INTERNATIONAL:
EUROPE/AFRICA/MIDDLE EAST & EXPORT

Europe achieved good sales and better margin growth in fixed currencies in 2003, as steady gains in its Healthcare and Textile Care businesses, along with strategic acquisitions, led revenues. The weaker U.S. dollar leveraged these results to yield even stronger gains when translated to dollars.

HIGHLIGHTS

> Institutional sales benefited from the pan-European introduction of Oasis Pro and Penguin, a professional cleaning system for large hospitality and healthcare facilities.

> Food & Beverage posted continued good results across all segments, although regional economic challenges affected growth. Especially successful were its Total Hygiene Management program, which helped it win several large corporate accounts, and the Kovex Foam System, an innovative solution for improving hoof sanitation in dairy herds.

> Professional Products transformed its business model, focusing more extensively on customer segments and on new product launches.

> Healthcare had a good year, with the integration of Adams Healthcare positioning Ecolab as a leading player in the European hospital acute care market.

> The Africa, Middle East and Export businesses were aligned with Europe in 2003.They achieved modest growth, with good results in Turkey and South Africa helping to offset continuing economic and political strife in Israel and elsewhere.

OUTLOOK

Ecolab Europe anticipates an improved performance in 2004 by undertaking key initiatives to outpace local economies and market challenges. It is set to focus on customer segmentation, distribution channel expansion and a variety of new product launches.