% to sales . the impact of foreign exchange rates was unfavorable in 2012 , reducing sales 1.5 % . replace_table_token_3_th in 2012 , gross profit increased 6.3 % , however our gross profit margin declined 90 basis points . in fiscal year 2012 , we were able to offset the dollar impact of a high single digit increase in raw material and packaging costs with our pricing actions and cci cost savings . in 2012 , cci cost savings totaled $ 56 million of which $ 39 million lowered cost of goods sold . while pricing and cci cost savings offset the dollar impact of increased material costs , the net impact of these factors caused downward pressure on gross profit as a percentage of net sales . margins were further pressured by our mix of sales in 2012 , as sales in international markets grew at a faster rate than in the u.s. , where our gross profit margin is higher due to larger scale and less complexity . in 2013 we expect material cost inflation to moderate to an increase of approximately 3 % . due to the low interest rate environment , retirement benefit expense is expected to increase by $ 22 million in 2013. about 40 % of this increase is expected to impact cost of goods sold . replace_table_token_4_th selling , general and administrative expenses increased 5.8 % in 2012 from 2011 , but decreased as a percentage of net sales for those same time periods . the decrease in sg & a as a percent of net sales was primarily driven by a leveraging effect of our higher sales on these costs . we had a benefit from cci cost savings that lowered sg & a $ 17 million in 2012 and a favorable comparison to 2011 when sg & a included $ 10.9 million of transaction costs related to completed acquisitions , while 2012 had only $ 1.7 million of such costs . during 2012 , we increased brand marketing support by $ 11.0 million to $ 198.3 million . a large portion of this increase was in digital marketing , which is one of our highest return investments in brand marketing support . in 2013 , due to the low interest rate environment , retirement benefit expense is expected to increase by $ 22 million . about 60 % of this increase is expected to impact sg & a . replace_table_token_5_th interest expense for 2012 was higher than the prior year . the impact of higher average debt balances in 2012 compared to 2011 was partially offset by the impact of lower interest rates for 2012 compared to 2011. the higher average debt balances in 2012 were due to the acquisitions completed late in 2011. replace_table_token_6_th in 2012 , we repatriated $ 70.0 million of cash from foreign subsidiaries . this transaction generated u.s. foreign tax credits due to the mix of foreign earnings that related to this cash . these u.s. foreign tax credits reduced 2012 tax expense by $ 9.7 million and were the major driving factor in a reduction in the tax rate for 2012 as compared to the prior year . discrete tax benefits in 2012 were $ 2.0 million compared to $ 0.8 million in 2011. the increase in 2012 is mainly due to the reversal of a portion of a valuation allowance originally established against a subsidiary 's net operating losses . this subsidiary has established a pattern of profitability which resulted in us concluding that a portion of the valuation allowance should be reversed . in 2010 , the internal revenue service ( irs ) commenced an examination of our u.s. federal income tax return for the 2007 and 2008 tax years . during the course of the examination , we held discussions with the irs on certain issues and in october 2012 we received proposed adjustments for these tax years . in november 2012 we deposited $ 18.8 million with the irs to stop any potential interest on these proposed adjustments . we believe we have established appropriate deferred taxes or tax accruals under us gaap for these issues in prior periods . while it is often difficult to predict the final outcome or the timing of resolution of uncertain tax positions , we believe that our unrecognized tax benefits reflect the most likely outcome . we will continue to update these unrecognized tax benefits , and the related interest , in light of changing facts and circumstances in the future . in addition , see note 10 of the financial statements for a reconciliation of the u.s. federal statutory tax rate with the effective tax rate . replace_table_token_7_th income from unconsolidated operations decreased $ 3.9 million in 2012 compared to 2011. most of this decrease is attributable to our largest joint venture , mccormick de mexico , which was negatively impacted by an unfavorable foreign exchange rate between the mexican peso an the u.s. dollar for most of 2012. while this business grew sales 6 % , profits were also pressured by higher soybean oil cost ( a main ingredient for mayonnaise which is the leading product for this joint venture ) . this situation began in the fourth quarter of 2011 and the year-on-year impact in the fourth quarter of 2012 had eased . in 2012 , our mccormick de mexico joint venture represented 59 % of the sales and 82 % of the net income of our unconsolidated joint ventures . we own a 26 % share in our eastern condiments joint venture and on average own 50 % of our other unconsolidated joint ventures . story_separator_special_tag strong sales to food manufacturers were driven in part by the development of new products and increased demand for snack seasonings and ingredients , particularly in the u.s. and mexico . while sales to the foodservice industry were favorably impacted by product introductions , a number of our customers were impacted by the weak economy . both food manufacturers and foodservice customers continue to have an interest in products that feature all natural ingredients , reduced sodium and other healthy attributes . these types of projects accounted for 40 % of our product development activity in the u.s. during 2011. in emea , industrial business sales rose 12.3 % , with a 5.8 % increase from favorable volume and product mix , 2.9 % from pricing actions and 3.6 % from favorable foreign exchange rates . as in 2010 , demand from quick service restaurants was high and continued to be the key sales driver in this region . we had particular strength in the sales of products that we manufacture in our facilities in the u.k. , turkey and south africa for these customers , and supported their expansion in russia and the middle east . industrial business sales in the asia/pacific region rose 22.0 % . favorable volume and product mix grew sales 10.7 % , favorable foreign exchange rates added 9.0 % and increased pricing actions added 2.3 % . as in emea , sales to quick service restaurants were a source of strong growth in 2011. the rapid expansion of quick service restaurants in this region and our new product activity contributed to a 15 % increase of industrial business sales in china when measured in local currency . we also supported the expansion of quick service restaurants into india , further adding to our sales growth in this region . industrial business operating income increased $ 4.5 million to $ 111.9 million , a 4.2 % increase from 2010. the profit impact of higher sales and cci cost savings were offset in part by increased material costs and an investment in our branded foodservice business with $ 5 million of incremental marketing support . the net effect of these items , along with our sales mix of products during 2011 , led to a decline in industrial business operating income margin to 7.5 % from 8.0 % in 2011. since 2005 we have improved the operating income margin of this business and expect to achieve further improvements in margin in a less volatile input cost environment and as a result of our development of more value-added , higher margin new products . non-gaap financial measures the tables below include financial measures of net income and diluted earnings per share excluding the benefit of the reversal of a significant tax accrual in 2010. there were no adjustments to 2012 or 2011 financial results . this is a non-gaap financial measure which is prepared as a complement to our financial results prepared in accordance with united states generally accepted accounting principles . we believe this non-gaap information is important for purposes of comparison to prior periods and development of future projections and earnings growth prospects . this information is also used by management to measure the profitability of our ongoing operations and analyze our business performance and trends . in 2010 our discrete tax benefits included a $ 13.9 million reversal of a tax accrual for a closed tax year . this tax accrual was recorded in a prior period based on uncertainties about the tax aspects of transactions related to the reorganization of our european operations and divestment of certain of our joint ventures . we are treating this $ 13.9 million discrete tax benefit as a non-gaap adjustment to our diluted earnings per share . we are providing non-gaap results that exclude the impact of this reversal as the item to which it relates was recorded as a restructuring charge , and it allows for a better comparison of 2010 financial results to 2011 and 2012. when we had restructuring charges in periods prior to 2010 we used non-gaap financial measures to display earnings exclusive of these restructuring charges . these non-gaap measures may be considered in addition to results prepared in accordance with gaap , but they should not be considered a substitute for , or superior to , gaap results . we intend to continue to provide these non-gaap financial measures as part of our future earnings discussions and , therefore , the inclusion of these non-gaap financial measures will provide consistency in our financial reporting . a reconciliation of these non-gaap measures to gaap financial results is provided below . replace_table_token_20_th in addition to the non-gaap measures for net income and diluted earnings per share , we use total debt to earnings before interest , tax , depreciation and amortization ( ebitda ) as a measure of leverage . ebitda and the ratio of total debt to ebitda are both non-gaap financial measures . this ratio measures our ability to repay outstanding debt obligations . our target for total debt to ebitda , excluding the temporary impact from acquisition activity , is 1.5 to 1.7. we believe that total debt to ebitda is a meaningful metric to investors in evaluating our financial leverage and may be different than the method used by other companies to calculate total debt to ebitda . we define ebitda as net income plus expenses of interest , income taxes , depreciation and amortization . the following table reconciles our ebitda to our net income : replace_table_token_21_th story_separator_special_tag conjunction with acquisition activity and subsequent reduction of that debt . in 2011 , we increased our debt levels to help fund our kohinoor , kamis and kitchen basics acquisitions . during 2012 , the debt associated with these acquisitions was reduced to bring our total debt to ebitda within our target range of 1.5 to 1.7. most of our cash is in our foreign subsidiaries . we manage our

liquidity and financial condition replace_table_token_22_th we generate strong cash flow from operations which enables us to fund operating projects and investments that are designed to meet our growth objectives , increase our dividend , fund capital projects and make share repurchases when appropriate . in 2013 , we expect to continue our share repurchase activity and use a portion of our cash flow from operations to help fund our acquisition of wuhan asia-pacific condiments co. , ltd. , which is expected to close mid-year . in the cash flow statement , the changes in operating assets and liabilities are presented excluding the effects of changes in foreign currency exchange rates , as these do not reflect actual cash flows . accordingly , the amounts in the cash flow statement do not agree with changes in the operating assets and liabilities that are presented in the balance sheet . the reported values of our assets and liabilities held in our non-u.s. subsidiaries and affiliates can be significantly affected by fluctuations in foreign exchange rates between periods . at november 30 , 2012 , the exchange rates for the canadian dollar , australian dollar , polish zloty and british pound sterling were slightly higher versus the u.s. dollar compared to 2011. at november 30 , 2012 , the exchange rate for the euro and indian rupee versus the u.s. dollar were lower than at november 30 , 2011. operating cash flow – when 2012 is compared to 2011 , the increase in operating cash flow was led by a small decrease in inventory , whereas in 2011 we had a significant increase in inventory . in addition , we generated cash from higher net income in 2012. our total pension contributions were $ 104.3 million in 2012 as compared to $ 42.7 million in 2011 , which provided a partial offset to the increases noted above . when 2011 is compared to 2010 , the decrease in operating cash flow was driven by a higher level of inventory in 2011 as compared to the prior year .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity and financial condition replace_table_token_22_th we generate strong cash flow from operations which enables us to fund operating projects and investments that are designed to meet our growth objectives , increase our dividend , fund capital projects and make share repurchases when appropriate . in 2013 , we expect to continue our share repurchase activity and use a portion of our cash flow from operations to help fund our acquisition of wuhan asia-pacific condiments co. , ltd. , which is expected to close mid-year . in the cash flow statement , the changes in operating assets and liabilities are presented excluding the effects of changes in foreign currency exchange rates , as these do not reflect actual cash flows . accordingly , the amounts in the cash flow statement do not agree with changes in the operating assets and liabilities that are presented in the balance sheet . the reported values of our assets and liabilities held in our non-u.s. subsidiaries and affiliates can be significantly affected by fluctuations in foreign exchange rates between periods . at november 30 , 2012 , the exchange rates for the canadian dollar , australian dollar , polish zloty and british pound sterling were slightly higher versus the u.s. dollar compared to 2011. at november 30 , 2012 , the exchange rate for the euro and indian rupee versus the u.s. dollar were lower than at november 30 , 2011. operating cash flow – when 2012 is compared to 2011 , the increase in operating cash flow was led by a small decrease in inventory , whereas in 2011 we had a significant increase in inventory . in addition , we generated cash from higher net income in 2012. our total pension contributions were $ 104.3 million in 2012 as compared to $ 42.7 million in 2011 , which provided a partial offset to the increases noted above . when 2011 is compared to 2010 , the decrease in operating cash flow was driven by a higher level of inventory in 2011 as compared to the prior year .
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 Suspicious Activity Report : % to sales . the impact of foreign exchange rates was unfavorable in 2012 , reducing sales 1.5 % . replace_table_token_3_th in 2012 , gross profit increased 6.3 % , however our gross profit margin declined 90 basis points . in fiscal year 2012 , we were able to offset the dollar impact of a high single digit increase in raw material and packaging costs with our pricing actions and cci cost savings . in 2012 , cci cost savings totaled $ 56 million of which $ 39 million lowered cost of goods sold . while pricing and cci cost savings offset the dollar impact of increased material costs , the net impact of these factors caused downward pressure on gross profit as a percentage of net sales . margins were further pressured by our mix of sales in 2012 , as sales in international markets grew at a faster rate than in the u.s. , where our gross profit margin is higher due to larger scale and less complexity . in 2013 we expect material cost inflation to moderate to an increase of approximately 3 % . due to the low interest rate environment , retirement benefit expense is expected to increase by $ 22 million in 2013. about 40 % of this increase is expected to impact cost of goods sold . replace_table_token_4_th selling , general and administrative expenses increased 5.8 % in 2012 from 2011 , but decreased as a percentage of net sales for those same time periods . the decrease in sg & a as a percent of net sales was primarily driven by a leveraging effect of our higher sales on these costs . we had a benefit from cci cost savings that lowered sg & a $ 17 million in 2012 and a favorable comparison to 2011 when sg & a included $ 10.9 million of transaction costs related to completed acquisitions , while 2012 had only $ 1.7 million of such costs . during 2012 , we increased brand marketing support by $ 11.0 million to $ 198.3 million . a large portion of this increase was in digital marketing , which is one of our highest return investments in brand marketing support . in 2013 , due to the low interest rate environment , retirement benefit expense is expected to increase by $ 22 million . about 60 % of this increase is expected to impact sg & a . replace_table_token_5_th interest expense for 2012 was higher than the prior year . the impact of higher average debt balances in 2012 compared to 2011 was partially offset by the impact of lower interest rates for 2012 compared to 2011. the higher average debt balances in 2012 were due to the acquisitions completed late in 2011. replace_table_token_6_th in 2012 , we repatriated $ 70.0 million of cash from foreign subsidiaries . this transaction generated u.s. foreign tax credits due to the mix of foreign earnings that related to this cash . these u.s. foreign tax credits reduced 2012 tax expense by $ 9.7 million and were the major driving factor in a reduction in the tax rate for 2012 as compared to the prior year . discrete tax benefits in 2012 were $ 2.0 million compared to $ 0.8 million in 2011. the increase in 2012 is mainly due to the reversal of a portion of a valuation allowance originally established against a subsidiary 's net operating losses . this subsidiary has established a pattern of profitability which resulted in us concluding that a portion of the valuation allowance should be reversed . in 2010 , the internal revenue service ( irs ) commenced an examination of our u.s. federal income tax return for the 2007 and 2008 tax years . during the course of the examination , we held discussions with the irs on certain issues and in october 2012 we received proposed adjustments for these tax years . in november 2012 we deposited $ 18.8 million with the irs to stop any potential interest on these proposed adjustments . we believe we have established appropriate deferred taxes or tax accruals under us gaap for these issues in prior periods . while it is often difficult to predict the final outcome or the timing of resolution of uncertain tax positions , we believe that our unrecognized tax benefits reflect the most likely outcome . we will continue to update these unrecognized tax benefits , and the related interest , in light of changing facts and circumstances in the future . in addition , see note 10 of the financial statements for a reconciliation of the u.s. federal statutory tax rate with the effective tax rate . replace_table_token_7_th income from unconsolidated operations decreased $ 3.9 million in 2012 compared to 2011. most of this decrease is attributable to our largest joint venture , mccormick de mexico , which was negatively impacted by an unfavorable foreign exchange rate between the mexican peso an the u.s. dollar for most of 2012. while this business grew sales 6 % , profits were also pressured by higher soybean oil cost ( a main ingredient for mayonnaise which is the leading product for this joint venture ) . this situation began in the fourth quarter of 2011 and the year-on-year impact in the fourth quarter of 2012 had eased . in 2012 , our mccormick de mexico joint venture represented 59 % of the sales and 82 % of the net income of our unconsolidated joint ventures . we own a 26 % share in our eastern condiments joint venture and on average own 50 % of our other unconsolidated joint ventures . story_separator_special_tag strong sales to food manufacturers were driven in part by the development of new products and increased demand for snack seasonings and ingredients , particularly in the u.s. and mexico . while sales to the foodservice industry were favorably impacted by product introductions , a number of our customers were impacted by the weak economy . both food manufacturers and foodservice customers continue to have an interest in products that feature all natural ingredients , reduced sodium and other healthy attributes . these types of projects accounted for 40 % of our product development activity in the u.s. during 2011. in emea , industrial business sales rose 12.3 % , with a 5.8 % increase from favorable volume and product mix , 2.9 % from pricing actions and 3.6 % from favorable foreign exchange rates . as in 2010 , demand from quick service restaurants was high and continued to be the key sales driver in this region . we had particular strength in the sales of products that we manufacture in our facilities in the u.k. , turkey and south africa for these customers , and supported their expansion in russia and the middle east . industrial business sales in the asia/pacific region rose 22.0 % . favorable volume and product mix grew sales 10.7 % , favorable foreign exchange rates added 9.0 % and increased pricing actions added 2.3 % . as in emea , sales to quick service restaurants were a source of strong growth in 2011. the rapid expansion of quick service restaurants in this region and our new product activity contributed to a 15 % increase of industrial business sales in china when measured in local currency . we also supported the expansion of quick service restaurants into india , further adding to our sales growth in this region . industrial business operating income increased $ 4.5 million to $ 111.9 million , a 4.2 % increase from 2010. the profit impact of higher sales and cci cost savings were offset in part by increased material costs and an investment in our branded foodservice business with $ 5 million of incremental marketing support . the net effect of these items , along with our sales mix of products during 2011 , led to a decline in industrial business operating income margin to 7.5 % from 8.0 % in 2011. since 2005 we have improved the operating income margin of this business and expect to achieve further improvements in margin in a less volatile input cost environment and as a result of our development of more value-added , higher margin new products . non-gaap financial measures the tables below include financial measures of net income and diluted earnings per share excluding the benefit of the reversal of a significant tax accrual in 2010. there were no adjustments to 2012 or 2011 financial results . this is a non-gaap financial measure which is prepared as a complement to our financial results prepared in accordance with united states generally accepted accounting principles . we believe this non-gaap information is important for purposes of comparison to prior periods and development of future projections and earnings growth prospects . this information is also used by management to measure the profitability of our ongoing operations and analyze our business performance and trends . in 2010 our discrete tax benefits included a $ 13.9 million reversal of a tax accrual for a closed tax year . this tax accrual was recorded in a prior period based on uncertainties about the tax aspects of transactions related to the reorganization of our european operations and divestment of certain of our joint ventures . we are treating this $ 13.9 million discrete tax benefit as a non-gaap adjustment to our diluted earnings per share . we are providing non-gaap results that exclude the impact of this reversal as the item to which it relates was recorded as a restructuring charge , and it allows for a better comparison of 2010 financial results to 2011 and 2012. when we had restructuring charges in periods prior to 2010 we used non-gaap financial measures to display earnings exclusive of these restructuring charges . these non-gaap measures may be considered in addition to results prepared in accordance with gaap , but they should not be considered a substitute for , or superior to , gaap results . we intend to continue to provide these non-gaap financial measures as part of our future earnings discussions and , therefore , the inclusion of these non-gaap financial measures will provide consistency in our financial reporting . a reconciliation of these non-gaap measures to gaap financial results is provided below . replace_table_token_20_th in addition to the non-gaap measures for net income and diluted earnings per share , we use total debt to earnings before interest , tax , depreciation and amortization ( ebitda ) as a measure of leverage . ebitda and the ratio of total debt to ebitda are both non-gaap financial measures . this ratio measures our ability to repay outstanding debt obligations . our target for total debt to ebitda , excluding the temporary impact from acquisition activity , is 1.5 to 1.7. we believe that total debt to ebitda is a meaningful metric to investors in evaluating our financial leverage and may be different than the method used by other companies to calculate total debt to ebitda . we define ebitda as net income plus expenses of interest , income taxes , depreciation and amortization . the following table reconciles our ebitda to our net income : replace_table_token_21_th story_separator_special_tag conjunction with acquisition activity and subsequent reduction of that debt . in 2011 , we increased our debt levels to help fund our kohinoor , kamis and kitchen basics acquisitions . during 2012 , the debt associated with these acquisitions was reduced to bring our total debt to ebitda within our target range of 1.5 to 1.7. most of our cash is in our foreign subsidiaries . we manage our

