stores and
warehouses located throughout the United States, Western Europe, Canada,
Australia, Singapore, China, Brazil and Mexico. The Company owned 44 of the
facilities and the balance were leased. The Company operated 19 retail stores
in various sections of the United States, of which all were leased. The
approximate building space utilized by each product group of Standex at June
30, 2003 is as follows (in thousands):

Area in Square Feet
Owned Leased

Food Service.................... 507 230
Industrial...................... 1,886 680
Consumer........................ 342 278
General Corporate............... 29 -
Held for Resale................. 387 -
Total..................... 3,151 1,188

In general, the buildings are in sound operating condition and are considered
to be adequate for their intended purposes and current uses.

We own substantially all of the machinery and equipment utilized in our
businesses.

ITEM 3. LEGAL PROCEEDINGS

There are no material pending legal proceedings.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE
OF SECURITY HOLDERS

No matters were submitted to stockholders during the fourth quarter of the
fiscal year.

EXECUTIVE OFFICERS OF STANDEX

Principal Occupation During the
Name Age Past Five Years

Edward J. Trainor 63 Chairman of the Board of the Company since December
2001; Chief Executive Officer of the Company from
July 1995 to December 2002; President of the Company
from July 1994 to December 2001.

Roger L. Fix 50 Chief Executive Officer of the Company since January
2003; President of the Company since December 2001
and Chief Operating Officer of the Company from
December 2001 to December 2002; Chief Executive
Officer, Chief Operating Officer and President of
Outboard Marine Corporation from August 2000 to
February 2001; Chief Operating Officer of Outboard
Marine Corporation from June 2000 to August 2000;
Chief Executive of John Crane from 1998 through June
2000; President - North America of John Crane from
May 1996 to May 1998; prior thereto President of
Xomox, a division of Emerson Electric.

As COO of Outboard Marine Corporation ("OMC") (June-
August 2000), Mr. Fix completed a strategic review
and commenced implementation of programs to address
the financial crisis the company was and had been
experiencing since about 1997. Mr. Fix became
President and CEO of OMC in August 2000. In December
2000, at the direction of the investors, a voluntary
petition in Bankruptcy pursuant to Chapter 11 of the
U.S. Bankruptcy Code was filed for OMC. In August
2001, the case converted to a voluntary case under
Chapter 7 of the U.S. Bankruptcy Code.

Deborah A. Rosen 48 Chief Legal Officer of the Company since October
2001; Vice President of the Company since July 1999;
General Counsel of the Company since January 1998;
and Secretary of the Company since October 1997.

Christian Storch 43 Vice President and Chief Financial Officer of the
Company since September 2001; Manager of Corporate
Audit and Assurance Services of the Company from July
1999 to August 2001; prior thereto Divisional
Financial Director and Corporate Controller of
Vossloh AG, a publicly held German corporation.

Daniel C. Potter 47 Treasurer of the Company since August 1998; Assistant
Treasurer from July 1997 to July 1998 and prior
thereto Corporate Tax Manager of the Company since
February 1997.

Robert R. Kettinger 61 Corporate Controller of the Company since July 1991.

The executive officers are elected each year by the Board of Directors to serve
for one-year terms of office. There are no family relationships among any of
the directors or executive officers of the Company.

PART II

ITEM 5. MARKET FOR STANDEX COMMON STOCK
AND RELATED STOCKHOLDER MATTERS

The principal market in which the Common Stock of Standex is traded is the New
York Stock Exchange. The high and low sales prices for the Common Stock on the
New York Stock Exchange and the dividends paid per Common Share for each
quarter in the last two fiscal years are as follows:

COMMON STOCK PRICES AND DIVIDENDS PAID

COMMON STOCK PRICE RANGE
DIVIDENDS
2003 2002 PER SHARE
Year Ended June 30 High Low High Low 2003 2002

First quarter ....... $25.00 $19.35 $23.95 $18.32 $0.21 $0.21
Second quarter ...... 24.36 18.80 23.90 18.75 0.21 0.21
Third quarter ....... 24.00 18.70 24.90 20.60 0.21 0.21
Fourth quarter ...... 22.32 19.07 28.00 23.95 0.21 0.21

The approximate number of stockholders of record on August 29, 2003 was 2,900.

Additional information regarding the Company's equity compensation plans is
presented in the Notes to Consolidated Financial Statements under the caption
"Stock Based Compensation and Purchase Plans."

In June 2003, the Company completed the acquisition of certain assets and the
assumption of certain liabilities of I R International, Inc. and substantially
all of the outstanding stock of Dornbusch & cia, a Brazilian affiliate for a
total purchase price of $19.7 million in cash and unregistered stock. The
aggregate number of shares of Common Stock comprising the stock portion of the
purchase price was 173,996, based on an average market price for the stock of
$21.036 per share. An exemption from registration of the shares was claimed
under Regulation D, Rule 506 of the Securities Act. The exemption applied
because there were fewer than 35 purchasers, each purchaser was an accredited
investor and the transaction did not involve a public offering.

ITEM 6. SELECTED FINANCIAL DATA

Selected financial data for the five years ended June 30, 2003 is as follows:

2003 2002 2001 2000 1999
SUMMARY OF OPERATIONS
(IN THOUSANDS)

Net Sales
Industrial Group $332,855 $317,743 $327,836 $365,129 $356,393
Food Service Group 141,867 135,308 143,075 139,633 148,131
Consumer Group 99,814 110,150 115,615 115,276 114,023
Total 574,536 563,201 586,526 620,038 618,547
Gross Profit 185,483 185,908 195,636 205,205 205,609
Operating Income
Industrial Group 35,057 33,419 37,610 47,146 42,764
Food Service Group 10,455 9,802 13,627 11,409 17,201
Consumer Group 2,014 7,114 9,680 9,594 8,707
Restructuring (5,580) - - (5,408) 1,016
Other, net (1,306) - - - -
Corporate (12,979) (11,342) (8,057) (10,157) (9,652)
Total 27,661 38,993 52,860 52,584 60,036

Interest Expense 6,956 8,546 10,998 10,571 10,492
Other, net 146 (161) 200 608 533
Gain on stock received - - - 2,711 -
Provision for income taxes 7,014 9,657 17,399 18,602 19,264
Income from continuing
operations 13,837 20,629 24,663 26,730 30,813
Income/(loss) from
discontinued operations 312 (232) 234 973 548
Cumulative effect of
accounting change - (3,779) - - -
Net income 14,149 16,618 24,897 27,703 31,361

PER SHARE DATA
Basic
Income from continuing
operations 1.15 1.70 2.03 2.11 2.38
Income/(loss) from
discontinued operations 0.02 (0.02) 0.02 0.08 0.04
Cumulative effect of
change in accounting
principle - (0.31) - - -
Total 1.17 1.37 2.05 2.19 2.42

Diluted
Income from continuing
operations 1.14 1.68 2.00 2.09 2.37
Income/(loss) from
discontinued operations 0.02 (0.02) 0.02 0.08 0.04
Cumulative effect of
change in accounting
principle - (0.31) - - -
Total 1.16 1.35 2.02 2.17 2.41
Dividends paid 0.84 0.84 0.83 0.79 0.76

BALANCE SHEET AND CASH FLOW
(IN THOUSANDS)

Total Assets 422,480 406,039 424,264 424,200 410,042
Accounts Receivable 91,714 93,219 98,470 104,431 97,871
Inventories 82,530 92,931 102,674 112,201 120,172
Accounts Payable 41,241 35,209 33,554 36,495 35,975
Net Working Capital 133,003 150,941 167,590 180,137 182,068
Change in net
working capital (17,938) (16,649) (12,547) (1,931) (1,665)
Long-term debt 109,019 50,087 153,019 153,436 148,111
Short-term debt 910 82,221 2,532 2,357 3,963
Total debt 109,929 132,308 155,551 155,793 152,074
Less cash 11,509 8,092 8,955 10,438 5,909
Net debt 98,420 124,216 146,596 145,355 146,165
Shareholders' Equity 161,922 178,432 172,174 164,814 162,301
Total Capitalization 260,342 302,648 318,770 310,169 308,466

Depreciation 13,551 13,492 14,221 14,018 14,589
Capital expenditures 7,882 9,883 13,754 22,518 15,702
Cash flow from
continuing operations 50,618 42,466 40,811 41,684 33,830

KEY STATISTICS
Gross profit margin 32.28% 33.01% 33.36% 33.10% 33.24%
Operating income margin 4.81 6.92 9.01 8.48 9.71
Net debt to total
capital ratio 37.80 41.04 45.99 46.86 47.38

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

Statements contained in the following "Management's Discussion and Analysis"
that are not based on historical facts are "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. Forward-
looking statements may be identified by the use of forward-looking terminology
such as "may," "will," "expect," "believe," "estimate," "anticipate,"
"continue," or similar terms or variations of those terms or the negative of
those terms. There are many factors that affect the Company's business and the
results of its operations and may cause the actual results of operations in
future periods to differ materially from those currently expected or desired.
These factors include uncertainties in competitive pricing pressures,
unforeseen volatility in financial markets, general domestic and international
business and economic conditions and market demand.

OVERVIEW

Standex is a leading, diversified, multi-industry manufacturer. We produce a
variety of products and provide services for selected market segments, with
operations in three business segments: Food Service, Industrial, and Consumer.
Our goals have remained constant through the years: continue to make strategic
acquisitions while providing our customers with customer driven and engineered
solutions to meet their changing needs.

The following discussion and analysis covers key drivers behind our results for
2003 and is broken down into three major sections. First, we discuss our
liquidity and capital resources followed by an overview and discussion of
operations for the years 2001 through 2003 on a consolidated basis and by
business segment. Lastly, we discuss our risk management techniques, critical
accounting policies and impacts of future accounting changes.

LIQUIDITY AND CAPITAL RESOURCES

CASH FLOW

Our primary source of liquidity is cash flows from continuing operating
activities and the revolving credit facility with eight banks. In 2003,
continuing operations generated $50.6 million compared to $42.5 million last
year in cash flow. The increase year over year came as a result of a $17.9
million decrease in net working capital. Net working capital is defined as
accounts receivable plus inventories less accounts payable. In addition, the
sale of certain real estate generated $6 million of incremental cash during the
year while discontinued operations contributed $4.1 million in cash flows
during the year. We redeployed those resources by investing $17.7 million in
cash to expand several core businesses by making three acquisitions and by
investing $7.9 million in capital expenditures. In addition, we returned $11.8
million to shareholders through cash dividends ($10.1 million) and share
repurchases ($1.7 million). The remaining cash flow from continuing operating
activities was used to reduce net debt by $25.8 million. This represents the
fourth consecutive year in which Standex has generated cash from operations in
excess of $40.0 million, and the highest amount in the history of the Company.

We believe that cash flows from continuing operating activities in fiscal 2004
will be sufficient to cover capital expenditures, restructuring activities,
operating lease payments, pension contributions and mandatory debt payments.
We expect to spend between $9 million and $11 million on capital expenditures
in fiscal 2004. In addition, we regularly evaluate acquisition opportunities.
Any cash needed for future acquisition opportunities would be obtained through
a combination of any remaining cash flows from continuing operations and
borrowings under the revolving credit facility. In the event that cash flows
from continuing operating activities would not be sufficient, we have available
borrowing capacity under various agreements of up to $95 million as of June 30,
2003.

CAPITAL STRUCTURE

During 2003, we entered into a new $130 million unsecured revolving credit
facility with eight banks, of which $96 million was unused and $95 million was
available at June 30, 2003. This revolving credit facility replaced the
previous revolving credit facility of $175 million. Proceeds may be used for
general corporate purposes or to provide financing for acquisition activity.
Available borrowings under the revolving credit facility are reduced by
unsecured short-term borrowings. In addition, at June 30, 2003, we have a
money market credit facility with one bank. The agreement provides for a
maximum unsecured credit line of $10 million, of which $9.8 million is unused
and available. In addition, we entered into a Note Purchase agreement with two
institutional investors for $25 million. On June 30, 2002 and 2003, the
Company's credit quality designation was NAIC-2.

The following table sets forth the Company's capitalization at June 30:

Year Ended June 30 (In thousands) 2003 2002

Short-term debt...................... $ 910 $ 82,221
Long-term debt....................... 109,019 50,087
Total debt.......................... 109,929 132,308
Less cash............................ 11,509 8,092
Total net-debt...................... 98,420 124,216
Stockholders' equity................. 161,922 178,432
Total capitalization................. $260,342 $302,648

Stockholders' equity decreased year over year primarily as a result of the
recording of an additional pension liability net of tax benefit of
$34.7 million partially offset by favorable foreign currency movements of $11.4
million. Short and long-term net-debt decreased by $25.8 million to $98.4
million at June 30, 2003. Even with the above, the Company's net-debt to
capital percentage improved to 37.8% from 41.0% in 2002.

Historically low interest rates, another year of negative performance of the
equity markets, and changes in actuarial assumptions (including mortality
rates) caused Standex to suffer higher pension liabilities and lower pension
assets. These assumptions are more fully described in the Notes to
Consolidated Financial Statements. As a result, the Company recorded a $34.7
million after-tax equity charge in the fourth quarter to reflect the additional
minimum liability under these plans. This after-tax equity charge did not
impact cash or earnings and could reverse in future periods should either
interest rates increase and/or market performance and plan returns improve.

Pension expenses are expected to increase by approximately $0.25 per diluted
share in 2004 as a result of the funded status of the pension plans and changes
in actuarial assumptions. Contribution requirements in 2004 are expected to be
approximately $6.8 million.

The Company has an insurance program for certain key executives. The
underlying policies have a cash surrender value of $19.2 million and are
reported net of loans of $13.3 million for which the Company has the legal
right of offset. These policies have been purchased to fund supplemental
retirement income benefits for certain executives. The aggregate present value
of future obligations was $5,088,000 and $1,532,000 at June 30, 2003 and 2002,
respectively.

The Company is contractually obligated under various operating leases for real
property. The Company sponsors a number of both defined benefit plans and
defined contribution plans. We have evaluated the current and long-term cash
requirements of these plans. As noted above, the operating cash flows from
continuing operations is expected to be sufficient to cover required
contributions under ERISA and other governing rules.

Contractual obligations of the Company as of June 30, 2003 are as follows (in
millions):

LESS MORE
THAN 1 1-3 3-5 THAN 5
CONTRACTUAL OBLIGATIONS TOTAL YEAR YEARS YEARS YEARS

Long- and short-term
obligations................ $109.9 $1.0 $59.2 $35.7 $14.0
Capital lease obligations... - - - - -
Operating lease
obligations................ 25.1 6.0 10.9 8.2 -
Purchase obligations........ - - - - -
Other long-term
contractual liabilities.... - - - - -
Total.................... $135.0 $7.0 $70.1 $43.9 $14.0

OFF BALANCE SHEET ITEMS

The Company had no off balance sheet items at June 30, 2003.

FISCAL 2003 AS COMPARED TO FISCAL 2002

Summary

Net sales from continuing operations were $574.5 million, an increase of two
percent from last year's net sales of $563.2 million. The fiscal 2003 sales
include an extra month of European sales of $4.4 million resulting from the
Company's decision to conform the accounting year of its European operations to
the corporate fiscal year ending June 30. Foreign exchange rate changes
favorably impacted the current year sales by approximately $5.6 million.

Both the Industrial and Food Service Segments recorded improved performances
over the previous year, while both sales and operating income of the Consumer
Segment were below prior year levels.

The gross margin for 2003 was 32.3%, down from 33% in the prior year. The year-
over-year decline is primarily due to the substitution of lower margin sales in
the Food Service and Industrial Groups for higher margin sales in the Consumer
Group.

In October 2002, we announced a restructuring and realignment plan in the
amount of $11 to $12 million to be incurred over eighteen months. We designed
the plan to improve the Company's operating performance. The plan involves (1)
disposal or closing of certain under-performing operating plants, product
lines, manufacturing processes and businesses; (2) realignment and
consolidation of certain marketing and distribution activities; and (3) other
cost containment actions, including selective personnel reductions. We estimate
that these actions will yield annual cost savings of $8.0 million once fully
implemented.

During 2003 we completed the following restructuring activities: The
integration of USECO manufacturing activities into the Master-Bilt operations,
the closure of an underutilized Air Distribution Products facility in North
Carolina, the transfer of various manufacturing operations to Mexico, and the
closure of a Mold-Tech operation in California. We recognized $5.6 million for
these restructuring activities.

During 2003, we exited our H.F. Coors (Food Service) and National Metals
(Industrial) businesses. These actions were also taken as part of our
realignment plan as we concluded that the two businesses either had limited
growth prospects or that these businesses were not suited for long-term
strategic growth under our ownership. The real property of H.F. Coors and the
business were sold in separate transactions while National Metal Industries was
closed. Discontinued operations include the results of operations of these
businesses and the gain realized on the sale of the H.F. Coors property, net of
our exit cost.

In the second quarter of 2003, the Chief Executive Officer and the Executive
Vice President/Operations elected early retirement. The charges related to
these retirements include costs that previously were being amortized to an
anticipated retirement age of 65, the net present value of the conversion
feature of life-insurance policies, and a retirement bonus. The majority of
these benefits will be paid over the next ten years, and, accordingly, the
total benefits have been discounted to their present value of $5.6 million,
which is included in the caption "Other expenses, net" in the Statements of
Consolidated Income. Also included in this caption is a gain ($4.3 million) on
the sale of a manufacturing facility of a U.K. subsidiary, which was completed
in October, 2002. This sale is a part of the Company's realignment strategy.

After taking all these matters into account, income from continuing operations
was $13.8 million as compared to $20.6 million in the prior year.

Interest expense decreased by $1.6 million due to lower average borrowing
levels and lower average interest rates on our variable rate debt.

The effective income tax rate for fiscal 2003 was 33.6% versus fiscal 2002's
rate of 31.9%. The previous fiscal year's tax rate was affected by the
implementation of tax-planning strategies, transactional based benefits from
distributions from foreign subsidiaries and decreased levels of various tax
contingencies which resulted in one-time benefits.

In the first quarter of fiscal 2002, the Company recorded a charge of $3.8
million, which represented the cumulative effect of a change in accounting
principle. The change related to the Company's adoption of Statement of
Financial Accounting Standard (SFAS) No. 142 effective July 1, 2001.

The above resulted in a decline in Net Income from last year's $16.6 million to
the current year's $14.1 million.

Industrial Segment

Net sales increased by $15.1 million. Of this increase $3.3 million was due to
the extra month of European sales noted above, and $4.3 million was due to the
effect of changes in average foreign exchange rates. The remaining increase of
$7.5 million was primarily due to volume increases in our Standex Engraving,
Spincraft and Electronics divisions.

Gross profits for this segment improved from 29% to 30% due to improved volume
levels partially offset by significantly higher steel costs incurred primarily
by our Air Distribution Division as a result of the steel tariff imposed in the
spring of 2002 by the U. S. government.

Operating income for the Industrial Segment rose by $1.6 million over fiscal
2002's $33.4 million. The Standex Engraving, Spincraft and Electronics
divisions were the primary contributors to this increase, while operating
income levels of our Air Distribution Products division were negatively
impacted by higher material costs for steel.

Food Service

Net sales increased by $6.6 million to $141.9 million in 2003. Of this
increase $1.1 million was due to an extra month of European sales and $1.3
million was due to the effect of changes in average foreign exchange rates.
The remaining $4.2 million increase reflects primarily volume increases at
Master-Bilt, Federal and our Procon divisions as these businesses were able to
gain market share.

Gross profit margins declined from 29% to 27%, mainly due to lower volumes at
our USECO division combined with the integration costs that did not qualify as
restructuring charges.

As a result of higher sales volumes, the segment reported a 6.7% increase in
operating income for fiscal 2003 as compared to fiscal 2002.

Consumer Segment

Fiscal 2003 was a disappointing year for this segment. A 9.4% decrease in
sales was recorded from fiscal 2002's $110.2 million. The results of the mail
order business were negatively impacted by weak consumer demand and a shorter
Christmas holiday season. In addition, higher marketing expenses were incurred
to reach new customers, but did not yield the expected results. The bookstore
and publishing divisions also experienced weak consumer and church customer
demand due to low consumer confidence. Additionally, marketing expenses
increased in the publishing division due to the launch of a new product.

Although the segment's gross margins were only slightly affected (a decline of
one percentage point), operating income decreased by 71.7% from the prior
year's $7.1 million. Cost reduction opportunities have been, and will continue
to be, actively pursued which should lead to improved results in 2004.

Corporate

The expenses of this segment rose from $11.3 million to $13.0 million in the
current year. This increase is due to higher professional fees, a reduction in
pension credits, and expenses not allocated to the divisions.

FISCAL 2002 AS COMPARED TO FISCAL 2001

A difficult economic environment affected sales in all segments. Net sales
from continuing operations for the year ended June 30, 2002 were
$563.2 million, a 4% decrease from a year earlier as volume declined in each of
the business segments. The effect, on net sales, of changes in the average
foreign exchange rates was not significant.

Net earnings from continuing operations before the cumulative effect of a
change in accounting principle declined from $24.7 million in fiscal 2001 to
$20.6 million in fiscal 2002. Earnings per share before the cumulative effect
of a change in accounting principle decreased to $1.68 per share from $2.00 a
year earlier.

The Company recorded a charge of $3.8 million representing the cumulative
effect of a change in accounting principle to write-off previously recorded
goodwill. The charge related to the Company's adoption of SFAS No. 142
effective July 2001 is described in detail in the Notes to Consolidated
Financial Statements.

A weakened economy, combined with the events of September 11th, negatively
affected sales volumes in each of the segments. Because of the economic
environment, in the fourth quarter of 2002 the Company recorded higher than
normal inventory reserves of $3.4 million affecting all three segments.

Interest expense decreased by $2.5 million. The decline reflects lower average
borrowings driven by the Company's strong cash flow performance in 2002, and
lower interest rates on the Company's variable rate debt.

The effective tax rate was 36.3% which included the effect of a change in
accounting principle described above. The decline in the 2002 effective tax
rate from 2001 was affected by the implementation of additional tax-planning
strategies, transactional based benefits from distributions from foreign
subsidiaries and decreased levels of various tax contingencies.

Industrial Segment

The Industrial Segment was particularly hard hit by the recession. Segment
sales decreased 3.1%. ATC-Frost was acquired in late fiscal 2001. Excluding
this acquisition's impact on fiscal 2002, segment sales decreased by 5.7%.
Lower sales volume and negative price pressure from discounting activities was
somewhat offset by the effect of a strong housing market.

The segment's gross profit margin declined slightly to 29% from 30% due to the
above. Operating Income was also negatively impacted decreasing by 11% from
fiscal 2001's $37.6 million.

Food Service Segment

The 5.4% decline in Food Service Segment sales was primarily due to lower sales
volumes caused by a weak economy. Demand was weak as customers delayed or
scaled back their rollout programs.

A small decrease in gross profit margin (30% from 31%) was recorded by this
segment due to the sales decline. A 28% fall off in operating income to $9.8
million was also recorded.

Consumer Segment

Net sales in the Consumer Segment decreased by 4.7%. Reduced consumer
confidence levels and the events of September 11th negatively affected segment
performance.

Due to sales mix, the gross profit margin in this segment improved to 46% from
45%. However, reduced sales volume equated to a decline in operating income of
27% from $9.7 million.

Corporate Segment

This segment's expenses increased by $3.3 million due primarily to a lower
return on pension and life insurance assets.

OTHER MATTERS

Inflation - Certain of the Company's expenses, such as wages and benefits,
occupancy costs and equipment repair and replacement, are subject to normal
inflationary pressures.

Foreign Currency Translation - The Company's primary functional currencies used
by its non-U.S. subsidiaries are the Euro and the British Pound Sterling
(Pound). During the current year, both these currencies have experienced
significant increases in value relative to the US dollar, the Company's
reporting currency. Since June 30, 2002 the Euro has appreciated by 25.2%
relative to the U.S. dollar, and the Pound has appreciated by 13.6% relative to
the U.S. dollar. These higher exchange values were used in translating the
appropriate non-U.S. subsidiaries' balance sheets into U.S. dollars at the end
of the current quarter.

Environmental Matters - The Company is party to various claims and legal
proceedings, generally incidental to its business. As explained more fully in
the Notes to Consolidated Financial Statements, we do not expect the ultimate
disposition of these matters to have a material adverse effect on our financial
statements.

Seasonality - Typically, the second and fourth quarters have been the best
quarters for our consolidated financial results. Due to the gift-giving
holiday season, the Consumer Segment has experienced strong sales benefiting
the second quarter performance. The fourth quarter performance has been
enhanced by increased activity in the construction industry.

Employee Relations - The Company has labor agreements with a number of union
locals in the United States and a number of European employees belong to
European trade unions.

There were no work stoppages during fiscal year 2003. A total of seven
collective bargaining contracts will expire in fiscal 2004. Although we
believe we have good employee relations, there can be no assurances that work
stoppages can be avoided in future periods.

ACQUISITIONS

Our growth is dependent on not only organic growth within our existing
businesses, but also the successful completion of acquisitions that align with
the strategic goals of the Company. The ability to initiate these transactions
is dependent upon the attraction of the target company and the acquisition
multiples that the market is demanding.

2003 Acquisitions

IR manufactures, distributes and sells industrial, gravure and embossing rolls
and plates, laser and gravure engraving, texturing and coating services from
facilities in Virginia and Brazil. IR is highly complimentary to our existing
engraving businesses. The acquisition increased our current market penetration
and will further our ability to reach new markets such as South America. In
addition to the acquisition of IR, Standex acquired Dornbusch & cia
("Dornbusch") located in Sao Paolo, Brazil contingent upon receipt of various
government approvals. IR and Dornbusch will be fully integrated with Standex
Engraving. The purchase price was allocated to the fair value of the assets
acquired and liabilities assumed and resulted in the recognition of goodwill of
approximately $12 million.

In September 2002, we purchased substantially all of the assets of Cincinnati,
Ohio-based CIN-TRAN, Inc., a manufacturer of custom UL/CSA approved low-
frequency transformers. In December 2002, the Company acquired Millennium
Molds, a repairer of injection molds. The combined purchase price of these
acquisitions was $1.6 million. Both were treated as purchases.

CRITICAL ACCOUNTING POLICIES

The Consolidated Financial Statements include accounts of the Company and all
its subsidiaries. The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires us to make estimates and assumptions in certain circumstances that
affect amounts reported in the accompanying Consolidated Financial Statements,
giving due consideration to materiality. Although we believe that materially
different amounts would not be reported due to the accounting policies
described below, the application of these accounting policies involves the
exercise of judgment and use of assumptions as to future uncertainties and, as
a result, actual results could differ from these estimates. We have listed a
number of accounting policies which we believe to be the most critical, but we
also believe that all of our accounting policies are important to the reader.
Therefore, please refer to the Notes to Consolidated Financial Statements for a
more detailed description of these and other accounting policies of the
Company.

Allowance for Doubtful Accounts - Accounts Receivables are reduced by an
allowance for amounts that may become uncollectible in the future. Our
estimate for the allowance for doubtful accounts related to trade receivables
includes evaluation of specific accounts where we have information that the
customer may have an inability to meet its financial obligation together with a
general provision for unknown but existing doubtful accounts. Actual
collection experience may improve or decline.

Inventories and Related Reserves for Obsolete and Excess Inventory -
Inventories are valued at the lower of cost or market and are reduced by a
reserve for excess and potentially obsolete inventories. The Company regularly
reviews inventory values on hand using specific aging categories, and records a
provision for obsolete and excess inventory based on historical usage and
estimated future usage. As actual future demand or market conditions may vary
from those projected by management, adjustments to inventory valuations may be
required.

Income Taxes - We account for income taxes in accordance with SFAS no. 109,
"Accounting for Income Taxes." Deferred tax assets and liabilities are
recognized for the future tax consequences attributable to differences between
financial statement carrying amounts of existing assets and liabilities and
their respective tax bases and operating loss and tax carry forwards. Deferred
tax assets and liabilities are measured using enacted tax rates expected to
apply to taxable income in the years in which those temporary differences are
expected to be recovered or settled. We recorded a valuation allowance that
represents foreign operating loss carry forwards for which utilization is
uncertain. Management judgment is required in determining our provision for
income taxes, deferred tax assets and liabilities, and the valuation allowance
recorded against our net deferred tax assets. No provision for U.S. income and
foreign withholding taxes has been made for substantially all unrepatriated
foreign earnings because it is expected that such earnings will be reinvested
indefinitely or the distribution of any remaining amount would be principally
offset by foreign tax credits.

Workers' Compensation Accrual - The Company is self-insured for workers'
compensation at the majority of its divisions. The accrual is evaluated
frequently based on our actual claim experience. Management judgment is
required in determining our expense and related contingency levels as actual
future claim experience may differ from the projected claim experience.
Projecting claims experience requires management to make assumptions about
future liabilities for incidents which have already occurred but have not yet
been reported and future health care cost trends.

Environmental Liabilities - Our global operations are regulated by laws for the
protection of the environment. Under various circumstances these laws may
require remediation at sites where hazardous substances have been released and
are endangering the environment.

We have expended substantial resources to comply with the applicable
environmental laws and regulations. We believe we are in substantial
compliance with these laws and regulations and we maintain procedures designed
to foster and ensure compliance. However, we have been and may in the future
be subject to formal or informal enforcement actions or proceedings regarding
noncompliance with such laws or regulations, whether or not determined to be
ultimately responsible, in the normal course of business.

Goodwill - We adopted SFAS No. 142, "Goodwill and Other Intangibles" effective
July 1, 2001. Under SFAS No. 142, goodwill is no longer amortized; however,
goodwill must be tested for impairment at least annually. Therefore, on an
annual basis we test for goodwill impairment by estimating the fair value of
our reporting units using the present value of future cash-flows method. In
addition, goodwill of a reporting unit is tested for impairment between annual
tests if an event occurs or circumstances change that would more likely than
not reduce the fair value of a reporting unit. An impairment loss is
recognized if the carrying amount exceeds the fair value. We are subject to
financial statement risk to the extent that goodwill becomes impaired.

Employee Benefit Plans - We provide a range of benefits to our employees,
including pensions and some post retirement benefits. Annually we record
expenses relating to these plans based on calculations specified by U.S. GAAP,
which are dependent upon various actuarial assumptions such as discount rates,
assumed rates of return, compensation increases, turnover rates, and health
care cost trends. The expected return on plan assets assumption is based on
our expectation of the long-term average rate of return on assets in the
pension funds and is reflective of the current and projected asset mix of the
funds and considers the historical returns earned on the funds. We review our
actuarial assumptions on at least an annual basis and make modifications to the
assumptions based on current rates and trends when appropriate. Based on
information provided by our actuaries and other relevant sources, we believe
that our assumptions are reasonable.

ADOPTION OF SFAS AND NEW ACCOUNTING PRONOUNCEMENTS

Effective July 1, 2002, the Company adopted Statement of Financial Accounting
Standards (SFAS) Nos. 144, 145 and 146. SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets," which creates one accounting
model, based on the framework established in SFAS No. 121, to be applied to all
long-lived assets including discontinued operations. The impact of the
adoption of SFAS No. 144 was not significant.

SFAS No. 145, "Rescission of FASB Statements No. 4, 44 and 64, amendment to
FASB Statement No. 13, and Technical Corrections," among other things,
restricts the classification of gains and losses from extinguishment of debt as
extraordinary to only those transactions that are unusual and infrequent in
nature as defined by APB Opinion No. 30 as extraordinary. There was no impact
from the adoption of this SFAS.

SFAS No. 146, "Accounting for Costs Associated with Exit or Disposal
Activities," addresses financial accounting and reporting for costs associated
with exit or disposal activities and nullifies Emerging Issues Task Force Issue
No. 94-3, "Liability Recognition for Certain Employee Termination Benefits and
Other Costs To Exit an Activity (including Certain Costs Incurred in a
Restructuring)." The SFAS requires that a liability for costs associated with
an exit or disposal activity be recognized when the liability is incurred. The
Company announced in October 2002 that restructuring charges in the range of
$11 to $12 million (pre-tax) would be recorded over the next 18 months (see
above). If this SFAS had not been adopted, a significant portion of these
charges would have been recorded in the current year instead of the
$5.6 million (pre-tax), which has been recorded.

In December 2002, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 148, "Accounting for Stock-Based
Compensation - Transition and Disclosure," which amends the transition and
disclosure provisions of Statement of Financial Accounting Standards No. 123,
"Accounting for Stock-Based Compensation." Statement 148 provides methods of
transition for a voluntary change to the fair value based method of accounting
for stock-based employee compensation and amends the disclosure requirements of
Statement 123 to require more prominent and more frequent disclosures in
financial statements about the effects of stock-based compensation. The
transition provisions are effective for fiscal years ending after December 15,
2002. The disclosure provisions are effective for interim periods beginning
after December 15, 2002. The Company adopted the interim period disclosure
provisions of Statements 148 in the third quarter of this year. The adoption
of Statement 148 had no effect on the Company's financial condition or results
of operations.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK

Risk Management

We are exposed to market risks from changes in interest rates, commodity prices
and changes in foreign currency exchange. To reduce these risks, we
selectively use, from time to time, financial instruments and other proactive
management techniques. We have internal policies and procedures that place
financial instruments under the direction of the Treasurer and restrict all
derivative transactions to those intended for hedging purposes only. The use
of financial instruments for trading purposes (except for certain investments
in connection with the Keysop Plan) or speculation is strictly prohibited. The
Company has no majority owned subsidiaries that are excluded from the
consolidated financial statements. Further, the Company has no interests or
relationships with any special purpose entities.

Exchange Risk

The Company is exposed to both transactional risk and translation risk
associated with exchange rates. Regarding transactional risk, the Company
mitigates certain of its foreign currency exchange rate risk by entering into
forward foreign currency contracts from time to time. These contracts are used
as a hedge against anticipated foreign cash flows, such as dividend and loan
payments, and are not used for trading or speculative purposes. The fair value
of the forward foreign currency exchange contracts is sensitive to changes in
foreign currency exchange rates, as an adverse change in foreign currency
exchange rates from market rates would decrease the fair value of the
contracts. However, any such losses or gains would generally be offset by
corresponding gains and losses, respectively, on the related hedged asset or
liability. Due to the absence of forward foreign currency contracts at June
30, 2003, the Company did not have any fair value exposure for financial
instruments.

Within our foreign operations we are also exposed to transactional risks,
specifically with our subsidiaries using the Euro and the British Pound
Sterling. This transactional risk is mitigated, in large part, by natural
hedges developed with locally denominated debt service. A hypothetical 10%
appreciation or depreciation of the value of the Euro to the US Dollar at June
30, 2003 would result in an increase in short term debt of $34,000 on our
Consolidated Balance Sheet.

Our primary translation risk was with the Euro and the British Pound Sterling.
We do not hedge our translation risk. As a result, fluctuations in currency
exchange rates can affect our stockholders' equity.

Interest Rate

The Company's interest rate exposure is limited primarily to interest rate
changes on its variable rate borrowings. From time to time, the Company will
use interest rate swap agreements to modify our exposure to interest rate
movements. As of June 30, 2003, a hypothetical 10% immediate increase in
interest rates would increase the Company's annual interest expense by $76,000.
The Company had an interest rate swap agreement to fix the interest rate on $10
million of its variable rate borrowings. This agreement expired in May 2003.
At June 30, 2003, the Company has no outstanding interest rate swap
agreements.

The Company also has $71.4 million of long-term debt at fixed interest rates as
of June 30, 2003. There would be no immediate impact on the Company's interest
expense associated with its long-term debt due to fluctuations in market
interest rates. However, based on a hypothetical 10% immediate decrease in
market interest rates, the fair value of the Company's long-term debt would be
increased by approximately $3.8 million as of June 30, 2003. Such fair value
changes may affect the Company's determination as to whether to retain, replace
or retire its long-term debt.

The Company has a diversified customer base. As such, the risk associated with
concentration of credit risk is inherently minimized. As of June 30 2003 and
2002, no one customer accounted for more than 4% of our outstanding receivables
or of our sales.

Commodity Prices

The Company is exposed to fluctuating market prices for commodities, primarily
steel. Each of our segments is subject to the effects of changing raw material
costs caused by the underlying commodity price movements. In general, we do
not enter into purchase contracts that extend beyond one operating cycle. We
do not believe that this exposure is material to the Company.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

STATEMENTS OF CONSOLIDATED INCOME

STANDEX INTERNATIONAL CORPORATION AND SUBSIDIARIES

FOR THE YEARS ENDED JUNE 30
(IN THOUSANDS, EXCEPT PER SHARE DATA) 2003 2002 2001

Net Sales............................ $574,536 $563,201 $586,526
Cost of sales........................ 389,053 377,293 390,890
Gross profit......................... 185,483 185,908 195,636

Selling, general and administrative... 150,936 146,915 142,776
Other operating expense, net......... 1,306 - -
Restructuring/asset impairment....... 5,580 - -

Income from operations............... 27,661 38,993 52,860

Interest expense..................... (6,956) (8,546) (10,998)
Other, net........................... 146 (161) 200
Total................................ (6,810) (8,707) (10,798)

Income before income taxes........... 20,851 30,286 42,062
Provision for income taxes........... 7,014 9,657 17,399
Income from continuing operations.... 13,837 20,629 24,663

Income/(loss)from discontinued
operations......................... 312 (232) 234

Income before cumulative
effect of a change in
accounting principle............... $14,149 $20,397 $24,897

Cumulative effect of a change
in accounting principle............ - (3,779) -
Net income........................... $14,149 $16,618 $24,897

Basic earnings per share:
Income from continuing
operations......................... $1.15 $1.70 $2.03
Income/(loss) from discontinued
operations......................... $0.02 $(.02) $0.02
Cumulative effect of a change in
accounting principle............... $ - $(.31) $ -
Total................................ $1.17 $1.37 $2.05

Diluted earnings per share:
Income from continuing
operations......................... $1.14 $1.68 $2.00
Income/(loss) from discontinued
operations......................... $0.02 $(.02) $0.02
Cumulative effect of a change
in accounting principle............ $ - $(.31) $ -
Total................................ $1.16 $1.35 $2.02

See notes to consolidated financial statements.

Statements of Consolidated Stockholders' Equity

Unamortized Accumulated
Additional Value of Other Treasury Stock Total
Paid-in Restricted Retained Comprehensive ------------------ Stockholders'
Year End (In thousands) Common Stock Capital Stock Earnings Income Shares Amount Equity
- ---------------------------------------------------------------------------------------------------------------------------------

<s> <c> <c> <c> <c> <c> <c> <c> <c>
Balance, June 30, 2000 $41,976 $ 9,274 $ $363,303 $ (7,965) 15,660 $(241,774) $164,814
Stock issued for employee stock
options and stock purchase
plans, net of related income
tax benefit 1,372 (311) 4,828 6,200
Restricted stock awards 111 (1,450) (86) 1,339 -
Amortization of restricted stock
awards 401 401
Stock issued in conjunction with
acquisition 193 (29) 446 639
Treasury stock acquired 587 (12,483) (12,483)
Comprehensive income
Net income 24,897 24,897
Foreign currency
translation adjustment (1,109) (1,109)
Interest rate swap liability (1,060) (1,060)
--------
Total comprehensive income 22,728
--------
Dividends paid ($.83 per share) (10,125) (10,125)
-------------------------------------------------------------------------------------------
Balance, June 30, 2001 41,976 10,950 (1,049) 378,075 (10,134) 15,821 (247,644) 172,174
Stock issued for employee stock
options and stock purchase plans,
net of related income tax benefit 1,125 (221) 3,548 4,673
Amortization of
restricted stock awards 394 394
Treasury stock acquired 297 (6,984) (6,984)
Comprehensive income
Net income 16,618 16,618
Foreign currency
translation adjustment 1,091 1,091
Interest rate swap
liability 570 570
--------
Total comprehensive income 18,279
--------
Dividends paid ($.84 per share) (10,104) (10,104)
-------------------------------------------------------------------------------------------
Balance, June 30, 2002 41,976 12,075 (655) 384,589 (8,473) 15,897 (251,080) 178,432
Stock issued for employee stock
options and stock purchase plans,
net of related income tax benefit 397 (6) (55) 342
Amortization of restricted stock
awards 555 555
Stock issued in conjunction with
acquisition 898 (174) 2,755 3,653
Treasury stock acquired 74 (1,719) (1,719)
Comprehensive income
Net income 14,149 14,149
Foreign currency translation
adjustment 11,350 11,350
Additional minimum liability,
net of tax (34,695) (34,695)
--------
Total comprehensive income (9,196)
--------
Dividends paid ($.84 per share) (10,145) (10,145)
-------------------------------------------------------------------------------------------
Balance, June 30, 2003 $41,976 $13,370 $ (100) $388,593 $(31,818) 15,791 $(250,099) $161,922
===========================================================================================

See notes to consolidated financial statements.

CONSOLIDATED BALANCE SHEETS

STANDEX INTERNATIONAL CORPORATION AND SUBSIDIARIES

AS OF JUNE 30 (in thousands, except share data) 2003 2002

ASSET

Current Assets
Cash and cash equivalents...................... $ 11,509 $ 8,092
Accounts receivable............................ 91,714 93,219
Inventories.................................... 82,530 92,931
Prepaid expenses............................... 5,343 4,570
Total current assets........................... 191,096 198,812

Net property, plant and equipment.............. 111,597 112,892
Goodwill - net................................. 50,002 36,250
Prepaid pension cost........................... 25,923 47,405
Long-term deferred tax asset................... 21,564 -
Other non-current assets....................... 22,298 10,680
Total non-current assets....................... 231,384 207,227

Total assets................................... $422,480 $406,039

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current portion of debt........................ $ 910 $ 82,221
Accounts payable............................... 41,241 35,209
Accrued payroll and employee benefits.......... 16,979 14,944
Income taxes................................... 2,508 1,221
Other.......................................... 23,661 21,184
Total current liabilities...................... 85,299 154,779

Long-term debt - less current portion.......... 109,019 50,087
Deferred income taxes.......................... 18,205 18,909
Deferred pension............................... 39,347 3,342
Other non-current liabilities.................. 8,688 490
Total non-current liabilities.................. 175,259 72,828

Commitments and Contingencies
Stockholders' Equity
Common stock-authorized, 60,000,000 shares
in 2003 and 2002; par value,
$1.50 per share; issued 27,984,278 shares
in 2003 and 2002.............................. 41,976 41,976
Additional paid-in capital..................... 13,370 12,075
Retained earnings.............................. 388,593 384,589
Unamortized value of restricted stock.......... (100) (655)
Accumulated other comprehensive income......... (31,818) (8,473)
Treasury shares (15,791,206 shares in 2003
and 15,897,213 shares in 2002,
respectively)................................. (250,099) (251,080)
Total stockholders' equity..................... 161,922 178,432

Total liabilities and stockholders' equity..... $422,480 $406,039

See notes to consolidated financial statements.

STATEMENT OF CONSOLIDATED CASH FLOWS

STANDEX INTERNATIONAL CORPORATION AND SUBSIDIARIES

YEAR ENDED JUNE 30 (IN THOUSANDS) 2003 2002 2001
CASH FLOWS FROM OPERATING ACTIVITIES

Net income............................ $ 14,149 $ 16,618 $24,897
Income(loss) from discontinued
operations, net of dispositions...... 312 (232) 234
Income from continuing operations..... 13,837 16,850 24,663

Adjustments to reconcile net
income to net cash provided
by operating activities:
Cumulative effect of
change in accounting
principle........................ - 3,779 -
Depreciation and amortization..... 13,551 13,492 14,221
Amortization of restricted
stock awards..................... 555 394 401
Deferred income taxes............. (704) (432) 3,118
Net pension expense(credit)....... 502 (2,025) (3,608)
Non-cash portion of
restructure charge............... 3,914 - -
(Gain)/loss on sale of
investments, real estate
and equipment.................... (4,977) 35 182
Increase/(decrease) in cash
from changes in assets
and liabilities, net
of effects from acquisitions
& dispositions:
Receivables, net............... 5,522 4,598 7,433
Inventories.................... 9,805 8,691 10,566
Prepaid expenses and other..... (12,633) (3,195) (3,663)
Accounts payable............... 5,958 1,604 (2,909)
Accrued payroll, employee
benefits and other
liabilities................... 13,694 1,744 (8,764)
Income taxes................... 1,594 (3,069) (829)
Net cash provided by
operating activities
from continuing operations.... 50,618 42,466 40,811
Net cash provided by
operating activities from
discontinued operations....... 650 1,895 1,287
Net cash provided by
operating activities.......... 51,268 44,361 42,098

CASH FLOWS FROM INVESTING ACTIVITIES
Expenditures for property
and equipment...................... (7,882) (9,883) (13,754)
Expenditures for acquisitions,
net of cash acquired............... (17,681) - (15,048)
Proceeds from sale of
investments, real estate
and equipment...................... 6,032 268 1,906
Proceeds from disposition
of businesses...................... - - 532
Net cash used for investing
activities from continuing
operations........................... (19,531) (9,615) (26,364)
Net cash provided by/(used for)
investing activities from
discontinued operations.............. 4,236 (138) (78)
Net cash used for investing
activities........................... (15,295) (9,753) (26,442)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from additional
borrowings......................... 25,148 10,045 7,051
Payments of debt..................... (47,042) (31,068) (6,292)
Stock issued under employee
stock option and
purchase plans..................... 342 4,673 6,199
Cash dividends paid.................. (10,145) (10,104) (10,125)
Purchase of treasury stock........... (1,719) (6,984) (12,483)
Net cash used for financing
activities from
continuing operations................ (33,416) (33,438) (15,650)
Net cash used for financing
activities from
discontinued operations.............. (755) (2,220) (1,000)
Net cash used for
financing activities................. (34,171) (35,658) (16,650)

Effect of exchange rate
changes on cash...................... 1,615 187 (489)

Net changes in cash and
cash equivalents..................... 3,417 (863) (1,483)
Cash and cash equivalents
at beginning of year................. 8,092 8,955 10,438

Cash and cash equivalents
at end of year....................... $ 11,509 $ 8,092 $ 8,955

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Stock issued for acquisitions...... $ 3,660 $ - $ 639
Cash paid during the year for:
Interest.......................... 6,930 8,921 11,195
Income taxes...................... 6,656 13,484 15,408

See notes to consolidated financial statements.

STANDEX INTERNATIONAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

SUMMARY OF ACCOUNTING POLICIES

BASIS OF PRESENTATION AND CONSOLIDATION

Standex International Corporation ("Standex" or the "Company") is a diversified
manufacturing and service company with operations primarily in the United
States and Europe. The accompanying consolidated financial statements include
the accounts of Standex International Corporation and its subsidiaries and is
prepared in accordance with accounting principles generally accepted in the
United States of America. Prior to June 30, 2002, foreign operations were
consolidated based on a May 31 year end. Effective July 1, 2002 international
operations have been consolidated using a June 30 year end. This change
resulted in reporting thirteen months of international sales for the year ended
June 30, 2003, or an additional $4.4 million of net sales. The impact on net
income of the additional month of international operations was not significant.
All significant intercompany transactions are eliminated.

CASH AND CASH EQUIVALENTS

Cash and cash equivalents include highly liquid investments purchased with a
maturity of three months or less. These investments are carried at cost, which
approximates fair value.

TRADING SECURITIES

The Company purchases certain investments in connection with the Keysop Plan
for executives discussed below. These investments are classified as held for
trading and reported at fair value. The investments generally consist of
mutual funds and are included in other non-current assets and amounted to $6.4
million at June 30, 2003.

ACCOUNTS RECEIVABLE ALLOWANCES
The accounts receivable allowances at June 30, 2003 and 2002 were $5,054,000
and $4,609,000, respectively.

INVENTORIES AND REVENUE RECOGNITION

Inventories are stated at the lower of first-in, first-out cost or market.
Product and related service revenue is recognized when the price to the
customer is fixed or determinable, the collectibility of the invoice is
established and when delivery has occurred. Revenues under certain fixed price
contracts are generally recorded when deliveries are made or, in a limited
number of cases, on a percentage of completion basis.

ASSETS HELD FOR SALE

Assets held for sale are reported at the lower of the assets carrying amount or
fair value, less costs to sell. Assets held for sale are included in other
non-current assets in the consolidated balance sheet and amounted to $1.2
million at June 30, 2003.

PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are reported at cost less accumulated
depreciation. Depreciation is recorded on assets over their estimated useful
lives, generally using the straight-line method. Lives for property, plant and
equipment are as follows:

Buildings............................ 40 to 50 years
Leasehold Improvements............... 10 to 15 years
Machinery and Equipment.............. 8 to 15 years
Furniture and Fixtures............... 3 to 10 years
Computer hardware and software....... 3 to 7 years

Property, plant and equipment balances at June 30, are as follows (in
thousands):

2003 2002

Land, buildings and leasehold improvements..... $ 84,527 $ 89,449
Machinery, equipment and other................. 193,931 184,181
Total..................................... 278,458 273,630
Less accumulated depreciation.................. 166,861 160,738
Property, plant and equipment - net....... $111,597 $112,892

Minor maintenance costs are expensed as incurred. Major improvements which
extend the life, increase the capacity or improve the safety or the efficiency
of property owned are capitalized. Major improvements to leased buildings are
capitalized as leasehold improvements and depreciated.

LONG-LIVED ASSETS

Long-lived assets that are used in operations, excluding goodwill, are tested
for recoverability whenever events or changes in circumstances indicate that
its carrying amount may not be recoverable. Recognition and measurement of a
potential impairment loss is performed on assets grouped with other assets and
liabilities at the lowest level where identifiable cash flows are largely
independent of the cash flows of other assets and liabilities. An impairment
loss is the amount by which the carrying amount of a long-lived asset (asset
group) exceeds its estimated fair value. Fair value is determined based on
discounted cash flows or appraised values, depending upon the nature of the
assets.

GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS

Prior to July 1, 2001, the excess of purchase price of acquired businesses over
the fair value of net identifiable assets at date of acquisition was recorded
as goodwill and amortized on a straight-line basis over a forty- year period.
Accumulated amortization aggregated $12,184,000 at June 30, 2001. Amortization
of goodwill was $1,113,000 for fiscal 2001.

Effective July 1, 2001, the Company adopted the provisions of Statement of
Financial Accounting Standards ("SFAS") No. 141, "Business Combinations" and
SFAS No. 142, "Goodwill and Other Intangible Assets." Accordingly, all
business combinations initiated after June 30, 2001 are accounted for using the
purchase method, and goodwill and intangible assets with indefinite lives are
no longer amortized, but are reviewed annually for impairment or more
frequently if impairment indicators arise. Separable intangible assets that are
not deemed to have indefinite lives are amortized over their useful lives.

The effects of adopting the new standard on net income and earnings per share
for the years ended June 30, are as follows:

(IN THOUSANDS) 2003 2002 2001

Income before cumulative change in
accounting principle................ $14,149 $20,397 $24,897
Add back: Goodwill amortization..... - - 1,113
Adjusted net income.................. $14,149 $20,397 $26,010

Basic earnings per share:
Reported net income.................. $ 1.17 $ 1.68 $ 2.05
Goodwill amortization................ - - .09
Adjusted net income.................. $ 1.17 $ 1.68 $ 2.14

Diluted earnings per share:
Reported net income.................. $ 1.16 $ 1.66 $ 2.02
Goodwill amortization................ - - .09
Adjusted net income.................. $ 1.16 $ 1.66 $ 2.11

The result of the Company's initial assessment of goodwill for impairment
resulted in a non-cash charge of $3,779,000, which is reported as cumulative
effect of a change in accounting principle in the accompanying Statements of
Consolidated Income. There was no tax benefit for this change in accounting
principle as the impaired goodwill was not deductible for tax purposes. Future
adjustments for impairment of goodwill, if any, will be recognized as an
operating expense.

INCOME TAXES

Deferred assets and liabilities are recorded for the expected future tax
consequences of events that have been included in the financial statements or
tax returns. Deferred tax assets and liabilities are determined based on the
differences between the financial statements and the tax bases of assets and
liabilities using enacted tax rates. Valuation allowances are provided when
the Company does not believe it more likely than not the benefit of identified
tax assets will be realized.

RESEARCH AND DEVELOPMENT

Research and development expenditures are expensed as incurred.

STOCK COMPENSATION PLANS

In December 2002, SFAS No. 148, "Accounting for Stock-Based Compensation -
Transition and Disclosure" ("SFAS 148") was issued. SFAS 148 amends the
transition and disclosure provisions previously provided by SFAS No. 123,
"Accounting for Stock-Based Compensation" ("SFAS 123"). SFAS 148 provides
alternative methods of transition for a voluntary change to the fair value
based method of accounting for stock-based employee compensation and requires
more prominent and more frequent disclosures in financial statements about the
effects of stock-based compensation.

The Company accounts for stock options at their intrinsic value with disclosure
of the effects of fair value accounting on net income and earnings per share on
a pro forma basis.

FOREIGN CURRENCY TRANSLATION

Assets and liabilities of non-U.S. operations denominated in local currencies
are translated into U.S. dollars at year-end exchange rates. Revenues and
expenses of these operations are translated using average exchange rates. The
resulting translation adjustment is reported as a component of comprehensive
income, net of related income taxes, in the Statements of Consolidated
Stockholders' Equity. Gains and losses from currency transactions are included
in results of operations.

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

Standex manages its debt portfolio by periodically using interest rate swaps to
achieve an overall desired position of fixed and floating rate debt to reduce
certain exposures to interest rate fluctuations. These interest rate swaps are
generally designated as cash flow hedge instruments, and reported at fair
market value. Changes in the fair value of the interest rate swaps designated
as cash flow hedges are recorded in other comprehensive income. The
effectiveness of outstanding interest rate swaps are measured on a quarterly
basis. There were no outstanding interest rate swaps at June 30, 2003, and one
contract was outstanding for a notional value of $10 million at June 30, 2002.

Forward foreign currency exchange contracts are periodically used to limit the
impact of currency fluctuations on certain anticipated foreign cash flows, such
as dividends and loan payments from subsidiaries. The Company enters into such
contracts for hedging purposes only. The Company does not hold or issue
derivative instruments for trading purposes. There were no outstanding forward
foreign currency exchange contracts at June 30, 2003 or 2002.

CONCENTRATION OF CREDIT RISK

The Company is subject to credit risk through trade receivables and short-term
cash investments. Concentration of risk with respect to trade receivables is
minimized because of the diversification of the Company's operations, as well
as its large customer base and its geographical dispersion. No individual
customer accounts for more than 4% of revenues or accounts receivable.

Short-term cash investments are placed with high credit-quality financial
institutions or in short-duration, high quality debt securities. The Company
monitors the amount of credit exposure in any one institution or type of
investment instrument. The Company is also subject to credit risk exposure
relating to its interest rate swap agreements and foreign currency exchange
contracts.

ACCOUNTING ESTIMATES

The preparation of consolidated financial statements in conformity with
generally accepted accounting principles requires the use of estimates,
judgments and assumptions that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets
and liabilities at the date of the financial statements and for the period then
ended. Significant estimates at Standex include the allowance for doubtful
accounts, potentially obsolete inventory, impairments of tangible and
intangible assets, income taxes, self-insurance liabilities, incentive
compensation liabilities, assumptions used for defined benefit plans and
contingencies. Estimates are based on historical experience, actuarial
estimates, current conditions and various other assumptions that are believed
to be reasonable under the circumstances. These estimates form the basis for
making judgments about the carrying values of assets and liabilities when they
are not readily apparent from other sources. These estimates assist in the
identification and assessment of the accounting treatment necessary with
respect to commitments and contingencies. Actual results may differ from these
estimates under different assumptions or conditions.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amounts of cash and cash equivalents, accounts receivable,
accounts payable and accrued expenses approximate fair value because of their
short-term nature. Trading securities and interest rate swaps are reported at
fair value. The fair value of debt and interest rate swaps are estimated based
on the current trading price of the underlying security or the price at which a
similar instrument with similar terms could be obtained at year end.

EARNINGS PER SHARE
<CATPION>
The following table sets forth the number of shares (in thousands) used in the
computation of basic and diluted earnings per share:

2003 2002 2001

Basic - Average Shares Outstanding... 12,058 12,113 12,172
Effect of Dilutive
Securities - Stock Options........ 121 203 166
Diluted - Average Shares
Outstanding....................... 12,179 12,316 12,338

Both basic and dilutive income are the same for computing earnings per share.
Options, which were not included in the computation of diluted earnings per
share because to do so would have had an anti-dilutive effect, totaled 453,268;
294,090 and 565,091 for the years ended June 30, 2003, 2002 and 2001,
respectively.

RECLASSIFICATIONS

Certain prior years' amounts have been reclassified to conform to the 2003
financial statement presentation.

ADOPTION OF SFAS AND NEW ACCOUNTING PRONOUNCEMENTS

Effective July 1, 2002, the Company adopted Statement of Financial Accounting
Standards (SFAS) Nos. 144, 145 and 146. SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets," creates one accounting model,
based on the framework established in SFAS No. 121, to be applied to all long-
lived assets including discontinued operations. The impact of the adoption of
SFAS No. 144 was not significant.

The provisions of SFAS No. 146, "Accounting for Costs Associated with Exit or
Disposal Activities," were adopted as of the beginning of the year. This
standard addresses financial accounting and reporting for costs associated with
exit or disposal activities and nullifies Emerging Issues Task Force Issue No.
94-3, "Liability Recognition for Certain Employee Termination Benefits and
Other Costs To Exit an Activity (including Certain Costs Incurred in a
Restructuring)." The standard requires that a liability for costs associated
with an exit or disposal activity be recognized only when a liability is
incurred. Prior to the adoption of this standard, liabilities were generally
recognized when management, with an appropriate level of authority, committed
to a plan for the exit or disposal of an activity. The Company announced in
October 2002 that restructuring charges in the range of $11 to $12 million
would be recorded over the next 18 months. If this standard had not been
adopted, a significant portion of these charges would have been recorded in the
current year instead of the $5.6 million (pre-tax) which has been recorded.

In December 2002, the Financial Accounting Standards Board issued SFAS No. 148,
"Accounting for Stock-Based Compensation - Transition and Disclosure," which
amends the transition and disclosure provisions of SFAS No. 123, "Accounting
for Stock-Based Compensation." Statement 148 provides methods of transition
for a voluntary change to the fair value based method of accounting for stock-
based employee compensation and amends the disclosure requirements of SFAS No.
123 to require more prominent and more frequent disclosures in financial
statements about the effects of stock-based compensation. The transition
provisions are effective for fiscal years ending after December 15, 2002. The
disclosure provisions are effective for interim periods beginning after
December 15, 2002. The Company adopted the interim period disclosure
provisions of SFAS No. 148 in the third quarter of this year. The adoption of
SFAS No. 148 had no effect on the Company's financial condition or results of
operations.

INVENTORIES

Inventories are comprised of (in thousands):
JUNE 30 2003 2002

Raw materials............................. $28,954 $33,257
Work in process........................... 19,074 21,779
Finished goods............................ 34,502 37,895
Total.................................. $82,530 $92,931

GOODWILL

Changes to goodwill during the years ended June 30, 2003 and 2002 are as
follows (in thousands):

2003 2002

Balance at beginning of year.............. $ 36,250 $ 41,069
Impairments/dispositions.................. (421) (3,779)
Additions................................. 12,040 313
Other adjustments......................... 2,133 (1,353)
Balance at end of year.................... $ 50,002 $ 36,250

Goodwill additions, improvements and dispositions are discussed elsewhere in
the Notes to Consolidated Financial Statements.

DEBT

Debt is comprised of (in thousands):
JUNE 30 2003 2002

Bank credit agreements.................... $ 34,200 $74,732
Institutional investors
5.94% to 7.13% (due 2004-2012)......... 71,429 53,571
Other 3.0% to 4.85%
(due 2004-2018)........................ 3,928 4,005
Total................................. 109,557 132,308
Less current portion...................... 538 82,221
Total long-term debt................ $109,019 $50,087

BANK CREDIT AGREEMENTS

At June 30, 2003, the Company has an unsecured revolving credit facility (the
"Facility") with eight banks that provides for a maximum credit line of
$130,000,000. Borrowings under the Facility bear interest at a rate equal to
the sum of a base rate or a Eurodollar rate, plus an applicable percentage
based on the Company's consolidated leverage ratio, as defined by the Facility.
As of June 30, 2003, the effective rate of interest for outstanding borrowings
under the Facility was 2.25%. The Company is required to pay an annual fee of
0.3% on the maximum credit line. As of June 30, 2003, the Company had
borrowings of $34 million under the Facility. As of June 30, 2002, the Company
had borrowings under a prior agreement of $50 million. Available borrowings
under the Facility are reduced by unsecured short-term borrowings. At June 30,
2003, the Company had the ability to borrow an additional $95 million under the
Facility.

The Company also has a money market credit facility with a bank. The agreement
provides for a maximum credit line of $10,000,000 and is unsecured. Borrowings
under the money market facility reduce available borrowings under the revolving
credit agreement. As of June 30, 2003, the Company had borrowings of $200,000.
The Company has the option of refinancing this amount under the revolving
credit facility and as such has classified this amount as long term.

INSTITUTIONAL INVESTOR AGREEMENTS

The Company has three note purchase agreements with institutional investors of
$25,000,000, $25,000,000 and $50,000,000 dated October 2002, October 1998 and
September 1995, respectively. The notes bear interest at annual rates of
5.94%, 6.80% and 7.13%, respectively. Both note purchase agreements of
$25,000,000 require payment of interest annually and are due and payable in
October 2012 and October 2008, respectively. The $50,000,000 note purchase
agreement requires annual payments of interest and principle each September.
As of June 30, 2003 and 2002, the balance outstanding under the note purchase
agreements aggregated $71,429,000 and $53,571,000, respectively.

INTEREST RATE SWAP AGREEMENTS

At June 30, 2003, the Company had no interest rate swap contracts open. At
June 30, 2002, the Company had one interest rate swap contract with a notional
amount of $10.0 million. The agreement converted debt with a variable interest
rate to a fixed interest rate of 7.5% and matured in May 2003.

LOAN COVENANTS AND REPAYMENT SCHEDULE

The Company's loan agreements contain a limited number of provisions relating
to the maintenance of certain financial ratios and restrictions on additional
borrowings and investments. The most restrictive of these provisions requires
that the Company maintain a minimum ratio of earnings to fixed charges, as
defined, on a trailing four quarters basis and a minimum net worth level, as
defined.

Debt is due as follows: 2004, $538,000; 2005, $75,000; 2006, $55,629,000;
2007, $3,573,000; and thereafter, $49,742,000.

FAIR VALUE OF DEBT

The fair value of the Facility approximates the carrying value due to the
short-term nature of the underlying debt and the variability of the interest
rate. The fair value of the Institutional Investor Agreements was estimated to
be approximately $79 million at June 30, 2003.

ACCRUED PAYROLL AND EMPLOYEE BENEFITS

This current liability caption consists of (in thousands):

JUNE 30 2003 2002

Payroll................................... $13,680 $13,091
Benefits.................................. 3,059 1,654
Taxes..................................... 240 199
Total.................................. $16,979 $14,944

COMMITMENTS

The Company leases certain property and equipment under agreements with initial
terms ranging from one to twenty years. Rental expense for the years ended
June 30, 2003, 2002 and 2001 was approximately $8,100,000; $8,200,000 and
$7,500,000, respectively. At June 30, 2003, the minimum annual rental
commitments under noncancelable operating leases, principally real estate, were
approximately: 2004, $6,000,000; 2005, $4,600,000; 2006, $3,400,000; 2007,
$2,900,000; 2008, $2,500,000; and thereafter, $5,700,000.

CONTINGENCIES

The Company is a party to various claims and legal proceedings related to
environmental and other matters generally incidental to its business.
Management has evaluated each matter based, in part, upon the advice of its
independent environmental consultants and in-house personnel. Management has
considered that such matters are not material to the consolidated financial
statements.

INCOME TAXES

The provision for income taxes consists of (in thousands):

2003 2002 2001
Current:

Federal...................... $ 1,925 $ 7,314 $ 11,095
State........................ 887 1,186 1,003
Non-U.S...................... 4,906 2,079 2,080
Total........................ 7,718 10,579 14,178
Deferred........................ (704) (922) 3,221
Total........................ $ 7,014 $ 9,657 $ 17,399

The components of income from continuing operations before income taxes and
cumulative effect of the change in accounting principle are as follows (in
thousands):

2003 2002 2001

U.S. Operations................. $ 9,817 $ 24,940 $ 35,954
Non-U.S. Operations............. 11,034 5,346 6,108
Total........................ $ 20,851 $ 30,286 $ 42,062

A reconciliation of the U.S. Federal income tax rate on continuing operations
before cumulative effect of a change in accounting principle to the effective
income rate is as follows:

2003 2002 2001

Statutory tax rate................... 35.0% 35.0% 35.0%
Non-U.S.............................. 1.4 0.4 2.9
State taxes.......................... 2.5 2.8 3.0
Non-deductible goodwill.............. - - 1.0
Contingencies........................ - (4.3) -
Tax credits........................ (3.4) - -
Other................................ (1.9) (2.0) (0.5)

Effective income tax rate............ 33.6% 31.9% 41.4%

The Company changed its tax contingency reserve by $1.3 million in 2002. This
was primarily the result of management's evaluation of the need for certain
liabilities that had been established for various tax contingencies in prior
years. The Company considered the level of recorded amounts, the status of tax
filings under examination by the Internal Revenue Service and the ability to
benefit from distributions from foreign subsidiaries.

During 2003, as a part of ongoing tax strategies, the Company completed a
multi-year research and development (R&D) tax credit project. As a result of
the project, previously filed Federal and state tax returns were amended for
the years 1997 through 2001. Based on these amended tax returns, benefits, net
of associated project cost, of up to $2 million could be realized. Taxing
authorities have initiated an examination of these amended returns and any
benefit will be recorded in the Consolidated Statements of Income when those
examinations are complete or the results of the review can be reasonably
estimated with a high level of certainty.

Significant components of the Company's deferred income taxes are as follows
(in thousands):

2003 2002

Deferred tax liabilities:
Accelerated depreciation................. $ 8,668 $ 9,291
Net pension credit....................... 16,320 15,774
Other items.............................. 154 327
Deferred tax assets:
Expense accruals......................... (6,367) (5,930)
Additional minimum pension liability..... (21,564) -
Compensation costs....................... (570) (553)
Net deferred tax (asset)/liability....... $(3,359) $ 18,909

Deferred income taxes are reported in the
Consolidated Balance Sheet as:
Long-term deferred tax asset............. $(21,564) $ -
Long-term deferred tax liabilities....... 18,205 18,909
Net deferred tax (asset)/liability....... $(3,359) $ 18,909

At June 30, 2003, unrepatriated earnings of non-U.S. subsidiaries totaled
$33,825,000. No provision for U.S. income and foreign withholding taxes has
been made for substantially all unrepatriated foreign earnings because it is
expected that such earnings will be reinvested indefinitely or the
distribution of any remaining amount would be principally offset by foreign
tax credits. The determination of the withholding taxes that would be payable
upon remittance of these earnings and the amount of unrecognized deferred tax
liability on these unremitted earnings is not practicable.

INDUSTRY SEGMENT INFORMATION

The Company has determined that it has three distinct reportable segments:
Food Service, Consumer and Industrial. These three segments are managed
separately, and the operating results of each segment are regularly reviewed
and evaluated separately by the Company's senior management. During fiscal
2002, the Company realigned how certain operations are managed and reported to
the chief decision maker. The segment information for fiscal 2001 has been
recast to reflect the realignment. The Food Service and Industrial segments
information have also been recast to reflect the impact of discontinued
operations.

Net sales include only transactions with unaffiliated customers and include no
significant intersegment or export sales. Operating income by segment and
geographic area excludes general corporate and interest expenses. Assets of
the Corporate segment consist primarily of cash, administrative buildings,
equipment, prepaid pension cost, and other non-current assets.

DEPRECIATION AND
NET SALES AMORTIZATION
YEAR ENDED JUNE 30
(IN THOUSANDS) 2003 2002 2001 2003 2002 2001

Food Service... $141,867 $ 135,308 $ 143,075 $ 2,103 $ 2,089 $ 2,180
Consumer....... 99,814 110,150 115,615 1,524 1,501 1,695
Industrial..... 332,855 317,743 327,836 9,575 9,538 9,039
Corporate
and Other.... - - - 349 364 1,307
Total....... $574,536 $ 563,201 $ 586,526 $13,551 $13,492 $14,221

AS OF AND YEAR ASSETS EMPLOYED CAPITAL EXPENDITURES
ENDED JUNE 30
(IN THOUSANDS) 2003 2002 2001 2003 2002 2001

Food Service... $ 65,345 $ 64,559 $ 73,927 $ 1,310 $ 520 $ 1,569
Consumer....... 36,785 42,971 45,078 605 1,626 527
Industrial..... 268,459 255,330 264,011 5,871 7,646 11,475
Corporate
and Other..... 51,891 43,179 41,248 96 91 183
Total....... $422,480 $ 406,039 $ 424,264 $ 7,882 $ 9,883 $ 13,754

INCOME FROM
GOODWILL OPERATIONS
YEAR ENDED JUNE 30 YEAR ENDED JUNE 30
(IN THOUSANDS) 2003 2002 2003 2002 2001

Food Service............ $ 467 $ 672 $ 10,455 $ 9,802 $ 13,627
Consumer................ 1,571 1,571 2,014 7,114 9,680
Industrial.............. 47,670 33,734 35,057 33,419 37,610
Restructuring charge.... - - (5,580) - -
Other expenses, net..... - - (1,306) - -
Corporate............... 294 273 (12,979) (11,342) (8,057)
Total................ $ 50,002 $ 36,250 $ 27,661 $ 38,993 $ 52,860

PRODUCT NET SALES INFORMATION:

YEAR ENDED JUNE 30 (IN THOUSANDS) 2003 2002 2001

Food preparation, storage
and presentation products.......... $197,882 $ 190,652 $204,123
Printing and publishing
products........................... 106,552 113,685 126,115
Home and road construction
products........................... 123,735 123,084 118,483
Aerospace, automotive and
electronic products................ 128,500 116,090 117,612
Miscellaneous........................ 17,867 19,690 20,193
Total............................. $574,536 $ 563,201 $586,526

FINANCIAL DATA RELATED TO NON-U.S. OPERATIONS:

AS OF AND YEAR ENDED JUNE 30 NON-U.S.
(IN THOUSANDS) 2003 2002 2001

Net sales............................ $ 86,661 $ 68,345 $72,911
Income from operations............... 14,146 5,628 6,330
Long-lived assets.................... 31,921 30,488 32,511

EMPLOYEE BENEFIT PLANS

RETIREMENT PLANS

The majority of employees are covered by defined benefit pension plans,
including certain employees in foreign countries. Plan assets are generally
invested in common stocks and fixed income securities. Contributions for U.S.
plans are generally equal to the minimum amounts required by federal laws and
regulations. Foreign plans are funded in accordance with the requirements of
regulatory bodies governing each plan.

The components of net pension expense (credit) are as follows (in thousands):

YEAR ENDED JUNE 30 2003 2002 2001

Service cost..................... $ 5,670 $ 5,165 $ 4,687
Interest cost.................... 12,227 11,732 10,949
Expected return on
plan assets................... (18,211) (18,620) (17,874)
Amortization of prior
service cost.................. 263 252 214
Recognized actuarial loss........ 744 521 153
Amortization of transition
asset......................... (191) (1,075) (1,738)
Net pension expense/(credit). $ 502 $(2,025) $(3,609)

The following table sets forth the funded status and amounts recognized as of
June 30, 2003 and 2002 for the Company's U.S. and non-U.S. defined benefit
pension plans (in thousands):

YEAR ENDED JUNE 30 2003 2002

Change in benefit obligation:
Benefit obligation, beginning of year..... $ 171,744 $157,083
Service cost.............................. 5,192 5,165
Interest cost............................. 12,227 11,732
Employee contributions.................... 240 212
Amendments/settlements/curtailments....... 125 308
Actuarial loss............................ 23,007 8,656
Foreign currency exchange rate changes.... 3,679 254
Benefits paid............................. (11,698) (11,666)

Benefit obligation, end of year........... $ 204,516 $171,744

YEAR ENDED JUNE 30 2003 2002
Change in plan assets:
Fair value of plan assets,
beginning of year....................... $ 169,247 $170,703
(Loss)/return on plan assets.............. (19,562) 8,319
Employer contribution..................... 712 596
Employee contributions.................... 240 212
Foreign currency exchange rate changes.... 1,502 278
Benefits paid............................. (10,884) (10,861)
Fair value of plan assets, end of year.... $ 141,255 $169,247

Funded status.............................. $(63,394) $(2,447)
Unrecognized transition asset.............. (117) (290)
Unrecognized net actuarial loss............ 106,184 44,747
Unrecognized prior service cost............ 1,952 2,053
Net amount recognized...................... $ 44,625 $ 44,063
Amounts recognized in the balance
sheet consist of:
Prepaid benefit cost...................... $ 25,923 $ 47,405
Additional minimum liability.............. (34,759) -
Intangible asset.......................... 1,791 -
Accrued benefit liability................. (4,588) (3,342)
Accumulated other comprehensive income.... 56,258 -
Net amount recognized...................... $ 44,625 $44,063

YEAR ENDED JUNE 30 2003 2002
Weighted average assumptions as of June 30

Discount rate........................ 5.50 - 6.50% 4.00 - 7.30%
Expected return on assets............ 7.50 - 9.00% 8.50 - 9.60%
Rate of compensation increase........ 3.00 - 4.00% 3.50 - 4.00%

Included in the above are the following assumptions relating to the defined
benefit pension plans in the United States for fiscal 2003: discount rate
6.5%, expected return on assets 9.0% and rate of compensation increase 4.0%.
For fiscal 2002 the assumptions were discount rate 7.3%, expected return on
assets 9.6% and rate of compensation increase 4.0%. The U.S. defined benefit
pension plans represent the majority of the Company's pension obligations.

Certain U.S. employees are covered by union-sponsored, multi-employer pension
plans. Contributions and costs are determined in accordance with the
provisions of negotiated labor contracts or terms of the plans. Pension
expense for these plans was $1,768,000; $1,973,000; and $1,953,000 in 2003,
2002 and 2001, respectively.

ADDITIONAL MINIMUM PENSION LIABILITY

The significant downturn in the equities markets and a decrease in interest
rates has impacted both the fair value of the Pension Plans' assets and the
accumulated benefit obligation. At the most recent measurement date, March 31,
2003, the valuation of the Company's obligation for its defined benefit pension
plans, the accumulated benefit obligation, for several of the defined benefit
plans exceeded the fair value of related plan assets. This resulted in the
Company incurring an additional minimum pension liability of $58.1 million at
June 30, 2003 related to its U.S. salaried plan, the SERP plan and U.K. plan,
representing the total of unfunded accumulated benefit obligations plus the
previously recorded prepaid pension assets. The June 30, 2003 additional
minimum liability was reduced to $33 million by an intangible asset of $1.8
million to the extent of unrecognized prior service cost and $23.3 million of
the previously recorded prepaid pension assets. The minimum liability, net of
the intangible recorded, of $56.3 million was recorded as a component of other
comprehensive loss, net of a tax benefit of $21.6 million.

During 2003, the Company made contributions of $2.2 million to the above plans.
Future changes in the additional minimum liability will be dependent on several
factors including actual returns on our pension plan assets, company
contributions, benefit plan changes and our assumed discount rate. Actuarial
assumptions have a significant impact on both pension and other postretirement
benefit expenses.

The projected benefit obligation, accumulated benefit obligation, and fair
value of plan assets for pension plans with accumulated benefit obligations in
excess of plan assets were $161 million, $139 million and $100 million
respectively, as of June 30, 2003 and $6 million $5 million and $0,
respectively as of June 30, 2002.

RETIREMENT SAVINGS PLANS

The Company has primarily two employee savings plans, one for salaried
employees and one for hourly employees. Substantially all of the Company's
full-time domestic employees are covered by these savings plans. Under the
provisions of the plans, employees may contribute a portion of their
compensation within certain limitations. The Company, at the discretion of the
Board of Directors, may make contributions on behalf of its employees under the
plans. Company contributions were $957,000, $1,775,000 and $1,975,000 for the
years ended June 30, 2003, 2002 and 2001, respectively. At June 30, 2003, the
salaried plan holds approximately 1.0 million shares of Company stock,
representing approximately 59% of the holdings of the plan.

OTHER PLANS

Certain retired executives are covered by an Executive Life Insurance Program.
During 2003 two executives retired and the Board of Directors approved benefits
under this plan of approximately $5.6 million. The $5.6 million charge is
included in Other operating expense, net in the Consolidated Statements of
Income.

The aggregate present value of current vested and outstanding benefits to all
participants was approximately $5,088,000 and $1,532,000 at June 30, 2003 and
2002, respectively and will be paid over the next ten years.

KEY EMPLOYEE SHARE OPTION PLAN (KEYSOP)

In fiscal 2002, the Company created a Key Employee Share Option Plan (the
"KEYSOP"). The purpose of the KEYSOP is to provide alternate forms of
compensation to certain key employees of the Company commensurate with their
contributions to the success of the Company's activities. Under the KEYSOP,
certain employees are granted options by the Compensation Committee and
designated property is purchased by the Company and placed in a Rabbi trust.
The option price is set at the date of the grant is 25% of the fair value of
the underlying assets. During fiscal 2003, the Company granted options to two
key employees prior to their retirement. Assets associated with the plan were
$6.4 million at June 30, 2003. As of June 30, 2003, the Company has recorded a
liability of approximately $4.9 million associated with the grants made during
fiscal 2003.

POSTRETIREMENT BENEFITS OTHER THAN PENSIONS

The Company sponsors unfunded postretirement medical and life plans covering
certain full-time employees who retire and have attained the requisite age and
years of service. Retired employees are required to contribute toward the cost
of coverage according to various established rules.

The Company records postretirement benefits (such as health care and life
insurance) during the years an employee provides services.

The following table sets forth the funded status of the postretirement benefit
plans and accrued postretirement benefit cost reflected in the consolidated
balance sheet at year end (in thousands):

YEAR ENDED JUNE 30 2003 2002

Change in benefit obligation:
Benefit obligation, beginning of year.... $ 5,744 $ 8,692
Service cost............................. 98 131
Interest cost............................ 407 653
Participant contributions................ 326 361
Actuarial loss/(gain).................... 4,506 (3,190)
Benefits paid ........................... (672) (903)
Benefit obligation, end of year........... 10,409 5,744
Fair value of plan assets................. - -
Funded status............................. (10,409) (5,744)
Unrecognized net actuarial (gain)/loss.... 825 (3,895)
Unrecognized transition obligation........ 4,441 4,886
Net amount recognized.................. $(5,143) $(4,753)

The assumed weighted average discount rate as of June 30, 2003 and 2002 was
6.50% and 7.30% respectively. The annual assumed rate of increase in the per
capita cost of covered health care benefits is 8.0% for retirees under age 65
in 2003 and 9.0% in 2002, trending down to 5.0% in 2006 and is assumed to
remain at that level thereafter. A 1% increase in the assumed health care cost
trend rate would have increased the accumulated benefit obligation by
$1,169,000 and the net postretirement cost by $62,000 in 2003.

Net postretirement benefit costs are as follows (in thousands):

YEAR ENDED JUNE 30 2003 2002 2001

Service cost......................... $ 98 $ 131 $ 86
Interest cost........................ 407 653 476
Amortization of
transition obligation.............. 445 445 445
Net amortization and deferral........ (215) (37) (184)
Net postretirement benefit cost... $ 735 $ 1,192 $ 823

STOCK BASED COMPENSATION AND PURCHASE PLANS

STOCK BASED COMPENSATION PLANS

Under incentive compensation plans, the Company is authorized to, and has made
grants of, stock options, restricted stock and performance share units to
provide equity incentive compensation to key employees. At June 30, 2003,
1,746,129 shares of common stock were reserved for issuance under these plans.
Of this amount, 920,701 shares are for options granted but unexercised and
49,298 shares are for restricted stock grants outstanding.

STOCK OPTION PLANS

SFAS No. 123 encourages, but does not require companies to record compensation
cost for stock based employee compensation plans at fair value. The Company
has chosen to continue to account for stock based compensation using the
intrinsic method. Under the intrinsic method, the compensation cost of stock
options is measured as the excess, if any, of the quoted market price of the
Company's stock at the date of the grant over the option exercise price and is
charged to operations over the vesting period.

At June 30, 2003, the Company has made grants of options under various stock
option plans. Generally, these options may be granted at or below fair market
value as of the date of grant and must be exercised within the period
prescribed by the Compensation Committee of the Board of Directors at the time
of grant but no later than ten years from the date of grant. Certain options
granted at fair value can be exercised anytime after six months from the date
of grant, and other options can only be exercised in accordance with the
vesting schedules prescribed by the Committee.

RESTRICTED STOCK AWARDS

The Company may award shares of restricted stock to eligible employees at no
cost, giving them in most instances all of the rights of stockholders, except
that they may not sell, assign, pledge or otherwise encumber such shares and
rights. Such shares and rights are subject to forfeiture if certain employment
conditions are not met. During the restriction period, recipients of the
shares are entitled to dividends on such shares, providing that such shares are
not forfeited. Dividends are accumulated and paid out at the end of the
restriction period. During 2003 and 2002, the Company granted 1,000, and
45,000 shares, respectively, of restricted stock to eligible employees.
Restrictions on the stock lapse between 2003 through 2010. Through June 30,
2003, restrictions on 100,242 shares have lapsed. Upon issuance of the shares,
an unamortized compensation expense on the dates of the grant was charged to
stockholders' equity and will be amortized over the restriction period. For
the years ended June 30, 2003 and 2002, $1,028,000 and $601,791, respectively,
was recognized as compensation expense.

EXECUTIVE COMPENSATION PROGRAM

The Company operates a compensation program for key employees. The plan
contains both an annual component as well as long-term component. Under the
annual component, participants are required to defer 20% (and may elect to
defer up to 50%) of their annual incentive compensation in restricted stock
which is purchased at a discount to the market. During the restriction period,
recipients of the shares are entitled to dividends on such shares, providing
that such shares are not forfeited. Dividends are accumulated and paid out at
the end of the restriction period. The restrictions on the stock expire after
three years. At June 30, 2003 and 2002, respectively, 36,742 and 53,115 shares
of restricted stock are outstanding and subject to restrictions that lapse
between 2003 and 2004. The compensation expense associated with this short-
term incentive program is charged to income over the restriction period. The
Company recorded compensation expense related to this program of $70,000 and
$166,000 for the years ended June 30, 2003 and 2002, respectively.

Under the long-term component, grants of performance share units ("PSU's") are
made annually to key employees and are earned based on the achievement of
certain overall corporate financial performance targets over a three-year
period. In addition, stock options are awarded under this program at the fair
market value as of the date of grant. These options vest ratably over five
years and must be exercised within seven years. In certain circumstances, such
as retirement or a change in control, vesting of the options granted are
accelerated and PSU's are paid off on a pro-rata basis. At June 30, 2003,
under this program 50,300 shares were subject to the restrictions related to
the PSU's. Compensation expense, if any, associated with the PSU's is recorded
to expense as the achievement of future performance objectives appears
probably. Recipients of the PSU's do not receive dividend rights until such
time as the shares have been issued.

A summary of stock options and awards issued under the above plans is as
follows:

WEIGHTED
NUMBER AVERAGE
OF EXERCISE
YEAR ENDED JUNE 30 SHARES PRICE

Outstanding, June 30, 2000
($0.00 to $32.1875 per share)............ 914,472 $ 21.17
Granted ($0.00 to $18.6875 per share)..... 205,551 16.95
Exercised ($0.00 to $23.375 per share).... (165,642) 18.62
Canceled ($0.00 to $31.5625 per share).... (41,649) 26.18

Outstanding, June 30, 2001
($0.00 to $32.1875 per share)............ 912,732 20.45
Granted ($0.00 to $21.45 per share)....... 228,000 15.43
Exercised ($0.00 to $25.875 per share).... (66,450) 18.99
Canceled ($0.00 to $32.1875 per share).... (106,889) 23.51

Outstanding, June 30, 2002
($0.00 to $31.5625 per share)............ 967,393 19.03
Granted ($0.00 to $19.90 per share) 195,300 19.80
Exercised ($0.00 per share)............... (32,820) -
Canceled ($0.00 to $31.5625 per share).... (159,874) 9.91

Outstanding, June 30, 2003
($0.00 to $31.5625 per share)............ 969,999 21.33
Exercisable, June 30, 2003
($0.00 to $31.5625 per share)............ 655,108 $ 23.59

The following table sets forth information regarding options outstanding at
June 30, 2003:

WEIGHTED
AVERAGE
WEIGHTED WEIGHTED EXERCISE
AVERAGE AVERAGE NUMBER PRICES
NUMBER RANGE OF EXERCISE REMAINING CURRENTLY FOR CURRENTLY
OF OPTIONS PRICES PRICE LIFE (YEARS) EXERCISABLE EXERCISABLE
EXERCISE

147,533 $16.4375- $18.6875 $18.57 5 102,020 $18.53
319,900 $18.85 - $19.90 $19.46 5 134,900 $19.35
195,528 $21.45 - $24.75 $23.04 4 160,448 $23.25
189,100 $25.875- $28.375 $27.35 5 189,100 $27.35
68,640 $28.50 - $31.5625 $29.88 4 68,640 $29.88
920,701 $16.4375- $31.5625 $21.33 4 655,108 $23.59

As discussed above, the Company has chosen to continue to account for stock
based compensation using the intrinsic value method to measure compensation
expense. Had the Company used the fair value method to measure compensation
for grants after fiscal 1995, net income and earnings per share would have been
as follows:

YEAR ENDED JUNE 30 (IN THOUSANDS) 2003 2002 2001

Income before cumulative effect
of a change in accounting
principle............................ $ 14,149 $ 20,397 $ 24,897

Less: Total stock-based compensation,
net of income taxes................. (663) (1,115) (1,447)

Proforma Net Income.................. $ 13,486 $ 19,282 $ 23,450
Proforma Earnings Per Share
Basic............................... $ 1.12 $ 1.59 $ 1.93
Diluted............................. $ 1.11 $ 1.57 $ 1.90

Excluded from the above table for fiscal 2002 is a cumulative effect of a
change in accounting principle of $3,779,000 or 31 cents per share.

Options granted during 2003, 2002 and 2001 had a weighted average grant date
fair value of $3.46, $3.93, and $5.13, respectively. The fair value of option
on the grant date was measured using the Binomial option pricing model. Key
assumptions used to apply this pricing model are as follows:

YEAR ENDED JUNE 30 2003 2002 2001

Range of risk-free
interest rates.......... 1.69% to 3.49% 4.41% to 4.50% 4.29% to 6.18%
Range of expected
life of option
grants (in years)........ .6 to 7 5 to 7 3 to 7
Expected volatility of
underlying stock ........ 27% 30.0% to 30.6% 34.4% to 35.8%
Range of expected
quarterly dividends
(per share).............. $0.21 $0.21 $0.20 to $0.21

It should be noted that the option pricing model used was designed to value
readily tradable stock options with relatively short lives. The options
granted to employees are not tradable and have contractual lives of up to ten
years. However, management believes that the assumptions used and the model to
value the awards yields a reasonable estimate of the fair value of the grants
made under the circumstances.

EMPLOYEE STOCK PURCHASE PLAN

The Company has an Employee Stock Purchase Plan that allows employees to
purchase shares of common stock of the Company at a 15% discount from the lower
of the market value at the beginning or the end of each quarter. Shares of
stock reserved for the plan were 164,326 at June 30, 2003. Shares purchased
under this plan aggregated 65,959, 67,540; and 76,081; in 2003, 2002 and 2001,
respectively.

RIGHTS PLAN

The Company has a Shareholder Rights Plan for which purchase rights have been
distributed as a dividend at the rate of one right for each share of common
stock held. The rights may be exercised only if an entity has acquired
beneficial ownership of 15% or more of the Company's common stock, or announces
an offer to acquire 15% or more of the Company.

ACQUISITIONS

In June 2003, certain assets and liabilities of I R International Inc. ("IR")
and Dornbusch & cia were acquired for a total purchase price of $19.7 million
in cash and stock. IR manufactures, distributes and sells industrial, gravure
and embossing rolls and plates, laser and gravure engraving, and provides
texturing and coating services. IR has operations located in Virginia and
Brazil and will be integrated with existing Standex Engraving operations. The
purchase price was allocated to the fair value of the assets acquired and
liabilities assumed and resulted in the recognition of goodwill of
approximately $11,900,000.

In September 2002, the Company purchased substantially all of the assets of
Cincinnati, Ohio-based CIN-TRAN, Inc., a manufacturer of custom UL/CSA approved
low-frequency transformers. The allocation of the purchase price resulted in
the recognition of approximately $63,000 in goodwill.

In December 2002, the Company acquired Millennium Molds, a repairer of
injection molds. The allocation of the purchase price resulted in the
recognition of approximately $77,000 in goodwill.

In April 2001, ATC-Frost Magnetics, Inc. was purchased for a total of
$15,700,000 in cash and stock. ATC-Frost is a leading manufacturer of custom
magnetic components in Canada. This transaction was accounted for as a
purchase and, accordingly, the consolidated financial statements include the
results of the acquired company from its acquisition date. The purchase price
of the acquisition was allocated to the assets acquired based on their fair
market values and resulted in the recognition of goodwill of approximately $10
million.

If the acquisitions completed during fiscal 2003 had occurred as of the
beginning of the year, consolidated results of operations for 2003 would not
have been materially affected.

DISCONTINUED OPERATIONS, RESTRUCTURINGS, ASSET IMPAIRMENTS AND DISPOSITIONS

DISCONTINUED OPERATIONS

During 2003, we exited our H.F. Coors China Company (Food Service) and National
Metals (Industrial) businesses. These actions were also taken as part of our
realignment plan as we concluded that the two businesses either had limited
growth prospects or that these businesses were not suited for long-term
strategic growth under our ownership. The real property of H.F. Coors and the
business were sold in separate transactions while National Metal Industries was
closed. Discontinued operations include the results of operations of these
businesses and the gain realized on the sale of the H.F. Coors property, net of
our exit costs.

All interim and full year reporting periods have been restated to reflect the
discontinued operations discussed above. Earnings (losses) from discontinued
operations include the following results for the years ended June 30:

(IN THOUSANDS) 2003 2002 2001

Net sales............................ $ 6,836 $ 10,791 $ 13,626
Operating income..................... 509 (430) 403

Earnings (losses) from discontinued
operations, net of taxes............ (639) (232) 234
Gains (losses) on sale of discontinued
operations, net of taxes............ 951 0 (0)

Total net earnings (losses) from
discontinued operations............. $ 312 $ (232) $ 234

The major classes of discontinued assets and liabilities included in the
Consolidated Balance Sheets are as follows:

(IN THOUSANDS) 2002 2001

Assets:
Current assets................................. $ 558 $ 3,125
Non-current assets............................. 682 3,069

Total assets of discontinued operations..... $ 1,240 $ 6,194

Liabilities:
Current liabilities............................ $ 466 $ 696

Total liabilities of discontinued operations $ 466 $ 696

RESTRUCTURING, ASSET IMPAIRMENTS AND DISPOSITIONS

In October 2002, the Company announced it was incurring restructuring charges
over the next eighteen months in the amount of $11 to $12 million before taxes.
The restructuring plan involves the (1) disposal, closing or elimination of
certain under-performing and unprofitable operating plants, product lines,
manufacturing processes and businesses; (2) realignment and consolidation of
certain marketing and distribution activities; and (3) other cost containment
actions, including selective personnel reductions. The charges have been and
will be recorded in the Consolidated Statements of Income under the caption
"Restructuring/Asset Impairment." The components of the total estimated
charges include involuntary employee severance and benefits costs totaling
$4,772,000, asset impairments of $1,773,000 and shutdown costs of $4,812,000.

A summary of the charges for the year is as follows (in thousands):

YEAR ENDED JUNE 30, 2003
INVOLUNTARY
EMPLOYEE
SEVERANCE AND ASSET SHUTDOWN
BENEFITS COSTS IMPAIRMENT COSTS TOTAL

Cash expended............. $ 1,177 $ - $ 489 $ 1,666
Accrued/Non-cash.......... 2,638 1,210 66 3,914
Total.................. $ 3,815 $ 1,210 $ 555 $ 5,580

During 2003, the Company closed and consolidated certain manufacturing
facilities which were under utilized. In June 2003, the Company received an
offer to sell the remaining assets and property associated with one of the
facilities in the Industrial segment. Based on that offer, the assets
associated with that property were reduced by $1.1 million to their fair value
of $423,000 and classified as held for sale. The estimated loss was recorded
as part of the restructuring activities and asset impairments. The Company
expects to sell these assets by the end of 2004.

In addition, certain other assets were disposed of during 2003. The
disposition of these assets resulted in a net gain of $4.3 million, and is
included in Other operating expense, net in the Statement of Consolidated
Income.

QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

The unaudited quarterly results of operations for the years ended June 30, 2003
and 2002 are as follows:

YEAR ENDED JUNE 30 2003
(IN THOUSANDS,
EXCEPT PER SHARE DATA) FIRST SECOND THIRD FOURTH

Net sales................. $144,710 $147,127 $135,929 $146,770
Gross profit margin....... 46,136 49,895 42,686 46,766
Income from
continuing operations.... 4,509 3,581 1,870 3,877
EARNINGS PER SHARE
Basic................... 0.37 0.30 0.16 0.32
Diluted................. 0.37 0.29 0.16 0.32

YEAR ENDED JUNE 30 2002
(IN THOUSANDS,
EXCEPT PER SHARE DATA) FIRST SECOND THIRD FOURTH
Net sales................. $140,745 $146,895 $134,276 $141,285
Gross profit margin....... 45,421 51,969 43,067 45,451
Income from
continuing operations.... 5,506 6,338 3,538 5,247
EARNINGS PER SHARE
Basic................... 0.45 0.53 0.29 0.43
Diluted................. 0.45 0.51 0.29 0.43

The first quarter of fiscal 2002 excludes a cumulative effect of a change in
accounting principle of $3,779,000 or 31 cents per share. During the fourth
quarter of fiscal 2002, the Company recorded certain tax adjustments discussed
in the Income Tax Note to the Consolidated Financial Statements. In addition,
during the fourth quarter of fiscal 2002, the Company provided $3.4 million of
additional reserves for potentially obsolete and slow moving inventory.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

None

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF STANDEX

The Company will file with the Securities and Exchange Commission ("SEC") a
definitive Proxy Statement no later than 120 days after the close of the fiscal
year ended June 30, 2003 (the "Proxy Statement"). The information required by
this item and not provided in Item 4 "Executive Officers of Standex" is
incorporated by reference from the Proxy Statement under the captions "Election
of Directors," "Stock Ownership in the Company," "Other Information Concerning
the Company" and "Section 16(a) Beneficial Ownership Reporting Compliance."

ITEM 11. EXECUTIVE COMPENSATION

Information regarding executive compensation is incorporated by reference from
the Proxy Statement under the captions "Report of the Compensation Committee,"
"Executive Compensation," and "Directors' Fees."

ITEM 12. SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
AND RELATED STOCKHOLDER MATTERS

The stock ownership of each person known to Standex to be the beneficial owner
of more than 5% of its Common Stock and the stock ownership of all directors
and executive officers of Standex as a group are incorporated by reference in
the Proxy Statement under the caption "Stock Ownership in the Company." The
beneficial ownership of Standex Common Stock of all directors and executive
officers of the Company is incorporated by reference in the Proxy Statement
under the caption "Stock Ownership in the Company."

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Information regarding certain relationships and related transactions is
incorporated by reference in the Proxy Statement under the caption
"Indebtedness of Management."

ITEM 14. CONTROLS AND PROCEDURES

The management of the Company, including the Company's President/Chief
Executive Officer and the Vice President/Chief Financial Officer have evaluated
the effectiveness of the Company's disclosure controls and procedures (as
defined in Exchange Act Rule 13a-15(e)) as of June 30, 2003. Based on such
evaluation, the Company's President/Chief Executive Officer and the Vice
President/Chief Financial Officer have concluded that as of June 30, 2003, such
disclosure controls and procedures were effective in timely alerting the
Company's management to material information required to be included in this
Form 10-K and other Exchange Act filings.

In connection with the evaluation by management, including the Company's
President/Chief Executive Officer and the Vice President/Chief Financial
Officer, no changes in the Company's internal control over financial reporting
(as defined in Exchange Act Rule 13a-15(f)) during the quarter and year ending
June 30, 2003 were identified that have materially affected or are reasonably
likely to materially affect the Company's internal control over financial
reporting.

ITEM 15. PRINCIPAL ACCOUNTANT FEES AND SERVICES

Information regarding aggregate fees billed for each of the last two fiscal
years for professional services rendered by the professional accountant for
audit of the Company's annual financial statements and review of financial
statements included in the Company's Form 10-Q are incorporated by reference
in the Proxy Statement under the caption "Fees Paid to Independent Auditors."

PART IV

ITEM 16. EXHIBITS, FINANCIAL STATEMENT SCHEDULES,
AND REPORTS ON FORM 8-K

(a) Financial Statements and Schedule

(i) The financial statements required in response to this item are
listed in response to Part II, Item 8 of this Annual Report on
Form 10-K.

(ii) The financial statement schedule listed in the accompanying
index to the Consolidated Financial Statements and Schedules is
filed as part of this Annual Report on Form 10-K.

(b) Reports on Form 8-K

On April 24, 2003, Standex submitted a Report on Form 8-K incorporating under
Items 9 and 12 the Standex third quarter earnings press release. Such Report
is not deemed "filed" for the purposes of Section 18 of the Securities Exchange
Act of 1934 and is not incorporated by reference herein or in any filing under
the Securities Act of 1933 or the Exchange Act.

3. (i) Restated Certificate of Incorporation of Standex, dated
October 27, 1998, is incorporated by reference to the
exhibits to the Quarterly Report of Standex on Form 10-Q
for the fiscal quarter ended December 31, 1998.

(ii) By-Laws of Standex, as amended, and restated on July 27,
1994 are incorporated by reference to the exhibits to the
Annual Report of Standex on Form 10-K for the fiscal year
ended June 30, 1994 (the "1994 10-K").

4. (a) Agreement of the Company, dated September 15, 1981, to
furnish a copy of any instrument with respect to certain
other long-term debt to the Securities and Exchange
Commission upon its request is incorporated by reference
to the exhibits to the Annual Report of Standex on Form
10-K for the fiscal year ended June 30, 1981.

(b) Rights Agreement of the Company is incorporated by
reference to Form 8A filed with the Securities and
Exchange Commission on December 18, 1998 and to the Form
8-K filed with the Securities and Exchange Commission on
December 18, 1998.

10. (a) Employment Agreement dated May 1, 2000, between the
Company and David R. Crichton is incorporated by this
reference to the exhibits to the Annual Report on Form 10-
K for the fiscal year ended June 30, 2000 (the "2000 10-
K") and an Amendment to the Employment Agreement dated
January 30, 2002 is incorporated by this reference to the
exhibits to the Quarterly Report of Standex on Form 10-Q
for the fiscal quarter ended March 31, 2002 (the "March
2002 10-Q").*

(b) Employment Agreement dated May 1, 2000, between the
Company and Edward J. Trainor is incorporated by this
reference to the exhibits to the 2000 10-K and an
Amendment to the Employment Agreement dated January 30,
2002 is incorporated by this reference to the exhibits to
the March 2002 10-Q.*

(c) Employment Agreement dated May 1, 2000, between the
Company and Edward F. Paquette is incorporated by this
reference to the exhibits to the 2000 10-K.*

(d) Employment Agreement dated May 1, 2000, between the
Company and Deborah A. Rosen is incorporated by this
reference to the exhibits to the 2000 10-K and an
Amendment to the Employment Agreement dated January 30,
2002 is incorporated by this reference to the exhibits to
the March 2002 10-Q.*

(e) Employment Agreement dated April 1, 2001 between the
Company and Daniel C. Potter is incorporated by this
reference to the exhibits to the Annual Report on Form 10-
K for the fiscal year ended June 30, 2001 (the "2001 10-
K").*

(f) Employment Agreement dated September 1, 2001 between the
Company and Christian Storch is incorporated by this
reference to the exhibits to the Quarterly Report of
Standex on Form 10-Q for the fiscal quarter ended
September 30, 2001.*

(g) Employment Agreement dated December 3, 2001 between the
Company and Roger L. Fix is incorporated by this reference
to the exhibits to the Quarterly Report of Standex on Form
10-Q for the fiscal quarter ended December 31, 2001.*

(h) Standex International Corporation 1998 Long-Term Incentive
Plan, effective October 27, 1998 is incorporated by
reference to the exhibits to the Quarterly Report of
Standex on Form 10-Q of the fiscal quarter ended December
31, 1998.*

(i) Standex International Corporation Profit Improvement
Participation Shares Plan as amended and restated on
April 26, 1995 is incorporated by reference to the
exhibits to the Annual Report of Standex on Form 10-K for
the fiscal year ended June 30, 1995 (the "1995 10-K").*

(j) Standex International Corporation Stock Option Loan Plan,
effective January 1, 1985, as amended and restated on
January 26, 1994, is incorporated by reference to the
exhibits to the 1994 10-K.*

(k) Standex International Corporation Executive Security
Program, as amended and restated on January 31, 2001 is
incorporated by reference to the exhibits to the Quarterly
Report of Standex on Form 10-Q for the fiscal quarter
ended March 31, 2001 (the "March 2001 10-Q").*

(l) Standex International Corporation 1985 Stock Option Plan
effective July 31, 1985, as amended on October 30, 1990,
is incorporated by reference to the exhibits to the Annual
Report of Standex on Form 10-K for the fiscal year ended
June 30, 1991.*

(m) Standex International Corporation Executive Life Insurance
Plan effective April 27, 1994 and as amended and restated
on April 25, 2001 is incorporated by reference to the
exhibits to the 2001 10-K.*

(n) Standex International Corporation 1994 Stock Option Plan
effective July 27, 1994 is incorporated by reference to
the exhibits to the 1994 10-K.*

(o) Standex International Corporation Supplemental Retirement
Plan adopted April 26, 1995 and amended on July 26, 1995
is incorporated by reference to the exhibits to the 1995
10-K.*

(p) Standex International Corporation Key Employee Share
Option Plan dated June 27, 2002 is incorporated by
reference to this Annual Report on Form 10-K for the
fiscal year ended June 30, 2003.*

(q) Consulting Agreement dated December 31, 2002 between the
Company and Edward J. Trainor is incorporated by this
reference to the exhibits to the Quarterly Report of
Standex on Form 10-Q for the fiscal quarter ended December
31, 2002 (the "December 2002 10-Q").*

(r) Consulting Agreement dated December 31, 2002 between the
Company and David R. Crichton is incorporated by this
reference to the exhibits to the December 2002 10-Q.*

(s) Employment Agreement dated April 1, 2003 between the
Company and Roger L. Fix , which supersedes and replaces
the Employment Agreement between the parties dated
December 1, 2001, is incorporated by this reference in
this Form 10-K for the fiscal year ending June 30, 2003.*

21. Subsidiaries of Standex

23. Independent Auditors' Consent

24. Powers of Attorney of David R. Crichton, William R. Fenoglio,
Walter F. Greeley, Daniel B. Hogan, Thomas L. King, C. Kevin
Landry, H. Nicholas Muller, III, Ph.D., Deborah A. Rosen and
Edward J. Trainor

31.1 Rule 13a-14(a) Certification of President and Chief Executive
Officer

31.2 Rule 13a-14(a) Certification of Vice President and Chief
Financial Officer

32. Section 1350 Certification

(d) Schedule

The schedule listed in the accompanying Index to the Consolidated Financial
Statements and Schedules is filed as part of this Annual Report on Form 10-K.

* Management contract or compensatory plan or arrangement.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, Standex International Corporation has duly caused this Annual
Report on Form 10-K to be signed on its behalf by the undersigned, thereunto
duly authorized, on September 8, 2003.

STANDEX INTERNATIONAL CORPORATION
(Registrant)

By: /s/ ROGER L. FIX
Roger L. Fix
President/Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of Standex
International Corporation and in the capacities indicated on September 8, 2003:

Signature Title

/s/ ROGER L. FIX President/Chief Executive Officer
Roger L. Fix

/s/ CHRISTIAN STORCH Vice President/Chief Financial Officer
Christian Storch

/s/ ROBERT R. KETTINGER Corporate Controller (Chief Accounting Officer)
Robert R. Kettinger

Roger L. Fix, pursuant to powers of attorney which are being filed with this
Annual Report on Form 10-K, has signed below on September 8, 2003 as attorney-
in-fact for the following directors of the Registrant:

David R. Crichton C. Kevin Landry
William R. Fenoglio H. Nicholas Muller, III, Ph.D.
Walter F. Greeley Deborah A. Rosen
Daniel B. Hogan Edward J. Trainor
Thomas L. King

/s/ ROGER L. FIX
Roger L. Fix

Supplemental Information to be furnished with reports filed pursuant to Section
15(d) of the Act by Registrants which have not registered securities pursuant
to Section 12 of the Act.

The Company will furnish its 2003 Annual Report, its Proxy Statement and proxy
materials to security holders subsequent to the filing of the annual report on
this Form. Copies of such material shall be furnished to the Commission when
they are sent to security holders.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE

SCHEDULE

Schedule II Valuation and Qualifying Accounts

Independent Auditors' Report relating to Schedule II

Schedules (consolidated) not listed above are omitted because of the absence of
conditions under which they are required or because the required information is
included in the financial statements submitted.

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of
STANDEX INTERNATIONAL CORPORATION
Salem, New Hampshire

We have audited the accompanying consolidated balance sheets of Standex
International Corporation and subsidiaries as of June 30, 2003, and 2002, and
the related consolidated statements of income, stockholders' equity, and cash
flows for each of the three years in the period ended June 30, 2003. Our
audits also included the financial statement schedule listed in the Index at
Item 16(a)(ii). These financial statements and financial statement schedule
are the responsibility of the Company's management. Our responsibility is to
express an opinion on the financial statements and financial statement schedule
based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of the Standex International
Corporation and subsidiaries as of June 30, 2003 and 2002, and the results of
their operations and their cash flows for each of the three years in the period
ended June 30, 2003, in conformity with accounting principles generally
accepted in the United States of America. Also, in our opinion, such financial
statement schedule, when considered in relation to the basic consolidated
financial statements taken as a whole, presents fairly in all material respects
the information set forth therein.

As discussed in the notes to the consolidated financial statements, on July 1,
2001 the Company adopted Statement of Financial Accounting Standards No. 142,
"Goodwill and Other Intangible Assets."

/s/ DELOITTE & TOUCHE LLP
DELOITTE & TOUCHE LLP
Boston, Massachusetts

August 14, 2003

Schedule II

STANDEX INTERNATIONAL CORPORATION AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS

For the Years Ended June 30, 2003, 2002 and 2001

Column A Column B Column C Column D Column E
Balance Additions
At Charged to Charged
Beginning Costs and to Other Balance at
Description of Year Expenses Accounts Deductions End of Year

Allowances
deducted from
assets to which
they apply - for
doubtful accounts
receivable:

June 30, 2003 $4,609,329 $3,179,702 $(2,734,849)(1)$5,054,182

June 30, 2002 $3,433,443 $2,724,937 $(1,549,051)(1)$4,609,329

June 30, 2001 $3,397,174 $1,825,947 $(1,789,678)(1)$3,433,443

(1) Accounts written off - net of recoveries

INDEX TO EXHIBITS

PAGE
10. (s) Employment Agreement dated April 1, 2003 between
the Company and Roger L. Fix, which supersedes and
replaces the Employment Agreement between the parties
dated December 1, 2001, incorporated by this reference
in this Annual Report on Form 10-K for the fiscal year
ended June 30, 2003.

21. Subsidiaries of Standex

23. Independent Auditors' Consent

24. Powers of Attorney of David R. Crichton,
William R. Fenoglio, Walter F. Greeley,
Daniel B. Hogan, Thomas L. King, C. Kevin Landry,
H. Nicholas Muller, III, Ph.D., Deborah A. Rosen and
Edward J. Trainor

31.1 Rule 13a-14(a) Certification of President and Chief
Executive Officer

31.2 Rule 13a-14(a) Certification of Vice President and
Chief Financial Officer

32. Section 1350 Certification