MCCORMICK & COMPANY 2004 ANNUAL REPORT Average Notional contractual Fair Currency value exchange rate value Currency sold received (millions) (USD/fc) (millions) Euro USD $10.9 1.23 $ (.8) British pound sterling USD 7.8  1.80  (.4) Canadian dollar USD 29.9  .78  (2.5) (millions) 2004 2005 2006 2007 Thereafter Total Fair value Debt Fixed rate $ 16.3 $ 32.3 $ 196.4 $ .3 $ 205.4 $ 450.7 $ 508.5 Average interest rate 7.00% 7.10% 7.42% – 7.53% Variable rate $ 154.7 $ 14.2 – – – $ 168.9 $ 168.9 Average interest rate 1.52% 1.59% Year of Maturity at November 30  2003 Year of Maturity at November 30  2004 (millions) 2005 2006 2007 2008 Thereafter Total Fair value Debt Fixed rate $ 32.5 $ 196.1 $ .3 $ 149.9 $ 104.4 $ 483.2 $ 523.5 Average interest rate 5.95% 7.33% – 7.69% 4.2% Variable rate $ 140.7 – – – $ 14.3 $ 155.0 $ 155.0 Average interest rate 2.13% 2.43% Foreign Currency Exchange Contracts The Company has a number of smaller contracts with an aggregate notional value of $2.5 million to purchase or sell various other currencies  such as the Australian dollar  Japanese yen  and South African rand as of November 30  2004. The aggregate fair value of these contracts was $(0.2) million at November 30  2004. At November 30  2003  the Company had foreign currency exchange contracts for the Euro  British pound sterling  Canadian dollar  Australian dollar  Japanese yen and South African rand with a notional value of $58.9 million  all of which matured in 2004. The fair value of these contracts was $(1.7) million at November 30  2003. Contracts with durations which are less than 5 days and used for short-term cash flow funding within the Company are not included in the notes or table above. During 2004  the foreign currency translation compo- nent in other comprehensive income was principally related to the impact of exchange rate fluctuations on the Company’s net investments in France  the U.K.  Canada  and Australia. The Company did not hedge its net invest- ments in subsidiaries and unconsolidated affiliates in 2004  2003  or 2002.  Interest Rate Risk – The Company’s policy is to man- age interest rate risk by entering into both fixed and  variable rate debt. The Company also uses interest rate swaps to minimize worldwide financing costs and to achieve a desired mix of its fixed and variable rate debt. The table that follows provides principal cash flows and related interest rates  excluding the effect of interest rate swaps  by fiscal year of maturity at November 30  2004 and 2003. For foreign currency-denominated debt  the information is presented in U.S. dollar equivalents. Variable interest rates are based on the weighted- average rates of the portfolio at the end of the year  presented. Note: The table above displays the debt by the terms of the original debt instrument without consideration of interest rate swaps. These swaps have the following effects. The variable interest rate on $75 million of commercial paper is hedged by interest rate swaps through 2011. Net interest payments on the $75 million will be fixed at 6.35% during this period. Interest rate swaps  settled upon the issuance of the medium-term notes maturing in 2006 and 2008  effectively fixed the interest rate on $294 million of the notes at a weighted-average fixed rate of 7.62%. The fixed interest rate on $100 million of the 6.4% medium-term notes due in 2006 is effectively converted to a variable rate by interest rate swaps through 2006. Net interest payments on these notes are based on LIBOR plus 3.595% during this  period. The fixed interest rate on $50 million of 3.35% medium-term notes due in 2009 is effectively converted to a variable rate by interest rate swaps through 2009. Net interest payments are based on LIBOR minus .21% during this period. 31