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                                                                    EXHIBIT 13

                        ANNUAL REPORT TO SHAREHOLDERS
                                  FOR 2003



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                                                                    EXHIBIT 13


[Graybar Logo]                              2003 ANNUAL REPORT
works to your advantage

[photos]


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                     BOARD OF DIRECTORS

                          [photo]

Standing, left to right:

Jack F. Van Pelt
Vice President-Human Resources

Richard A. Cole
District Vice President-Chicago District

Kenneth B. Sparks
District Vice President-Seattle District

Robert A. Reynolds, Jr.
Chairman, President and Chief Executive Officer

Juanita H. Hinshaw
Senior Vice President and Chief Financial Officer

Richard D. Offenbacher
Senior Vice President-Comm/Data Business

Thomas S. Gurganous
District Vice President-Richmond District

Thomas F. Dowd
Vice President, Secretary and General Counsel

Seated, left to right:

Lawrence R. Giglio
Senior Vice President-Operations

Dennis E. DeSousa
Senior Vice President-Sales and Distribution

John C. Loff
District Vice President-Dallas District

Gary D. Hodges
District Vice President-Phoenix District

Charles R. Udell
Senior Vice President-Electrical Business



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Company's Business

Graybar Electric Company, Inc. is engaged internationally in the
distribution of electrical, telecommunications and networking products
and the provision of related supply chain management and logistics
services, primarily to contractors, industrial plants, telephone
companies, power utilities, and commercial users.  All products sold by
the Company are purchased by the Company from others.


Classes of Customers Served

Electrical Contractor
Commercial & Industrial
Voice & Data Communications
Power Utility
International


Capital Stock Data

Number of Equity Security Holders as of
December 31, 2003:
-------------------------------------------------------------------------
Title of Class                                Number of Security Holders
-------------------------------------------------------------------------
Preferred Stock                                                       53
Common Stock                                                         135
Voting Trust Certificates for Common Stock                         5,605
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<TABLE>
Dividend Data

Common Stock, par value $1; stated value $20.
<CAPTION>
Dividends declared for year:                            2003        2002        2001
-------------------------------------------------------------------------------------
<S>                                                   <C>          <C>         <C>
First Quarter                                          $ .30       $ .30       $ .30
Second Quarter                                           .30         .30         .30
Third Quarter                                            .30         .30         .30
Fourth Quarter                                         $1.10       $1.10       $1.10
-------------------------------------------------------------------------------------
</TABLE>


Contents

Board of Directors                Inside Front Cover

Letter to Shareholders                             2

Market Review                                      4

Operations Review                                 10

Financial Review                                  13

Management's Discussion and Analysis
of Financial Condition and Results of Operations  16

Consolidated Financial Statements                 20

Report of Independent Auditors                    30

District Management                               31

Locations                                         32



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                   LETTER TO SHAREHOLDERS

     In 2003, we continued to adapt to a world that for the last several
years has been rapidly changing.  Change is inherently difficult, for
organizations as well as individuals, but we have taken the steps we
needed to adapt to the wide variety of challenges we have confronted.
The good news is this:  We think we have learned how to deal with change
better, and we are well positioned to take advantage of the different
world we now inhabit.

     We should not underestimate the scope of the challenges we have
faced.  In the 1970s and the first half of the 1980s, our business was
relatively predictable.  From day to day, from month to month, from year
to year, our employees could generally predict their work lives.

     But change began to descend on us in the mid-1980s, and as the
years passed, accelerated.  In addition, as our markets declined, our
business, like those of our competitors, was hit hard - harder, in fact,
than it had ever been hit.

     But we responded rationally.  We capitalized on our fundamental
strength to make changes that other companies, with fewer resources and
perhaps less confidence, would not make.  Now, we believe, we have
weathered the storm.

     Our most significant achievements in 2003 all involved this theme
of adjustment and preparation for the future. They included our new
organization, our new enterprise-wide software system, and our new
branding effort.

     One of the over-arching aspects of the changes that have been
roiling our business is the shift from a product-based business to a
service-based business.  To thrive in today's environment, we need to
react quickly to customers' and suppliers' needs, delivering solutions
faster than the competition.  The organizational changes we made were
designed to help us do just that.

     We reduced organizational layers.  We based our organization on
geographic territories rather than market silos.  We layered our
national capabilities and resources atop our strong presence in local
communities.

     The result has been just what we wanted:  By driving our decision-
making down, we've been better able to listen to our customers and
suppliers.  And we're already seeing the results.

     Meanwhile, we began implementing our new Enterprise Resource
Planning (ERP) system with the help of SAP, IBM and Deloitte Consulting.
This system will link all of Graybar's 250-plus branch, zone and
district facilities, but it's more than a change and integration in
software - it's a change in our whole business process.  It will give us
a powerful new tool for managing our assets - the key to success in the
distribution business.  It will improve both our supply chain management
services and our customer service.

     These systems are often extraordinarily challenging to bring to
life; many companies in the implementation phase have stumbled.  But to
date, our rollout - in three corporate departments - Human Resources,
Purchasing and Accounting - and in three districts - Minneapolis,
Chicago and Pittsburgh - has been extremely encouraging.  In fact, many
of our industry peers have acknowledged the success and speed with which
we have deployed our ERP system is unrivaled.

     Finally in 2003, we launched a new brand strategy that reflects
our tighter focus on providing our customers with supply chain logistics
and service solutions.  The announcement included the unveiling of a new
Graybar brand mark - our first major revision in 78 years - to reflect
our transition from a 'pick, pack and ship' company - a mere middleman -
to one of America's largest providers of managed distribution and supply
chain services.

     The new brand strategy is based on solid research that clearly
identified our Company's competitive edge - our people and their ability
to build relationships that work to our customers' and suppliers'
advantage.  The brand strategy is designed to help increase awareness of
the value-added services we provide.  It brings clarity to who we are
and what we do.

     But while our strategy for communicating our brand has changed,
the brand itself, the way we do business, is the same.  It continues to
stand for reliability, teamwork and resourcefulness - characteristics
that define the collective power of our employees and get to the core of
our Company's point of difference.  The responsibility to deliver on
that brand promise - every day in everything we do - remains as
important as ever.

     All these accomplishments will position us well as business
conditions improve.  They are beginning to do so, and our results are
improving with them.

     Our performance improved as the year went on.  And although our
sales were relatively flat, our "right price" program had the desired
impact on our gross margin rate - it improved in spite of the sluggish
market.

     Besides the upturn in business as the year progressed, there were
other heartening indicators of our performance. In February, Fortune
magazine named us as one of America's Most Admired Companies for the
second consecutive year.  The rankings are based on a survey of
executives, directors and analysts, who ranked companies according to
such criteria as innovation, employee talent, use of corporate assets,
management quality, financial strength and others.

     Then in May, the National Association of Electrical Distributors
(NAED) honored us with five awards for marketing excellence, including
"Best of the Best Overall."  The NAED also gave us awards for
merchandising, print advertising, literature/selling tools, and
integrated promotional campaigns.

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     Most recently, Graybar was named an InfoWorld 100 award recipient
for technology leadership.  We received this first-time honor in
recognition of our world-class enterprise management system.

     Looking ahead, we expect moderate growth in our businesses as our
markets continue to trend up, and we intend to capture increased market
share.  Our four top priorities are to make the budget; to complete the
successful rollout of the ERP system; to nail down our logistics and
inventory strategy; and to communicate more and more effectively.
A few words about each:

   * Budget - To get there, we need to continue to charge the "right
     price" and to control expense.  We need to strive to achieve our
     stretch goal of Drive for Five.  This goal is within our reach,
     but it will take everyone working together to eliminate
     redundancy, reduce errors and improve service to drive improved
     operating income.

   * ERP - Our goal is to complete the rollout by the third quarter
     2004.  This system will give us the knowledge and horsepower we
     need to help reduce the cost of doing business.  But the system is
     so comprehensive that we will need to spread the competence to use
     it across the entire organization.  For the sake of our customers
     and suppliers, we need to get the best out of this significant
     investment.

   * Logistics and Inventory -  We continue to refine our logistics
     strategy in response to changing market dynamics and direct input
     from our customers and suppliers.  In 2004, we look to continue
     refining this strategy by clearly defining how we can maximize our
     current model to better service customers and meet growing market
     demands in specific sectors, such as electrical,
     telecommunications, and industrial automation.

   * Communication - Last year, we started holding meetings between
     top management and field and corporate employees.  We also began
     holding quarterly conference calls with all employees.

     This year, we'll step it up.  That's because the meetings have
     reinforced our conviction that good communication - clear, concise
     and consistent communication - is absolutely fundamental to our
     performance.  With good communication, we can avoid errors and do
     the job right the first time - and thereby save ourselves millions
     of dollars.  With good communication, we can establish goals for
     our people, empower them to reach those goals, and ultimately
     establish better accountability.

     And in our Company, there is no greater issue than accountability.
     Our people have to know what they are responsible for achieving.
     And they must be held accountable for achieving it and recognized
     when they do.  That is the only way the goals can have any
     meaning.

     As we enter 2004, we can take satisfaction in the fact that we
have used the difficult times through which we have passed to prepare
for the future.  Now, just as most of our preparations are complete, the
forces of change appear to be turning in our favor and a brighter future
dawning.  It's a happy confluence of circumstances.  Now it's up to
every one of us to make the best of it.

/s/ Robert A. Reynolds, Jr.

Robert A. Reynolds, Jr.
Chairman, President and CEO

St. Louis, Missouri
March 2004

"Looking ahead, we expect moderate growth in our businesses as our
markets continue to trend up, and we intend to capture increased market
share."

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                       MARKET REVIEW

"The Company continued to build on its performance in the Electrical
Contractor Market."

In 2003, we continued to leverage Graybar's unique strength in both the
Electrical and Comm/Data Markets.  The reorganization of our field
management allowed Graybar to work to the advantage of our customers and
suppliers with a powerful and unified service platform while at the same
time providing the advantage of specialized solutions for each market.

We formalized agreements and programs with 12 new manufacturers during
the year to launch a comprehensive security and notification product
line-up, which addresses the growing demand for these products among
electrical contractors and communication resellers.

Our customer loyalty program, ePoint, was expanded to include electrical
contractor customers in 2003, providing more than 13,000 reseller and
contractor customers with travel and electronics redemption awards based
on their purchases.

In response to the Company's new organization and our corporate accounts
customers' demand for a more layered approach to service, the Corporate
Accounts Group further refined its structure and strategy in 2003.  The
group increased focus on national contractors, comm/data service
providers, industrial end users, government agencies, technology
companies and utilities.  These large, national customers require
specialized distribution services that must be applied across their
entire enterprise.  Each of these customer segments has dedicated
Graybar strategic account management that helps deliver and promote our
value-added service offerings and total value proposition.

This approach layers our robust corporate capabilities on top of strong
local support backed by our centralized Corporate Accounts Service
Group.

In addition, during the year, we implemented a more comprehensive
selling approach following formal business plans specific to each of our
strategic accounts.  We remain committed to growing our business with
these valuable customers while carefully managing the number of covered
accounts.  The Corporate Accounts Service Group continues to offer all
strategic accounts centralized customer service, account administration,
specialized reporting, quotations and financial coverage.

The ability to embrace our strategic customers with a single, unified
message and service platform coupled with our broad capabilities--
whether delivered centrally or through our distribution network--
continues to differentiate us in the marketplace.

Our government business, conducted principally under agreements with the
Defense Logistics Agency, General Services Administration (GSA) and
U.S. Communities, experienced meaningful growth in 2003.  Through these
contracts, Graybar can address most local, state or federal
opportunities with a powerful product and service offering.  Much of
this business is transacted through our Corporate Accounts Service
Group.

In 2003, we developed the Graybar Technology Showcase concept, which
adopted and enhanced our traditional comm/data trade shows and promoted
them as a national program.  The shows offered training credits for the
Registered Communications Distribution Designer

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                     CONTRACTOR MARKET

(RCDD) certification sponsored by the Building Industry Consulting
Services International (BICSI) organization.  Several BICSI regional
directors were invited to use the Graybar Technology Showcases as a
venue to conduct BICSI regional meetings, adding value and increasing
attendance at our events, which were held in various locations across
the country.  We conducted an Automation Technology Showcase in
conjunction with the January BICSI conference, combining electrical
automation manufacturers with comm/data suppliers to demonstrate our
capabilities with converging applications where both traditional
electrical and comm/data products are used.  Another Technology Showcase
in Indianapolis brought a variety of our customers together with
Graybar's automation specialists and network system specialists.

Graybar's efforts throughout 2003 allowed us to maintain our position as
an industry leader.  We developed and refined programs that strengthened
our leadership role as a vital link in the nation's supply chain for
electrical and communication / data products and services.

Although industry-wide performance in the residental market showed some
improvement in 2003,  most other customer segments declined compared to
2002.  Despite these weak overall market conditions, the Company
continued to build on its performance in the Electrical Contractor
Market.

Specialized sales representatives and project management teams, who are
focused on the electrical contractor market, continue to be the driving
force with these customers.  These well-trained individuals deliver
benefits and services that help contractors manage their projects from
beginning to end, making sure critical deadlines are met.

Our combination of zone and local inventories meets the everyday demand
for goods required on the job site.  Contractors can enjoy same-day
access to frequently used materials while our zones provide backup
inventories of additional products as well as hard-to-find items.

In September, over 300 sales, customer service, quotations and counter
representatives, along with branch managers, participated in the second
annual Graybar Electrical Training Conference in Boston.  Testimonials
from key customers helped educate our people on the need to provide
services that help contractor customers improve efficiency on the job
site.  Separate breakout sessions allowed participants to work together
to share best practices on how to create and deliver solutions for
contractors.

Our e-business strategy was enhanced to include a new dedicated web site
for electrical contractors on Graybar.com.  This new site is designed to
deliver valuable information on Graybar's service capabilities and key
suppliers.

Graybar continues to support the National Electrical Contractors
Association (NECA), the Independent Electrical Contractors (IEC) and
Associated Builders and Contractors (ABC).  In October, we exhibited at
the NECA convention in Orlando and, in September, the IEC convention in
Anaheim.  We also participated in the educational and research group
Electri21 for NECA.  This group provides valuable research and
educational materials for the electrical contractor industry.  At the
ABC convention we supplied materials for their annual National Craft
Championships.

[photo]

Suppliers exhibiting at the Electrical Training Conference promoted
product features and benefits to more than 300 Graybar delegates.

                                                                       5




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                       MARKET REVIEW

"Graybar is well positioned to grow our industrial market share and be a
leading solutions provider to our industrial customers."

INDUSTRIAL MARKET

In early 2003, leading economic indicators pointed to a down economy in
the Industrial Market.  By year-end, these indices rebounded to
significantly improve the 2004 economic outlook for industry in the
United States.  Graybar's sales to our industrial customers followed a
similar pattern, starting slowly and finishing the year with positive
results.  A bright spot was our sales of automation products, which
continued to grow throughout the year.

Graybar is poised to increase sales to industrial customers through our
focus on their maintenance, repair and operations (MRO), original
equipment manufacturing (OEM) and automation needs.  Our expanded
emphasis in these areas includes the development of specialized sales
and technical training, implementation of new sales tools and the
creation of customer-focused resources.

Increased focus on sales and technical training included the development
of two new online courses--Industrial Networking 101 and Industrial
Ethernet--as well as hands-on training seminars in many branches across
the country.  The training efforts were backed by a series of market-
focused solution guides designed to assist sales representatives in
matching Graybar's product and service offering with the unique needs of
the industry or customer application.  In addition, a new industrial
networking brochure and several white papers were provided to improve
our specification position and promote the value of Graybar's service
offerings.

In 2003, we developed a new industrial section on our web site,
Graybar.com, to serve as a foundation of our e-business strategy for
industrial customers.  The site provides information on services and
emerging technologies and highlights key manufacturers and products
targeted to the industrial customer.  In addition, we created an
industrial networking section on our web site to support plant floor
networking opportunities such as Industrial Ethernet.

Graybar will continue to meet emerging Industrial Market needs for
networking, wireless and automation applications.  With our specialized
sales force, automation application specialists and network system
specialists, Graybar is well positioned to grow our industrial market
share and be a leading solutions provider to our industrial customers.


[photo]

Hands-on training seminars in many Graybar locations taught employees
the basic skills needed to respond to industrial controls opportunities.

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COMM/DATA MARKET

Demand in the Comm/Data Market for new equipment or services did not
rebound significantly in 2003.  Industry restructurings and price
erosion continued as a result of overcapacity in the marketplace.

Although market conditions presented us with fewer opportunities, we
enhanced our premise fiber cable and apparatus service offering by
introducing VIP Fiber to the industry early in the year.  VIP Fiber is
an addition to Graybar's Verified Independently for Performance (VIP)
program, which provides independent testing of the cabling systems we
distribute.  This new addition to our VIP program produced favorable
results in 2003.

The recent IEEE activity on 10 Gigabit Ethernet solutions (802.3 10G
Base-T) began to validate the use of copper structured cabling solutions
in high bandwidth applications.  Accordingly, there was a strong
industry move from Category 5e cable to the higher performance Category
6 cable.

We refined and relaunched our Pipeline reporting application in 2003.
Added emphasis on the role of account managers and pursuit of additional
VIP registrations resulted in a substantial increase in project
registrations.  The Pipeline software application allows us to track
important project bids and view real-time data so branch, district and
corporate management can more efficiently monitor sales and order
activity.

Graybar continued to be an industry leader in distribution of VoIP
(Voice over Internet Protocol) products--an important strategy as IP is
becoming more widespread.  Pursuit of new partnerships with wireless
cellular and local area network (LAN) manufacturers proceeded in 2003,
expanding Graybar's solutions for the breadth of our communications
customer base.

Our sales to the Service Provider Market stabilized in 2003, but
predictions for growth remain relatively flat.  There were a few bright
spots, such as Fiber To The Home (FTTH) and digital subscriber line
(DSL) high speed Internet deployment.  These new technologies are
marketed to municipalities and utilities, but are particularly
attractive to independent telephone companies (ITCOs) that normally are
the carrier of choice in rural areas.  Graybar maintains a specialized
and strong position among these customers.

UTILITY MARKET

The Company renewed its commitment to future growth in the Utility
Market with the appointment of a vice president of corporate accounts to
focus on strategic investor-owned utilities and subsidiaries.  In
addition, a national product/market manager was appointed at Corporate
Headquarters in 2003 to support and enhance the strategic and field-
managed accounts.  More strategic account managers were assigned to
develop specific plans for pursuing targeted accounts, promoting Graybar
solutions and problem solving capabilities.  As a result, several major
successes were realized that are expected to impact 2004 sales and gross
margin.

We believe our increased focus on the Utility Market will bring
continued success as we increase our market penetration and use our
multi-faceted approach to promote our value proposition.

[photo]

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                       MARKET REVIEW

"In the fall, Graybar Canada established its first presence in western
Canada with a new comm/data branch in Calgary, Alberta."

INTERNATIONAL MARKETS

Canada
Graybar Canada finished the year with a sales increase of more than 10%,
increasing market share in its trading areas.

In the fall, Graybar Canada established its first presence in western
Canada with a new comm/data branch in Calgary, Alberta.  This new
location will enable us to enhance service to our national accounts and
customers in the western provinces while creating additional business
opportunities.

In July, the second Graybar Canada employee share offering went out to
all Canadian employees and was well received, with over 50%
participation.

Graybar Canada successfully completed conversion to its new computer
system and is now operating under one system throughout Canada.

Mexico
Graybar de Mexico suffered from another year of an overall soft Mexican
economy, and management continued to control expenses and monitor
inventory investments.  Emphasis continued on the Comm/Data Market, but
the focus of our sales efforts changed from the Reseller Market to the
End User Market.  The Mexico City location was moved to a more
economical and desirable location.

Puerto Rico
Graybar Puerto Rico began serving a new Defensive Logistics Agency (DLA)
contract in 2003.  In the Contractor and Industrial Markets, Graybar
Puerto Rico continued with the team approach to sales and service in
order to grow market share.  We expect continued growth in 2004 as a
result.  Increased participation in automation opportunities and
additional focus on active component solutions in the Comm/Data Market
will also drive our business opportunities during 2004.

MARKETING SUPPORT

Graybar Financial Services
Positioned as a value-added service to our customers and their end-user
clients, the Company's equipment leasing and project financing
subsidiary, Graybar Financial Services (GFS), clearly differentiates
Graybar from its competitors.

GFS' primary mission is to facilitate the sale of electrical,
telecommunications and data equipment distributed by Graybar.  Among
GFS' key objectives for 2004 will be the active support of Graybar's
marketing initiatives in the industrial automation and security/
notification systems areas.

GFS provides excellent customer service by assigning dedicated teams of
Graybar employees to manage GFS' relationship with each of its
customers.  To enhance this service platform during the past two years
GFS has successfully installed web-enabled technology that provides its
customers with a window to the entire lease application process--from
the entering of an application to the final production of lease
documents.  End-user customers are now able to conveniently access their
GFS accounts using Internet-based self-service to obtain payment
history, invoice copies and end-of-lease options.

Counter Marketing
Graybar's Counter Marketing is focused on getting customers the right
material as quickly as possible while reminding them of needed items
that were not on their original bill of materials.  Banners promoting
Graybar's service capabilities and product offerings are positioned at
our counters to generate additional customer interest.  The 'Counter
Update' monthly email newsletter was established in 2003 to distribute
essential information directly to all counter sales representatives.

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[photo]

New banners at Graybar counters featured our broad service capabilities
and product offerings.

E-Business
Graybar's customers continued to look for ways to decrease their overall
cost of purchasing by utilizing online marketplaces, e-procurement
solutions, electronic estimating solutions and reverse auctions.
Integration with several of our customers' online marketplaces was
accomplished in 2003 so purchase orders could be received electronically
into the new SAP system as well as our legacy system.  Additionally,
several of our large customers elected to incorporate our electronic
catalog into their electronic procurement process, allowing their buyers
to select products from our catalog for automatic inclusion on their
purchase requisitions.

Our electronic estimating capability is becoming increasingly more
important to our customers as they become more electronically engaged,
and we believe this trend will lead to increased business.

In 2003, our electronic catalog was enhanced with the addition of tens
of thousands of communication, data, utility and electrical products.
It now offers more than 130,000 items.  A new table of contents allows
individuals searching the electronic catalog to navigate through
multiple levels of product categories using a drill-down process.

Much of the e-business effort with our suppliers in 2003 was focused on
migration to our new SAP system.  Support from our suppliers through
this transition period has been excellent, and we now look forward to
implementing additional capabilities with them in 2004.

                                                                       9


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                      OPERATIONS REVIEW

"The revised logistics strategy announced in November will accelerate
the process we began earlier in the year of positioning inventory closer
to our customers."

INVESTMENT AND INVENTORY MANAGEMENT

In 2003, we continued to address the quality and positioning of
inventory to ensure sufficient product was available to meet customer
demand in each of our markets.  Inventory our customers regularly order
on a same-day basis was increased in our branch locations and reduced in
our zone locations.  Overall inventory investment was reduced from the
prior year.

The Company implemented the new SAP system nationally for all purchasing
functions on March 31.  To support the implementation, the existing
staff of Corporate Purchasing was restructured to more effectively
utilize the new operating software.

[photo]


10


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Product management, along with Corporate Purchasing, developed a new
vendor managed inventory (VMI) agreement to better define our
relationship with suppliers participating in this initiative.  The
framework was established to expand supplier participation.

The revised logistics strategy announced in November will accelerate the
process we began earlier in the year of positioning inventory closer to
our customers.  Under the new strategy our zones will provide enhanced
service capabilities with access to slower moving electrical products as
well as comm/data products.

CUSTOMER SERVICE

Utilizing the District Operating Dashboard Report developed in 2002, we
improved service basics (on-time shipping, selection accuracy, billing
accuracy, prompt resolution of returns) by placing increased focus on
goal setting and monthly monitoring of results.  Progress was made in
all targeted areas, helping prepare the Company for conversion to the
new SAP operating system.

Additional customer service focus was placed on educating Graybar
employees on the Company's value-added services through deployment of
the Service Solutions Manual.  All corporate departments collaborated on
the development of this online tool, which provides background
information on Company services including bar coding, commodity
management, electronic commerce, material storage, product kitting and
project management.


[PHOTO]


ZONE OPERATIONS

In August, we completed our zone buildout with our state-of-the-art
facility in Richmond, Virginia.

Our Warehouse Management System (WMS) continues to demonstrate its value
by improving accuracy and productivity on inbound shipments from
suppliers and outbound orders to customers.

SAFETY

New milestones were set in safety performance in 2003.  Our Company
achieved the lowest rate of injuries per hours worked and the lowest
rate of vehicle accidents as a percentage of total vehicles since we
began tracking these measurements in 1996.

Our attention to safety allowed us to complete the year with a vehicle
accident rate of 15.6%, which was considerably better than the industry
average for fleets our size.

                                                                      11



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                     OPERATIONS REVIEW

"Graybar's implementation of myGraybar is currently one of the largest
ERP projects under way in United States industry."

INFORMATION SYSTEMS

The Company's new SAP Enterprise Resource Planning (ERP) system is an
integrated information system serving all departments.  It includes
software for order entry, accounts receivable and payable, general
ledger, forecasting and purchasing, inventory control, human resources
and payroll.

After months of planning and hard work by Graybar employees and our
consultants, employees at Corporate Headquarters and the Minneapolis
District began using the new SAP software solution, myGraybar, on March
31.  From the first day of implementation, users were able to process
orders, receive materials, make shipments, bill customers and pay
vendors.

By year-end, the Chicago and Pittsburgh Districts were also converted to
the new system.  The rollout of myGraybar to the remaining districts is
expected to be completed by the third quarter 2004.

The Employee Self Service (ESS) functionality of myGraybar was rolled
out to districts and branches throughout the year, and by January 19,
2004, all employees--even those not yet on the full system--had access
to ESS.  ESS allows employees to enter and track time, view benefits and
remuneration statements, and view and change personal information.

A comprehensive training program, including self-paced courses, eClasses
and instructor-led courses, was designed for the support of more than
7,000 users.  Designated employees from the converting districts became
"super users."  They received special training to prepare them to
educate their colleagues on the system and new business processes.
Throughout the year, the 112 "super users" conducted 1,323 courses at 41
locations.  These courses are supported by innovative, portable,
wireless training classrooms that allow deployment in any Graybar
location.

[photo]

Employees can enter time, view benefits and remuneration statements and
change personal information online with the Employee Self Service
functionality of SAP.

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Graybar's implementation of myGraybar is currently one of the largest
ERP projects under way in United States industry.  Late in 2003, Graybar
was named as an InfoWorld 100 award recipient, recognizing our
information technology achievement.

The ERP team continues to focus on improving our new system
functionality, enhancing training approaches and continuing with the
development of business processes throughout deployment.

In addition, the IS department launched a project in the second half of
2003 to deploy a more cost effective way to back up data stored at field
locations.  Using our existing hardware and data network and new
software, we successfully migrated 120 servers to this solution.

As part of the replacement of the legacy systems, the Kansas City
mainframe was shut down in December and the functionality moved to St.
Louis.  The Kansas City Data Center remains open for testing and
development purposes and disaster backup for our SAP and WMS systems.

GroupWise(R) Instant Messenger (IM) was made available to all locations
late in the year.  IM provides employees the ability to hold real-time,
online conversations via computer from wherever they are located.

FINANCIAL REVIEW

                                                                      13



<PAGE>
<PAGE>
                     TABLE OF CONTENTS

Selected Consolidated Financial Data                      15

Management's Discussion and Analysis
of Financial Condition and Results of Operations          16

Consolidated Financial Statements                         20

Report of Independent Auditors                            30

14



<PAGE>
<PAGE>
<TABLE>
                                                    FINANCIAL REVIEW
----------------------------------------------------------------------------------------------------------------------

                                         Selected Consolidated Financial Data

                                    (Stated in thousands except for per share data)
<CAPTION>

                                                        2003           2002          2001         2000          1999
----------------------------------------------------------------------------------------------------------------------
<S>                                              <C>            <C>           <C>          <C>           <C>
Sales                                             $3,813,272     $3,986,954    $4,829,862   $5,231,901    $4,311,405
   Less--Cash discounts                              (10,820)       (12,062)      (13,380)     (13,564)      (11,465)
----------------------------------------------------------------------------------------------------------------------
Net Sales                                          3,802,452      3,974,892     4,816,482    5,218,337     4,299,940
----------------------------------------------------------------------------------------------------------------------
Cost of Merchandise Sold                          (3,067,986)    (3,229,791)   (3,934,719)  (4,271,745)   (3,514,228)
----------------------------------------------------------------------------------------------------------------------
Interest Expense                                     (24,128)       (26,301)      (39,073)     (46,681)      (30,241)
----------------------------------------------------------------------------------------------------------------------
Provision for Income Taxes
  Current                                              7,690         (7,233)      (22,915)     (44,395)      (43,899)
  Deferred                                           (14,032)            14         3,302        1,196          (130)
----------------------------------------------------------------------------------------------------------------------
    Total provision for income taxes                  (6,342)        (7,219)      (19,613)     (43,199)      (44,029)
----------------------------------------------------------------------------------------------------------------------
Net Income                                             8,465         11,401        31,688       66,157        64,659
----------------------------------------------------------------------------------------------------------------------
Income Applicable to Common Stock                      8,463         11,399        31,685       66,154        64,654
----------------------------------------------------------------------------------------------------------------------
Average Common Shares Outstanding (A)                  5,993          6,245         5,846        6,101         6,276
----------------------------------------------------------------------------------------------------------------------
Income per Share of Common Stock (A)                    1.41           1.83          5.42        10.84         10.30
----------------------------------------------------------------------------------------------------------------------
  Cash dividends per share                              2.00           2.00          2.00         2.00          2.00
----------------------------------------------------------------------------------------------------------------------
Retained Earnings
  Balance, beginning of year                         309,434        310,521       290,405      241,473       193,838
  Add--Net income                                      8,465         11,401        31,688       66,157        64,659
----------------------------------------------------------------------------------------------------------------------
                                                     317,899        321,922       322,093      307,630       258,497
----------------------------------------------------------------------------------------------------------------------
  Less dividends
    Preferred ($1.00 per share)                           (2)            (2)           (3)          (3)           (5)
    Common (in cash)                                 (11,867)       (12,486)      (11,569)     (11,583)      (11,442)
    Common (in stock)                                     --             --            --       (5,639)       (5,577)
----------------------------------------------------------------------------------------------------------------------
                                                     (11,869)       (12,488)      (11,572)     (17,225)      (17,024)
----------------------------------------------------------------------------------------------------------------------
  Balance, end of year                               306,030        309,434       310,521      290,405       241,473
  Proceeds on stock subscriptions,
    shares unissued                                       45             50            --           49            56
Stock Outstanding
  Preferred                                               43             45            51           57            68
  Common                                             117,427        123,272       114,424      119,828       118,270
----------------------------------------------------------------------------------------------------------------------
                                                  $  423,545     $  432,801    $  424,996   $  410,339    $  359,867
----------------------------------------------------------------------------------------------------------------------
Accumulated other comprehensive income (loss)        (35,962)       (44,958)      (17,504)        (542)         (204)
----------------------------------------------------------------------------------------------------------------------
Total Shareholders' Equity                        $  387,583     $  387,843    $  407,492   $  409,797    $  359,663
----------------------------------------------------------------------------------------------------------------------
Total Assets                                       1,422,130      1,400,171     1,535,998    1,843,438     1,698,544
Long-term Debt                                    $  254,381     $  266,710    $  315,549   $  238,349    $  255,897
----------------------------------------------------------------------------------------------------------------------

<FN>
(A) Adjusted for the declaration of 5% stock dividends in 2000 and
1999. Prior to adjusting for the stock dividends, the
average common shares outstanding for 1999 were 5,692.
</TABLE>


This summary should be read in conjunction with the consolidated
financial statements and related notes thereto included
elsewhere in this annual report.

                                                                      15




<PAGE>
<PAGE>
                          FINANCIAL REVIEW
-------------------------------------------------------------------------------

     Management's Discussion and Analysis of Financial Condition
                      and Results of Operations

     (Stated in thousands except for share and per share data)

OVERVIEW
     The decline in business experienced by the Company in each of the
last three years reflects the general economic downturn experienced by
the electrical and comm/data wholesale distribution industries and the
customers they serve.  The Company has responded to this decline by
controlling expenses, particularly salary and benefits, changing its
organizational structure and initiating programs to improve its gross
margin rate on sales.  At the same time, the Company is attempting to
increase its productivity and service capabilities as well as
positioning itself for future business opportunities that are expected
to result from an improving economy by upgrading its existing computer
systems.
     Moderate sales growth is expected in 2004 as the electrical and
communications markets trend upward.

RESULTS OF OPERATIONS

Operating Results as a Percentage of Net Sales
     The following table sets forth certain information relating to the
operations of the Company expressed as a percentage of net sales:

<TABLE>
<CAPTION>
Years Ended December 31:                                2003        2002        2001
--------------------------------------------------------------------------------------
<S>                                                 <C>         <C>         <C>
Net Sales                                              100.0%      100.0%      100.0%
Cost of Merchandise Sold                               (80.7)      (81.3)      (81.7)
--------------------------------------------------------------------------------------
Gross Margin                                            19.3        18.7        18.3
Selling, General and
   Administrative Expenses                             (16.5)      (15.8)      (14.9)
Taxes, other than income
   taxes                                                (1.0)       (1.0)       (1.0)
Depreciation and
   amortization                                         (1.0)        (.8)        (.7)
--------------------------------------------------------------------------------------
   Income from operations                                 .8         1.1         1.7
Other Income, net                                         .2          .1          .2
Interest Expense                                         (.6)        (.7)        (.8)
Loss on debt extinguishment                               --          --          --
--------------------------------------------------------------------------------------
Income Before Provision
   for Income Taxes                                       .4          .5         1.1
--------------------------------------------------------------------------------------
Provision for Income Taxes                               (.2)        (.2)        (.4)
--------------------------------------------------------------------------------------
Net Income                                                .2%         .3%         .7%
--------------------------------------------------------------------------------------
</TABLE>

2003 Compared to 2002
     Net sales in 2003 decreased $172,440, or 4.3%, compared to 2002.
The lower net sales resulted from the generally depressed economic
conditions that have been prevalent on an industry-wide basis in the
electrical and communications market sectors in which the Company
operates.  The general slowdown in new construction projects and the
reduction in capital spending by commercial and industrial customers
that began in 2001 continued throughout 2002 and the first half of 2003.
Consolidated net sales in the second half of 2003 increased 1.5% when
compared to the second half of 2002.  Communications market activity
continued to be more heavily impacted by the weak economic conditions
compared to the Company's business in the electrical market due to the
overall excess of infrastructure and plant and network capacity in the
communications marketplace.  Electrical market sales decreased 3.4% and
communications market sales decreased 12.8% when comparing 2003 to 2002.
     Gross margin decreased $10,635, or 1.4%, in 2003 primarily due to
the lower sales in the electrical and communications markets.  Gross
margin increased 2.1% when comparing the second half of 2003 to the
second half of 2002.
     Selling, general and administrative expenses decreased slightly in
2003 due largely to current year and prior year reductions in the
Company's employment levels which resulted in decreases in related
employee compensation costs of approximately $10,700 in 2003.  The
decrease in these expenses was partially offset by an increase in
expenses related to the implementation of the Enterprise Resource
Planning (ERP) system of approximately $6,100.  The Company expects that
the decrease in employment levels will be sustainable until such time as
there is a significant growth in sales.  As a percentage of sales,
selling, general and administrative expenses increased to 16.5% in 2003
compared to 15.8% in 2002, primarily because the rate at which expenses
were reduced lagged the rate at which sales volume decreased.
     The reduction in taxes, other than income taxes of $1,178 in 2003
compared to 2002 resulted primarily from lower payroll tax expenses due
to the reduction in the Company's employment levels.
     Depreciation and amortization increased $2,617 in 2003 primarily
due to additional amortization expenses as a result of the
implementation of the ERP system during the second quarter of 2003.
     Other income, net includes gains on sale of property of $4,753 and
$0 and accounts receivable interest charges to customers of $969 and
$1,552 in 2003 and 2002, respectively.
     Interest expense decreased $2,173, or 8.3%, in 2003 primarily due
to lower interest rates on short-term borrowings.  The average amount of
short-term borrowings outstanding during 2003 and 2002 amounted to
approximately $109,000 and $101,000 at weighted average interest rates
of 1.51% and 2.11%, respectively.
     The combined effect of the decrease in gross margin and the
increase in other income, together with the increase in depreciation and
amortization and decreases in selling, general and administrative
expenses and interest expense, resulted in a decrease in pretax earnings
of $3,813 in 2003 compared to 2002.

16





<PAGE>
<PAGE>
                          FINANCIAL REVIEW
-------------------------------------------------------------------------------

     Management's Discussion and Analysis of Financial Condition
                      and Results of Operations

      (Stated in thousands except for share and per share data)

2002 Compared to 2001
     Net sales in 2002 decreased $841,590, or 17.5%, compared to 2001.
The lower net sales resulted from the generally depressed economic
conditions that continued to be prevalent on an industry-wide basis in
the electrical and communications market sectors in which the Company
operates.  The reduction in capital spending by commercial and
industrial customers and the general slowdown in new construction
projects that began in 2001 continued during 2002.  Activity in the
communications market remained severely depressed, leading to continued
and substantial contraction in the Company's business in that market.
Electrical market sales decreased 6.4% and communications market sales
decreased 32.1% when comparing 2002 to 2001.
     Gross margin decreased $136,662, or 15.5%, in 2002 primarily due
to the lower sales in the electrical and communications markets.
     Selling, general and administrative expenses decreased $91,366, or
12.7%, when comparing 2002 to 2001, due largely to current year and
prior year reductions in the Company's employment levels which resulted
in decreases in related employee compensation costs of approximately
$60,000 in 2002.  The decrease in these expenses was partially offset by
increases in pension plan expense and health care plan costs of
approximately $4,600.  The Company expects that the decrease in
employment levels will be sustainable until such time as there is a
significant growth in sales.  The balance of the reduction in selling,
general and administrative expenses in 2002 compared to 2001 resulted
from decreases in transportation, warehousing and other general
operating expenses due to decreased sales and lower transaction volumes.
As a percentage of sales, selling, general and administrative expenses
increased to 15.8% in 2002 compared to 14.9% in 2001, primarily because
the rate at which expenses were reduced lagged the rate at which sales
volume decreased.
     The reduction in taxes, other than income taxes of $5,653 in 2002
compared to 2001 resulted primarily from lower payroll tax expenses due
to the reduction in the Company's employment levels and lower incentive
plan payments with respect to 2001 paid in the first quarter of 2002.
     Depreciation and amortization increased $1,214 in 2002 due to
purchases of equipment and facilities improvements.
     Other income, net includes gains on sale of property of $0 and
$2,677 and accounts receivable interest charges to customers of $1,552
and $2,433 in 2002 and 2001, respectively.
     Interest expense decreased $12,772, or 32.7%, in 2002 primarily
due to lower interest rates on short-term borrowings and decreased
levels of short-term borrowings required to finance lower levels of
inventory and receivables.  The average amount of short-term borrowings
outstanding during 2002 and 2001 amounted to approximately $101,000 and
$305,000 at weighted average interest rates of 2.11% and 4.86%,
respectively.
     Loss on debt extinguishment consists of a $545 make-whole premium
paid to a lender for early retirement of long-term debt.
     The combined effect of the decreases in gross margin and other
income, together with the increase in depreciation and amortization and
decreases in selling, general and administrative expenses and interest
expense, resulted in a decrease in pretax earnings of $32,681 in 2002
compared to 2001.

FINANCIAL CONDITION AND LIQUIDITY
     At December 31, 2003 current assets exceeded current liabilities
by $416,612, down $29,021 from December 31, 2002.  The increase in
accounts receivable from December 31, 2002 to December 31, 2003 resulted
largely from higher sales volume in December 2003 compared to sales for
December 2002.  The average number of days of sales in accounts
receivable increased slightly during 2003.  Merchandise inventory levels
were lower at December 31, 2003 when compared to December 31, 2002
inventory levels due largely to continuing reductions in specific
inventory carried to support customer contract agreements and lower
inventory levels required to support the overall decrease in sales
volume.  Inventory turnover improved approximately two days during 2003.
The increase in trade accounts payable resulted primarily from
additional dating taken on supplier payments.
     The Company is converting its existing computer systems to an
Enterprise Resource Planning (ERP) system. Implementation of the new
system began in April 2003.  The total project costs are expected to be
approximately $100,000.  The Company is funding the project through a
combination of equipment leases and working capital.  Project costs
through December 31, 2003 are approximately $95,000, of which $76,339
has been capitalized.  The Company expects that conversion to the new
ERP system will provide future benefits to its results of operations
upon completion.  The Company does not have any other plans or
commitments that would require significant amounts of additional
working capital.
     At December 31, 2003 the Company had available to it unused lines
of credit amounting to $283,429.  These lines are available to meet
short-term cash requirements of the Company.  Included in the Company's
lines of credit is a Revolving Credit Loan Agreement with a group of
banks at an interest rate based on the London Interbank Offered Rate
(LIBOR) that had previously consisted of a $205,000, five-year facility.
In October 2003 the Company elected to reduce the facility
from $205,000 to $50,000.  The credit agreement expires in
July 2004.  There were no amounts outstanding under the Revolving Credit
Loan Agreement at December 31, 2003.

                                                                      17




<PAGE>
<PAGE>
                           FINANCIAL REVIEW
-------------------------------------------------------------------------------

     Management's Discussion and Analysis of Financial Condition
                      and Results of Operations

      (Stated in thousands except for share and per share data)

     At December 31, 2003 the Company had a $200 million accounts
receivable securitization program that expired in October 2003 and was
subsequently renewed for an additional three-year period with an
expiration date of October 2006. The securitization program provides for
the sale of certain of the Company's trade receivables on a revolving
basis to Graybar Commerce Corporation (GCC), a wholly owned, bankruptcy
remote, special purpose subsidiary.  GCC sells an undivided interest in
the receivables to an unrelated multi-seller commercial paper conduit.
The Company accounts for the securitization as an on-balance sheet
financing arrangement because the Company has maintained effective
control of the accounts receivable through a call option that gives GCC
the unilateral right to repurchase the undivided interests.
Accordingly, the accounts receivable and related debt are included in
the accompanying consolidated balance sheets.  GCC has granted a
security interest in its trade receivables to the commercial paper
conduit.  There were no borrowings outstanding under the securitization
program at December 31, 2003.
     Short-term borrowings outstanding during 2003 and 2002 varied from
a minimum of $0 to a maximum of $188,281 and $216,779, respectively.
     The Revolving Credit Loan Agreement and certain other note
agreements have various covenants that limit the Company's ability to
make investments, pay dividends, incur debt, dispose of property, and
issue equity securities.  The Company is also required to maintain
certain financial ratios as defined in the agreements.
     The Company has funded its capital requirements from operations,
stock issuances to its employees and long-term debt.  During 2003, cash
provided by operations amounted to $73,715 compared to $213,379 cash
provided by operations in 2002.  The decrease in cash provided by
operations was predominantly attributable to the combined change in
trade receivables, merchandise inventory and trade accounts payable,
which in the aggregate generated cash of $16,817 in 2003 compared to
$177,947 in 2002. Cash provided from the sale of common stock and
proceeds received on stock subscriptions amounted to $506 and $15,191 in
2003 and 2002, respectively.
     Capital expenditures for property were $50,824, $55,532 and
$53,985 for the years ended December 31, 2003, 2002 and 2001,
respectively.  Purchases of treasury stock were $6,358, $6,299 and
$5,861 for the years ended December 31, 2003, 2002 and 2001,
respectively.  Dividends paid were $12,202, $11,984 and $11,616 for the
years ended December 31, 2003, 2002 and 2001, respectively.

Off-Balance Sheet Financing
     The Company has two operating lease arrangements with an
independent lessor which have provided $63,684 of off-balance sheet
financing for eight of the Company's zone distribution facilities. Each
of the agreements carries a five-year term.  The Company has the option,
with the consent of the lenders to the lessor, to renew the leases for
up to two additional five-year terms or to purchase the property for a
price including the outstanding lease balance.  If the Company elects
not to renew the lease or purchase the property, or such lenders refuse
to consent to a renewal, the Company may elect to remarket the property
and arrange for its sale to a third party.  In the third quarter 2003,
the Company renewed one of these operating lease agreements.  Upon
renewal, the Company recorded a $1,079 liability, the estimated fair
value of the residual value guarantee.
     The leasing structures used in these two lease arrangements
qualify as variable interest entities under FASB Interpretation No. 46
and the Company's interests in the variable interest entities are
required to be consolidated in the Company's financial statements
beginning in the first quarter of 2005. As of December 31, 2003 the
Company's maximum exposure to loss as a result of its involvement with
the two lease arrangements is $54,131, the amount guaranteed by the
Company as the residual fair value of the property in accordance with
the lease arrangements.

Contractual Obligations and Commitments
     The Company has the following contractual obligations as of
December 31, 2003:
<TABLE>
<CAPTION>
                                                                   Less                                More
                                                                  than 1       1-3         4-5        than 5
                                                      Total        Year       Years       Years       Years
                                                      -----       ------      -----       -----       ------
<S>                                                <C>         <C>         <C>         <C>         <C>
Long-term
  Debt
  Obligations                                       $345,742    $ 38,502    $141,903     $79,008    $ 86,329

Capital
  Lease
  Obligations                                         13,724       2,643      11,081          --          --

Operating
  Lease
  Obligations                                        137,259      37,582      53,581      15,125      30,971

Purchase
  Obligations                                        344,976     344,976          --          --          --
                                                    --------    --------    --------     -------    --------
Total                                               $841,701    $423,703    $206,565     $94,133    $117,300
</TABLE>

     Long-term debt obligations consist of principal and interest
payments.
     Purchase obligations consist primarily of open inventory purchase
orders made in the normal course of business.  Many of these obligations
may be cancelled with limited or no financial penalties.
     The above table does not include $92,153 of accrued, unfunded
employment-related benefit obligations, of which $77,636 is related to
the Company's postretirement benefits plan, because it is not certain
when the obligations will be paid.
     The Company also expects to make contributions totaling
approximately $30,000 to its defined benefit pension plan during 2004
which are not included in the table.

18



<PAGE>
<PAGE>
                          FINANCIAL REVIEW
-------------------------------------------------------------------------------

     Management's Discussion and Analysis of Financial Condition
                      and Results of Operations

      (Stated in thousands except for share and per share data)

CRITICAL ACCOUNTING POLICIES
     The consolidated financial statements are prepared in accordance
with accounting principles generally accepted in the United States,
which require the Company to make estimates and assumptions (see Note 1
to the consolidated financial statements).  The Company believes the
following accounting policies have the potential to have a more
significant impact on the financial statements either because of the
significance of the financial statement item to which they relate or
because they involve a higher degree of judgment and complexity.

Allowance for Doubtful Accounts
     The Company performs ongoing credit evaluations of its customers,
and a significant portion of trade receivables is secured by lien or
bond rights.  The Company maintains allowances to reflect the expected
uncollectibility of accounts receivable based on past collection
history, the economic environment and specific risks identified in the
receivables portfolio.  Although actual credit losses have historically
been within management's expectations, additional allowances may be
required if the financial condition of the Company's customers were to
deteriorate.

Inventory
     The Company values its inventories at the lower of cost or market.
In assessing the ultimate realization of inventories, the Company makes
judgments as to rights of return to suppliers and future demand
requirements.  If actual future demand, market conditions or supplier
return provisions are less favorable than those projected by management,
additional inventory write-downs may be required.

Pension Plan
     The Company's pension plan expense and obligations are determined
based on the selection of certain assumptions, the most significant of
which are the expected long-term rate of return on plan assets and the
discount rate used to discount plan liabilities.  While management
believes that the assumptions selected by the Company are appropriate,
differences in actual experience or changes in assumptions may affect
the Company's pension plan obligation and future pension expense.  In
2003, the Company reduced the expected long-term rate of return on plan
assets to 8.75%, down from 9.00% in 2002.  The discount rate used to
discount plan liabilities was changed from 6.75% at December 31, 2002 to
6.00% at December 31, 2003.  The Company reduced the expected long-term
rate of return on plan assets from 8.75% in 2003 to 8.25% for 2004.  The
change in assumptions and poor return on assets experienced by the plan
in 2000, 2001 and 2002 are expected to result in additional 2004 pension
expense of approximately $4,200.

Supplier Volume Incentives
     The Company's agreements with many of its suppliers provide for
the Company to earn incentives based on purchases during the agreement
period.  These agreements typically provide for the incentives to be
paid in arrears, and the Company estimates amounts to be received from
suppliers at the end of each reporting period based on the earnout level
that the Company estimates is probable of being achieved.  Amounts
received have historically been within management's estimates.  In the
event that the operating performance of the Company's suppliers were to
decline, however, there can be no assurance that amounts earned would be
paid or that the incentives would continue to be included in future
agreements.

                                                                      19




<PAGE>
<PAGE>

<TABLE>
                                  CONSOLIDATED FINANCIAL STATEMENTS
-----------------------------------------------------------------------------------------------

                       Consolidated Statements of Income and Retained Earnings

                      (Stated in thousands except for share and per share data)
<CAPTION>
For the Years Ended December 31,                        2003             2002            2001
-----------------------------------------------------------------------------------------------
<S>                                              <C>              <C>             <C>
Sales, net of returns and allowances             $ 3,813,272      $ 3,986,954     $ 4,829,862
    Less--Cash discounts                             (10,820)         (12,062)        (13,380)
-----------------------------------------------------------------------------------------------
      Net Sales                                    3,802,452        3,974,892       4,816,482
-----------------------------------------------------------------------------------------------
Cost of Merchandise Sold                          (3,067,986)      (3,229,791)     (3,934,719)
-----------------------------------------------------------------------------------------------
      Gross Margin                                   734,466          745,101         881,763
Selling, General and Administrative expenses        (626,199)        (627,015)       (718,381)
Taxes, other than income taxes                       (40,119)         (41,297)        (46,950)
Depreciation and amortization                        (37,253)         (34,636)        (33,422)
-----------------------------------------------------------------------------------------------
      Income from operations                          30,895           42,153          83,010
Other Income, net                                      8,040            3,313           7,364
Interest Expense                                     (24,128)         (26,301)        (39,073)
Loss on debt extinguishment                               --             (545)             --
-----------------------------------------------------------------------------------------------
Income Before Provision for Income Taxes              14,807           18,620          51,301
-----------------------------------------------------------------------------------------------
Provision for Income Taxes
  Current                                              7,690           (7,233)        (22,915)
  Deferred                                           (14,032)              14           3,302
-----------------------------------------------------------------------------------------------
        Total provision for income taxes              (6,342)          (7,219)        (19,613)
-----------------------------------------------------------------------------------------------
Net Income                                             8,465           11,401          31,688
-----------------------------------------------------------------------------------------------
Retained Earnings, beginning of year                 309,434          310,521         290,405
  Cash dividends-
        Preferred, $1.00 per share each year              (2)              (2)             (3)
        Common, $2.00 per share each year            (11,867)         (12,486)        (11,569)
  Common Stock dividend                                   --               --              --
-----------------------------------------------------------------------------------------------
Retained Earnings, end of year                   $   306,030      $   309,434     $   310,521
-----------------------------------------------------------------------------------------------
Net Income per share of Common Stock             $      1.41      $      1.83     $      5.42
-----------------------------------------------------------------------------------------------
</TABLE>

See accompanying Notes to Consolidated Financial Statements

20



<PAGE>
<TABLE>
                                  CONSOLIDATED FINANCIAL STATEMENTS
-----------------------------------------------------------------------------------------------------------------
<CAPTION>
                                       Consolidated Balance Sheets

                         (Stated in thousands except for share and per share data)              December 31,
                                                                                            2003           2002
-----------------------------------------------------------------------------------------------------------------
<S>                                                                                   <C>            <C>
ASSETS
-----------------------------------------------------------------------------------------------------------------
Current Assets
  Cash and cash equivalents                                                           $   19,161     $   20,826
  Trade receivables (less allowances of $7,199 and $6,307, respectively)                 556,967        504,102
  Merchandise inventory                                                                  483,333        515,691
  Other current assets                                                                    17,815         17,270
-----------------------------------------------------------------------------------------------------------------
    Total current assets                                                               1,077,276      1,057,889
-----------------------------------------------------------------------------------------------------------------
Property, at cost
  Land                                                                                    27,092         25,601
  Buildings                                                                              237,840        235,205
  Furniture and fixtures                                                                 163,932        167,371
  Software                                                                                76,339         50,236
  Capital leases                                                                          23,987         24,159
-----------------------------------------------------------------------------------------------------------------
                                                                                         529,190        502,572
  Less--Accumulated depreciation and amortization                                        223,585        209,189
-----------------------------------------------------------------------------------------------------------------
                                                                                         305,605        293,383
-----------------------------------------------------------------------------------------------------------------
Deferred Income Taxes                                                                     10,402         24,294
-----------------------------------------------------------------------------------------------------------------
Other Assets                                                                              28,847         24,605
-----------------------------------------------------------------------------------------------------------------
                                                                                      $1,422,130     $1,400,171
-----------------------------------------------------------------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY
-----------------------------------------------------------------------------------------------------------------
Current Liabilities
  Current portion of long-term debt                                                   $   22,872     $   23,314
  Trade accounts payable                                                                 536,179        498,855
  Accrued payroll and benefit costs                                                       36,292         22,667
  Other accrued taxes                                                                     13,684         12,036
  Dividends payable                                                                        6,469          6,802
  Other payables and accruals                                                             45,168         48,582
-----------------------------------------------------------------------------------------------------------------
    Total current liabilities                                                            660,664        612,256
-----------------------------------------------------------------------------------------------------------------
Postretirement Benefits Liability                                                         77,636         77,586
-----------------------------------------------------------------------------------------------------------------
Pension Liability                                                                         40,895         55,776
-----------------------------------------------------------------------------------------------------------------
Long-term Debt                                                                           254,381        266,710
-----------------------------------------------------------------------------------------------------------------
Other Non-current Liabilities                                                                971             --
-----------------------------------------------------------------------------------------------------------------
<CAPTION>
                                                          Shares at December 31,
                                                              2003           2002
-----------------------------------------------------------------------------------------------------------------
<S>                                                      <C>            <C>           <C>            <C>
Shareholders' Equity
  Capital stock-
    Preferred, par value $20 per share,
     authorized 300,000 shares--
      Issued to shareholders                                 2,173          2,337
      In treasury, at cost                                     (52)           (87)
-----------------------------------------------------------------------------------------------------------------
      Outstanding                                            2,121          2,250             43             45
-----------------------------------------------------------------------------------------------------------------
    Common, stated value $20 per share,
      Authorized                                         7,500,000      7,500,000
      Issued to voting trustees                          5,609,313      5,879,436
      Issued to shareholders                               290,389        311,549
      In treasury, at cost                                 (28,343)       (27,380)
-----------------------------------------------------------------------------------------------------------------
      Outstanding                                        5,871,359      6,163,605        117,427        123,272
-----------------------------------------------------------------------------------------------------------------
  Common shares subscribed                                                                   614          1,124
  Retained earnings                                                                      306,030        309,434
  Accumulated other comprehensive income (loss)                                          (35,962)       (44,958)
-----------------------------------------------------------------------------------------------------------------
                                                                                         388,152        388,917
      Less--Subscriptions receivable                                                         569          1,074
-----------------------------------------------------------------------------------------------------------------
      Total Shareholders' Equity                                                         387,583        387,843
-----------------------------------------------------------------------------------------------------------------
                                                                                      $1,422,130     $1,400,171
-----------------------------------------------------------------------------------------------------------------
</TABLE>

See accompanying Notes to Consolidated Financial Statements
                                                                      21




<PAGE>
<PAGE>
<TABLE>
                             CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------------

                           Consolidated Statements of Cash Flows

                                   (Stated in thousands)

<CAPTION>
For the Years Ended December 31,                        2003        2002        2001
--------------------------------------------------------------------------------------
<S>                                               <C>         <C>         <C>
Cash Flows From Operations
  Net Income                                       $   8,465   $  11,401   $  31,688
--------------------------------------------------------------------------------------
  Adjustments to reconcile net income to cash
   provided by operations -
    Depreciation and amortization                     37,253      34,636      33,422
    Deferred income taxes                             14,032         (14)     (3,302)
    Gain on sale of property                          (4,752)         --      (2,677)
    Changes in assets and liabilities:
     Trade receivables                               (52,865)     88,650     172,794
     Merchandise inventory                            32,358      97,285     135,778
     Other current assets                               (545)     (2,828)     11,002
     Other assets                                     (5,229)      3,655       1,633
     Trade accounts payable                           37,324      (7,988)    (37,995)
     Accrued payroll and benefit costs                13,625      (4,149)    (31,380)
     Other accrued liabilities                        (5,951)     (7,269)    (30,050)
--------------------------------------------------------------------------------------
                                                      65,250     201,978     249,225
--------------------------------------------------------------------------------------
  Net cash flow provided by operations                73,715     213,379     280,913
--------------------------------------------------------------------------------------
Cash Flows From Investing Activities
    Proceeds from sale of property                    15,896       5,689       3,974
    Capital expenditures for property                (50,824)    (55,532)    (53,985)
    Investment in joint venture                          987         360       1,405
--------------------------------------------------------------------------------------
  Net cash flow used by investing activities         (33,941)    (49,483)    (48,606)
--------------------------------------------------------------------------------------
Cash Flows From Financing Activities
    Net increase (decrease) in short-term
     borrowings                                           --     (98,737)   (307,462)
    Proceeds from long-term debt                          --          --     100,000
    Repayment of long-term debt                      (16,691)    (46,430)    (21,439)
    Principal payments under capital leases           (6,694)     (4,890)     (3,866)
    Sale of common stock                                 506      15,191         402
    Purchases of treasury stock                       (6,358)     (6,299)     (5,861)
    Dividends paid                                   (12,202)    (11,984)    (11,616)
--------------------------------------------------------------------------------------
   Net cash flow used by financing activities        (41,439)   (153,149)   (249,842)
--------------------------------------------------------------------------------------
Net Increase (Decrease) in Cash                       (1,665)     10,747     (17,535)
--------------------------------------------------------------------------------------
Cash, Beginning of Year                               20,826      10,079      27,614
--------------------------------------------------------------------------------------
Cash, End of Year                                  $  19,161   $  20,826   $  10,079
--------------------------------------------------------------------------------------
</TABLE>

See accompanying Notes to Consolidated Financial Statements

22



<PAGE>
<PAGE>
<TABLE>

                                             CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------------------------------------------------

                                Consolidated Statements of Changes in Shareholders' Equity
                                   for the Years Ended December 31, 2003, 2002 and 2001

                                                   (Stated in thousands)

<CAPTION>

                                                                    Common                       Accumulated
                                                                    Stock                          Other
                                         Common      Preferred    Subscribed,     Retained      Comprehensive
                                         Stock         Stock       Unissued       Earnings      Income (Loss)      Total
                                        --------     ---------    -----------    ---------      -------------     --------
<S>                                    <C>           <C>           <C>            <C>             <C>              <C>
December 31, 2000                       $119,828      $     57      $     49      $290,405        $   (542)       $409,797
                                        ========      ========      ========      ========        ========        ========
Net income                                                                          31,688                          31,688

Currency translation adjustments                                                                      (267)           (267)
Cumulative impact of adoption of
   SFAS 133 (net of tax of $877)                                                                    (1,342)         (1,342)

Unrealized gain/(loss) from interest
   rate swap (net of tax of $317)                                                                     (590)           (590)

Minimum pension liability (net
   of tax of $9,125)                                                                               (14,763)        (14,763)
                                                                                                                  --------
Comprehensive income                                                                                                14,726
                                                                                                                  --------
Stock issued                                 451                                                                       451

Stock redeemed                            (5,855)           (6)                                                     (5,861)

Advance payments                                                         (49)                                          (49)

Dividends declared                                                                 (11,572)                        (11,572)
                                        --------      --------      --------      --------        --------        --------
December 31, 2001                       $114,424      $     51      $      0      $310,521        $(17,504)       $407,492
                                        ========      ========      ========      ========        ========        ========
Net income                                                                          11,401                          11,401

Currency translation adjustments                                                                      (441)           (441)

Unrealized gain/(loss) from interest
   rate swap (net of tax of $1,536)                                                                 (2,374)         (2,374)

Minimum pension liability (net
   of tax of $15,621)                                                                              (24,639)        (24,639)
                                                                                                                  --------
Comprehensive income (loss)                                                                                        (16,053)
                                                                                                                  --------
Stock issued                              15,141                                                                    15,141

Stock redeemed                            (6,293)           (6)                                                     (6,299)

Advance payments                                                          50                                            50

Dividends declared                                                                 (12,488)                        (12,488)
                                        --------      --------      --------      --------        --------        --------
December 31, 2002                       $123,272      $     45      $     50      $309,434        $(44,958)       $387,843
                                        ========      ========      ========      ========        ========        ========
Net income                                                                           8,465                           8,465

Currency translation adjustments                                                                     2,585           2,585

Unrealized gain/(loss) from interest
   rate swap (net of tax of $426)                                                                      673             673

Minimum pension liability (net
   of tax of $3,638)                                                                                 5,738           5,738
                                                                                                                  --------
Comprehensive income                                                                                                17,461
                                                                                                                  --------
Stock issued                                 511                                                                       511

Stock redeemed                            (6,356)           (2)                                                     (6,358)

Advance payments                                                          (5)                                           (5)

Dividends declared                                                                 (11,869)                        (11,869)
                                        --------      --------      --------      --------        --------        --------
December 31, 2003                       $117,427      $     43      $     45      $306,030        $(35,962)       $387,583
                                        ========      ========      ========      ========        ========        ========
</TABLE>

See accompanying Notes to Consolidated Financial Statements

                                                                           23



<PAGE>
<PAGE>

                      CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------------------------------------------

                 Notes to Consolidated Financial Statements
            for the Years Ended December 31, 2003, 2002 and 2001

          (Stated in thousands except for share and per share data)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Description of Business
     Graybar Electric Company, Inc. is engaged internationally in the
distribution of electrical, telecommunications and networking products
and the provision of related supply chain management and logistics
services, primarily to contractors, industrial plants, telephone
companies, power utilities, and commercial users.  All products sold by
the Company are purchased by the Company from others. The Company's
business activity is primarily with customers in the United States;
however, the Company has limited sales activity in several international
locations.

Principles of Consolidation
     The consolidated financial statements include the accounts of
Graybar Electric Company, Inc. and its subsidiary companies.  All
significant intercompany balances and transactions have been eliminated.

Revenue Recognition
     Revenue is recognized when products are shipped and title
transfers to the customer. Shipping and handling costs are primarily
recorded in cost of merchandise sold, with the exception of costs
totaling $15,521, $14,705 and $18,618 which are included in selling,
general and administrative expenses in 2003, 2002 and 2001,
respectively.

Estimates
     The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets,
liabilities, revenues and expenses and the disclosure of contingent
assets and liabilities.  Actual results could differ from those
estimates.

Reclassifications
     Certain reclassifications of prior year presentations have been
made to conform to the 2003 presentation.

Cash and Cash Equivalents
     The Company classifies cash on hand, deposits in banks and other
short-term, highly liquid investments with an original maturity of three
months or less as cash and cash equivalents.

Merchandise Inventory
     Inventory is stated at the lower of cost (determined using the
last-in, first-out (LIFO) cost method) or market.  LIFO accounting is a
method of accounting that, compared with other inventory accounting
methods, generally provides better matching of current costs with
current revenues. At December 31, 2003 and 2002 first-in, first-out
(FIFO) inventory approximated LIFO inventory.  The Company liquidated a
portion of a previously created LIFO layer in 2003 and 2002, resulting
in an increase in cost of goods sold of $2,081 and $5,446, respectively.

Supplier Volume Incentives
     The Company's agreements with many of its suppliers provide for
the Company to earn incentives based on purchases during the agreement
period.  The Company estimates the amount to be received from suppliers
at the end of each reporting period based on the earnout level that the
Company estimates is probable of being achieved.  The Company records
the incentive ratably over the year as a reduction of cost of sales as
related inventory is sold.  Changes in the estimated amount of
incentives are treated as changes in estimate and are recognized using a
cumulative catch-up adjustment.

Property and Depreciation
     The Company provides for depreciation and amortization using the
straight-line method over the following estimated useful lives of the
assets:

------------------------------------------------------------------------
Buildings                                                      42 years
------------------------------------------------------------------------
Permanent fixtures--                              Over the lives of the
leased property                                       respective leases
------------------------------------------------------------------------
Furniture, fixtures and equipment                         4 to 14 years
------------------------------------------------------------------------
Capital leases                                    Over the lives of the
                                                      respective leases
------------------------------------------------------------------------
     Depreciation expense was $26,039, $27,744 and $26,253 in 2003,
2002 and 2001, respectively.
     At the time property is retired, or otherwise disposed of, the
asset and related accumulated depreciation are removed from the
accounts, and any resulting gain or loss is credited or charged to other
income.
     Property under capital leases is recorded in property with the
corresponding obligations carried in long-term debt.  The amount
capitalized is the present value at the beginning of the lease term of
the aggregate future minimum lease payments.
     Maintenance and repairs are expensed as incurred.  Major renewals
and betterments that extend the life of the property are capitalized.
     The Company capitalizes interest expense on major construction and
development projects while in progress.  Interest capitalized in 2003
and 2002 was $776 and $1,505, respectively.
     The Company capitalizes qualifying internal and external costs
incurred to develop or obtain software for internal use during the
application development stage.  Costs incurred during the pre-
application development and post-implementation stages are expensed as
incurred.  During 2003 and 2002, the Company capitalized $26,103 and
$48,726, respectively. The estimated useful life of the software is
eight years.


24




<PAGE>
<PAGE>

                      CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------------------------------------------

Credit Risk
     Financial instruments that potentially expose the Company to
concentrations of credit risk consist primarily of trade accounts
receivable. The Company performs ongoing credit evaluations of its
customers, and a significant portion of trade receivables is secured by
lien or bond rights.  The Company maintains allowances for potential
credit losses, and such losses historically have been within
management's expectations.

Derivative Financial Instruments
     Statement of Financial Accounting Standards (SFAS) No. 133, as
amended by SFAS No. 138 and SFAS No. 149, "Accounting for Derivative
Instruments and Hedging Activities", requires the Company to recognize
all derivative instruments on the balance sheet at fair value.  The
Company has entered into an interest rate swap agreement that
effectively converts its floating rate payments to a fixed-rate basis.
The Company manages interest rates on amounts due under certain
operating leases through its swap agreement.  The Company's interest
rate swap agreement is designated as a cash flow hedge.
     On an ongoing basis, the Company reflects the current fair value
of the interest rate swap on its balance sheet.  At December 31, 2003
the Company has recorded a liability of $5,937 in Other Payables and
Accruals on the balance sheet for the fair value of the swap.  The
effective portion of the related gains or losses on the swap are
deferred in accumulated other comprehensive income.  Because the swap is
completely effective, no ineffectiveness was recorded in the
consolidated statements of income during 2003, 2002 and 2001.  An
unrealized net gain of $673 (net of tax) and unrealized net losses of
$2,374 (net of tax) and $590 (net of tax) related to the swap were
recorded in accumulated other comprehensive income during the twelve
month periods ended December 31, 2003, 2002 and 2001, respectively.  At
December 31, 2003 an unrealized net loss of $3,633 (net of tax) is
recorded in accumulated other comprehensive income.  These deferred
gains and losses are recognized in income in the period in which the
related interest payments being hedged are recognized in expense.

Goodwill
     On January 1, 2002 the Company adopted Statement of Financial
Accounting Standards (SFAS) No. 142, "Goodwill and Other Intangible
Assets."  Under SFAS 142, goodwill and indefinite-lived intangible
assets are no longer amortized but are rather tested annually for
impairment.  The effect of amortization expense related to goodwill on
net income in periods prior to 2002 was not material.  As of December
31, 2003 the Company has completed its annual impairment test and
concluded that there is no impairment of the Company's goodwill.  At
December 31, 2003 the Company has $6,680 of goodwill included in Other
Assets on the balance sheet.

2. INCOME TAXES
     The provisions for income taxes recorded in the Consolidated
Statements of Income and Retained Earnings are as follows:

Years Ended December 31:                         2003        2002        2001
------------------------------------------------------------------------------
Federal income tax
      Current                                 $(8,197)     $6,724     $21,804
      Deferred                                 13,115         693      (3,087)
State income tax
      Current                                     507         509       1,111
      Deferred                                    917        (707)       (215)
------------------------------------------------------------------------------
Financial statement
      income tax provision                    $ 6,342      $7,219     $19,613
------------------------------------------------------------------------------

      Deferred income taxes are provided based upon differences between
the financial statement and tax bases of assets and liabilities.  The
following deferred tax assets (liabilities) are recorded at December 31:

Assets/(Liabilities)                             2003                    2002
------------------------------------------------------------------------------
Postretirement benefits                       $30,201                 $30,181
Payroll accruals                                3,287                   3,419
Bad debt reserves                               2,651                   2,238
Other deferred tax assets                      11,748                  11,444
Accrued (prepaid) pension                      11,268                  17,213
Inventory                                      (1,721)                  4,474
Fixed asset depreciation                      (15,586)                (14,264)
Fixed asset gains                              (9,542)                 (7,392)
Computer software                              (7,149)                 (1,945)
Other deferred tax liabilities                 (8,588)                (10,628)
------------------------------------------------------------------------------
                                              $16,569                 $34,740
------------------------------------------------------------------------------

                                                                          25




<PAGE>
<PAGE>

                     CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------------------------------------------

     Deferred tax assets included in Other Current Assets were $6,167
and $10,446 in 2003 and 2002, respectively.  The Company's deferred tax
assets include state net operating loss carryforwards of $5,938 and
$2,690 as of December 31, 2003 and 2002, respectively, that expire from
2006 to 2022.  Valuation allowances of $2,191 and $529 have been
established for a portion of these deferred tax assets as of December
31, 2003 and 2002, respectively.
     A reconciliation between the "statutory" federal income tax rate
and the effective tax rate in the Consolidated Statements of Income and
Retained Earnings is as follows:

Years Ended December 31:                         2003        2002        2001
------------------------------------------------------------------------------
"Statutory" tax rate                             35.0%       35.0%       35.0%
State and local income taxes,
  net of federal benefit                          2.4        (3.2)       (0.2)
Other, net                                        5.4         7.0         3.4
------------------------------------------------------------------------------
Effective tax rate                               42.8%       38.8%       38.2%
------------------------------------------------------------------------------

3. CAPITAL STOCK
     The Company's capital stock is owned by its employees and
retirees.  Neither common nor preferred stock may be sold by the holder
thereof, except by first offering it to the Company.  The Company may
buy any common shares so offered at the price at which they were issued
($20) with appropriate adjustments for current dividends or may call all
or part of the preferred stock at par plus accrued dividends.
     During 2001 the Company offered to eligible employees the right to
subscribe to 1,300,000 shares of common stock at $20 per share in
accordance with the provisions of the Company's Common Stock Purchase
Plan dated October 8, 2001.  This resulted in the subscription of
813,251 shares ($16,265). Subscribers under the Plan elected to make
payments under one of the following options: (i) all shares subscribed
for prior to January 18, 2002; (ii) a portion of such shares prior to
January 18, 2002, and the balance in monthly installments through
payroll deductions (or in certain cases where a subscriber is no longer
on the Company's payroll, through pension deductions or direct monthly
payments) over a 34-month period; or (iii) all shares pursuant to the
installment method.
     Shares were issued and Voting Trust Certificates were delivered to
subscribers as of January 18, 2002, in the case of shares paid for prior
to January 18, 2002.  Shares will be issued and Voting Trust
Certificates will be delivered to subscribers on a quarterly basis, as
of the tenth day of March, June, September and December to the extent
full payments of shares are made in the case of subscriptions under the
installment method.
     Shown below is a summary of shares reacquired and retired by the
Company in the three years ended December 31:

                         Preferred                         Common
               Reacquired          Retired       Reacquired       Retired
------------------------------------------------------------------------------
2003               129               164           317,774        316,811
2002               316               256           314,647        298,967
2001               299               397           292,732        310,472
------------------------------------------------------------------------------

26




<PAGE>
<PAGE>

                     CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------------------------------------------

4. LONG-TERM DEBT AND BORROWINGS
   UNDER SHORT-TERM CREDIT AGREEMENTS
                                                          December 31,
Long-term debt was composed of:                         2003            2002
------------------------------------------------------------------------------
7.49% note, unsecured, due in
    annual installments of $14,286
    in each of the years 2005
    through 2011                                    $100,000        $100,000
6.59% note, unsecured, due in
    semiannual installments of $3,750
    beginning in October 2003 through
    April 2013                                        71,250          75,000
7.36% note, unsecured, maturing
    May 2011, installments of $3,095
    due semiannually in each of the
    years 2001 through 2010 with
    final payment of $3,094 due in 2011               46,428          52,619
6.65% note, unsecured, due in annual
    installments of $3,636 in each of the
    years 2003 through 2013                           36,364          40,000
6.23% to 8.30% capital leases,
    various maturities                                13,521          10,434
9.23% note secured by a first
    mortgage on various properties,
    maturing May 2005, installments
    of $2,725 due annually in each of
    the years 1995 through 2004 with
    final payment of $2,750 due in 2005                5,475           8,200
Variable rate mortgages, secured by
    facilities, various maturities                     4,215           3,771
------------------------------------------------------------------------------
                                                    $277,253        $290,024
Less current portion                                  22,872          23,314
------------------------------------------------------------------------------
                                                    $254,381        $266,710
------------------------------------------------------------------------------

Long-term debt matures as follows:
-------------------------------------------------------------
2005                                                $ 48,750
2006                                                  31,782
2007                                                  31,725
2008                                                  31,728
2009-2013                                            110,396
-------------------------------------------------------------
                                                    $254,381
-------------------------------------------------------------

     The net book value of property securing various long-term debt
instruments was $14,535 at December 31, 2003.
     The Company's borrowings under short-term credit agreements
consist of issuances of commercial paper and borrowings under revolving
credit agreements and bank lines of credit.
     The Company has a Revolving Credit Loan Agreement with a group of
banks at an interest rate based on the London Interbank Offered Rate
(LIBOR) that had previously consisted of a $205,000, five-year facility.
In October 2003 the Company elected to reduce the facility from $205,000
to $50,000.  The credit agreement expires in July 2004.  There were no
amounts outstanding under the Revolving Credit Loan Agreement at
December 31, 2003.
     At December 31, 2003 the Company had a $200 million accounts
receivable securitization program that expired in October 2003 and was
subsequently renewed for an additional three-year period with an
expiration date of October 2006.  The securitization program provides
for the sale of certain of the Company's trade receivables on a
revolving basis to Graybar Commerce Corporation (GCC), a wholly owned,
bankruptcy remote, special purpose subsidiary.  GCC sells an undivided
interest in the receivables to an unrelated multi-seller commercial
paper conduit.  The Company accounts for the securitization as an on-
balance sheet financing arrangement because the Company has maintained
effective control of the accounts receivable through a call option that
gives GCC the unilateral right to repurchase the undivided interests.
Accordingly, the accounts receivable and related debt are included in
the accompanying consolidated balance sheets.  GCC has granted a
security interest in its trade receivables to the commercial paper
conduit.  There were no borrowings outstanding under the securitization
program at December 31, 2003.
     Borrowings under short-term credit agreements varied from a
minimum of $0 to a maximum of $188,281 and $216,779 in 2003 and 2002,
respectively.  The average amount of borrowings outstanding under short-
term credit agreements during 2003 and 2002 amounted to approximately
$109,000 and $101,000 at weighted average interest rates of 1.51% and
2.11%, respectively.  The averages are based on the daily amounts
outstanding during each year.
     The Company had unused lines of credit of approximately $283,429
as of December 31, 2003.  Certain committed lines of credit have annual
fees of up to one hundred basis points of the committed lines of credit.
     The Revolving Credit Loan Agreement and certain other note
agreements have various covenants that limit the Company's ability to
make investments, pay dividends, incur debt, dispose of property, and
issue equity securities.  The Company is also required to maintain
certain financial ratios as defined in the agreements.  The Company is
in compliance with all covenants as of December 31, 2003.
     The carrying amounts of the Company's outstanding long-term debt
and short-term borrowings approximate their fair values at December 31,
2003.

                                                                      27



<PAGE>
<PAGE>

                      CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------------------------------------------

5. PENSION AND OTHER POSTRETIREMENT BENEFITS
     The Company has a noncontributory defined benefit pension plan
covering substantially all full-time employees.  The plan provides
retirement benefits based on an employee's final average earnings and
years of service.  Employees become 100% vested after five years of
service, regardless of age.  The Company's funding policy is to
contribute the net periodic pension cost accrued each year, provided
that the contribution will not be less than the ERISA minimum or greater
than the maximum tax-deductible amount.  The assets of the defined
benefit pension plan are invested primarily in equity and fixed income
securities and money market funds.
     The Company and its subsidiaries provide certain health care and
life insurance benefits for retired employees through the Retiree
Welfare Plan (the Plan).  Substantially all of the Company's employees
may become eligible to participate in the Plan if they reach normal
retirement age while working for the Company.  Benefits are provided
through insurance coverage with premiums based on the benefits paid
during the year.  The Company funds the Plan on a pay-as-you-go basis,
and accordingly, the Plan has no assets at December 31, 2003 or 2002.
     The following table sets forth information regarding the Company's
pension and other postretirement benefits as of December 31, 2003 and
2002:
                                                           Postretirement
                                   Pension Benefits           Benefits
                                 ---------------------  ----------------------
                                     2003        2002        2003        2002
                                 ---------------------------------------------
Accumulated benefit
  obligation                     $176,801   $ 157,065   $ 126,298   $ 118,500
                                 --------   ---------   ---------   ---------
Projected benefit
  obligation                      231,706     203,100          --          --
Fair value of
  plan assets                     135,906     101,132          --          --
                                 --------   ---------   ---------   ---------

Funded status                    $(95,800)  $(101,968)  $(126,298)  $(118,500)
                                 --------   ---------   ---------   ---------

     Amounts recognized in the balance sheet at December 31, 2003
consist of the following:
                                                           Postretirement
                                   Pension Benefits           Benefits
                                 ---------------------  ----------------------
                                     2003        2002        2003        2002
                                 ---------------------------------------------
Prepaid (accrued)
  benefit cost                   $(40,895)   $(55,776)   $(77,636)   $(77,586)
Intangible asset                   12,392      13,673          --          --
Accumulated other
  comprehensive loss               33,664      39,402          --          --
                                 --------    --------    --------    --------
Net amount recognized            $  5,161    $ (2,701)   $(77,636)   $(77,586)
                                 --------    --------    --------    --------

     Weighted average assumptions as of December 31 are:
                                                           Postretirement
                                   Pension Benefits           Benefits
                                 ---------------------  ----------------------
                                     2003        2002        2003        2002
                                 ---------------------------------------------
Discount rate                        6.00%       6.75%       6.00%       6.75%
Expected return on
  plan assets                        8.75%       9.00%         --          --
Rate of compensation
  increase                           4.00%       3.75%         --          --
Health care cost trend on
  covered charges                      --          --       10%/5%      10%/6%

      The following presents information regarding the plans for the
years ended December 31, 2003 and 2002:
                                                           Postretirement
                                   Pension Benefits           Benefits
                                 ---------------------  ----------------------
                                     2003        2002        2003        2002
                                 ---------------------------------------------
Employer
  contributions                  $ 21,300    $ 14,074    $ 11,148     $ 9,148
Participant
  contributions                        --          --         750         300
Benefits paid                    $(23,043)   $(25,556)   $(11,898)    $(9,448)
                                 --------    --------    --------     -------

     The net periodic cost recognized for the defined benefit pension
plan was $16,779, $14,231 and $11,707 for each of the three years ended
December 31, 2003, 2002 and 2001, respectively.
     The net periodic cost recognized for the postretirement benefit
plan was $11,198, $9,533 and $8,719 for each of the three years ended
December 31, 2003, 2002 and 2001, respectively.
     For measurement of the net periodic postretirement benefit
obligation, a 10.0% annual rate of increase in per capita cost of
covered health care benefits was assumed for 2004.  The rate was assumed
to gradually decrease to 5.0% for 2013 and to remain at that level
thereafter.
     The Company has elected to defer accounting for the effects of the
Medicare Prescription Drug, Improvement and Modernization Act of 2003 in
accordance with FASB Staff Position (FSP) No. FAS 106-1.  The
accumulated postretirement benefit obligation and the net periodic
postretirement benefit cost do not currently reflect the accounting
impact of the Act.  Authoritative guidance on accounting for the federal
subsidy is pending and could require the Company to change previously
reported information.
     The Company also provides a defined contribution profit sharing
and savings plan covering substantially all of its full-time employees.
Annual contributions by the Company to the plan are at the discretion of
management and are generally determined based on the profitability of
the Company.  Employees may also contribute to the plan subject to
limitations imposed by federal tax law and ERISA.

28




<PAGE>
<PAGE>

                     CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------------------------------------------

6. NET INCOME PER SHARE OF COMMON STOCK
     The computation of net income per share of common stock is based
on the weighted average number of common shares outstanding during each
year.  The average numbers of shares used in computing net income per
share of common stock were 5,992,889, 6,245,008 and 5,845,840 in 2003,
2002 and 2001, respectively.

7. COMMITMENTS
     The Company has two operating lease arrangements with an
independent lessor which have provided $63,684 of off-balance sheet
financing for eight of the Company's zone distribution facilities. Each
of the agreements carries a five-year term.  The Company has the option,
with the consent of the lenders to the lessor, to renew the leases for
up to two additional five-year terms or to purchase the property for a
price including the outstanding lease balance.  If the Company elects
not to renew the lease or purchase the property, or such lenders refuse
to consent to a renewal, the Company may elect to remarket the property
and arrange for its sale to a third party.  In the third quarter 2003,
the Company renewed one of these operating lease agreements.  Upon
renewal, the Company recorded a $1,079 liability, the estimated fair
value of the residual value guarantee.
     The leasing structures used in these two lease arrangements
qualify as variable interest entities under FASB Interpretation No. 46
and the Company's interests in the variable interest entities are
required to be consolidated in the Company's financial statements
beginning in the first quarter of 2005.  As of December 31, 2003 the
Company's maximum exposure to loss as a result of its involvement with
the two lease arrangements is $54,131, the amount guaranteed by the
Company as the residual fair value of the property in accordance with
the lease arrangements. Rental expense was $42,396, $43,936 and $34,989
in 2003, 2002 and 2001, respectively.
     Future minimum rental payments required under operating leases
that have either initial or remaining noncancelable lease terms in
excess of one year as of December 31, 2003 are as follows:

Years ending December 31:
-------------------------------------------------------------
2004                                                 $37,582
2005                                                  25,911
2006                                                  15,872
2007                                                  11,798
2008                                                  10,045
Subsequent to 2008                                   $36,051
-------------------------------------------------------------

     In September 2000 the Company entered into a swap agreement to
manage interest rates on amounts due under certain operating leases.
The agreement, which expires in July 2013, is based on a notional amount
of $28.7 million.  The agreement calls for an exchange of interest
payments with the Company receiving payments based on a London Interbank
Offered Rate (LIBOR) floating rate, and making payments based on a fixed
rate of 6.92%.  There is no exchange of the notional amount upon which
the payments are based.  The fair value of the swap was $(5,937) at
December 31, 2003 and is recorded in Other Payables and Accruals in the
balance sheet.

8. STATEMENTS OF CASH FLOWS
     During 2003, 2002 and 2001 income taxes paid/(refunded) totaled
$(1,684), $12,484 and $8,526; interest paid totaled $24,094, $26,976 and
$38,764; and liabilities assumed in connection with capitalized leases
totaled $9,793, $0 and $3,779, respectively.

9. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
     The components of accumulated other comprehensive income (loss) as
of December 31, 2003 and 2002 are as follows:
                                                        2003       2002
-------------------------------------------------------------------------
Currency translation adjustments                    $  1,335   $ (1,250)
Unrealized gain/(loss) from
  interest rate swap                                  (3,633)    (4,306)
Minimum pension liability                            (33,664)   (39,402)
-------------------------------------------------------------------------
                                                    $(35,962)  $(44,958)
-------------------------------------------------------------------------


10. QUARTERLY FINANCIAL INFORMATION
      (UNAUDITED)
     Quarterly financial data for 2003 and 2002 is as follows:
<TABLE>
<CAPTION>
                                                                For the quarters ended,
     2003                                              3/31        6/30        9/30       12/31
-------------------------------------------------------------------------------------------------
<S>                                                 <C>       <C>         <C>           <C>
Net sales                                           $861,344  $  949,982  $1,024,449    $966,677
Gross margin                                         172,813     180,813     190,971     189,869
Net income                                               158       1,697       4,609       2,001
Net income per share of common stock                $    .03  $      .28  $      .77    $    .33
-------------------------------------------------------------------------------------------------

<CAPTION>
                                                                 For the quarters ended,
      2002                                              3/31        6/30        9/30       12/31
-------------------------------------------------------------------------------------------------
<S>                                                 <C>       <C>         <C>           <C>
Net sales                                           $967,910  $1,046,092  $1,013,783    $947,107
Gross margin                                         181,742     190,238     188,820     184,301
Net income (loss)                                     (1,456)      3,396       5,554       3,907
Net income (loss) per share of common stock         $   (.23) $      .54  $      .89    $    .63
-------------------------------------------------------------------------------------------------
</TABLE>

                                                                     29





<PAGE>
<PAGE>

                         [Ernst & Young letterhead]


                       REPORT OF INDEPENDENT AUDITORS
------------------------------------------------------------------------------


                       Report of Independent Auditors

The Shareholders and
  the Board of Directors
Graybar Electric Company, Inc.

We have audited the accompanying consolidated balance sheets of Graybar
Electric Company, Inc. as of December 31, 2003 and 2002, and the related
consolidated statements of income and retained earnings, changes in
shareholders' equity, and cash flows for each of the three years in the period
ended December 31, 2003. These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion
on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
in significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Graybar
Electric Company, Inc. at December 31, 2003 and 2002, and the consolidated
results of its operations and its cash flows for each of the three years
in the period ended December 31, 2003, in conformity with accounting
principles generally accepted in the United States.

As discussed in Note 1 to the consolidated financial statements, the Company
changed its method of accounting for goodwill effective January 1, 2002.


                                                 /s/ Ernst & Young LLP


St. Louis, Missouri
March 3, 2004


30



<PAGE>
<PAGE>

                 DISTRICT MANAGEMENT AS OF DECEMBER 31, 2003
------------------------------------------------------------------------------

NEW YORK DISTRICT
Christopher O. Olsen District Vice President
Ronald P. Segraves Director, Electrical Sales
Stephen E. Thomas Director, Comm/Data Sales
Joseph M. Sabatino Director, Operations
Brian R. Buchholz Director, Finance

--------------------------------------------------

BOSTON DISTRICT
Donald M. Block District Vice President
Peter R. Elkas Director, Electrical Sales
Gerald G. Pollick Director, Operations
Joseph P. Peduto Director, Finance

--------------------------------------------------

PITTSBURGH DISTRICT
Steven M. Schooley District Vice President
Wade V. Leidecker Director, Electrical Sales
David A. Bender Director, Comm/Data Sales
C. Robert Smith Director, Operations
Peter M. Wingrove Director, Finance

--------------------------------------------------

ATLANTA DISTRICT
Joseph F. LaMotte District Vice President
Donald W. Heitmeier Director, Electrical Sales
Jeffrey W. Craig Director, Comm/Data Sales
Keith E. (Kip) Davis Director, Operations
Thomas G. Karrenbauer Director, Finance

--------------------------------------------------

RICHMOND DISTRICT
Thomas S. Gurganous District Vice President
Lindsey G. Darnell Director, Electrical Sales
Thomas R. Moore Director, Comm/Data Sales
David K. Ange Director, Operations
Sharon L. Enman Director, Finance

--------------------------------------------------
TAMPA DISTRICT
Robert C. Lyons District Vice President
Bruce E. Neilson Director, Electrical Sales
Terrell L. Loveless Director, Comm/Data Sales
Dale J. Thayer, Jr. Director, Operations
Richard C. Hird Director, Finance

--------------------------------------------------

CHICAGO DISTRICT
Richard A. Cole District Vice President
Michael N. Wall Director, Electrical Sales
Richard H. Harvey Director, Comm/Data Sales
John T. Roney Director, Operations
Timothy E. Carpenter Director, Finance

--------------------------------------------------

MINNEAPOLIS DISTRICT
Robert L. Nowak District Vice President
G. William Keller Director, Electrical Sales
Paul D. Wise Director, Operations
Ellen S. Rebne Director, Finance

--------------------------------------------------

ST. LOUIS DISTRICT
Michael W. Fowler District Vice President
Thomas J. Spellacy Director, Electrical Sales
John G. Smith Director, Comm/Data Sales
Scott B. Neubauer Director, Operations
Pete Rodriguez Director, Finance

--------------------------------------------------

DALLAS DISTRICT
John C. Loff District Vice President
John H. Hawfield Director, Electrical Sales
Philip J. Harvatin Director, Comm/Data Sales
Thomas T. Townsend Director, Operations
Thomas E. Kinate Director, Finance

--------------------------------------------------

SEATTLE DISTRICT
Kenneth B. Sparks District Vice President
Kirk A. Snure Director, Electrical Sales
Christopher A. Borel Director, Comm/Data Sales
John C. Fisher Director, Operations
Randall R. Harwood Director, Finance

--------------------------------------------------

PHOENIX DISTRICT
Gary D. Hodges District Vice President
Mick K. Upchurch Director, Electrical Sales
Gilbert G. Romo Director, Comm/Data Sales
Shayne P. Jones Director, Operations
Kevin D. Cook Director, Finance

--------------------------------------------------

CALIFORNIA DISTRICT
David G. Maxwell District Vice President
Robert C. Odney Director, Electrical Sales
Jon D. Umene Director, Comm/Data Sales
Kathy L. Edwards Director, Operations
Richard T. Birkett Director, Finance


                                                                          31



<PAGE>
<PAGE>

                     LOCATIONS AS OF DECEMBER 31, 2003
------------------------------------------------------------------------------

CORPORATE OFFICE
34 North Meramec Avenue
St. Louis, Missouri 63105
314 573-9200

--------------------------------------------------
New York District
--------------------------------------------------

1300 Livingston Avenue
North Brunswick,
New Jersey  08902
732 568-2500

BRANCHES
New York: Albany, Hauppauge,
 Long Island City
New Jersey: Newark,
 North Brunswick, Teterboro,
 Hackettstown, Parsippany,
 Wanamassa, Hamilton
Pennsylvania: Philadelphia,
 Harrisburg, Allentown,
 Wilkes-Barre
Delaware: New Castle

--------------------------------------------------
Boston District
--------------------------------------------------

345 Harrison Avenue
Boston, Massachusetts 02118
617 406-5000

BRANCHES
Rhode Island: Cranston
Massachusetts: Worcester,
 West Springfield, Somerville
Maine: Portland
New Hampshire: Manchester
Vermont: Rutland, Burlington
Connecticut: Hamden, Hartford

--------------------------------------------------
Pittsburgh District
--------------------------------------------------

900 Ridge Avenue
Pittsburgh,
Pennsylvania 15212
412 323-5200

BRANCHES
Kentucky: Lexington, Louisville
Ohio: Cincinnati, Columbus,
 Dayton, Lima, Toledo,
 Youngstown, Cleveland,
 Akron, Canton, Mansfield
Pennsylvania: Greensburg, Erie
West Virginia: Wheeling, Charleston
New York: Buffalo, Rochester,
 Syracuse

INFORMATION SYSTEMS
11885 Lackland Road
St. Louis, Missouri 63146
314 573-5700

--------------------------------------------------
Atlanta District
--------------------------------------------------

2050 Nancy Hanks Drive
Norcross, Georgia 30071
770 441-5580

BRANCHES
Georgia: Atlanta
 Midtown, Marietta,
 Fayetteville, Savannah,
 Cartersville, Augusta
Alabama: Birmingham,
 Huntsville, Mobile
South Carolina: Columbia,
 Greenville, Spartanburg,
 Hilton Head, Beaufort
Tennessee: Knoxville,
 Chattanooga, Nashville
Florida: Pensacola
Mississippi: Jackson

--------------------------------------------------
Richmond District
--------------------------------------------------

1510 Tomlynn Street
Richmond, Virginia 23230
804 354-1300

BRANCHES
Virginia: Norfolk, Roanoke,
 Hampton, Chantilly,
 Commonwealth Controls-Richmond
North Carolina: Asheville,
 Raleigh, Winston-Salem, Charlotte,
 Greensboro, Wilmington, Monroe
South Carolina: Rock Hill
Tennessee: Bristol
Maryland: Baltimore, Lanham

--------------------------------------------------
Tampa District
--------------------------------------------------

801 North Rome Avenue
Tampa, Florida 33606
813 253-8881

BRANCHES
Florida: Sarasota, Lakeland,
 Orlando, Pinellas, Melbourne, North Tampa,
 Tallahassee, Jacksonville, Daytona Beach, Perrine,
 Miami, West Palm Beach, Fort Myers, Fort Pierce,
 Naples, Pompano Beach, Gainesville

--------------------------------------------------
Chicago District
--------------------------------------------------

900 Regency Drive
Glendale Heights, Illinois
60139
630 893-3600

BRANCHES
Illinois: Naperville, Chicago
 Downtown, Joliet, East Peoria,
 Springfield
Indiana: Indianapolis, Hammond
 Fort Wayne, South Bend
Michigan: Detroit, Flint,
 Auburn Hills, East Livonia,
 Lansing, Grand Rapids
Iowa: Davenport, Cedar Rapids
Wisconsin: West Allis, Racine,
 Madison

--------------------------------------------------
Minneapolis District
--------------------------------------------------

2300 East 25th Street
Minneapolis, Minnesota 55406
612 721-3545

BRANCHES
Minnesota: St. Paul, Duluth,
 Burnsville, Plymouth, Rochester, Mankato,
 St. Cloud
North Dakota: Fargo
South Dakota: Sioux Falls, Brookings
Wisconsin: Green Bay, Marinette,
 Manitowoc, Neenah,
Stevens Point, Eau Claire
Iowa: Des Moines

--------------------------------------------------
St. Louis District
--------------------------------------------------

8170 Lackland Road
Bel Ridge, Missouri 63114
314 573-2000

BRANCHES
Missouri: Jefferson City,
 Kansas City, Springfield
Kansas: Wichita
Nebraska: Omaha
Tennessee: Memphis, Jackson
Arkansas: Little Rock, Springdale,
 Conway
Indiana: Evansville
Oklahoma: Oklahoma City, Tulsa

--------------------------------------------------
Dallas District
--------------------------------------------------

4601 Cambridge Road
Ft. Worth, Texas 76155
817 213-1200

BRANCHES
Texas: Amarillo, Austin, Abilene,
 Dallas (Royal Lane Counter)
 Freeport, Houston, Beaumont,
 San Antonio, Corpus Christi
Louisiana: Shreveport, Harahan,
 Baton Rouge,  Lake Charles

32




<PAGE>
<PAGE>

                      LOCATIONS AS OF DECEMBER 31, 2003
------------------------------------------------------------------------------

--------------------------------------------------
Seattle District
--------------------------------------------------

1919 Sixth Avenue South
Seattle, Washington 98134
206 292-4848

BRANCHES
Washington: Spokane,
  Tacoma, Everett
Oregon: Portland, Eugene
Idaho: Boise
Alaska: Anchorage, Fairbanks
Montana: Billings
Hawaii: Honolulu

--------------------------------------------------
Phoenix District
--------------------------------------------------

3350 West Earll Drive
Phoenix, Arizona 85017
602 269-2131

BRANCHES
Arizona: Mesa, Tucson,
  Scottsdale
Colorado: Colorado Springs,
  Denver
New Mexico: Albuquerque
Texas: El Paso
Nevada: Las Vegas
Utah: Salt Lake City

--------------------------------------------------
California District
--------------------------------------------------

383 South Cheryl Lane
City of Industry,
California 91789
909 451-4000

BRANCHES
California: Anaheim, Long Beach,
  Van Nuys, Costa Mesa,
Los Angeles (Counter),
San Bernardino, Hayward,
San Francisco (Downtown),
 Martinez, San Jose,
 Sacramento, Roseville,
San Diego, San Marcos,
Santa Barbara, Santa Maria,
 Bakersfield,
 Fresno, Modesto
Nevada: Sparks

REGIONAL ZONES

--------------------------------------------------
Atlanta Regional
And National Zone
--------------------------------------------------
Woodlands Business Park
Building 100
8180 Troon Circle
Austell, Georgia 30168
678 945-9970

--------------------------------------------------
Charlotte Regional Zone
--------------------------------------------------
1700 West Pointe Drive, Suite A
Charlotte, North Carolina 28214
704 602-7000

--------------------------------------------------
Cincinnati Regional Zone
--------------------------------------------------
8814 Trade Port Drive
Hamilton, Ohio 45011
513 874-8814

--------------------------------------------------
Cranbury Regional Zone
--------------------------------------------------
4 Aurora Drive
Suite 401
Cranbury, New Jersey 08512
609 409-8100

--------------------------------------------------
Fresno Regional
And National Zone
--------------------------------------------------
4401 E. Central Avenue
Fresno, California 93725
559 264-2393

--------------------------------------------------
Joliet Regional
And National Zone
--------------------------------------------------
1700 Crossroad Drive
Joliet, Illinois 60431
815 741-4660

--------------------------------------------------
Richmond Regional Zone
--------------------------------------------------
2501 Distribution Drive
Richmond, Virginia 23231
804 521-6800

--------------------------------------------------
Rogers Regional Zone
--------------------------------------------------
13251 George Weber Drive
Rogers, Minnesota 55374
763 428-1545

--------------------------------------------------
Seattle Regional Zone
--------------------------------------------------
1101 North Levee Road
Puyallup, Washington 98371
253 848-3305

--------------------------------------------------
Springfield Regional Zone
--------------------------------------------------
1904 N. LeCompte, Building #12
Springfield, Missouri 65802
417 864-4955

--------------------------------------------------
Stafford Regional
And National Zone
--------------------------------------------------
13131 North Promenade Boulevard
Stafford, Texas 77477
281 340-5500

--------------------------------------------------
Tampa Regional Zone
--------------------------------------------------
8520 Eagle Palm Drive
Riverview, Florida 33569
813 739-4100

--------------------------------------------------
Taunton Regional Zone
--------------------------------------------------
305 John Hancock Road
Taunton, Massachusetts 02780
508 821-3838

--------------------------------------------------
Youngstown Regional
and National Zone
--------------------------------------------------
1100 Ohio Works Drive
Youngstown, Ohio 44510
330 799-3220

--------------------------------------------------
INTERNATIONAL
--------------------------------------------------

34 North Meramec Avenue
St. Louis, Missouri 63105
314 573-5210

LOCATIONS
Carolina, Puerto Rico
Mexico City, Mexico
Kitchener, Ontario
Hamilton, Ontario
Guelph, Ontario
Mississauga, Ontario
Niagara Falls, Ontario
Windsor, Ontario
Halifax, Nova Scotia
Dartmouth, Nova Scotia
Bridgewater, Nova Scotia
Kentville, Nova Scotia
New Glasgow, Nova Scotia
Sydney, Nova Scotia
Truro, Nova Scotia
Yarmouth, Nova Scotia
Charlottetown, Prince
  Edward Island
Bathurst, New Brunswick
Florenceville, New Brunswick
Fredericton, New Brunswick
Moncton, New Brunswick
Saint John, New Brunswick
Corner Brook, Newfoundland
Grand Falls-Windsor,
  Newfoundland
St. John's, Newfoundland
Wabush, Newfoundland
Calgary, Alberta

                                                                         33




<PAGE>
<PAGE>


------------------------------------------------------------------------

                       Graybar Electric Company, Inc.
                           34 North Meramec Avenue
                          St. Louis, Missouri 63105
                               www.graybar.com