C A R R I E R   Carrier’s productivity and growth strategies yielded strong results in 2003, with revenues up 5 percent, earnings up 11 percent, and margins up by 60 basis points, adjusted for restructuring. The last quarter of 2003 marked the seventh consecutive quarter of margin expansion.
        Productivity has come from factory consolidations, reduced vertical integration and implementation of the ACE operating and quality system. Since 2000, revenue per employee has risen 23 percent.
       Product development efforts now focus on common, global platforms developed by cross-functional teams that leverage Carrier’s worldwide knowledge and skills. This platform concept is reducing product complexity and the number of design centers. Over the last three years, in the fields of residential and commercial heating, ventilation and air conditioning (HVAC) systems and commercial refrigeration systems, Carrier has been issued more U.S. patents than any of its competitors. Carrier’s complete systems and controls solution for Time Warner’s New York City headquarters illustrates its ability to integrate HVAC solutions with other systems including fire/life/safety, security/access and lighting.
        The Carrier Aero™ Air Handling Unit is now available with AgION™ antimicrobial coated steel, a silver ion-based compound that suppresses the growth of molds and other microbes in HVAC equipment serving commercial buildings.
        In 2003, sales through Sears, the largest retail player in residential ducted systems, increased 89 percent. Building on its success with products supplied under the Sears Kenmore brand, the Carrier brand was added to Sears’ offering.
        Carrier also secured its position as HVAC supplier of choice to Ryland Homes, the sixth largest residential builder in the United States, with upgrade orders for 2,500 new homes in 2004, converting to high efficiency, non-ozone depleting Puron® air conditioners. Carrier already supplies HVAC products to 15,000 new Ryland homes each year.
         Carrier markets have more than doubled over the past 15 years, despite market weakness in the last three years.Trends such as urbanization, demographics, food safety and energy efficiency all point to continued growth. Carrier is poised to build on its 100-year heritage as its customer’s first choice in heating, ventilation, air conditioning and commercial refrigeration.