In a year marked by recession and post 9/11 uncertainty, Red Lobster’s strength as a trusted brand and, indeed, an American icon, were most evident. The 34-year-old leader in casual dining seafood posted record results during fiscal 2002. Total sales reached a record high of $2.34 billion, 7.1% over fiscal 2001. Same-restaurant sales growth, which has continued for 18 consecutive quarters, increased 6.2% for the year. The average weekly same-restaurant guest count rose 3.4% to a 10-year high. This performance reaffirms Red Lobster’s strategy of offering great seafood at a great value. In addition to the great variety of seafood we serve every day, much of our success during the year centered on well-executed features, such as “30 Shrimp for $9.99,” our signature “Lobsterfest” and a “Festival of Crab” celebration. These advertised campaigns emphasized Red Lobster’s classic favorites and exciting new offerings, while underscoring the important elements of this enduring, trusted brand. Much of Red Lobster’s success reflects a strategic approach to culinary development, which includes a systemized analytical tool – Menu Offering Rationalization and Evaluation (MORE) – that helps determine how well our menu mix matches the tastes and preferences of our guests. Red Lobster’s recently launched fresh fish initiative, emphasizing the freshest fish in casual dining, is a product of this disciplined approach. Rigorous research also characterizes Red Lobster’s beverage strategy. As a result of this continued focus, adult beverage sales were up in fiscal 2002. And as Red Lobster continues to improve the total dining experience offered to guests, this remains a significant opportunity for growth. Red Lobster continues to add to a long tradition of culinary innovation in a multi-unit restaurant operation. Restaurant Business magazine recognized Executive Chef Stephen Anderson as the most influential and creative menu planner in the chain restaurant market this year, naming him the magazine’s first ever “Menu Strategist of the Year” for his key role in enhancing the Red Lobster menu with bigger, bolder flavors and expanding its fresh fish selections. Anderson was also a recipient of Nation’s Restaurant News’ 2002 MenuMaster Award, which highlights the role of research and development in food service. Red Lobster’s culinary management team gained further strength this past year with the addition of Keith Keogh, a highly regarded culinarian, as Senior Vice President of Culinary and Beverage Excellence. The Red Lobster team enjoys an enviable position in the restaurant industry. Serving 2.8 million guests each week, we command 49% of the casual dining seafood market, and seafood is what casual dining consumers order most frequently when they dine out – especially as they get older and dine out more often. continued>