he theme of our 2001 Annual Report is “Opening a New Window to Growth”. During the year we initiated a Brand Acquisition Strategy that is a new window to future growth. We have acquired eight brands for just over $100 million that immediately make us the 2nd largest branded player in the U.S. market. These profitable, regional brands are typically the market leader and have given us a #1 or #2 branded position in 28 of the Top 50 A.C. Nielsen markets. We will discuss our Branded Strategy in more detail later in this Annual Report, but first want to emphasize some of the highlights of our fiscal 2001:

Delivered our 12th straight year of double digit volume growth;

Grew our Ingredient customer volumes by 35% in part by adding Luigino’s (Michelina brand frozen foods), Tyson and Heinz as new customers;

Grew our Private Label volumes by over 27% including SuperValu, Target and Demoulas as new customers;

Created a meaningful U.S. market presence for our Italian products with customers such as Kroger, Delhaize, Shaw’s, HEB and Price Chopper;

Added the ADM pasta brand production through an outsourcing agreement;

Continued the outstanding track record of our operations performance by improving total delivered cost, customer service, and the rapid realization of synergies targeted from our branded acquisitions;

Replaced our existing debt facility with a new $300 million debt syndication that facilitated the acquisition of the Borden brands and positioned us to finance future growth, capitalizing on current low interest rates;

Significantly strengthened and expanded our management team in the sales and marketing functions and in supply chain management; and

Saw real capacity and industry rationalization with Borden Foods’ pasta brands acquired partially by AIPC with the remainder by New World Pasta and the subsequent announcement of four plant closings by New World.

These accomplishments and industry developments helped us achieve record financial results. Net sales grew by 25% to $311 million. Operating profit (excluding acquisition-related charges) grew 19% to $56.6 million, maintaining our top quartile industry operating margin at 18.2%. Finally, fully diluted EPS was up over 15% at $1.73 (also excluding unusual charges). We view this as outstanding performance in a year where we positioned our Company for even greater growth in 2002 and beyond.