EXHIBIT 99.1
------------
L e t t e r T o S h a r e h o l d e r s
a n d P r o x y S t a t e m e n t
-----------------------------------------------------
NEWELL RUBBERMAID{TM}
---------------------
[Graphics of product logos omitted]
Sharpie{R} [Logo]
Irwin{R} [Logo]
Calphalon{R} [Logo]
Rubbermaid{R} [Logo]
Irwin Vise-Grip{R} [Logo]
BernzOmatic{R} [Logo]
Lenox{R} [Logo]
Waterman{R} [Logo]
Graco{R} [Logo]
Levolor{R} [Logo]
Paper Mate{R} [Logo]
Little Tikes{R} [Logo]
Parker{R} [Logo]
NEWELL RUBBERMAID{TM}
Conducts Business Under
Five Segments
2003 SALES
$7,750.0
ALL SALES ARE REPORTED IN MILLIONS
[Pie chart depicting 2003 Sales omitted]
26% Cleaning and Organization
22% Office Products
15% Tools & Hardware
16% Home Fashions
21% Other
CLEANING & ORGANIZATION
DIVISIONS:
Rubbermaid Home Products, Food & Beverage, Commercial, Europe, Canada
This segment focuses on indoor and outdoor organization, home storage,
food storage and cleaning products.
Sales Operating Income*
----- ----------------
2003 $2,013.7 $ 92.0 4.6%
2002 $1,901.8 $169.0 8.9%
BRANDS:
Rubbermaid{R}, Stain Shield{R}, TakeAlongs{R}, Roughneck{R}, Brute{R}
* For a reconciliation of operating income by segment to total
operating income for Newell Rubbermaid Inc. refer to management's
discussion and analysis in Appendix A to the proxy statement
accompanying this letter.
OFFICE PRODUCTS
DIVISIONS:
Sanford North America, Europe, Latin America, Asia Pacific
This segment is a world leader in writing instruments with a product
offering that includes pens, pencils, permanent markers, juvenile
writing instruments, fine writing, dry erase markers, highlighters,
art supplies and office products.
Sales Operating Income*
----- ----------------
2003 $1,681.2 $309.6 18.4%
2002 $1,684.1 $306.1 18.2%
BRANDS:
Sharpie{R}, Paper Mate{R}, Waterman{R}, Parker{R}, Colorific{R},
Eldon{R}
* For a reconciliation of operating income by segment to total
operating income for Newell Rubbermaid Inc. refer to management's
discussion and analysis in Appendix A to the proxy statement
accompanying this letter.
----------------------------------------------------------------------
NEWELL RUBBERMAID{TM} is a global manufacturer and marketer of
branded consumer products and their commercial extensions,
serving a wide array of retail channels including department
stores, discount stores, warehouse clubs, home centers,
hardware stores, commercial distributors, office
superstores, contract stationers, grocery stores, drug
stores, automotive stores and pet superstores. We market a
multi-product offering of consumer and commercial products,
backed by an obsession with customer service excellence and
new product development. Our portfolio includes a family of
Power Brands that consumers rely on where they work, live
and play.
Our vision is to create a global powerhouse in consumer and
commercial products, providing long-term value to our
shareholders.
---------------------------------------------------------------------
TOOLS & HARDWARE
DIVISIONS:
IRWIN North America, IRWIN Latin America, IRWIN Europe, Lenox,
BernzOmatic, Shur-Line, Amerock
This segment includes an extensive global offering of hand tools,
power tool accessories, propane torches, paint applicators and cabinet
hardware.
Sales Operating Income*
----- ----------------
2003 $1,199.7 $179.2 14.9%
2002 $ 783.0 $ 79.2 10.1%
BRANDS:
IRWIN{R}, Lenox{R}, VISE-GRIP{R}, Marathon{R}, Quick-Grip{R},
BernzOmatic{R}, Shur-Line{R}
* For a reconciliation of operating income by segment to total
operating income for Newell Rubbermaid Inc. refer to management's
discussion and analysis in Appendix A to the proxy statement
accompanying this letter.
HOME FASHIONS
DIVISIONS:
Levolor/Kirsch, Home Decor Europe, Swish UK, Frames Europe, Burnes
This segment competes in window blinds and shades, drapery hardware
and picture frames.
Sales Operating Income*
----- ----------------
2003 $1,258.7 $ 54.9 4.4%
2002 $1,425.5 $113.5 8.0%
BRANDS:
Levolor{R}, Kirsch{R}, Gardinia{R}, Swish{R}, Burnes of Boston{R}
OTHER
DIVISIONS:
Calphalon, Cookware Europe, Panex, Anchor, Goody, Graco, Little Tikes
This segment includes cookware, cutlery, glassware, hair care
accessories as well as infant and juvenile products including toys,
high chairs, car seats, strollers and outdoor play equipment.
Sales Operating Income*
2003 $1,596.7 $108.9 6.8%
2002 $1,659.5 $115.7 7.0%
BRANDS:
Calphalon{R}, Mirro{R}, WearEver{R}, Anchor{R}, Graco{R}, Little
Tikes{R}, Goody{R}
* For a reconciliation of operating income by segment to total
operating income for Newell Rubbermaid Inc. refer to management's
discussion and analysis in Appendix A to the proxy statement
accompanying this letter.
DEAR FELLOW SHAREHOLDERS,
Three years ago we began a journey to transform Newell
Rubbermaid from a "growth by acquisition" company into a global
marketer of consumer and commercial products that could grow
organically, fueled by innovation behind a stable of power brands.
To execute a change of this magnitude, we found it necessary to
not only change our strategy, but to change our culture. In May of
2001, we introduced our "How We Win" Roadmap for Success - a
comprehensive plan that establishes The Right Measures, The Right
Strategy, The Right Organization, The Right Operating Cycle and The
Right Culture.
Now, let me walk you through "How We Win."
"HOW WE WIN" ROADMAP STRATEGIC INITIATIVES
The Right MEASURES PRODUCTIVITY
The Right STRATEGY STREAMLINING
The Right ORGANIZATION NEW PRODUCT DEVELOPMENT
The Right OPERATING CYCLE MARKETING
The Right CULTURE STRATEGIC ACCOUNT MANAGEMENT
COLLABORATION
THE RIGHT MEASURES
In 2003, we experienced pressure related to increased material
cost, elevated competition in low-end product lines and lower
production levels that resulted in short-term gross margin
contraction. These short-term pressures, combined with the complexity
of our transformation, have extended the time-frame for achieving our
financial targets. Nevertheless, we continue to focus on our Five Key
Measures because they drive the right behaviors for the long-term
success of this organization.
Our first metric, INTERNAL SALES GROWTH*, was flat for the year
compared to 2002. We saw significant growth in many of our high-
margin businesses, including Sharpie{R} permanent markers and IRWIN{R}
hand tools and power tool accessories. However, in some of our
businesses, primarily low-end product lines where we cannot support
premium pricing with strong brands and product innovation, we saw
significant pricing and volume declines. The resulting double-digit
sales declines in these categories caused us to take some aggressive
strategic actions.
By mid-year, we identified approximately $300 million in annual
sales of low-margin product lines that would not yield our target
returns in their market categories. We are pleased to report that, by
* defined on page 3
the end of 2003, we took aggressive steps to exit approximately $50
million in sales of these product lines and in 2004 we will continue
this process of rationalizing low-margin product lines.
This decision puts short-term pressure on top-line growth and on
gross margin, as the exit of our fixed costs will not occur at an
equally rapid rate. Over the long-term, however, this decision will
contribute to gross margin expansion, helping us improve OPERATING
INCOME* as a percent of sales. This is our second key measure, which
we will grow from 9.5%, delivered in 2003, to our long-term target of
15%.
We have also made consistent progress driving our third measure,
WORKING CAPITAL* as a percent of sales, toward our long-term goal of
20%. At the close of 2003, significant inventory reduction drove
working capital as a percent of sales down to 24%, from 30% in 2001.
We ended the year with the lowest inventory level in three years.
This was truly a great performance delivered by the team.
This inventory reduction helped us finish the year with $242
million in FREE CASH FLOW*, our fourth measure. The company has shown
a dramatic improvement in this metric over the past three years. We
have generated over one billion dollars in Free Cash Flow for the
period 2001 to 2003, compared to the previous three-year period where
we generated $158 million. More importantly, this strong cash flow
supports our dividend and our ability to pay down debt. Our long-term
goal is to grow Free Cash Flow in line with, or better than, earnings
growth.
Our fifth measure is RETURN ON INVESTED CAPITAL* (ROIC). ROIC is
improved by either increasing profitability or decreasing assets - we
are working on both. Regarding profitability, Operating Income is a
strong focus for the organization and we are working diligently to
improve this metric. Regarding our asset base, we have made
significant progress to right size our manufacturing network. To
date, we have closed 78 facilities in North America and Western
Europe. Making these decisions is difficult, but necessary to deliver
long-term shareholder value. We must manufacture our products in a
best-cost environment in order to stay competitive in the global
market place. In addition to rationalizing our facilities, we have
become much more disciplined with our capital spending, allocating
resources to those projects with the highest returns. This approach
will drive improvements in ROIC from our current 9.5% level to our
long-term target of 15%.
THE RIGHT STRATEGY
Our strategy remains unchanged. Our Six Strategic Initiatives
are the right strategies to drive improvement in our five key measures
to transform this company into a strong financial performer over the
long-term and to unlock the power of our brands.
* defined on page 3
Our first two initiatives, PRODUCTIVITY and STREAMLINING, focus
on reducing costs. In terms of Productivity, or reducing cost of
goods sold (COGS), we continue to build upon our broad-based
improvements in purchasing, manufacturing efficiencies as well as
distribution and transportation. Additionally, we continue to execute
on our three-year restructuring program, which began in 2001 and was
designed to drive best-cost performance in our manufacturing network.
As planned, we will complete the charges related to this program in
the second quarter of 2004 and expect annualized savings of
approximately $150 million.
<Table>
<Caption>
<s> <c> <c> <c>
[Bar Graph depicting [Bar Graph depicting [Bar Graph depicting [Bar Graph depicting Free
Internal Sales Growth] Operating Income] Working Capital] Cash Flow]
INTERNAL SALES GROWTH OPERATING INCOME WORKING CAPITAL FREE CASH FLOW
(PERCENT INCREASE) (PERCENT OF NET SALES) (PERCENT OF NET SALES) (IN MILLIONS OF DOLLARS)
'01 (7.6) '01 9.5 '01 29.6 '01 392
'02 3.3 '02 10.4 '02 25.8 '02 392
'03 0 '03 9.5 '03 23.9 '03 242
</Table>
As part of our productivity initiative, we have an internal
target to deliver 5% cost reductions year over year. We fell short of
our goal in 2003, primarily due to rising material costs that we were
unable to offset
[Picture of Paper Mate{R} Tandem{TM} omitted]
through other initiatives. This is unacceptable to our organization.
In order to deliver our productivity targets going forward, we are
focused on the deployment of Newell Operational Excellence (NWL OPEX)
throughout our manufacturing network. NWL OPEX is a methodical process
focused on lean manufacturing. It includes creating the right
manufacturing and distribution metrics and using these to drive
improvements quarter after quarter. In 2003, we trained all of our
plant managers in the principles of NWL OPEX and are encouraged with
the prospects for 2004 and beyond.
In terms of Streamlining, or reducing non-strategic selling,
general and administrative expenses (SG&A), the team has cut $125
million dollars of redundant or unnecessary SG&A at an annualized
rate. We have reinvested these dollars to support strategic growth
through new product development, marketing and brand building. We are
encouraged with these cost savings and recognize cost reduction is an
on-going process critical to funding future growth.
Our next four strategic initiatives are where our leadership
translates into an unassailable competitive advantage.
We have focused on installing and fostering our NEW PRODUCT
DEVELOPMENT process, as high-margin, new products are key to our
success. This process and discipline have been infused throughout the
company and the team has delivered many innovative, high-margin
products.
The writing instruments team launched the Paper Mate{R}
Tandem{TM}. This dual-use pen, with detachable, refillable high-
lighter and comfort grip, is ideal for business, travel or study.
Calphalon launched its highly-anticipated Calphalon{R} One{TM} Infused
Anodized product line. This patent-pending, revolutionary, infused
anodized cooking surface outperforms existing high-end cookware by
combining the benefits of a traditional hard-anodized surface with the
benefits of a non-stick surface.
At IRWIN, Strait-Line{R} laser tools generated superior results
and provide an excellent platform for growth in the measuring and
marking tool categories. Our Rubbermaid business is delivering
smarter solutions for pets through innovation, style and quality. The
Rubbermaid{R} Pets product line includes doghouses, pet grooming,
travel and food storage products.
These products are just a few examples from our new product
pipeline. This initial progress is encouraging, but we are still in
the nascent phase of developing our new product development process.
Our challenge over the past few years has not been a lack of ideas,
but rather finding the right cadence of new product introductions that
our manufacturing network and sales and marketing teams could execute.
Today our teams are in a much better rhythm, focused on impact versus
activity. Our pipeline is building and gaining traction.
We have worked hard on strengthening the company's MARKETING
capabilities. By creating demand for our products through grass roots
marketing to the end user, we are moving from a push to a pull
strategy. We are also focused on strengthening the brands within our
portfolio. With that in mind, in mid-2003, we unified our
professional grade hand tools and power tool accessories business
under the IRWIN{R} brand name. As part of the global strategy, each
of IRWIN's sub-brands, like VISE-GRIP{R} and Marathon{R}, will retain
its category-leading name while endorsing a common IRWIN{R} brand
identity. This creates a strong platform in global hand tools and
power tool accessories and provides future expansion opportunities
into new categories under the IRWIN{R} brand.
We continue to focus on retailers with the brightest futures
through our STRATEGIC ACCOUNT MANAGEMENT process. In 2003, we
generated a 12% increase in sales to our eight most-strategic
accounts. The most promising aspect of this program is, as our
company develops innovations and creates end-user demand through
impactful marketing, we have a strong distribution network of high-
growth retail partners. This is a very powerful formula that will
yield great returns for our organization in the years ahead.
Through our COLLABORATION initiative we continue to act as one
company, leveraging our divisional talent, expertise and
relationships. The Rubbermaid Tough Tools{TM} line, launched in 2003,
is a collection of hand tools designed for the beginner to
intermediate do-it-yourself (DIY) market. This product line was a
direct result of collaborative efforts between Rubbermaid and our tool
business. They brought together a powerful brand and a quality
product, expanding into new categories and new channels of
distribution. We have an extremely talented and creative
organization. When we share ideas and best practices, the results are
exponentially better.
Having walked through each of our six initiatives, I would
reiterate that our strategy has not changed. However, we have learned
that some of the businesses in our portfolio do not fit our strategic
model. Therefore, a key priority for the company in 2004 is to build
THE RIGHT PORTFOLIO -- divest businesses whose fundamentals do not
align with our strategic direction. We have identified 10% - 15% of
our portfolio that has limited brand strength and innovation
potential, two areas we believe critical to establish a competitive
advantage. We are optimistic we will complete the bulk of these
divestitures in 2004, leaving a strong core portfolio of businesses.
[Picture of Strait-Line{R} Laser Tape omitted]
THE RIGHT ORGANIZATION
Last year we further strengthened our organization through the
promotions of Robert S. Parker and James J. Roberts to Co-Chief
Operating Officers. This new structure aligns all of our businesses
under the guidance of two of our strongest and proven leaders.
Additionally, this structure leverages their operational talent across
multiple divisions and provides continuity and focus on the execution
of NWL OPEX.
Our Phoenix Program is also helping us create the right
organization. We've hired over 1,500 college graduates into this
program since its inception in July 2001. The Phoenicians focus on
building relationships at the store level in our strategic accounts
and developing in-store merchandising, training and product sell-
through initiatives. The goal of the Phoenix Program has always been
to give ambitious, talented individuals experience with our products,
our strategic accounts and our consumers in order to develop a world-
class farm system of talent. We have promoted over 460 Phoenicians,
further strengthening the knowledge and direct customer experience
level within the organization.
FIVE KEY MEASURES (reconciliation provided on page 4)
[Bar chart depict- INTERNAL SALES GROWTH: NET SALES GROWTH FOR
ing Return on BUSINESSES owned longer
Invested Capital than one year, including
omitted] minor acquisitions and
divestitures.
'01 '03 '02 Target: 2-4%
--- --- ---
7.9 10.4 9.5 OPERATING INCOME: Operating income, excluding
restructuring and other
RETURN ON charges, as a percentage of
INVESTED CAPITAL sales. Target: 15%
(percent)
WORKING CAPITAL: Five-quarter average of
accounts receivable plus
inventory, net of accounts
payable, divided by
trailing 12-month sales.
Target: 20%
FREE CASH FLOW: Cash flow provided by
operations, net of
dividends and capital
expenditure. Target: Grow
Free Cash Flow in line with
earnings growth.
ROIC: Trailing 12-month after-tax
operating income excluding
restructuring and other
charges divided by a five-
quarter average of debt and
equity. Target: 15%
THE RIGHT OPERATING CYCLE
Over the past few years our operating cycle has strengthened our
organization. At the divisional and corporate level, we have
instituted consistent monthly, quarterly and annual reviews. These
dynamic exchanges serve to monitor current progress against our core
metrics while helping to establish priorities, foster open
communication, assess opportunities, and develop cross-
functionalities. We now have an operating rhythm for our 28 divisions
that keeps us focused on what's important.
THE RIGHT CULTURE
Culture is one of the most difficult things to change in an
organization. A Newell Rubbermaid culture, reflecting the values and
dedication of our 40,000 employees, has taken shape within our
organization. Principles of our culture like customer focus, teamwork
and consistently "raising the bar" have become second nature. Our
team is energized, motivated and more passionate than ever.
CLOSING REMARKS
As I look back over the past three years, we have made great
strides in positioning Newell Rubbermaid for long-term success. We
have implemented a consistent strategy through-out the entire
organization and developed the right set of metrics to measure and
monitor our performance. We have built an extremely talented
organization with the skill set necessary to execute our strategy. We
have achieved a good operating rhythm for our organization. Perhaps
most importantly, we have unified the company around a new culture.
Make no mistake, it has not been an easy journey. There have
been bumps in the road along the way, including a difficult 2003. We
have celebrated some exciting victories and learned some valuable
lessons during this process. We enthusiastically look forward to our
prospects in 2004 when we will complete our restructuring program,
improve our business portfolio and continue to execute our "How We
Win" Roadmap to unleash our company's full potential.
Sincerely,
/s/ Joseph Galli
Joseph Galli
Chief Executive Officer
======================================================================
The Phoenix Program is creating a highly
talented organization at Newell Rubbermaid.
Members of the Phoenix Program are recent
college graduates who begin their careers
at the store level focused on strategic
accounts. More importantly this program is
a "farm system" for Newell Rubbermaid to
[Picture of develop talented leaders and deploy those [Phoenix
members of individuals in other areas of organization. Logo
Phoenix omitted]
Program The individuals shown to the left, end-user
omitted] specialists at IRWIN Industrial Tool
Company, are participating in a hands-on
product training session at the Rubbermaid
IRWIN Training Center in Huntersville, NC.
They all began their careers as members of
the Phoenix Program and have since earned
their second and, for some, third promotion
within the organization. Newell
Rubbermaid's "promote from within"
philosophy moves these ambitious talented
individuals, who have experience with
products, strategic accounts and consumers,
into other roles helping to develop the
right organization and to infuse the right
culture at Newell Rubbermaid.
======================================================================
<Table>
<Caption>
FIVE KEY MEASURES RECONCILIATION
INTERNAL SALES GROWTH 12 MONTHS ENDING DECEMBER 31
<s> <c> <c> <c>
2001 2002 2003
---- ---- ----
Net Sales $6,909.3 $7,453.9 $7,750.0
Less: Sales from Acquisitions 498.5 318.4 299.4
------- ------- -------
Internal Sales 6,410.8 7,135.5 7,450.6
======= ======= =======
Less: Prior Year Net Sales 6,934.7 6,909.3 7,453.9
------- ------- -------
Internal Sales Growth (Decline) $(523.9) $226.2 $(3.3)
======= ======= =======
Internal Sales Growth (Decline)% (7.6)% 3.3% 0.0%
OPERATING INCOME % OF SALES 12 MONTHS ENDING DECEMBER 31
2001 2002 2003
---- ---- ----
Operating Income As Reported $570.9 $629.7 $179.9
Less: Restructuring & Other Charges(1) 86.0 143.9 552.8
------ ------ ------
Operating Income Excluding Charges 656.9 773.6 732.7
====== ====== ======
Current Year Net Sales $6,909.3 $7,453.9 $7,750.0
OI% 9.5% 10.4% 9.5%
(1) Charges excluded from "as reported" results are restructuring, acquisition or
divestiture related charges.
</Table>
<Table>
<Caption>
FREE CASH FLOW 12 MONTHS ENDING DECEMBER 31
<s> <c> <c> <c> <c> <c> <c>
1998 1999 2000 2001 2002 2003
---- ---- ---- ---- ---- ----
Net Cash provided by
operating activities $478.8 $554.0 $623.5 $865.4 $868.9 $773.2
Less: Expenditure for plant,
property and equipment 318.7 200.1 316.6 249.8 252.1 300.0
Less: Cash Dividends 212.5 225.8 225.1 224.0 224.4 230.9
----- ----- ----- ----- ----- -----
Free Cash Flow $(52.4) $128.1 $81.8 $391.6 $392.4 $242.3
WORKING CAPITAL % OF SALES Q4 2000 Q1 2001 Q2 2001 Q3 2001 Q4 2001
------- ------- ------- ------- -------
Accounts Receivable $1,183.4 $1,131.5 $1,246.6 $1,316.1 $1,298.2
Plus: Inventory 1,262.6 1,310.0 1,271.7 1,185.5 1,113.8
Less: Accounts Payable 342.4 366.5 429.1 446.3 501.3
------- ------- ------- ------- -------
Total Working Capital 2,103.6 2,075.0 2,089.2 2,055.3 $1,910.7
======= ======= ======= ======= ========
Average Working Capital of
the Previous 5 Quarters $2,046.8
Divided by Net Sales 6,909.3
Working Capital % 29.6%
WORKING CAPITAL % OF SALES Q1 2002 Q2 2002 Q3 2002 Q4 2002
------- ------- ------- -------
Accounts Receivable $1,191.3 $1,429.2 $1,363.0 $1,377.7
Plus: Inventory 1,147.4 1,290.7 1,277.3 1,196.2
Less: Accounts Payable 525.8 655.8 684.9 686.6
------- ------- ------- -------
Total Working Capital $1,812.9 $2,064.1 $1,955.4 $1,887.3
======= ======= ======= =======
Average Working Capital of
the Previous 5 Quarters $1,926.1
Divided by Net Sales 7,453.9
Working Capital % 25.8%
WORKING CAPITAL % OF SALES Q1 2003 Q2 2003 Q3 2003 Q4 2003
------- ------- ------- -------
Accounts Receivable $1,276.4 $1,455.1 $1,392.6 $1,442.6
Plus: Inventory 1,285.4 1,365.1 1,271.2 1,066.3
Less: Accounts Payable 736.5 863.0 815.9 777.4
------- ------- ------- -------
Total Working Capital $1,825.3 $1,957.2 $1,847.9 $1,731.5
======= ======= ======= =======
Average Working Capital of
the Previous 5 Quarters $1,849.8
Divided by Net Sales 7,750.0
Working Capital % 23.9%
</Table>
<Table>
<Caption>
<s> <c> <c> <c> <c> <c>
RETURN ON INVESTED CAPITAL Q4 2000 Q1 2001 Q2 2001 Q3 2001 Q4 2001
------- ------- ------- ------- -------
OI Excluding Charges(1) $656.9
Effective Income Tax Rate 36.4%
-------
After-Tax OI Excluding Charges $417.8
=======
Notes Payable 23.5 $13.8 $25.6 $23.9 $19.1
Current Portion of
Long-Term Debt 203.7 214.3 174.0 915.4 807.5
Long-Term Debt(2) 2,819.6 2,818.3 2,715.5 1,865.0 1,865.0
Stockholders Equity 2,448.6 2,344.4 2,356.4 2,417.2 2,433.4
------- ------- ------- ------- -------
Total Invested Capital 5,495.4 $5,390.8 $5,271.5 $5,221.5 $5,125.0
======= ======= ======= =======
After-Tax OI Excluding Charges $417.8
Divided by Average Invested
Capital of Previous 5 Quarters 5,300.8
ROIC 7.9%
(1) Charges excluded from "as reported" results are restructuring, acquisition or
divestiture related charges.
(2) Long-Term Debt reflects adoption of Fin. 46 in 2003 and 2002.
RETURN ON INVESTED CAPITAL Q1 2002 Q2 2002 Q3 2002 Q4 2002
------- ------- ------- -------
OI Excluding Charges(1) $773.6
Effective Income Tax Rate 33.5%
------
After-Tax OI Excluding Charges $514.4
======
Notes Payable $29.7 $30.5 $29.6 $25.2
Current Portion of
Long-Term Debt 553.0 300.2 405.8 424.0
Long-Term Debt(2) 2,080.7 2,732.0 2,505.7 2,372.1
Stockholders Equity 1,885.4 2,025.8 2,048.7 2,063.5
------- ------- ------- -------
Total Invested Capital $4,548.8 $5,088.5 $4,989.8 $4,884.8
======= ======= ======= =======
After-Tax OI Excluding Charges $514.4
Divided by Average Invested
Capital of Previous 5 Quarters 4,927.4
-------
ROIC 10.4%
RETURN ON INVESTED CAPITAL Q1 2003 Q2 2003 Q3 2003 Q4 2003
------- ------- ------- -------
OI Excluding Charges(1) $732.7
Effective Income Tax Rate 32.4%
After-Tax OI Excluding Charges $495.3
Notes Payable $24.5 $37.4 $31.6 $21.9
Current Portion of
Long-Term Debt 227.9 129.8 30.8 13.5
Long-Term Debt(2) 2,893.0 3,062.5 3,054.2 2,868.6
Stockholders Equity 2,221.8 2,322.8 2,326.3 2,016.3
------- ------- ------- -------
Total Invested Capital $5,367.2 $5,552.5 $5,442.9 $4,920.3
======= ======= ======= =======
After-Tax OI Excluding Charges $495.3
Divided by Average Invested
Capital of Previous 5 Quarters 5,233.5
-------
ROIC 9.5%
(1) Charges excluded from "as reported" results are restructuring, acquisition
or divestiture related charges.
(2) Long-Term Debt reflects adoption of Fin. 46 in 2003 and 2002.
</Table>
<Table>
<Caption>
<s> <c> <c>
DIRECTORS
---------
WILLIAM P. SOVEY ALTON F. DOODY CYNTHIA A. MONTGOMERY
Chairman of the Board President & Chief Executive Professor, Graduate School
Age 70 Officer, Alton F. Doody Co. of Business Administration,
Director since 1986 Age 69 Harvard University
Director since 1976 Age 51
JOSEPH GALLI Director since 1995
Chief Executive Officer WILLIAM D. MAROHN
Age 45 Retired Vice Chairman of the Board, ALLAN P. NEWELL
Director since 2001 Whirlpool Corporation Private Investor
Age 63 Age 57
THOMAS E. CLARKE Director since 1999 Director since 1982
President,
New Business Ventures Nike, Inc. ELIZABETH CUTHBERT MILLETT GORDON R. SULLIVAN
Age 52 Private Investor President, Association of
Director since 2003 Age 47 the United States Army
Director since 1995 Age 66
SCOTT S. COWEN Director since 1999
President, Tulane University
Age 57 RAYMOND G. VIAULT
Director since 1999 Vice Chairman, General Mills, Inc.
Age 59
Director since 2002
</Table>
<Table>
<Caption>
<s> <c> <c> <c>
OFFICERS KEY ACCOUNTS
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JOSEPH GALLI DALE L. MATSCHULLAT JAMES J. ROBERTS PAUL G. BOITMANN
Chief Executive Officer Vice President, General Chief Operating Officer President
Age 45 Counsel and Corporate Rubbermaid/Irwin The Home Depot Division
Joined Company 2001 Secretary Age 45 Age 42
Age 58 Joined Company 2001 Joined Company 2001
HARTLEY "BUDDY" BLAHA Joined Company 1989
Vice President J. PATRICK ROBINSON RICHARD L. KERN
Corporate Development ROBERT S. PARKER Vice President Controller President
Age 38 Chief Operating Officer Chief Financial Officer Lowe's Division
Joined Company 2003 Sharpie/Calphalon Age 48 Age 42
Age 58 Joined Company 2001 Joined Company 2001
TIM J. JAHNKE Joined Company 1992
Vice President STEVEN R. SCHEYER
Human Resources President
Age 44 Wal*Mart Division
Joined Company 1986 Age 45
Joined Company 2001
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STOCKHOLDER INFORMATION
Additional copies of this letter to shareholders, proxy statement and
Form 10-K filed with the Securities and Exchange commission, dividend
reinvestment plan information, recent and historical financial data
and other information about Newell Rubbermaid are available without
charge to interested stockholders upon request to:
Newell Rubbermaid Inc. Investor Relations
10B Glenlake Parkway, Suite 600
Atlanta, GA 30328
(800) 424-1941
investor.relations@newellco.com
www.newellrubbermaid.com
ANNUAL MEETING OF STOCKHOLDERS
The annual meeting of stockholders will be held May 12, 2004, 10:00
a.m., local time at:
Grand Hyatt Hotel
3300 Peachtree Road
Atlanta, GA 30305
404-365-8100
INVESTOR AND OTHER INQUIRIES
Security analysts, investment professionals, news media and other
inquiries should be directed to:
Jesse J. Herron
Vice President - Investor Relations
10B Glenlake Parkway, Suite 600
Atlanta, GA 30328
(770) 407-3994
STOCKHOLDER ACCOUNT MAINTENANCE
Communications concerning the transfer of shares, lost certificates,
dividends, dividend reinvestment, receipt of multiple dividend checks,
duplicate mailings or change of address should be directed to the
Transfer Agent and Registrar:
The Bank of New York
Shareholder Relations Dept. 8W
PO Box 11258
Church Street Station
New York, NY 10286
800-432-0140
www.stockbny.com
FORWARD-LOOKING STATEMENTS
The statements contained in this letter to shareholders that are not
historical in nature are forward-looking statements. Forward-looking
statements are not guarantees since there are inherent difficulties in
predicting future results, and actual results could differ materially
from those expressed or implied in the forward-looking statements. For
a list of major factors that could cause actual results to differ
materially from those projected, refer to Appendix A to Newell
Rubbermaid's 2004 annual meeting proxy statement
accompanying this letter.
This letter to shareholders should be read in conjunction with Newell
Rubbermaid's 2004 annual meeting proxy statement and the 2003 Form 10-
K. Copies of the proxy statement and Form 10-K may be obtained online
at www.newellrubbermaid.com.
PRODUCTS ON THE BACK COVER
From left to right, top to bottom:
IRWIN{R} Bolt Grip.,
Graco{R} Harmony{TM} Highchair,
Lenox{R} Lazer{TM}
Reciprocating Saw Blade,
Sharpie{R} RT Retractable Marker,
Rubbermaid{R} Commercial Trademaster Utility Cart,
Calphalon{R} One{TM} Infused Anodized Cookware
10B Glenlake Parkway, Suite 600
Atlanta, Georgia 30328
www.newellrubbermaid.com
NEWELL RUBBERMAID(TM}
[Pictures of above listed products omitted]