##### Table of Contents



UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
   Form 10-K
   þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)  OF THE
    SECURITIES EXCHANGE ACT OF 1934For the Fiscal Year Ended
    December 31, 2005ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)  OF
    THE SECURITIES EXCHANGE ACT OF 1934For the Transition Period
    from          to   Commission File Number: 1-8485
  MILACRON INC.
 (Exact name of registrant as
    specified in its charter)
  DELAWARE

31-1062125(State or other jurisdiction
    of

(I.R.S. Employerincorporation or
    organization)

Identification No.)2090 Florence Avenue
    Cincinnati, Ohio

45206(Address of principal executive
    offices)

(Zip Code)  (513) 487-5000
 (Registrants telephone number, including area code)
  None
 (Former name, former address and
    former fiscal year, if changed since last report)
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of each class

Name of each exchange on which
    registeredCommon Stock, $.01 par value
    per share


New York Stock Exchange, Inc.   Securities registered pursuant to Section 12(g) of the
    Act:
 None
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
 o þ o
  Rule 12b-2 o þ
      Class

Outstanding at March 1,
    2006Common Stock, $.01 par value
    per share

51,285,132 shares   DOCUMENTS
    INCORPORATED BY REFERENCE
  Document

Parts Into Which
    IncorporatedProxy Statement for the Annual
    Meeting of Shareholders to be held May 3, 2006

Part III




---



##### 



MILACRON
    INC.
    2005 FORM 10 K
    TABLE OF CONTENTS
  PagePART IItem 1.

Business


2Executive Officers of the
    Registrant


9Item 1A.

Risk Factors


11Item 1B.

Unresolved Staff
    Comments


22Item 2.

Properties


22Item 3.

Legal
    Proceedings


22Item 4.

Submission of
    Matters to a Vote of Security Holders


22PART IIItem 5.

Market for the
    Registrants Common Equity, Related Stockholder Matters and
    Issuer Purchases of Equity Securities


22Item 6.

Selected Financial
    Data


24Item 7.

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


25Item 7A.

Quantitative and
    Qualitative Disclosures About Market Risk


52Item 8.

Financial Statements
    and Supplementary Data


52Item 9.

Changes in and
    Disagreements with Accountants on Accounting and Financial
    Disclosure


112Item 9A.

Controls and
    Procedures


112Item 9B.

Other
    Information


114PART IIIItem 10.

Directors and
    Executive Officers of the Registrant


114Item 11.

Executive
    Compensation


115Item 12.

Security Ownership
    of Certain Beneficial Owners and Management and Related
    Stockholder Matters


115Item 13.

Certain
    Relationships and Related Transactions


115Item 14.

Principal
    Accountant Fees and Services


116PART IVItem 15.

Exhibits and
    Financial Statement Schedules


116Index to Certain Exhibits and
    Financial Statement Schedules


124Schedule II  Valuation
    and Qualifying Accounts and Reserves


125Signatures


126EX-11EX-21EX-23EX-31.1EX-31.2EX-32   1




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##### Table of Contents



PART I  Item 1.
    Business  General
    
    Machinery technologies  North America
    Machinery technologies  Europe
    Mold technologies
    Industrial fluids  state-of-the-art
      History
    Recent
    Events
     2




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##### Table of Contents



Website
  Form 10-K Form 10-Q 8-K
  Strategic
    Acquisitions and Divestitures
    Acquisition

Date

Product LinesProgress Precision

2001

Plastics extrusion feed screwsReform Flachstahl

2001

Plastics mold bases and componentsEOC Normalien

2001

Plastics mold bases and components   Divestiture

Date

Product LinesValenite

2002

Carbide metalcutting inserts, tool
    holdersWidia

2002

Carbide metalcutting inserts, tool
    holdersWerkö

2002

Round metalcutting toolsTalbot

2003

Round metalcutting toolsMinnesota Twist Drill

2003

Round metalcutting toolsCimform

2004

Vitrified and resin-bonded
    grinding wheels   Manufacturing
    Efficiency and Cost Structure
      and/or
   3




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Refinancing
  1 2
      Product
    Research and Development
    Patents
    Employees
    Segment
    Information
  Form 10-K.
  Plastics
    Technologies
  Products and Services.
 4




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##### Table of Contents



Machinery
    technologies  North America
  
    Injection molding systems, parts and services supplied from
    North America, India and China
    Blow molding systems, parts, molds and services supplied from
    North America
    Extrusion systems, parts and services supplied from North America  Machinery
    technologies  Europe
  
    Injection molding systems, parts and services supplied from
    Europe
    Blow molding systems, parts, molds and services supplied from
    Europe  Mold
    technologies
  
    Injection mold bases, related components/tooling and services
    worldwide
    MRO  maintenance, repair and operating supplies
    worldwide  end-to-end
    state-of-the-art
    art-to-part
 5




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##### Table of Contents



day-to-day
    Markets.
  strength-to-weight
      Geographic Sales.
  Distribution. and/or
    Customers.
 6




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##### Table of Contents



Production Facilities.
  Facility Location

ProductsAhmedabad, India

Injection molding machinesBatavia, Ohio*

Injection molding machinesBlow molding machinesExtrusion systemsCharlevoix, Michigan

Mold componentsCorby, England

Injection molding componentsFulda, Germany

Mold basesGreenville, Michigan*

Mold basesJiangyin, China*

Injection molding machinesLewistown, Pennsylvania

Mold componentsMadison Heights, Michigan

Hot runner systemsMagenta, Italy*

Blow molding machinesMalterdingen, Germany

Injection molding machinesMcPherson, Kansas*

Extrusion screws and barrelsMechelen, Belgium

Mold componentsMelrose Park, Illinois

Mold basesMississauga, Canada*

Extrusion screwsMt. Orab, Ohio

Plastics machinery partsPolicka, Czech Republic*

Blow molding machinesTecumseh, Michigan*

Molds for blow moldingWindsor, Canada

Mold basesYoungwood, Pennsylvania

Mold bases and components     *
    
    Leased      1 2
  Competition.
 7




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##### Table of Contents



Industrial
    Fluids
  Products and Services.
        Markets.
      Geographic Sales.
  Distribution.
  Customers.
   8




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Production Facilities.
  Facility Location

ProductsCincinnati, Ohio

Metalworking fluidsCorby, England *

Metalworking and metalforming
    fluidsLivonia, Michigan

Process cleaners, corrosion
    inhibitors, specialty productsSturgis, Michigan

Metalforming fluidsUlsan, South Korea

Metalworking fluidsVlaardingen, The Netherlands

Metalworking fluids     *
    
    Leased    1 2
  Competition.
  Executive
    Officers of the Registrant
    Positions Held During Last FiveName and Age

Position

YearsRonald D. Brown 
    (52)

Chairman, President and Chief
    Executive Officer

Elected Chairman, President and
    Chief Executive Officer in 2001. Elected President and Chief
    Operating Officer in 1999. Has served as a Director since 1999.Ross A. Anderson 
    (49)

Vice
    President  Finance and Chief Financial Officer

Elected Vice
    President  Finance and Chief Financial Officer
    in 2005. Prior thereto was Vice President and General Manager
    for North American Plastics Injection Machinery from 2004 to
    2005, Corporate Controller from 2002 to 2004 and Group
    Controller of Plastics Machinery Technologies Group from 1998 to
    2002.Hugh C. ODonnell 
    (54)

Senior Vice President, General
    Counsel and Secretary

Elected Senior Vice President in
    2004 and elected Vice President, General Counsel and Secretary
    in 1999. 9




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##### Table of Contents



Positions Held During Last FiveName and Age

Position

YearsDr. Karlheinz Bourdon 
    (48)

President  Global
    Plastics Machinery

Elected President of Global
    Plastics Machinery business in 2004. Prior thereto was General
    Manager, Plastics Machinery Technologies Group from 2003 to
    2004, Senior Managing Director, Plastics Machinery Europe from
    2001 to 2003, and Managing Director, Ferromatik Milacron from
    1999 to 2001.David E. Lawrence 
    (55)

President  Global
    Mold Technologies

Elected President of Global Mold
    Technologies business in 2004. Prior thereto was General
    Manager, Global Mold Technologies from 2003 to 2004 and General
    Manager, North America of D-M-E, a Milacron subsidiary, from
    1999 to 2003.Robert C. McKee 
    (54)

President  Global
    Industrial Fluids

Elected President of Global
    Industrial Fluids business in 2004. Prior thereto was General
    Manager, Global Industrial Fluids from 2002 and General Manager,
    Consumable Products Division from 2000 to 2002.M. Bradley Baker 
    (40)

Vice
    President  Human Resources

Elected Vice President of Human
    Resources in 2004. Prior thereto was Director, Global Human
    Resources from 2002 to 2004 and Group Director, Human
    Resources  Plastics Technologies from 1999 to
    2002.John C. Francy 
    (41)

Vice President and Treasurer

Elected Vice President in 2004 and
    Treasurer in 2001. Prior thereto was Assistant Treasurer from
    1998.Danny L. Gamez 
    (43)

Controller

Elected Controller in 2005. Prior
    thereto was employed by subsidiaries of SPX Corporation from
    2001 to 2005, most recently as Chief Financial Officer of SPX
    Cooling Technologies GmbH, and by Donnelly Hohe GmbH as Group
    Controller and Finance Director from 1998 to 2001.       The parenthetical figure below the name of each individual
    indicates his age at most recent birthday prior to
    December 31, 2005.There are no family relationships among the executive officers
    of the Registrant.Officers of the company are elected each year by the Board of
    Directors. 10




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##### Table of Contents



Item 1A.
    Risk
    Factors  Risks
    Relating to Our Liquidity and Our Indebtedness
  If our
    cash flow available to service our debt does not continue to
    improve, we may not be able to service our debt with cash from
    operating activities, which may cause us to default on our debt
    instruments.
      1 2 Form 10-K
  Our
    liquidity depends on the availability of borrowings under our
    asset facility, which is subject to the discretion of the
    administrative agent thereunder.
   11




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Our
    substantial level of indebtedness may adversely affect our
    financial condition, limit our ability to grow and compete and
    prevent us from fulfilling our obligations under our
    indebtedness.
  non-U.S. subsidiaries
    
    require us to dedicate a substantial portion or even all of our
    cash flow from operations to payments on our indebtedness,
    thereby reducing the availability of our cash flow to fund
    working capital, capital expenditures, research and development
    efforts and other general corporate purposes;
    increase the amount of interest expense that we have to pay
    because some of our borrowings are at variable rates of
    interest, which, if increased, will result in higher interest
    payments;
    increase our vulnerability to existing and future adverse
    economic and industry conditions;
    limit our flexibility in planning for, or reacting to, changes
    in our business and the industries in which we operate;
    make it more difficult for us to satisfy our obligations with
    respect to our indebtedness;
    place us at a competitive disadvantage compared to our
    competitors that have less indebtedness;
    limit, along with the financial and other restrictive covenants
    in our indebtedness, among other things, our ability to borrow
    additional funds, dispose of assets or pay cash
    dividends; and
    restrict us from making strategic acquisitions, introducing new
    technologies or exploiting business opportunities.   12




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##### Table of Contents



Despite
    current indebtedness levels, we and our subsidiaries may still
    be able to incur substantially more debt. This could further
    exacerbate the risks associated with our substantial
    leverage.
    Restrictions
    and covenants in debt agreements limit our ability to take
    certain actions.
  1 2
  
    borrow money;
    use assets as security in other borrowings or transactions;
    pay dividends on capital stock or purchase capital stock;
    sell assets;
    enter into certain transactions with affiliates; and
    make certain investments or acquisitions.      1 2
 13




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##### Table of Contents



1 2 1 2
    An
    ownership change for U.S. federal income tax
    purposes will cause utilization of our pre-change tax loss
    carryforwards and other tax attributes to be substantially
    delayed, which could increase income tax expense and decrease
    available cash in future years.
    Risks
    Relating to Our Business
  If we
    fail to continue to comply with the requirements of
    Section 404 of the Sarbanes-Oxley Act of 2002 or to remedy
    any material weaknesses in our internal controls that we may
    identify in the future, such failure could result in material
    misstatements in our financial statements, cause investors to
    lose confidence in our reported financial information and have a
    negative effect on the trading price of our common
    stock.
    
    inadequate levels of review of complex and judgmental accounting
    issues;
    inadequate segregation of incompatible duties with respect to
    manual and computer-based business processes at the corporate
    and operating levels; and
    insufficient controls with respect to the accounting for
    inventories, primarily at one major North American manufacturing
    facility. 14




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Many
    of our customers are in cyclical industries that have
    historically experienced significant downturns, which has
    resulted in substantially reduced demand for our
    products.
     15




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##### Table of Contents



If a
    large portion of our North American and Western European
    customers continue to outsource their manufacturing activities
    to areas where we do not currently have manufacturing
    operations, we may encounter difficulties keeping these
    customers.
    We
    operate in highly competitive industries, many of which are
    currently subject to intense price competition, and if we are
    unable to compete successfully our results of operations could
    fail to further improve or could deteriorate.
    We may
    encounter difficulties in our restructuring and cost-savings
    efforts, which could prevent us from achieving our anticipated
    cost savings.
    Further
    increases in our cost structure will have an adverse effect on
    our operating results on cash flows.
   16




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Our
    significant international operations subject us to risks such as
    unfavorable political, regulatory, labor and tax
    conditions.
    
    agreements may be difficult to enforce and receivables difficult
    to collect through a foreign countrys legal system;
    foreign countries may impose additional withholding taxes or
    otherwise tax our foreign income, impose tariffs or adopt other
    restrictions on foreign trade or investment, including currency
    exchange controls;
    general economic and political conditions in the countries in
    which we operate could have an adverse effect on our earnings
    from operations in those countries;
    fluctuations in exchange rates may affect product demand and may
    adversely affect the profitability in U.S. dollars or
    products and services provided by us in foreign markets where
    payment for our products and services is made in the local
    currency;
    unexpected adverse changes in foreign laws or regulatory
    requirements may occur; and
    compliance with a variety of foreign laws and regulations may be
    difficult.    Our
    operations are conducted worldwide and our results of operations
    are subject to currency translation risk and currency
    transaction risk that could adversely affect our financial
    condition and results of operations.
   17




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Our
    operations depend to a great extent on the economy of the
    European and Asian markets. These economies may not be as stable
    as that of the U.S.
      Our
    principal U.S. pension plan is underfunded, which we expect
    will require us to make cash contributions to the plan, which,
    in turn, will reduce the cash available for our business, and
    adverse equity market or interest rate conditions may increase
    our pension liability and expense.
     18




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We may
    be unable to respond in an effective and timely manner to
    technological changes in our industry and could lose customers
    as a result.
    We may
    not be able to adequately protect our intellectual property and
    proprietary rights, which could harm our future success and
    competitive position.
    
    any of our patents will not be invalidated, circumvented or
    licensed to others;
    any of our pending or future patent applications will be issued
    within the scope of the claims sought by us, if at all; 19




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
    others will not develop technologies that are similar or
    superior to our technologies, duplicate our technologies or
    design around our patents; or
    steps taken by us to protect our technologies will prevent
    misappropriation of such technologies.    We are
    subject to litigation that could have an adverse effect upon our
    business, financial condition, results of operations or
    reputation.
  and/or
  Our
    operations may subject us to potential responsibilities and
    costs under environmental laws that could have an adverse effect
    on our business, financial condition and results of
    operations.
  clean-up clean-up clean-up
  A
    significant softening of the U.S. economy could require us
    to change our assumptions regarding our deferred tax assets,
    which could materially increase our income tax expense and
    adversely affect our results of operations.
  non-U.S. net non-U.S. assets
 20




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##### Table of Contents



non-U.S. net non-U.S. jurisdictions  primarily
          If we
    are unable to retain key employees, our performance may be
    hindered.
   21




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##### Table of Contents



The
    interests of our principal shareholders may conflict with those
    of other shareholders.
    Item 1B.
    Unresolved
    Staff Comments    Item 2.
    Properties    Form 10-K.
  Item 3.
    Legal
    Proceedings  and/or
  Item 4.
    Submission
    of Matters to a Vote of Security Holders   PART II  Item 5.
    Market
    for the Registrants Common Equity, Related Stockholder
    Matters and Issuer Purchases of Equity Securities    1 2 Form 10-K) Form 10-K)
 22




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##### Table of Contents



Common
    Stock Price Range
  High


Low2004, quarter endedMarch 31

$
4.55


$
1.86June 30


4.49



3.25September 30


4.02



2.83December 31


3.76



2.662005, quarter endedMarch 31

$
3.50


$
2.40June 30


3.09



1.88September 30


2.30



1.65December 31


1.90



1.08     (a)


(b)


(c)


(d)Maximum NumberTotal Number


(or Approximateof Shares


Dollar Value) of(or Units)


Shares (or Units)Total Number


Average Price


Purchased as


that May Yet Beof Shares


Paid per


Part of Publicly


Purchased Under(or Units)


Share


Announced Plans


the Plans orPeriod

Purchased


(or Unit)


or Programs(1)


Programs(1)October 1 - October 31, 2005














November 1 - November 30, 2005














December 1 - December 31, 2005














Total














     (1)
    
    As of December 31, 2005, there were no publicly announced
    plans or programs to repurchase stock.   23




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##### Table of Contents



Item 6.
    Selected
    Financial Data  2005


2004


2003


2002


2001(Dollars in millions, except
    per-share amounts)Summary of OperationsSales

$
808.9


$
774.2


$
739.7


$
693.2


$
755.2Loss from continuing operations
    before cumulative effect of change in method of accounting(a)


(16.5
)(b)


(51.3
)(b)


(183.7
)(b)


(18.7
)(b)


(28.6
)(b)Per common share(c)Basic


(.47
)


(1.72
)(d)


(5.02
)


(.52
)


(.80
)Diluted


(.47
)(e)


(1.72
)(d)(e)


(5.02
)(e)


(.52
)(e)


(.80
)(e)Earnings (loss) from discontinued
    operations


2.5
(f)


(.5
)(f)


(7.2
)(f)


(16.8
)(f)


(7.0
)Per common share(c)Basic


.05



(.01
)


(.19
)


(.46
)


(.19
)Diluted


.05
(e)


(.01
)(e)


(.19
)(e)


(.46
)(e)


(.19
)(e)Cumulative effect of change in
    method of accounting














(187.7
)(g)


Per common share(c)Basic














(5.15
)


Diluted














(5.15
)(e)


Net loss(a)


(14.0
)


(51.8
)


(190.9
)


(223.2
)


(35.6
)Per common share(c)Basic


(.42
)


(1.73
)(d)


(5.21
)


(6.13
)


(.99
)Diluted


(.42
)(e)


(1.73
)(e)


(5.21
)(e)


(6.13
)(e)


(.99
)(e)Financial Position at Year
    EndWorking capital of continuing
    operations


186.8



193.4



22.2



166.9



176.5Property, plant and equipment-net


114.2



128.4



140.8



149.8



165.8Total assets


671.6



737.9



733.4



947.3



1,528.5Long-term debt


233.3



235.9



163.5



255.4



501.1Total debt


240.0



253.1



323.4



301.5



576.7Net debt (total debt less cash and
    cash equivalents)


194.3



183.9



230.6



179.2



486.6Shareholders equity (deficit)


(5.1
)


50.4



(23.6
)


143.5



444.6Per common share


(2.49
)


(1.42
)


(.85
)


4.07



13.11Other DataDividends paid to common
    shareholders










.7



1.4



12.4Per common share










.02



.04



.37Capital expenditures


12.7



8.8



6.5



6.2



13.5Depreciation and amortization


18.4



20.3



21.7



23.0



34.9Backlog of unfilled orders at
    year-end


96.5



87.3



92.0



76.4



61.2Employees (average)


3,516



3,490



3,760



4,090



4,672     (a)
    
    In the fourth quarter of 2004, the company elected to change its
    method of accounting for certain U.S. plastics machinery
    inventories from the
    last-in,
    first-out (LIFO) method to the
    first-in,
    first-out (FIFO) method, retroactive to the beginning of the
    year. Upon adoption of the FIFO method, all amounts for the
    years 2001 through 2003 were adjusted to conform to the new
    presentation. 24




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##### Table of Contents



(b)
    
    Includes restructuring costs of $1.6 million
    ($1.5 million after tax) in 2005, $13.0 million (with
    no tax benefit) in 2004, $27.1 million ($25.5 million
    after tax) in 2003, $13.9 million ($8.8 million after
    tax) in 2002 and $17.5 million ($11.0 million after
    tax) in 2001. In 2004 and 2003, includes refinancing costs of
    $21.4 million and $1.8 million, respectively, in both
    cases with no tax benefit. In 2003 and 2002, includes goodwill
    impairment charges of $65.6 million and $1.0 million,
    respectively, in both cases with no tax benefit.(c)
    
    The numbers of shares used to compute earnings (loss) per common
    share data for all years prior to 2004 include the effect of a
    bonus element inherent in a rights offering that was
    completed in the fourth quarter of 2004. Under the terms of the
    offering, holders of common shares were permitted to acquire
    additional shares at a price of $2.00 per share compared to
    a weighted-average market price on the closing dates of
    $2.91 per share. The effect of the bonus element was to
    increase the numbers of shares used to calculate basic and
    diluted earnings (loss) per common share by a factor of 1.0891.(d)
    
    In 2004, loss from continuing operations per common share and
    net loss per common share include the effect of a beneficial
    conversion feature that is included in the Series B
    Preferred Stock that was issued in June 2004. In addition to
    dividends on all preferred stock, the $15.9 million value
    of the beneficial conversion feature has been added to the
    applicable loss amounts in calculating the respective loss per
    common share amounts.(e)
    
    For all years presented, diluted earnings per common share is
    equal to basic earnings per common share because the inclusion
    of potentially dilutive securities would result in a smaller
    loss per common share.(f)
    
    In 2005, 2004 and 2003, includes income of $2.5 million,
    income of $.8 million and expense of $.8 million,
    respectively, related to adjustments of previously recorded
    gains and losses on divestitures of discontinued operations. In
    2002, includes a net gain of $8.4 million on the
    divestitures of the Valenite and Widia and Werkö
    metalcutting tools businesses, the planned divestiture of the
    round metalcutting tools and grinding wheels businesses and
    adjustments of reserves related to the 1998 sale of the machine
    tools segment.(g)
    
    Represents a goodwill impairment charge related to the adoption
    of a new accounting standard.  Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Executive
    Summary
  Company
    Overview
  end-to-end
       25




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Plastics
    Markets  Background and Recent
    History
      12-month
      Industrial
    Fluids  Recent History
  2000-2003,
    Consolidated
    2005 Results
   26




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Opportunities
    and Challenges
        Consolidated
    2005 Results
  Presence
    Outside the U.S.
        Significant
    Accounting Policies and Judgments
  Form 10-K,
  Deferred
    Tax Assets and Valuation Allowances
  non-U.S. net
 27




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##### Table of Contents



non-U.S. assets
  non-U.S. net non-U.S. jurisdictions  primarily
       28




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Accounts
    Receivable, Inventory and Warranty Reserves
         29




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percentage-of-sales
  Impairment
    of Goodwill and Long-Lived Assets
    non-U.S. countries
   30




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Self-Insurance
    Reserves
     31




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Pensions
  non-U.S. employees.
  1 2 3 4 1 2
  year-to-year rate-of-return
  1 4 1 2 1 4 3 4
   32




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Results
    of Operations
  Form 10-K
  Basis
    of Presentation
  last-in, first-in,
  Earnings
    Per Common Share
    Discontinued
    Operations
    Pension
    Expense and Pension Funding
  rate-of-return
 33




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Form 10-K
  2005
    Compared to 2004
  New
    Orders and Sales
    U.S.-built non-U.S. markets
    Margins,
    Costs and Expenses
     34




---



##### Table of Contents



Refinancing
    Costs
  5 8
  Restructuring
    Costs
             35




---



##### Table of Contents



Restructuring
    Actions
  Restructuring Costs


Cash CostsYear Initiated

2005


2004


2003


2005


2004


2003(In millions)Machinery
    technologies  North AmericaInjection molding and blow molding
    employment reductions

2003 & 2004

$
.4


$
2.6


$
3.8


$
.7


$
1.7


$
.7Blow molding machinery and mold
    making relocations

2002


.9



5.5



3.9



.4



.6



3.4Other 2001 actions

2001






(.1
)














1.3



8.0



7.7



1.1



2.3



4.1Machinery
    technologies  EuropeConsolidation of European sales
    offices

2005


.2











(.2
)






Blow molding product line
    rationalization and employment reductions

2003






.2



4.5



.1



.9



.7Injection molding sales office and
    employment reductions

2003










2.0







1.4



.5Injection molding and blow molding
    overhead reductions

2001






















1.3.2



.2



6.5



(.1
)


2.3



2.5Mold technologiesConsolidation of European sales
    offices

2005


.1



















Downsize Fulda plant

2004


.1



2.1







.4



.6



Mahlberg plant closure

2003


(.1
)


1.3



5.7



(1.1
)






2.8North American employment
    reductions

2003










1.0







.3



.6European sales reorganization

2003 & 2004






1.1



3.6



.6



2.4



1.3Monterey Park plant closure

2002










.5











(.2
)EOC and Reform integration

2001


(.2
)


.3



1.8



(.5
)


.2



.2(.1
)


4.8



12.6



(.6
)


3.5



4.7Industrial fluids and
    corporateFluids blending plant closure

2005


.2



















Early retirement program and
    general overhead reductions

2003










.3







.1



.2Early retirement program and
    general overhead reductions

2001 & 2002


















.1



.3.2







.3







.2



.5$
1.6


$
13.0


$
27.1


$
.4


$
8.3


$
11.8  36




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##### Table of Contents



Restructuring
    Actions
  Cost SavingsHeadcountYear Initiated

Reductions


2003


2004


2005(In millions)Machinery
    technologies  North AmericaInjection molding and blow molding
    employment reductions

2003 & 2004


163


$
2.1


$
8.8


$
12.1Blow molding machinery and mold
    making relocations

2002


42



3.7



4.7



4.7Southwest Ohio reorganization

2002


24



2.7



2.7



2.7Injection molding and extrusion
    early retirement program and general overhead reductions

2001


165



10.7



10.7



10.7Injection molding and blow molding
    facilities product line rationalization

2001


64



4.2



4.2



4.2Other 2001 actions

2001


52



5.0



5.0



5.0510



28.4



36.1



39.4Machinery
    technologies  EuropeBlow molding product line
    rationalization and employment reductions

2003


47



1.0



2.8



2.8Injection molding sales office and
    employment reductions

2003


72



.4



3.6



4.5Injection molding and blow molding
    overhead reductions

2001


133



6.8



7.2



7.2252



8.2



13.6



14.5Mold technologiesDownsize Fulda plant

2004


25











.8Mahlberg plant closure

2003


64



2.1



3.8



3.8North American employment
    reductions

2003


38



1.0



3.1



3.1European sales reorganization ..

2003 & 2004


79



.1



5.5



5.5Monterey Park plant closure

2002


12



.6



.8



.8EOC and Reform integration

2001


233



5.2



5.2



5.2North American overhead and
    general employment reductions

2001 & 2002


47



2.0



1.9



1.9498



11.0



20.3



21.1 37




---



##### Table of Contents



Cost SavingsHeadcountYear Initiated

Reductions


2003


2004


2005(In millions)Industrial fluids and
    corporateEarly retirement program and
    general overhead reductions

2003


11



.5



1.4



1.4Early retirement program and
    general overhead reductions

2001 & 2002


16



1.0



1.0



1.027



1.5



2.4



2.41,287


$
49.1


$
72.4


$
77.4     Results
    By Segment
  Machinery technologies  North
    America
  Machinery
    technologies  Europe
  Mold technologies
 38




---



##### Table of Contents



Industrial Fluids
  Loss
    From Continuing Operations Before Income Taxes
    Income
    Taxes
  non-U.S. operations non-U.S. operations.
  non-U.S. jurisdictions non-U.S. operations  primarily
  Loss
    From Continuing Operations
   39




---



##### Table of Contents



Discontinued
    Operations
      Net
    Loss
    2004
    Compared to 2003
  New
    Orders and Sales
    U.S.-built non-U.S. markets,
  U.S.-built
  Margins,
    Costs and Expenses
     40




---



##### Table of Contents



Refinancing
    Costs
  5 8
  Restructuring
    Costs
         41




---



##### Table of Contents



Goodwill
    Impairment Charge
    Results
    By Segment
  Machinery technologies  North
    America
  Machinery
    technologies  Europe
  Mold technologies
 42




---



##### Table of Contents



Industrial Fluids
  Loss
    From Continuing Operations Before Income Taxes
    Income
    Taxes
    non-U.S. subsidiaries non-U.S. operations,
  non-U.S. operations. non-U.S. losses
  Loss
    From Continuing Operations
   43




---



##### Table of Contents



Discontinued
    Operations
      Net
    Loss
    Comparative
    Operating Results
    2005


2004


2003(In millions)Machinery
    technologies  North AmericaOperating ResultsSegment operating earnings as
    reported

$
17.3



16.0



8.1Restructuring costs


(1.3
)


(8.0
)


(7.7
)Adjusted operating earnings

$
16.0


$
8.0


$
.4   2005


2004


2003(In millions)Machinery
    technologies  EuropeOperating ResultsSegment operating earnings (loss)
    as reported

$
(5.0
)

$
1.9


$
(1.4
)Restructuring costs

$
(.2
)


(.2
)


(6.5
)Adjusted operating earnings (loss)

$
(5.2
)

$
1.7


$
(7.9
)   2005


2004


2003(In millions)Mold technologiesOperating ResultsSegment operating earnings as
    reported

$
3.9


$
4.3


$
1.8Restructuring costs

$
.1



(4.8
)


(12.6
)Adjusted operating earnings (loss)

$
4.0


$
(.5
)

$
(10.8
)   44




---



##### Table of Contents



2005


2004


2003(In millions)Industrial fluidsOperating ResultsSegment operating earnings as
    reported

$
8.7


$
9.2


$
15.7Restructuring costs

$
(.2
)






Adjusted operating earnings

$
8.5


$
9.2


$
15.7   Market
    Risk
  Foreign
    Currency Exchange Rate Risk
    Interest
    Rate Risk
  1 2
    Off-Balance
    Sheet Arrangements
  Sales
    of Accounts Receivable
   45




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##### Table of Contents



non-U.S. subsidiaries
  Sales
    of Notes and Guarantees
  non-U.S. subsidiaries,
  Contractual
    Obligations
    2007-


2009-


BeyondTotal


2006


2008


2010


2010(In millions)Contractual
    ObligationsAsset-based facility due 2008

$
2.2


$
2.2


$



$



$
111/2%
    Senior Secured Notes due 2011


225.0















225.0Other long-term debt


1.9



.7



.9



.3



Capital lease obligations


13.4



1.9



4.2



5.2



2.1Operating leases


30.8



11.0



14.8



4.2



.8Purchase obligations(a)


















Other long-term liabilitiesPension plan contributions(b)


52.7



2.7



50.0



(b
)


(b
)Unfunded pension benefits(c)(d)


141.4



2.7



5.4



5.4



127.9Postretirement medical
    benefits(d)(e)


15.8



1.2



1.8



1.3



11.5Insurance reserves(d)


21.8



2.5



12.5



4.5



2.3Total

$
505.0


$
24.9


$
89.6


$
20.9


$
369.6   (a)
    
    We did not have any significant purchase obligations as of
    December 31, 2005.(b)
    
    We will be required to make contributions to our defined benefit
    pension plan for certain U.S. employees and retirees in
    2006 and beyond. The amount shown above for 2006 is based on the
    current provisions of the plan, its current funded status and
    the discount rate required to be used for minimum funding
    purposes by the Pension Funding Act of 2004. This amount is not
    expected to change significantly, if all. The amount shown in
    the
    2007-2008
    column is an estimate of the minimum required contribution in
    2007 as discussed below. However, actual contributions for years
    after 2006 cannot be reasonably determined at this time because
    of the potential effects of new legislation pending in the
    U.S. Congress. If enacted, this legislation is expected to
    have the effect of increasing the total required contribution
    amounts but allowing them to be made over a longer period of
    time than under current law. Enactment of the legislation could
    significantly change the estimated minimum required contribution
    for 2007 that is presented above. In addition, interest rate
    relief measures that had been in place under the Pension Funding
    Act of 2004 expired on December 31, 2005 and have not yet
    been replaced. These relief measures allowed plan sponsors to
    use higher interest rates based on corporate bond yields to
    establish funding requirements than would have otherwise been
    the case. In this regard, current law would have required the
    yield on 30 year Treasury securities to be used if interest
    rate relief had not been in place. In the absence of interest
    rate relief or new legislation, funding requirements beyond 2006
    could increase 46




---



##### Table of Contents



substantially. We are currently evaluating various alternatives,
    some of which have the potential of permitting us to satisfy our
    funding obligations over a longer period.(c)
    
    Represents liabilities related to unfunded pension plans in the
    U.S. and Germany.(d)
    
    The amounts presented for unfunded pension benefits, other
    postretirement benefits and insurance reserves are estimates
    based on current assumptions and expectations. Actual annual
    payments related to these obligations can be expected to differ
    from the amounts shown. The amounts shown for insurance reserves
    are net of expected recoveries from excess carriers and other
    third parties totaling $7.4 million.(e)
    
    As discussed more fully in the note to the Consolidated
    Financial Statements captioned Retirement Benefit
    Plans, we have moved prescription drug coverage for
    retirees who are eligible for Medicare from the self-funded
    company plan to third-party insurers effective January 1,
    2006. This change is expected to result in cash savings in
    excess of $1 million per year. The amounts presented above
    include estimates of these benefits.    Liquidity
    and Sources of Capital
    non-U.S. operations. non-U.S. cash non-U.S. receivables.
  5 8
         47




---



##### Table of Contents



3 8 pay-in-kind
    1 2
  1 2
  
    purchase 114,990,000 of the 115 million
    aggregate outstanding principal amount of Milacron Capital
    Holdings B.V.s
    75/8%
    Guaranteed Bonds due in April 2005 at the settlement of a tender
    offer therefor;
    terminate and repay $19 million of borrowings outstanding
    under the revolving A facility of the Credit Suisse First Boston
    facility, which included additional amounts borrowed subsequent
    to March 12, 2004. We also used $17.4 million of
    availability under our asset based facility to replace or
    provide credit support for the outstanding letters of credit
    under the revolving A facility of the Credit Suisse First Boston
    facility;
    repay the $75 million term loan B facility of the
    Credit Suisse First Boston facility; and
    pay transaction expenses.  1 2
 48




---



##### Table of Contents



last-in, first-in,
 49




---



##### Table of Contents



1 2 1 2
  1 2
 50




---



##### Table of Contents



non-U.S. banks
          Cautionary
    Statement
   51




---



##### Table of Contents




    our ability to comply with financial and other covenants
    contained in the agreements governing our indebtedness,
    including our senior secured notes and asset based credit
    facility;
    our ability to remediate or otherwise mitigate any material
    weakness in internal control over financial reporting or
    significant deficiencies that may be identified;
    global and regional economic conditions, consumer spending,
    capital spending levels and industrial production, particularly
    in segments related to the level of automotive production and
    spending in the plastics and construction industries;
    fluctuations in currency exchange rates of U.S. and foreign
    countries, including countries in Europe and Asia where we have
    several principal manufacturing facilities and where many of our
    customers, competitors and suppliers are based;
    fluctuations in interest rates which affect the cost of
    borrowing;
    production and pricing levels of important raw materials,
    including plastic resins, which are a key material used by
    purchasers of our plastics technologies products, as well as
    steel, oil and chemicals;
    lower than anticipated levels of plant utilization resulting in
    production inefficiencies and higher costs, whether related to
    the delay of new product introductions, improved production
    processes or equipment, or labor relations issues;
    customer acceptance of new products introduced during 2005 and
    products expected to be introduced in 2006;
    any major disruption in production at key customer or supplier
    facilities or at our facilities;
    disruptions in global or regional commerce due to wars, to
    social, civil or political unrest in the
    non-U.S. countries
    in which we operate and to acts of terrorism, continued threats
    of terrorism and military, political and economic responses
    (including heightened security measures) to terrorism;
    alterations in trade conditions in and between the U.S. and
    non-U.S.
    countries where we do business, including export duties, import
    controls, quotas and other trade barriers;
    changes in tax, environmental and other laws and regulations in
    the U.S. and
    non-U.S. countries
    where we do business;
    litigation, claims or assessments, including but not limited to
    claims or problems related to product liability, warranty or
    environmental issues;
    fluctuations in stock market valuations of pension plan assets
    or changes in interest rates that could result in increased
    pension expense and reduced shareholders equity and
    require us to make significant cash contributions in the
    future; and
    our ability to extend our pension funding obligations for 2007
    and beyond over a longer period of time, or otherwise be able to
    fund our pension funding obligations when they become due.  Item 7A.
    Quantitative
    and Qualitative Disclosures About Market Risk  Form 10-K.
  Item 8.
    Financial
    Statements and Supplementary Data  Regulation S-K.
 52




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF OPERATIONS
 Years
    ended December 31, 2005, 2004 and 2003
  2005


2004


2003(In millions, except per-share
    amounts)Sales

$
808.9


$
774.2


$
739.7Cost of products sold


663.1



626.6



603.8Cost of products sold related to
    restructuring






1.4



3.3Total cost of products sold


663.1



628.0



607.1Manufacturing margins


145.8



146.2



132.6Other costs and expensesSelling and administrative


133.8



126.9



129.0Restructuring costs


1.6



11.6



23.8Refinancing costs






21.4



1.8Goodwill impairment charge










65.6Other expense  net


.4



2.9



(.2
)Total other costs and expenses


135.8



162.8



220.0Operating earnings (loss)


10.0



(16.6
)


(87.4
)InterestIncome


1.5



2.0



1.9Expense


(31.8
)


(39.3
)


(24.9
)Interest  net


(30.3
)


(37.3
)


(23.0
)Loss from continuing operations
    before income taxes


(20.3
)


(53.9
)


(110.4
)Provision (benefit) for income
    taxes


(3.8
)


(2.6
)


73.3Loss from continuing
    operations


(16.5
)


(51.3
)


(183.7
)Discontinued operations net of
    income taxesLoss from operations






(1.3
)


(6.4
)Net gain (loss) on divestitures


2.5



.8



(.8
)Total discontinued operations


2.5



(.5
)


(7.2
)Net loss

$
(14.0
)

$
(51.8
)

$
(190.9
)Loss applicable to common
    shareholders

$
(20.1
)

$
(70.9
)

$
(191.1
)Earnings (loss) per common
    share  basic and dilutedContinuing operations

$
(.47
)

$
(1.72
)

$
(5.02
)Discontinued operations


.05



(.01
)


(.19
)Net loss

$
(.42
)

$
(1.73
)

$
(5.21
)    53




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  CONSOLIDATED
    BALANCE SHEETS
 December 31,
    2005 and 2004
  2005


2004(In millions, except par
    value)ASSETSCurrent assetsCash and cash equivalents

$
45.7


$
69.2Notes and accounts receivable,
    less allowances of $9.0 in 2005 and $12.1 in 2004


117.7



134.6InventoriesRaw materials


8.2



8.1Work-in-process
    and finished parts


83.6



69.2Finished products


69.3



76.6Total inventories


161.1



153.9Other current assets


44.3



49.1Total current assets


368.8



406.8Property, plant and
    equipment  net


114.2



128.4Goodwill


83.7



86.6Other noncurrent assets


104.9



116.1Total assets

$
671.6


$
737.9LIABILITIES AND
    SHAREHOLDERS EQUITY (DEFICIT)Current liabilitiesShort-term borrowings

$
4.1


$
11.2Long-term debt and capital lease
    obligations due within one year


2.6



6.0Trade accounts payable


76.4



80.3Advance billings and deposits


22.6



18.6Accrued and other current
    liabilities


76.3



97.3Total current liabilities


182.0



213.4Long-term accrued liabilities


261.4



238.2Long-term debt


233.3



235.9Total liabilities


676.7



687.5Commitments and contingencies






Shareholders equity (deficit)4% Cumulative Preferred shares


6.0



6.06% Series B Convertible
    Preferred Stock, $.01 par value (outstanding: .5 in both
    2005 and 2004)


112.9



112.9Common shares, $.01 par value
    (outstanding: 50.1 in 2005 and 48.6 in 2004)


.5



.5Capital in excess of par value


348.0



347.2Contingent warrants


.5



.5Accumulated deficit


(332.8
)


(312.7
)Accumulated other comprehensive
    loss


(140.2
)


(104.0
)Total shareholders equity
    (deficit)


(5.1
)


50.4Total liabilities and
    shareholders equity (deficit)

$
671.6


$
737.9    54




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF COMPREHENSIVE INCOME AND SHAREHOLDERS EQUITY
    (DEFICIT)
 Years
    ended December 31, 2005, 2004 and 2003
  2005


2004


2003(In millions)4% Cumulative Preferred sharesBalance at beginning and end of
    period

$
6.0


$
6.0


$
6.06% Series B Convertible
    Preferred StockBalance at beginning of period


112.9







Net proceeds from issuance






97.0



Beneficial conversion feature






15.9



Balance at end of period


112.9



112.9



Common sharesBalance at beginning of period


347.7



318.8



317.3Net restricted stock activity






3.1



.2Reissuance of treasury shares


.6



1.6



1.3Issuance of previously unissued
    shares


.2







Beneficial conversion feature
    related to Series A Notes






6.6



Conversion of Series A Notes
    to common stock






28.1



Conversion to Series B
    Convertible Preferred Stock






(34.6
)


Proceeds from rights offering






24.1



Balance at end of period


348.5



347.7



318.8Contingent warrantsBalance at beginning of period


.5







Issuance of contingent warrants






.5



Balance at end of period


.5



.5



Accumulated deficitBalance at beginning of period


(312.7
)


(241.7
)


(50.0
)Net loss for the period


(14.0
)


(51.8
)


(190.9
)Dividends declared4% Cumulative Preferred shares


(.1
)


(.4
)


(.1
)6% Series B Convertible
    Preferred Stock


(6.0
)


(2.9
)


Common shares










(.7
)Beneficial conversion feature
    related to Series B ConvertiblePreferred Stock






(15.9
)


Balance at end of period


(332.8
)


(312.7
)


(241.7
)Accumulated other comprehensive
    income (loss)Balance at beginning of period


(104.0
)


(106.7
)


(129.8
)Foreign currency translation
    adjustments


(16.8
)


15.9



8.5Minimum pension liability
    adjustments


(19.4
)


(13.0
)


14.6Other






(.2
)


Balance at end of period


(140.2
)


(104.0
)


(106.7
)Total shareholders equity
    (deficit)

$
(5.1
)

$
50.4


$
(23.6
)Net loss for the period

$
(14.0
)

$
(51.8
)


(190.9
)Change in accumulated other
    comprehensive income (loss)


(36.2
)


2.7



23.1Total comprehensive
    loss

$
(50.2
)

$
(49.1
)

$
(167.8
)    55




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWSYears ended December 31, 2005, 2004 and 2003
  2005


2004


2003(In millions)Increase (decrease) in cash and
    cash equivalentsOperating activities cash
    flowsNet loss

$
(14.0
)

$
(51.8
)

$
(190.9
)Operating activities providing
    (using) cashLoss from discontinued operations






1.3



6.4Net (gain) loss on divestitures


(2.5
)


(.8
)


.8Depreciation and amortization


18.4



20.3



21.7Restructuring costs


1.6



13.0



27.1Refinancing costs






21.4



1.8Goodwill impairment charge










65.6Deferred income taxes


(.7
)


8.7



73.9Working capital changesNotes and accounts receivable


10.0



(36.1
)


6.6Inventories


(14.3
)


(1.1
)


22.3Other current assets


3.1



3.0



13.9Trade accounts payable


1.1



9.3



(6.1
)Other current liabilities


(8.2
)


(30.4
)


(31.3
)Decrease (increase) in other
    noncurrent assets


7.0



3.0



(.6
)Increase (decrease) in long-term
    accrued liabilities


7.0



(1.9
)


(2.7
)Other  net


.7



.4



1.5Net cash provided (used) by
    operating activities


9.2



(41.7
)


10.0Investing activities cash
    flowsCapital expenditures


(12.7
)


(8.8
)


(6.5
)Net disposals of property, plant
    and equipment


2.6



.6



2.5Divestitures


.3



8.0



(20.3
)Acquisitions










(6.5
)Net cash used by investing
    activities


(9.8
)


(.2
)


(30.8
)Financing activities cash
    flowsIssuance of long-term debt






219.8



Repayments of long-term debt


(5.0
)


(261.5
)


(2.2
)Increase (decrease) in short-term
    borrowings


(7.3
)


68.5



(2.6
)Issuance of common shares






25.2



Costs of 2004 rights offering


(1.1
)






Debt issuance costs


(.6
)


(27.8
)


Dividends paid


(6.2
)


(3.3
)


(.8
)Net cash provided (used) by
    financing activities


(20.2
)


20.9



(5.6
)Effect of exchange rate
    fluctuations on cash and cash equivalents


(2.7
)


1.6



8.8Cash flows of discontinued
    operations (revised)Operating activities






(4.1
)


(8.6
)Investing activities






(.1
)


(.2
)Financing activities










(3.1
)Total cash flows of discontinued
    operations






(4.2
)


(11.9
)Decrease in cash and cash
    equivalents


(23.5
)


(23.6
)


(29.5
)Cash and cash equivalents at
    beginning of year


69.2



92.8



122.3Cash and cash equivalents at
    end of year

$
45.7


$
69.2


$
92.8    56




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES
    TO CONSOLIDATED FINANCIAL STATEMENTS
  Summary
    of Significant Accounting Policies
  Use of
    Estimates
    Consolidation
    Foreign
    Currency Translation
  non-U.S. operations
  Revenue
    Recognition
          Advertising
    Costs
   57




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Income
    Taxes
  non-U.S.
  Earnings
    Per Common Share
      Reclassification
    of Financial Statement
    Cash
    and Cash Equivalents
    Cash
    Flows of Discontinued Operations
    Inventory
    Valuation
  first-in, last-in,
  Property,
    Plant and Equipment
   58




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Range ofAsset

Depreciation LifeBuildings (new)


25  45 yearsBuildings (used)


20  30 yearsLand improvements


10  20 yearsBuilding components


5  45 yearsFactory machinery


6  12 yearsVehicles


3  6 yearsOffice furniture and fixtures


5  10 yearsComputers


3  5 yearsPersonal computers


3 years     Goodwill
    Long-Lived
    Assets
    Warranty
    Reserves
    Self-Insurance
    Reserves
   59




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Retirement
    Benefit Plans
  non-U.S.
    Stock-Based
    Compensation
    Pro
    Forma Loss
  2005


2004


2003(In millions, exceptper-share amounts)Net loss as reported

$
(14.0
)

$
(51.8
)

$
(190.9
)Effect on reported loss of
    accounting for stock options at fair value






(1.2
)


(1.1
)Pro forma net loss

$
(14.0
)

$
(53.0
)

$
(192.0
)Loss per common
    share  basic and dilutedAs reported

$
(.42
)

$
(1.73
)

$
(5.21
)Pro forma

$
(.42
)

$
(1.76
)

$
(5.24
)    60




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Derivative
    Financial Instruments
        Change
    in Method of Accounting
  last-in, first-in,
  Recently
    Issued Pronouncements
   61




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Discontinued
    Operations
      Loss
    From Discontinued Operations
  2004


2003(In millions)Sales

$
9.6


$
51.6Operating loss including
    restructuring costs


(1.2
)


(5.1
)Allocated interest expense


(.1
)


(1.3
)Loss from operations(a)

$
(1.3
)

$
(6.4
)     (a)
    
    No income tax benefit could be recorded with respect to the
    losses incurred in 2004 and 2003.      Gain
    (Loss) on Divestiture of Discontinued Operations
  2005


2004


2003(In millions)Sale of Valenite

$
1.0


$
(.4
)

$
.4Sale of Widia and Werkö


.9



.5



.9Sale of round metalcutting tools
    business


(.3
)


(.5
)


(2.2
)Sale of grinding wheels business


.8



.6



1.0Adjustment of reserves for the
    1998 divestiture of the machine tools segment


.1



.6



(.9
)Net gain (loss) on divestitures

$
2.5


$
.8


$
(.8
)  62




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Goodwill
    Impairment Charge
    Restructuring
    Costs
    clean-up
 63




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
       clean-up clean-up
   64




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
                65




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Restructuring
    Costs
  2005


2004


2003(In millions)EOC and Reform integration

$
(.2
)

$
.3


$
1.8Relocation of blow molding
    machinery and mold manufacturing


.9



5.5



4.0Monterey Park closure










.5Downsize Magenta Italy facility










4.0Mahlberg closure


(.1
)


1.3



5.7Third quarter 2003 initiatives






.6



11.1North America plastics machinery
    overhead reductions


.4



1.1



Discontinuation of blow molding
    product lines






1.5



Downsize Germany mold technologies
    facility


.1



2.1



Additional European mold base
    reductions






.6



Consolidation of European sales
    offices


.3







Closure of metalworking fluids
    operation


.2







Total restructuring costs

$
1.6


$
13.0


$
27.1     Restructuring
    Costs
  2005


2004


2003(In millions)Accruals for restructuring costsTermination benefits

$
.4


$
2.5


$
8.7Facility exit costs


.1



.2



.4Total accruals


.5



2.7



9.1Supplemental retirement benefits










3.2Adjustments of assets to
    realizable values and gains and losses on disposal






6.3



4.1Other restructuring costsCosts charged to expense as
    incurredInventory adjustments related to
    product line discontinuation






1.4



3.3Inventory and machinery relocation


.1



1.2



1.5Employee relocation and other move
    costs


.1







1.1Severance and facility exist costs


.8



.8



3.7Other


.4



.5



1.1Reserve adjustments


(.1
)


(.2
)


(1.8
)1.8



12.7



25.3Costs (income) related to the EOC
    and Reform integration


(.2
)


.3



1.8Total restructuring costs

$
1.6


$
13.0


$
27.1  66




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
         Restructuring
    Reserves
  2005Beginning





Usage and


EndingBalance


Additions


Other


Balance(In millions)EOC and Reform integrationTermination benefits

$
1.0


$



$
(.3
)

$
.7Facility exit costs


.3







(.2
)


.11.3







(.5
)


.8Restructuring costsTermination benefits


1.3



.4



(1.3
)


.4Facility exit costs


.2



.1



(.1
)


.21.5



.5



(1.4
)


.6Total reserves related to
    continuing operations

$
2.8


$
.5


$
(1.9
)

$
1.4   2004Beginning





Usage and


EndingBalance


Additions


Other


Balance(In millions)EOC and Reform integrationTermination benefits

$
1.3


$



$
(.3
)

$
1.0Facility exit costs


.3











.31.6







(.3
)


1.3Restructuring costsTermination benefits


4.5



2.5



(5.7
)


1.3Facility exit costs


.4



.2



(.4
)


.24.9



2.7



(6.1
)


1.5Total reserves related to
    continuing operations

$
6.5


$
2.7


$
(6.4
)

$
2.8    67




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Refinancing
    Costs
  5 8
  Acquisitions
      Allocation
    of Acquisition Cost
  2003(In millions)Cash and cash equivalents

$
.4Accounts receivable


1.5Inventories


.3Other current assets


.1Property, plant and equipment


.2Total assets


2.5Current liabilities


1.4Total liabilities


1.4Total acquisition cost

$
1.1    68




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Research
    and Development
    Research
    and Development
  2005


2004


2003(In millions)Research and development

$
19.7


$
19.8


$
17.8   Retirement
    Benefit Plans
    Pension
    Expense
  2005


2004


2003(In millions)Service cost (benefits earned
    during the period)

$
4.7


$
4.2


$
4.5Interest cost on projected benefit
    obligation


33.5



33.9



33.4Expected return on plan assets


(32.9
)


(35.1
)


(38.8
)Supplemental retirement benefits(a)










3.2Amortization of unrecognized prior
    service cost


.7



.8



.8Amortization of unrecognized gains
    and losses


10.4



7.0



3.1Pension expense

$
16.4


$
10.8


$
6.2     (a)
    
    In 2003, the entire amount is included in the line captioned
    Restructuring costs in the Consolidated Statement of
    Operations for that year.    Projected
    Benefit Obligation
  2005


2004(In millions)Balance at beginning of year

$
(557.2
)

$
(538.1
)Service cost


(4.7
)


(4.2
)Interest cost


(33.5
)


(33.9
)Benefits paid


42.9



42.8Actuarial loss


(7.9
)


(6.1
)Changes in discount rates


(18.2
)


(16.6
)Foreign currency translation
    adjustments


2.0



(1.1
)Balance at end of year

$
(576.6
)

$
(557.2
)  69




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Plan
    Assets
  2005


2004(In millions)Balance at beginning of year

$
378.8


$
370.9Actual investment gain


21.3



44.0Benefits and expenses paid


(39.9
)


(40.3
)Contributions


2.4



4.2Balance at end of year

$
362.6


$
378.8     Allocation
    of Plan Assets
  2005


2004Equity securities


71
%


69
%Debt securities


29
%


31
%100
%


100
%          70




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Funded
    Status at Year-End
  2005


2004(In millions)Vested benefit obligation

$
(519.7
)

$
(506.7
)Accumulated benefit obligation

$
(531.2
)

$
(519.0
)Projected benefit obligation

$
(560.1
)

$
(541.1
)Plan assets at fair value


362.6



378.8Deficiency of plan assets in
    relation to projected benefit obligation


(197.5
)


(162.3
)Unrecognized net loss


192.6



166.9Unrecognized prior service cost


2.9



3.6Prepaid (accrued) pension cost

$
(2.0
)

$
8.2     Balance
    Sheet
    Presentation  U.S. Plans
  2005


2004(In millions)Intangible asset

$
2.9


$
3.6Accrued pension cost


(168.5
)


(140.5
)Accumulated other comprehensive
    loss(a)


163.6



145.1$
(2.0
)

$
8.2     (a)
    
    Represents the pretax amount of an after-tax charge to
    accumulated other comprehensive loss of $112.3 million in
    2005 and $93.8 million in 2004.      Status
    at Year-End
  2005


2004(In millions)Vested benefit obligation

$
(12.6
)

$
(12.3
)Accumulated benefit obligation

$
(15.4
)

$
(14.2
)Projected benefit obligation

$
(16.5
)

$
(16.1
)Unrecognized net (gain) loss


1.9



(.4
)Accrued pension cost

$
(14.6
)

$
(16.5
)    71




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Balance
    Sheet Presentation  Germany Plans
  2005


2004(In millions)Accrued pension cost

$
(15.4
)

$
(16.5
)Accumulated other comprehensive
    loss


.8



$
(14.6
)

$
(16.5
)     Actuarial
    Assumptions
  2005


2004


2003Discount rate


5.97
%


6.24
%


6.49
%Expected long-term rate of return
    on plan assets


9.00
%


9.00
%


9.00
%Rate of increase in future
    compensation levels


3.76
%


3.66
%


2.41
%     Actuarial
    Assumptions
  2005


2004Discount rate


5.71
%


5.97
%Rate of increase in future
    compensation levels


3.77
%


3.61
%     Pension
    Benefit Payments
  (In millions)2006

$
37.92007


37.22008


36.72009


36.42010


36.42011-2015


187.0      72




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
       Postretirement
    Health Care Cost
  2005


2004


2003(In millions)Service cost (benefits earned
    during the period)

$
.1


$
.1


$
.1Interest cost on accumulated
    postretirement benefit obligation


1.3



1.4



1.5Amortization of unrecognized gains


(.1
)


(.2
)


(.3
)Postretirement health care cost

$
1.3


$
1.3


$
1.3     Accumulated
    Postretirement Benefit Obligation
  2005


2004(In millions)Balance at beginning of year

$
(22.8
)

$
(23.2
)Service cost


(.1
)


(.1
)Interest cost


(1.3
)


(1.4
)Participant contributions


(5.9
)


(5.7
)Benefits paid


8.6



8.4Actuarial loss


(.2
)


(.4
)Estimated effect of plan amendment


14.5



Changes in discount rates


(.5
)


(.4
)Balance at end of year

$
(7.7
)

$
(22.8
)  73




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Accrued
    Postretirement Health Care Benefits
  2005


2004(In millions)Accumulated postretirement benefit
    obligationRetirees

$
(4.4
)

$
(16.9
)Fully eligible active participants


(1.0
)


(1.6
)Other active participants


(2.3
)


(4.3
)(7.7
)


(22.8
)Unamortized benefit from plan
    amendment


(14.5
)


Unrecognized net gain


(3.6
)


(4.5
)Accrued postretirement health care
    benefits

$
(25.8
)

$
(27.3
)     Actuarial
    Assumptions
  2005


2004


2003Accumulated postretirement benefit
    obligation


5.75
%


6.00
%


6.25
%Postretirement health care cost


6.00
%


6.25
%


6.50
%       Postretirement
    Health Care Benefits
  (In millions)2006

$
.82007


.72008


.72009


.72010


.62011-2015


3.1   Income
    Taxes
  non-U.S. net non-U.S. loss
 74




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  non-U.S. jurisdictions  primarily
         75




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      non-U.S. non-U.S. operations.
       76




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Components
    of Deferred Tax Assets and Liabilities
  2005


2004(In millions)Deferred tax assetsNet operating loss carryforwards

$
109.3


$
111.2Tax credit carryforwards


16.8



14.2Accrued postretirement health care
    benefits


9.3



8.5Inventories, due principally to
    obsolescence reserves and additional costs inventoried for tax
    purposes


4.1



4.8Accrued employee benefits other
    than pensions and retiree health care benefits


1.6



1.7Accrued pension cost


7.6



8.8Accrued warranty cost


1.3



1.2Accrued taxes


1.6



2.1Accounts receivable, due
    principally to allowances for doubtful accounts


1.6



1.7Goodwill


31.4



39.2Deferred pension costs


52.1



41.1Accrued liabilities and other


17.4



11.8Total deferred tax assets


254.1



246.3Less valuation allowances


(168.6
)


(157.1
)Deferred tax assets net of
    valuation allowances


85.5



89.2Deferred tax liabilitiesProperty, plant and equipment, due
    principally to differences in depreciation methods


8.6



8.5Inventories


5.8



9.5Total deferred tax liabilities


14.4



18.0Net deferred tax assets

$
71.1


$
71.2     Loss
    Before Income Taxes
  2005


2004


2003(In millions)United States

$
(23.6
)

$
(59.7
)

$
(96.7
)Non-U.S.


3.3



5.8



(13.7
)$
(20.3
)

$
(53.9
)

$
(110.4
)  77




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   non-U.S. earnings non-U.S. operations non-U.S. operations
  Provision
    (Benefit) for Income Taxes
  2005


2004


2003(In millions)Current provision (benefit)United States

$
(2.2
)

$
(12.5
)

$
(1.8
)State and local


.3



.1



Non-U.S.


(1.2
)


1.1



1.2(3.1
)


(11.3
)


(.6
)Deferred provision (benefit)United States


2.7



2.7



68.7Non-U.S.


(3.4
)


6.0



5.2(.7
)


8.7



73.9$
(3.8
)

$
(2.6
)

$
73.3   Components
    of the Provision (Benefit) for Deferred Income
    Taxes
  2005


2004


2003(In millions)Change in valuation allowances

$
11.5


$
17.3


$
104.6Change in deferred taxes related
    to operating loss and tax credit carryforwards


(.7
)


(17.8
)


(30.5
)Depreciation and amortization


7.9



7.1



6.0Inventories and accounts receivable


(2.9
)


(1.7
)


1.2Accrued pension and other employee
    costs


(9.7
)


(4.0
)


4.7Other


(6.8
)


7.8



(12.1
)$
(.7
)

$
8.7


$
73.9    78




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Reconciliation
    of the U.S. Statutory Rate to the Tax Provision
    Rate
  2005


2004


2003U.S. statutory tax rate


(35.0
)%


(35.0
)%


(35.0
)%Increase (decrease) resulting fromEffect of changes in valuation
    allowances


61.1



37.9



94.7Tax benefit from debt waiver


(37.7
)






Adjustment of tax reserves






(19.5
)


Statutory tax rate changes


3.5



.9



State and local income taxes, net
    of federal benefit


1.4



.2



Foreign dividends






12.4



6.7Additional interest deduction for
    statutory purposes


(7.1
)


(1.6
)


Other


(4.8
)


(.1
)


(18.6
)%


(4.8
)%


66.4
%   non-U.S. subsidiaries
  non-U.S. earnings
    Earnings
    Per Common Share
    Loss
    Applicable to Common Shareholders
  2005


2004


2003(In millions)Net loss

$
(14.0
)

$
(51.8
)

$
(190.9
)Dividends on preferred shares


(6.1
)


(3.2
)


(.2
)Beneficial conversion feature
    related to Series B Preferred Stock(a)






(15.9
)


Loss applicable to common
    shareholders

$
(20.1
)

$
(70.9
)

$
(191.1
)     (a)
    
    Represents a beneficial conversion feature arising from the fact
    that holders of the Series B Preferred  Stock are able to
    acquire common shares of the company at a price that is less
    than their fair value on March 12, 2004 (see
    Shareholders Equity).  Reconciliation
    of Shares
  2005


2004


2003(In thousands)Weighted-average common shares
    outstanding


47,665



40,955



36,660Effect of dilutive stock options
    and restricted shares










Weighted-average common shares
    assuming dilution


47,665



40,955



36,660  79




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Receivables
  non-U.S.
      Inventories
    Goodwill
    and Other Intangible Assets
   80




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Changes
    in Goodwill
  2005MachineryTechnologies


MachineryNorth


Technologies


Mold


IndustrialAmerica


Europe


Technologies


Fluids


Total(In millions)Balance at beginning of year

$
17.6


$
.8


$
58.0


$
10.2


$
86.6Foreign currency translation
    adjustments


.2



(.1
)


(3.0
)






(2.9
)Balance at end of year

$
17.8


$
.7


$
55.0


$
10.2


$
83.7   2004MachineryTechnologies


MachineryNorth


Technologies


Mold


IndustrialAmerica


Europe


Technologies


Fluids


Total(In millions)Balance at beginning of year

$
17.5


$
.7


$
55.4


$
10.2


$
83.8Foreign currency translation
    adjustments


.1



.1



2.6







2.8Balance at end of year

$
17.6


$
.8


$
58.0


$
10.2


$
86.6   Property,
    Plant and Equipment
    Property,
    Plant and Equipment-Net
  2005


2004(In millions)Land

$
9.1


$
11.3Buildings


121.5



132.5Machinery and equipment


208.7



218.2339.3



362.0Less accumulated depreciation


(225.1
)


(233.6
)$
114.2


$
128.4   Other
    Assets
   81




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Other
    Current Assets
  2005


2004(In millions)Deferred income taxes

$
25.3


$
26.2Recoverable from excess liability
    carriers


3.2



4.1Refundable income taxes


3.8



3.5Other


12.0



15.3$
44.3


$
49.1   Other
    Noncurrent Assets
  2005


2004(In millions)Deferred income taxes net of
    valuation allowances

$
60.2


$
63.1Recoverable from excess liability
    carriers


4.2



7.6Intangible assets other than
    goodwill


2.6



5.1Other


37.9



40.3$
104.9


$
116.1   Liabilities
    Accrued
    and Other Current Liabilities
  2005


2004(In millions)Accrued salaries, wages and other
    compensation

$
19.6


$
24.0Taxes payable other than income
    taxes


8.1



9.9Reserves for post-closing
    adjustments on divestitures


2.0



4.9Accrued and deferred income taxes


8.3



13.2Accrued insurance and
    self-insurance reserves


11.3



13.7Other accrued expenses


27.0



31.6$
76.3


$
97.3     Warranty
    Reserves
  2005


2004(In millions)Balance at beginning of year

$
6.5


$
8.1Accruals


3.6



4.2Payments


(3.2
)


(5.6
)Warranty expirations


(1.0
)


(.3
)Foreign currency translation
    adjustments


(.3
)


.1Balance at end of year

$
5.6


$
6.5  82




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Long-Term
    Accrued Liabilities
  2005


2004(In millions)Accrued pensions and other
    compensation

$
39.8


$
39.9Minimum pension liability


148.5



119.8Accrued postretirement health care
    benefits


26.4



28.7Self-insurance reserves(a)


24.0



24.7Accrued and deferred income taxes


10.2



11.4Reserves for post-closing
    adjustments on divestitures


5.6



7.1Other


6.9



6.6$
261.4


$
238.2     (a)
    
    As presented in the above table, self-insurance reserves exclude
    expected recoveries from excess liability carriers and other
    third parties of $7.4 million in 2005 and
    $11.7 million in 2004. These amounts are included in other
    current assets and other noncurrent assets.  Refinancing
    Transactions
  3 8 pay-in-kind
    1 2
   83




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    1 2
  
    purchase 114,990,000 of the 115 million
    aggregate outstanding principal amount of Milacron Capital
    Holdings B.V.s
    75/8%
    Guaranteed Bonds due in April 2005 at the settlement of a tender
    offer therefor;
    terminate and repay $19 million of borrowings outstanding
    under the revolving A facility of the Credit Suisse First Boston
    facility, which included additional amounts borrowed subsequent
    to March 12, 2004. The company also used $17.4 million
    in availability under the asset based facility to replace or
    provide credit support for the outstanding letters of credit
    under the revolving A facility of the Credit Suisse First Boston
    facility;
    repay the $75 million term loan B facility of the
    Credit Suisse First Boston facility; and
    pay transaction expenses.    Short-Term
    Borrowings
    Short-Term
    Borrowings
  2005


2004(In millions)Asset based credit facility due
    2008

$
2.2


$
11.0Borrowings under other lines of
    credit


1.9



.2$
4.1


$
11.2   1 2
   84




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          last-in, first-in,
       85




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    1 2 1 2 1 2
    non-U.S. banks
  non-U.S. banks.
 86




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Long-Term
    Debt
    Long-Term
    Debt
  2005


2004(In millions)111/2% Senior
    Secured Notes due 2011

$
220.6


$
220.1Capital lease obligations


13.4



15.9Other


1.9



5.9235.9



241.9Less current maturities


(2.6
)


(6.0
)$
233.3


$
235.9   1 2
  1 2
  1 2
  1 2 long-term
    1 2
 87




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
         Maturities
    of Long-Term Debt
  (In millions)2006

$
.72007


.72008


.22009


.22010


.1     Capital
    Lease Payments
  (In millions)2006

$
2.72007


2.72008


2.72009


4.22010


1.6After 2011


2.2Total capital lease payments


16.1Less interest component(a)


(2.7
)Capital lease obligations

$
13.4     (a)
    
    Includes $.8 million applicable to 2006. 88




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Rental
    Payments
  (In millions)2006

$
11.02007


8.62008


6.22009


3.42010


.8After 2010


.8     Shareholders
    Equity
      
    an increase in the number of authorized common shares from
    50.0 million to 165.0 million;
    a decrease in the par value of each common share from
    $1.00 per share to $.01 per share;
    the issuance of a new series of Series B Preferred Stock
    that is convertible into common shares; and
    the issuance of contingent warrants, exercisable to purchase
    additional shares of the companys common stock.   89




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      pay-in-kind
     90




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
         91




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
           Shareholders
    Equity  Preferred and Common
    Shares
  2005


2004(In millions, except per-share
    amounts)4% Cumulative Preferred shares
    authorized, issued and outstanding, 60,000 shares at
    $100 par value, redeemable at $105 a share

$
6.0


$
6.06% Series B Convertible
    Preferred Stock authorized, issued and outstanding,
    500,000 shares at $.01 par value






Common shares, $.01 par value
    authorized 165,000,000 shares, issued and outstanding,
    2005: 50,112,490 shares, 2004: 48,559,474 shares


.5



.5       Changes
    in Common Shares Outstanding
  2005


2004


2003Outstanding at beginning of year


48,559,474



34,824,025



33,753,781Net restricted stock activity


1,122,496



760,440



826,013Reissuance of treasury shares for
    employee benefit and incentive programs


430,520



295,434



244,231Conversion of Series A Notes
    to common stock






15,000,000



Conversion of common stock to
    Series B Preferred Stock






(15,000,000
)


Net common shares issued in rights
    offering






12,679,575



Outstanding at end of year


50,112,490



48,559,474



34,824,025  92




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          93




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Comprehensive
    Loss
    Comprehensive
    Loss
  2005


2004


2003(In millions)Net loss

$
(14.0
)

$
(51.8
)

$
(190.9
)Foreign currency translation
    adjustments


(16.8
)


15.9



8.5Minimum pension liability
    adjustments(a)


(19.4
)


(13.0
)


14.6Change in fair value of foreign
    currency exchange contracts






(.2
)


Total comprehensive loss

$
(50.2
)

$
(49.1
)

$
(167.8
)     (a)
    
    In all years presented, includes no income tax expense or
    benefit.    Accumulated
    Other Comprehensive Loss
  2005


2004(In millions)Foreign currency translation
    adjustments

$
(27.0
)

$
(10.2
)Minimum pension liability
    adjustments(a)


(113.2
)


(93.8
)$
(140.2
)

$
(104.0
)     (a)
    
    In both 2005 and 2004, the amount presented is net of a
    U.S. tax benefit of $51.4 million that was recorded in
    2002.  Contingencies
    and/or
 94




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Foreign
    Exchange Contracts
    Stock-Based
    Compensation
        Stock
    Option Activity
  Weighted-AverageExerciseShares


PriceOutstanding at year-end 2002


4,617,950


$
20.03Granted


18,000



5.43Cancelled


(314,100
)


18.65Waived


(465,900
)


22.75Outstanding at year-end 2003


3,855,950



19.75Granted


14,000



4.30Cancelled


(345,050
)


22.97Outstanding at year-end 2004


3,524,900



19.37Cancelled


(344,200
)


20.79Outstanding at year-end 2005


3,180,700


$
19.22    95




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Exercisable
    Stock Options at Year-End
  StockOptions2003


2,723,0882004


2,887,2882005


2,982,856   Shares Available
    for Future Grant at Year-End
  Shares2003


276,7372004


7,127,1802005


6,535,974     Components
    of Outstanding Stock Options
  Average


Weighted-Remaining


AverageNumber


Contract


ExerciseRange of Exercise
    Prices

Outstanding


Life


Price$ 4.30-19.56


1,359,075



2.5


$
13.2320.09-27.91


1,821,625



2.2



23.683,180,700   Components
    of Exercisable Stock Options
  Weighted-AverageNumber


ExerciseRange of Exercise
    Prices

Exercisable


Price$ 4.30-19.56


1,161,231


$
13.3720.09-27.91


1,821,625



23.682,982,856     Fair
    Value Assumptions
  2004


2003Dividend yield


0.0
%


1.6
%Expected volatility


74
%


54
%Risk free interest rate at grant
    date


4.00
%


2.97
%Expected life in years


5



5  96




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Restricted
    Stock Activity
  2005


2004


2003Restricted stock granted


1,109,500



1,192,572



924,300Weighted-average market value on
    date of grant

$
3.12


$
4.25


$
2.74               Deferred
    Shares
  2005


2004


2003Grants


255,310



218,700



199,400Cancellations






63,032



Settlements at vesting date


94,942



1,017



Unvested awards at year end


529,621



369,253



214,602  97




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
       Organization
          Total
    Sales by Segment
  2005


2004


2003(In millions)Plastics technologiesMachinery technologies-North
    America

$
376.5


$
334.4


$
321.2Machinery technologies-Europe


149.5



167.0



151.0Mold technologies


173.4



167.1



168.7Eliminations


(2.7
)


(3.3
)


(5.4
)Total plastics technologies


696.7



665.2



635.5Industrial fluids


112.2



109.0



104.2Total sales

$
808.9


$
774.2


$
739.7  98




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Customer
    Sales by Segment
  2005


2004


2003(In millions)Plastics technologiesMachinery technologies-North
    America

$
376.0


$
333.9


$
319.6Machinery technologies-Europe


147.3



164.2



147.2Mold technologies


173.4



167.1



168.7Total plastics technologies


696.7



665.2



635.5Industrial fluids


112.2



109.0



104.2Total sales

$
808.9


$
774.2


$
739.7   Operating
    Information by Segment
  2005


2004


2003(In millions)Operating profit (loss)Plastics technologiesMachinery technologies-North
    America

$
17.3


$
16.0


$
8.1Machinery technologies-Europe


(5.0
)


1.9



(1.4
)Mold technologies


3.9



4.3



1.8Total plastics technologies


16.2



22.2



8.5Industrial fluids


8.7



9.2



15.7Goodwill impairment charge(a)










(65.6
)Restructuring costs(b)


(1.6
)


(13.0
)


(27.1
)Refinancing costs






(21.4
)


(1.8
)Corporate expenses


(12.8
)


(11.9
)


(14.3
)Other unallocated expenses(c)


(.5
)


(1.7
)


(2.8
)Operating earnings (loss)


10.0



(16.6
)


(87.4
)Interest expense-net


(30.3
)


(37.3
)


(23.0
)Loss before income taxes


(20.3
)

$
(53.9
)

$
(110.4
)Segment assets(d)Plastics technologiesMachinery technologies-North
    America

$
193.7


$
183.9


$
181.3Machinery technologies-Europe


97.5



116.4



110.2Mold technologies


140.0



152.9



156.4Other


(1.1
)


(.9
)


.7Total plastics technologies


430.1



452.3



448.6Industrial fluids


44.9



49.2



50.2Cash and cash equivalents


45.7



69.2



92.8Receivables sold










(33.0
)Deferred income taxes


85.5



89.2



98.8Assets of discontinued operations










7.2Unallocated corporate and other(e)


65.4



78.0



68.8Total assets

$
671.6


$
737.9


$
733.4 99




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  2005


2004


2003(In millions)Capital expendituresPlastics technologiesMachinery technologies-North
    America

$
5.8


$
4.0


$
1.7Machinery technologies-Europe


2.9



1.6



1.1Mold technologies


2.3



1.7



1.6Total plastics technologies


11.0



7.3



4.4Industrial fluids


1.0



1.4



2.1Unallocated corporate


.7



.1



Total capital expenditures

$
12.7


$
8.8


$
6.5Depreciation and amortizationPlastics technologiesMachinery technologies-North
    America

$
6.4


$
7.3


$
8.7Machinery technologies-Europe


4.2



4.2



3.9Mold technologies


6.0



6.7



6.7Total plastics technologies


16.6



18.2



19.3Industrial fluids


1.7



1.8



2.0Unallocated corporate


.1



.3



.4Total depreciation and amortization

$
18.4


$
20.3


$
21.7     (a)
    
    Relates to the mold technologies segment.(b)
    
    In 2005, $1.3 million relates to machinery
    technologies  North America, $.2 million
    relates to machinery technologies  Europe,
    $(.1) million relates to mold technologies and
    $.2 million relates to industrial fluids. In 2004,
    $8.0 million relates to machinery
    technologies  North America, $.2 million
    relates to machinery technologies  Europe and
    $4.8 million relates to mold technologies. In 2003,
    $7.7 million relates to machinery
    technologies  North America, $6.5 million
    relates to machinery technologies  Europe,
    $12.6 million relates to mold technologies and
    $.3 million relates to corporate expenses. In 2004 and
    2003, $1.4 and $3.3 million, respectively, relates to
    product line discontinuation and is therefore included in cost
    of products sold in the Consolidated Statements of Operations
    for those years.(c)
    
    Represents financing costs, including those related to the sale
    of accounts receivable prior to March 12, 2004.(d)
    
    Segment assets consist principally of accounts receivable,
    inventories, goodwill and property, plant and equipment which
    are considered controllable assets for management reporting
    purposes.(e)
    
    Consists principally of corporate assets, nonconsolidated
    investments, certain intangible assets, expected recoveries from
    excess insurance carriers, cash surrender value of company-owned
    life insurance, prepaid expenses and deferred charges. 100




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Geographic
    Information
  2005


2004


2003(In millions)Sales(a)United States

$
504.3


$
466.6


$
450.8Non-U.S. operationsGermany


101.7



104.5



102.3Other Western Europe


128.4



134.2



121.9Asia


39.6



36.4



31.0Other


34.9



32.5



33.7Total sales

$
808.9


$
774.2


$
739.7Noncurrent assetsUnited States

$
93.5


$
101.8


$
103.3Non-U.S. operationsGermany


34.3



45.4



46.7Other Western Europe


17.8



18.7



21.5Asia


7.0



6.6



5.7Other


1.4



1.7



4.9154.0



174.2



182.1Investments not consolidated


2.3



2.0



1.6Goodwill


83.7



86.6



83.8Other intangible assets


2.6



5.1



6.5Deferred income taxes net of
    valuation allowances


60.2



63.2



70.9Total noncurrent assets

$
302.8


$
331.1


$
344.9     (a)
    
    Sales are attributed to specific countries or geographic areas
    based on the origin of the shipment.    non-U.S. operations
  Condensed
    Consolidating Financial Information
  1 2 This information is
    provided pursuant to
    Rule 3-10
    of
    Regulation S-X
    in lieu of separate financial statements of each subsidiary
    guaranteeing the Senior Secured Notes.
 101




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Consolidating
    Statement of Operations
  Year Ended December 31,
    2005Guarantor


Nonguarantor


Eliminations &Parent


Subsidiaries


Subsidiaries


Other


Milacron Inc.(In millions)Sales

$



$
541.0


$
291.2


$
(23.3
)

$
808.9Cost of products sold


6.9



442.4



237.1



(23.3
)


663.1Manufacturing margins


(6.9
)


98.6



54.1







145.8Other costs and expensesSelling and administrative


26.4



51.5



55.9







133.8Restructuring costs






1.3



.3







1.6Other expense  net


.4



(1.3
)


1.3







.4Total other costs and expenses


26.8



51.5



57.5







135.8Operating earnings (loss)


(33.7
)


47.1



(3.4
)






10.0Other non-operating expense (income)Intercompany management fees


(12.6
)


12.6











Intercompany interest


(28.5
)


30.2



(1.7
)






Equity in (earnings) losses of
    subsidiaries


(8.9
)


(52.6
)






61.5



Total other non-operating expense
    (income)


(50.0
)


(9.8
)


(1.7
)


61.5



Earnings (loss) from continuing
    operations before interest and income taxes


16.3



56.9



(1.7
)


(61.5
)


10.0Interest
    expense  net


(30.7
)


.9



(.5
)






(30.3
)Earnings (loss) from continuing
    operations before income taxes


(14.4
)


57.8



(2.2
)


(61.5
)


(20.3
)Provision (benefit) for income taxes


2.1



1.2



(7.1
)






(3.8
)Earnings (loss) from continuing
    operations


(16.5
)


56.6



4.9



(61.5
)


(16.5
)Discontinued operations net of
    income taxesNet gain on divestitures


2.5















2.5Net earnings (loss)

$
(14.0
)

$
56.6


$
4.9


$
(61.5
)

$
(14.0
)  102




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Consolidating
    Statement of Operations
  Year Ended December 31,
    2004Guarantor


Nonguarantor


Eliminations &Parent


Subsidiaries


Subsidiaries


Other


Milacron Inc.(In millions)Sales

$



$
498.0


$
300.7


$
(24.5
)

$
774.2Cost of products sold


5.3



408.1



237.7



(24.5
)


626.6Cost of products sold related to
    restructuring






1.4











1.4Total cost of products sold


5.3



409.5



237.7



(24.5
)


628.0Manufacturing margins


(5.3
)


88.5



63.0







146.2Other costs and expensesSelling and administrative


17.6



52.0



57.3







126.9Restructuring costs


.1



6.5



5.0







11.6Refinancing costs


15.8



5.6











21.4Other expense  net


2.0



.2



.7







2.9Total other costs and expenses


35.5



64.3



63.0







162.8Operating earnings (loss)


(40.8
)


24.2











(16.6
)Other non-operating expense
    (income) Intercompany management fees


(10.9
)


10.9











Intercompany interest


(15.4
)


16.3



(.9
)






Equity in (earnings) losses of
    subsidiaries


14.8



(4.1
)






(10.7
)


Other intercompany transactions


(1.2
)


1.1



.1







Total other non-operating expense
    (income)


(12.7
)


24.2



(.8
)


(10.7
)


Earnings (loss) from continuing
    operations before interest and income taxes


(28.1
)






.8



10.7



(16.6
)Interest
    expense  net


(32.3
)


(4.4
)


(.6
)






(37.3
)Earnings (loss) from continuing
    operations before income taxes


(60.4
)


(4.4
)


.2



10.7



(53.9
)Provision (benefit) for income
    taxes


(7.8
)


.8



4.4







(2.6
)Earnings (loss) from continuing
    operations


(52.6
)


(5.2
)


(4.2
)


10.7



(51.3
)Discontinued operations net of
    income taxesLoss from operations






(1.3
)










(1.3
)Net gain on divestitures


.8















.8Total discontinued operations


.8



(1.3
)










(.5
)Net earnings (loss)

$
(51.8
)

$
(6.5
)

$
(4.2
)

$
10.7


$
(51.8
)  103




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Consolidating
    Statement of Operations
  Year Ended December 31,
    2003Guarantor


Nonguarantor


Eliminations &Parent


Subsidiaries


Subsidiaries


Other


Milacron Inc.(In millions)Sales

$



$
482.7


$
275.8


$
(18.8
)

$
739.7Cost of products sold


(.9
)


405.4



218.1



(18.8
)


603.8Cost of products sold related to
    restructuring










3.3







3.3Total cost of products sold


(.9
)


405.4



221.4



(18.8
)


607.1Manufacturing margins


.9



77.3



54.4







132.6Other costs and expensesSelling and administrative


14.5



58.1



56.4







129.0Goodwill impairment charge






65.6











65.6Restructuring costs


.7



8.8



14.3







23.8Refinancing costs


1.8















1.8Other expense
    (income)  net


1.6



(2.1
)


.3







(.2
)Total other costs and expenses


18.6



130.4



71.0







220.0Operating loss


(17.7
)


(53.1
)


(16.6
)






(87.4
)Other non-operating expense
    (income) Intercompany management fees


(11.9
)


11.9











Intercompany interest


(5.3
)


6.1



(.8
)






Equity in (earnings) losses of
    subsidiaries


107.9



(25.6
)






(82.3
)


Total other non-operating expense
    (income)


90.7



(7.6
)


(.8
)


(82.3
)


Earnings (loss) from continuing
    operations before interest and income taxes


(108.4
)


(45.5
)


(15.8
)


82.3



(87.4
)Interest
    expense  net


(13.4
)


(9.2
)


(.4
)






(23.0
)Earnings (loss) from continuing
    operations before income taxes


(121.8
)


(54.7
)


(16.2
)


82.3



(110.4
)Provision (benefit) for income
    taxes


68.3



(.9
)


5.9







73.3Earnings (loss) from continuing
    operations


(190.1
)


(53.8
)


(22.1
)


82.3



(183.7
)Discontinued operations net of
    income taxesLoss from operations






(6.4
)










(6.4
)Net loss on divestitures


(.8
)














(.8
)Total discontinued operations


(.8
)


(6.4
)










(7.2
)Net earnings (loss)

$
(190.9
)

$
(60.2
)

$
(22.1
)

$
82.3


$
(190.9
)  104




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Consolidating
    Balance Sheet
  December 31, 2005Guarantor


Nonguarantor


Eliminations &Parent


Subsidiaries


Subsidiaries


Other


Milacron Inc.(In millions)ASSETSCurrent assetsCash and cash equivalents

$
(.6
)

$
10.8


$
35.5


$



$
45.7Notes and accounts receivable
    (excluding intercompany receivables)


.5



65.0



52.2







117.7Inventories


(.2
)


100.5



60.8







161.1Other current assets


13.0



12.5



18.8







44.3Intercompany receivables (payables)


(354.8
)


241.8



115.3



(2.3
)


Total current assets


(342.1
)


430.6



282.6



(2.3
)


368.8Property, plant and
    equipment  net


1.3



55.9



57.0







114.2Goodwill






53.0



30.7







83.7Investment in subsidiaries


298.1



226.6



(15.8
)


(508.9
)


Intercompany
    advances  net


470.0



(503.0
)


33.0







Other noncurrent assets


33.8



52.2



18.9







104.9Total assets

$
461.1


$
315.3


$
406.4


$
(511.2
)

$
671.6LIABILITIES AND
    SHAREHOLDERS EQUITY (DEFICIT)Current liabilitiesShort-term borrowings

$
2.2


$



$
1.9


$



$
4.1Long-term debt and capital lease
    obligations due within one year


1.1







1.5







2.6Trade accounts payable


6.1



40.6



29.7







76.4Advance billings and deposits






16.1



6.5







22.6Accrued and other current
    liabilities


22.0



23.9



30.4







76.3Total current liabilities


31.4



80.6



70.0







182.0Long-term accrued liabilities


206.9



4.2



50.3







261.4Long-term debt


227.9







5.4







233.3Total liabilities


466.2



84.8



125.7







676.7Commitments and contingencies


















Shareholders equity (deficit)4% Cumulative Preferred shares


6.0















6.06% Series B Convertible
    Preferred Stock


112.9















112.9Common shares, $.01 par value


.5



25.4



12.8



(38.2
)


.5Capital in excess of par value


348.0



316.4



80.3



(396.7
)


348.0Contingent warrants


.5















.5Reinvested earnings (accumulated
    deficit)


(332.8
)


(103.1
)


185.2



(82.1
)


(332.8
)Other comprehensive income
    (accumulated other comprehensive loss)


(140.2
)


(8.2
)


2.4



5.8



(140.2
)Total shareholders equity
    (deficit)


(5.1
)


230.5



280.7



(511.2
)


(5.1
)Total liabilities and
    shareholders equity (deficit)

$
461.1


$
315.3


$
406.4


$
(511.2
)

$
671.6  105




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Consolidating
    Balance Sheet
  December 31, 2004Guarantor


Nonguarantor


Eliminations &Parent


Subsidiaries


Subsidiaries


Other


Milacron Inc.(In millions)ASSETSCurrent assetsCash and cash equivalents

$
23.0


$
7.9


$
38.3


$



$
69.2Notes and accounts receivable
    (excluding intercompany receivables)


1.3



75.7



57.6







134.6Inventories


(.2
)


90.2



63.9







153.9Other current assets


12.7



16.6



19.8







49.1Intercompany receivables (payables)


(331.7
)


218.9



115.1



(2.3
)


Total current assets


(294.9
)


409.3



294.7



(2.3
)


406.8Property, plant and
    equipment  net


1.1



58.9



68.4







128.4Goodwill






52.7



33.9







86.6Investment in subsidiaries


301.0



173.8



(15.8
)


(459.0
)


Intercompany
    advances  net


461.6



(499.3
)


37.7







Other noncurrent assets


37.8



59.7



18.6







116.1Total assets

$
506.6


$
255.1


$
437.5


$
(461.3
)

$
737.9LIABILITIES AND
    SHAREHOLDERS EQUITY (DEFICIT)Current liabilitiesShort-term borrowings

$
11.0


$



$
.2


$



$
11.2Long-term debt and capital lease
    obligations due within one year


1.0







5.0







6.0Trade accounts payable


6.8



39.2



34.3







80.3Advance billings and deposits






12.5



6.1







18.6Accrued and other current
    liabilities


29.4



26.9



41.0







97.3Total current liabilities


48.2



78.6



86.6







213.4Long-term accrued liabilities


179.7



7.7



50.8







238.2Long-term debt


228.3







7.6







235.9Total liabilities


456.2



86.3



145.0







687.5Commitments and contingencies


















Shareholders equity (deficit)4% Cumulative Preferred shares


6.0















6.06% Series B Convertible
    Preferred Stock


112.9















112.9Common shares, $.01 par value


.5



25.4



12.8



(38.2
)


.5Capital in excess of par value


347.2



316.4



78.7



(395.1
)


347.2Contingent warrants


.5















.5Reinvested earnings (accumulated
    deficit)


(312.7
)


(146.2
)


180.3



(34.1
)


(312.7
)Other comprehensive income
    (accumulated other comprehensive loss)


(104.0
)


(26.8
)


20.7



6.1



(104.0
)Total shareholders equity
    (deficit)


50.4



168.8



292.5



(461.3
)


50.4Total liabilities and
    shareholders equity (deficit)

$
506.6


$
255.1


$
437.5


$
(461.3
)

$
737.9  106




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Consolidating
    Statement of Cash Flows
  Year Ended December 31,
    2005Guarantor


Nonguarantor


Eliminations &Parent


Subsidiaries


Subsidiaries


Other


Milacron Inc.(in millions)Increase (decrease) in cash and
    cash equivalentsOperating activities cash
    flowsNet earnings (loss)

$
(14.0
)

$
56.6


$
4.9


$
(61.5
)

$
(14.0
)Operating activities providing
    (using) cashNet gain on divestiture


(2.5
)














(2.5
)Depreciation and amortization


.1



11.0



7.3







18.4Restructuring costs






1.3



.3







1.6Equity in (earnings) losses of
    subsidiaries


4.7



(52.6
)






47.9



Distributions from equity
    subsidiaries






(13.6
)






13.6



Deferred income taxes


2.7







(3.4
)






(.7
)Working capital changesNotes and accounts receivable


.3



10.0



(.3
)






10.0Inventories






(10.2
)


(4.1
)






(14.3
)Other current assets


1.9



.7



.5







3.1Trade accounts payable


1.0



1.4



(1.3
)






1.1Other current liabilities


(9.5
)


6.6



(5.3
)






(8.2
)Decrease in other noncurrent assets


3.2



.9



2.9







7.0Increase (decrease) in long-term
    accrued liabilities


9.5



(1.2
)


(1.3
)






7.0Other  net


1.3



(2.0
)


1.4







.7Net cash provided (used) by
    operating activities


(1.3
)


8.9



1.6







9.2Investing activities cash
    flowsCapital expenditures


(.5
)


(7.3
)


(4.9
)






(12.7
)Net disposals of plant, property
    and equipment


.3



.2



2.1







2.6Divestitures


.3















.3Net cash provided (used) by
    investing activities


.1



(7.1
)


(2.8
)






(9.8
)Financing activities cash
    flowsRepayments of long-term debt


(.5
)






(4.5
)






(5.0
)Increase (decrease) in short-term
    borrowings


(8.8
)






1.5







(7.3
)Debt issuance costs


(.6
)














(.6
)Costs of 2004 rights offering


(1.1
)














(1.1
)Dividends paid


(6.2
)














(6.2
)Net cash used by financing
    activities


(17.2
)






(3.0
)






(20.2
)Intercompany receivables and
    payables


23.2



(25.0
)


1.8







Intercompany advances


(28.4
)


25.8



2.6







Effect of exchange rate
    fluctuations on cash and cash equivalents






.3



(3.0
)






(2.7
)Increase (decrease) in cash and
    cash equivalents


(23.6
)


2.9



(2.8
)






(23.5
)Cash and cash equivalents at
    beginning of year


23.0



7.9



38.3







69.2Cash and cash equivalents at end
    of year

$
(.6
)

$
10.8


$
35.5


$



$
45.7  107




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Consolidating
    Statement of Cash Flows
  Year Ended December 31,
    2004Guarantor


Nonguarantor


Eliminations &Parent


Subsidiaries


Subsidiaries


Other


Milacron Inc.(In millions)Increase (decrease) in cash and
    cash equivalentsOperating activities cash
    flowsNet earnings (loss)

$
(51.8
)

$
(6.5
)

$
(4.2
)

$
10.7


$
(51.8
)Operating activities providing
    (using) cashLoss from discontinued operations






1.3











1.3Net (gain) loss on divestiture


(.8
)














(.8
)Depreciation and amortization


.2



12.6



7.5







20.3Refinancing costs


15.8



5.6











21.4Restructuring costs


.1



7.9



5.0







13.0Equity in (earnings) losses of
    subsidiaries


26.8



11.6







(38.4
)


Distributions from equity
    subsidiaries






(12.0
)


(15.7
)


27.7



Deferred income taxes


2.7







6.0







8.7Working capital changesNotes and accounts receivable


.6



(40.1
)


3.4







(36.1
)Inventories


1.1



(2.7
)


.5







(1.1
)Other current assets


4.7



(3.3
)


1.6







3.0Trade accounts payable


3.1



7.2



(1.0
)






9.3Other current liabilities


(13.2
)


(4.8
)


(12.4
)






(30.4
)Decrease in other noncurrent assets


2.3







.7







3.0Increase (decrease) in long-term
    accrued liabilities


(2.9
)


(.8
)


1.8







(1.9
)Other  net


(.5
)






.9







.4Net cash provided (used) by
    operating activities


(11.8
)


(24.0
)


(5.9
)






(41.7
)Investing activities cash
    flowsCapital expenditures






(4.6
)


(4.2
)






(8.8
)Net disposals of plant, property
    and equipment






.3



.3







.6Divestitures


8.0















8.0Net cash provided (used) by
    investing activities


8.0



(4.3
)


(3.9
)






(.2
)Financing activities cash
    flowsIssuance of long-term debt


219.8















219.8Repayments of long-term debt


(115.7
)


(144.7
)


(1.1
)






(261.5
)Increase (decrease) in short-term
    borrowings


69.0







(.5
)






68.5Issuance of common shares


25.2















25.2Debt issuance costs


(27.8
)














(27.8
)Dividends paid


(3.3
)














(3.3
)Net cash provided (used) by
    financing activities


167.2



(144.7
)


(1.6
)






20.9Intercompany receivables and
    payables


(8.1
)


6.3



1.8







Intercompany advances


(159.0
)


164.3



(5.3
)






Effect of exchange rate
    fluctuations on cash and cash equivalents






.2



1.4







1.6Cash flows of discontinued
    operations (revised)Operating activities






(4.1
)










(4.1
)Investing activities






(.1
)










(.1
)Total cash flows of discontinued
    operations






(4.2
)










(4.2
)Decrease in cash and cash
    equivalents


(3.7
)


(6.4
)


(13.5
)






(23.6
)Cash and cash equivalents at
    beginning of year


26.7



14.3



51.8







92.8Cash and cash equivalents at end
    of year

$
23.0


$
7.9


$
38.3


$



$
69.2  108




---



##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Consolidating
    Statement of Cash Flows
  Year Ended December 31,
    2003Guarantor


Nonguarantor


Eliminations &Parent


Subsidiaries


Subsidiaries


Other


Milacron Inc.(In millions)Increase (decrease) in cash and
    cash equivalentsOperating activities cash
    flowsNet loss

$
(190.9
)

$
(60.2
)

$
(22.1
)

$
82.3


$
(190.9
)Operating activities providing
    (using) cashLoss from discontinued operations






6.4











6.4Net loss on divestitures


.8















.8Depreciation and amortization


.4



13.8



7.5







21.7Refinancing costs


1.8















1.8Restructuring costs


.7



8.8



17.6







27.1Equity in (earnings) losses of
    subsidiaries


119.8



(4.9
)






(114.9
)


Distributions from equity
    subsidiaries






(11.9
)


(20.7
)


32.6



Goodwill impairment charge






65.6











65.6Deferred income taxes


71.2



(2.5
)


5.2







73.9Working capital changesNotes and accounts receivable


(.5
)


2.9



4.2







6.6Inventories






13.4



8.9







22.3Other current assets


9.0



2.8



2.1







13.9Trade accounts payable


.4



(7.3
)


.8







(6.1
)Other current liabilities


(.5
)


(30.9
)


.1







(31.3
)Decrease (increase) in other
    noncurrent assets


(3.0
)


1.6



.8







(.6
)Increase (decrease) in long-term
    accrued liabilities


.3



(.8
)


(2.2
)






(2.7
)Other  net


7.7



(3.5
)


(2.7
)






1.5Net cash provided (used) by
    operating activities


17.2



(6.7
)


(.5
)






10.0Investing activities cash
    flowsCapital expenditures






(4.5
)


(2.0
)






(6.5
)Net disposals of plant, property
    and equipment


.5



1.7



.3







2.5Divestitures


(20.3
)














(20.3
)Acquisitions






(2.9
)


(3.6
)






(6.5
)Net cash used by investing
    activities


(19.8
)


(5.7
)


(5.3
)






(30.8
)Financing activities cash
    flowsRepayments of long-term debt


(.9
)






(1.3
)






(2.2
)Decrease in short-term borrowings










(2.6
)






(2.6
)Dividends paid


(.8
)














(.8
)Net cash used by financing
    activities


(1.7
)






(3.9
)






(5.6
)Intercompany receivables and
    payables


14.3



32.9



(47.2
)






Intercompany advances


(4.7
)


(2.1
)


6.8







Effect of exchange rate
    fluctuations on cash and cash equivalents






.4



8.4







8.8Cash flows of discontinued
    operations (revised)Operating activities






(8.6
)










(8.6
)Investing activities






(.2
)










(.2
)Financing activities






(3.1
)










(3.1
)Total cash flows of discontinued
    operations






(11.9
)










(11.9
)Increase (decrease) in cash and
    cash equivalents


5.3



6.9



(41.7
)






(29.5
)Cash and cash equivalents at
    beginning of year


21.4



7.4



93.5







122.3Cash and cash equivalents at end
    of year

$
26.7


$
14.3


$
51.8


$



$
92.8  109




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##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM             Ernst &
    Young LLP
    110




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##### Table of Contents



Operating
    Results by Quarter (Unaudited)
  2005Qtr 1


Qtr 2


Qtr 3


Qtr 4(In millions, except per-share
    amounts)Sales

$
192.3


$
208.8


$
190.7


$
217.1Manufacturing margins


32.2



37.8



33.4



42.4Percent of sales


16.7
%


18.1
%


17.5
%


19.5
%Earnings (loss) from continuing
    operations(a)(b)


(9.1
)


(4.4
)


(7.6
)


4.6Per common share Basic


(.22
)


(.12
)


(.20
)


.06Diluted


(.22
)


(.12
)


(.20
)


.04Discontinued operations






.6



.7



1.2Per common share Basic






.01



.02



.03Diluted






.01



.02



.01Net earnings (loss)(b)


(9.1
)


(3.8
)


(6.9
)


5.8Per common share Basic


(.22
)


(.11
)


(.18
)


.09Diluted


(.22
)


(.11
)


(.18
)


.05   2004Qtr 1


Qtr 2


Qtr 3


Qtr 4Sales

$
188.9


$
191.7


$
180.5


$
213.1Manufacturing margins


32.8



35.5



34.2



43.7Percent of sales


17.4
%


18.5
%


18.9
%


20.5
%Loss from continuing operations(c)


(16.0
)


(27.9
)


(5.5
)


(1.9
)Per common
    share  
    basic and diluted(d)(e)


(.43
)


(.99
)


(.18
)


(.03
)Discontinued operations


(.6
)


.1







Per common
    share  
    basic and diluted(d)


(.02
)










Net loss


(16.6
)


(27.8
)


(5.5
)


(1.9
)Per common
    share  
    basic and diluted(d)(e)


(.45
)


(.99
)


(.18
)


(.03
)     (a)
    
    Includes restructuring costs of $.4 million in quarter 1
    (with no tax benefit), $.3 million in quarter 2 (with no
    tax benefit), $.1 million in quarter 3 (with no tax
    benefit) and $.8 million in quarter 4 ($.7 after tax).(b)
    
    In the fourth quarter of 2005, includes an income tax benefit of
    $7.6 million that resulted from a waiver of intercompany
    notes receivable by the companys Dutch subsidiary.
    Including this amount, the net benefit for income taxes for the
    fourth quarter was $5.6 million.(c)
    
    Includes restructuring costs of $1.1 million in
    quarter 1, $1.7 million in quarter 2,
    $2.3 million in quarter 3 and $7.9 million in
    quarter 4, in all cases with no tax benefit.(d)
    
    As discussed more fully in the notes to the Consolidated
    Financial Statements that are included elsewhere herein, the
    numbers of shares used to compute earnings (loss) per common
    share data for all periods prior to the fourth quarter of 2004
    include the effect of a bonus element inherent in a
    rights offering that was completed in that quarter.(e)
    
    As discussed more fully in the notes to the Consolidated
    Financial Statements that are included elsewhere herein, the
    Series B Preferred Stock that was issued in the second
    quarter of 2004 includes a beneficial conversion feature arising
    from the fact that the holders thereof are able to acquire
    common shares of the company at an effective conversion price
    that is less than their fair value as of March 12, 2004.
    The beneficial conversion feature was initially assigned a value
    of approximately $18.0 million in the second quarter. This
    amount has been added to the loss from continuing operations and
    net loss for the second quarter in calculating the related loss
    per common share amounts. The value of the beneficial conversion
    feature was subsequently adjusted to $15.9 million in the
    fourth quarter based on an independent appraisal of contingent
    warrants that were issued to the holders of the Series B
    Preferred Stock. The $2.1 million reduction in value has
    been applied to reduce the loss amounts for the fourth quarter
    of 2004 in calculating the applicable per-share amounts. 111




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##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  Disclosure
    Controls and Procedures
  Rule 13a-15(b)
  Internal
    Control Over Financial Reporting
  Rule 13a-15(f) 15d-15(f)
    
    pertain to the maintenance of records that, in reasonable
    detail, accurately and fairly reflect the transactions and
    dispositions of the assets of the issuer;
    provide reasonable assurance that transactions are recorded as
    necessary to permit preparation of financial statements in
    accordance with generally accepted accounting principles, and
    that receipts and expenditures of the company are being made
    only in accordance with authorizations of management and
    directors of the company; and
    provide reasonable assurance regarding prevention or timely
    detection of unauthorized acquisition, use or disposition of the
    companys assets that could have a material effect on the
    financial statements.        Changes
    in Internal Control Over Financial Reporting
   112




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##### Table of Contents



Report of
    Independent Registered Public Accounting Firm
                 Ernst &
    Young LLP
    113




---



##### Table of Contents



Item 9B.
    Other
    Information   PART III  Item 10.
    Directors
    and Executive Officers of the Registrant  Form 10-K
  Audit
    Committee Financial Literacy and Financial Experts
        Code of
    Ethics
       45206-2425
  Other
    Corporate Governance Matters
       45206-2425
          114




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##### Table of Contents



Form 10-K
  Item 11.
    Executive
    Compensation    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters    Securities
    Authorized for Issuance Under Equity Compensation
    Plans
  Equity
    Compensation Plan Information
  Number of SecuritiesRemaining Available forNumber of Securities to be





Future Issuance Under EquityIssued Upon Exercise of


Weighted-Average Exercise


Compensation Plans [c]Outstanding Options,


Price of Outstanding Options,


(Excluding SecuritiesPlan Category

Warrants and Rights
    [a]


Warrants and Rights
    [b]


Reflected in
    Column[a])Equity compensation plans not
    approved by security holders










Equity compensation plans approved
    by security holders


3,180,700


$
19.22



6,535,974Total


3,180,700


$
19.22



6,535,974   Item 13.
    Certain
    Relationships and Related Transactions   115




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##### Table of Contents



Item 14.
    Principal
    Accountant Fees and Services    Principal
    Accountant Fees and Services
  2005


2004Audit Fees(a)

$
3,790,000


$
5,347,000Audit-related fees(b)






14,000Tax fees(c)


450,000



336,000All other fees(d)






6,000Total

$
4,240,000


$
5,703,000     (a)
    
    For services related to the annual audit of the companys
    consolidated financial statements (including statutory audits of
    subsidiaries or affiliates of the company), quarterly reviews of
    Forms 10-Q,
    issuance of the attestation on the companys internal
    controls over financial reporting, issuance of consents,
    issuance of comfort letters and assistance with review of
    documents filed with the Securities and Exchange Commission.(b)
    
    For services related to the companys March 2004
    refinancing of debt.(c)
    
    For services related to tax compliance, tax return preparation
    and tax planning.(d)
    
    For miscellaneous performed services in 2004.   PART IV  Item 15.
    Exhibits
    and Financial Statement Schedules  Item 15(a)
    (1) & (2)  List of Financial
    Statements and Financial Statement Schedules.
    PageConsolidated
    Statements of Operations  2005, 2004 and 2003


53Consolidated
    Balance Sheets  2005 and 2004


54Consolidated
    Statements of Comprehensive Income and Shareholders Equity
    (Deficit)  2005, 2004 and 2003


55Consolidated
    Statements of Cash Flows  2005, 2004 and 2003


56Notes to
    Consolidated Financial Statements


57Report of
    Independent Registered Public Accounting Firm


110Supplementary Financial Information


111     Schedule II    Valuation
    and Qualifying Accounts and Reserves


125  116




---



##### Table of Contents



Item 15(a)(3)  List
    of Exhibits  Exhibit No.



Page2
.

Plan of Acquisition,
    Reorganization, Arrangement, Liquidation, or
    Succession  not applicable3
.

Articles of Incorporation and
    By-Laws3
.1

Restated Certificate of
    Incorporation of Milacron Inc. Incorporated by
    reference to the companys
    Form S-8
    filed on June 11, 20043
.2

Certificate of Designation of 6.0%
    Series B Convertible Preferred Stock of Milacron Inc. Incorporated by
    reference to the companys
    Form S-8
    filed on June 11, 20043
.3

Amended and restated By-Laws of
    Milacron Inc. Incorporated by
    reference to the companys
    Form S-8
    filed on June 11, 20044
.

Instruments Defining the Rights of
    Security Holders, Including Indentures:4
.1

Indenture dated as of May 26,
    2004, between Milacron Escrow Corporation, to be merged with and
    into Milacron Inc., and U.S. Bank National Association, as
    trustee, relating to the
    111/2%
    Senior Secured Notes due 2011 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.2

Supplemental Indenture dated as of
    June 10, 2004, among Milacron Inc., the Guaranteeing
    Subsidiaries named therein and U.S. Bank National
    Association, as trustee, relating to the
    111/2% Senior
    Secured Notes due 2011 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.3

Form of
    111/2% Senior
    Secured Notes due 2011 (included in Exhibit 4.1)4
.4

Registration Rights Agreement
    dated as of May 26, 2004, between Milacron Escrow
    Corporation and Credit Suisse First Boston LLC, as
    representative of the several purchasers listed therein,
    relating to the
    111/2% Senior
    Secured Notes due 2011 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.5

Joinder to the Registration Rights
    Agreement dated June 10, 2004 by Milacron Inc. and the
    Guarantors listed therein Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.6

Security Agreement dated
    June 10, 2004, made by each of the Grantors listed therein
    in favor of U.S. Bank National Association Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.7

Security Agreement (Canada) dated
    June 10, 2004, made by each of the Grantors listed therein
    in favor of U.S. Bank National Association Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.8

Pledge and Security Agreement
    dated June 10, 2004, made by each of the Pledgors listed
    therein in favor of U.S. Bank National Association Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899) 117




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##### Table of Contents



Exhibit No.



Page4
.9

Intercreditor Agreement dated as
    of June 10, 2004, by and between JPMorgan Chase Bank and
    U.S. Bank National Association, acknowledged by Milacron
    Inc. and the subsidiaries of Milacron Inc. listed therein Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.10

Mortgage, Assignment of Leases and
    Rents, Security Agreement and Fixture Filing made by
    D-M-E
    Company in favor of U.S. Bank National Association
    (1975 N. 17th Avenue, Melrose Park, Illinois
    60160), dated as of June 10, 2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.11

Mortgage made by D-M-E U.S.A. Inc.
    in favor of U.S. Bank National Association (6328 Ferry
    Avenue, Charlevoix, Michigan 49720), dated as of June 10,
    2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.12

Mortgage made by D-M-E U.S.A. Inc.
    in favor of U.S. Bank National Association (29215
    Stephenson Highway, Madison Heights, Michigan 48071) dated
    as of June 10, 2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.13

Mortgage made by Oak
    International, Inc. in favor of U.S. Bank National
    Association (1160 White Street, Sturgis, Michigan 49091), dated
    as of June 10, 2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.14

Mortgage made by Milacron
    Industrial Products, Inc. in favor of U.S. Bank National
    Association (31003 Industrial Road, Livonia, Michigan 48150),
    dated as of June 10, 2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.15

Mortgage made by D-M-E U.S.A. Inc.
    in favor of U.S. Bank National Association (29111
    Stephenson Highway, Madison Heights, Michigan 48071), dated as
    of June 10, 2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.16

Open-End Mortgage, Assignment of
    Leases and Rents, Security Agreement and Fixture Filing made by
    D-M-E Company in favor of U.S. Bank National Association
    (558 Leo Street, Dayton, Ohio 45404) dated as of
    June 10, 2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.17

Open-End Mortgage, Assignment of
    Leases and Rents, Security Agreement and Fixture Filing made by
    Milacron Inc. in favor of U.S. Bank National Association
    (418 West Main Street, Mount Orab, Ohio 45154) dated
    as of June 10, 2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.18

Open-End Mortgage, Assignment of
    Leases and Rents, Security Agreement and Fixture Filing made by
    Milacron Inc. in favor of U.S. Bank National Association
    (3000 Disney Street, Cincinnati, Ohio 45209) dated as of
    June 10, 2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.19

Open-End Mortgage, Assignment of
    Leases and Rents, Security Agreement and Fixture Filing made by
    Milacron Inc. in favor of U.S. Bank National Association
    (3010 Disney Street, Cincinnati, Ohio 45209) dated as of
    June 10, 2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899) 118




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##### Table of Contents



Exhibit No.



Page4
.20

Open-End Mortgage, Assignment of
    Leases and Rents, Security Agreement and Fixture Filing made by
    D-M-E Company in favor of U.S. Bank National Association
    (977 Loop road, Lewistown, Pennsylvania) dated as of
    June 10, 2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)4
.21

Open-End Mortgage, Assignment of
    Leases and Rents, Security Agreement and Fixture Filing made by
    D-M-E Company in favor of U.S. Bank National Association
    (70 East Hills Street, Youngwood, Pennsylvania 15697) dated
    as of June 10, 2004 Incorporated by
    reference to the companys
    Form S-4
    filed on June 25, 2004 (Registration
    No. 333-116899)9
.

Voting
    Trust Agreement  not applicable10
.

Material Contracts:10
.1

Milacron Supplemental Pension
    Plan, as amended Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 199910
.2

Milacron Supplemental Retirement
    Plan, as amended Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 199910
.3

Milacron Supplemental Executive
    Retirement Plan, as amended Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200210
.4

Milacron Supplemental Retirement
    Plan Amended and Restated Trust Agreement by and between
    Milacron Inc. Reliance Trust Company Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended June 30, 200410
.5

Milacron Supplemental Executive
    Pension Plan Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 199910
.6

Milacron Kunststoffmaschinen
    Europa GmbH Pension Plan for Senior Managers and Executives Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200410
.7

Milacron Compensation Deferral
    Plan, as amended Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 199910
.8

Milacron Compensation Deferral
    Plan, as amended February 26, 2004 Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200310
.9

Milacron Compensation Deferral
    Plan Trust Agreement by and between Milacron Inc. And
    Reliance Trust Company Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 199910
.10

Milacron Inc. Executive Life
    Insurance Plan Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 2004 119




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##### Table of Contents



Exhibit No.



Page10
.11

Form of Tier I Executive
    Severance Agreement applicable to R. D. Brown Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended September 30, 200310
.12

Form of Tier II Executive
    Severance Agreement applicable to D. E. Lawrence and
    H. C. ODonnell Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended September 30, 200310
.13

Form of Tier II Executive
    Severance Agreement applicable to K. Bourdon and R. C. McKee Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200410
.14

Amendment to Tier 1 Executive
    Severance Agreement with R. D. Brown and Tier II Executive
    Severance Agreements with R. P. Lienesch and H. C.
    ODonnell dated as of February 10, 2004 Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200310
.15

Temporary Enhanced Severance Plan
    applicable to R. D. Brown and H. C. ODonnell Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended September 30, 200310
.16

Award Letter re. Temporary
    Enhanced Severance Plan to R. D. Brown Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended September 30, 200310
.17

Award Letter re. Temporary
    Enhanced Severance Plan to H. C. ODonnell Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended September 30, 200310
.18

Award Letter re. Temporary
    Enhanced Severance Plan to R. C. McKee Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200410
.19

Employment Agreement with
    Karlheinz Bourdon dated March 30, 2005 Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200410
.20

Executive Medical Expense
    Reimbursement Plan, Amended as of July 29, 2004 Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended September 30, 200410
.21

Milacron Inc. 2002 Short-Term
    Incentive Plan, as amended February 10, 2004 Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200310
.22

Milacron Inc. 1994 Long-Term
    Incentive Plan, as amended July 29, 2004 Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended September 30, 200410
.23

Milacron Inc. 1997 Long-Term
    Incentive Plan, as amended July 29, 2004 Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended September 30, 200410
.24

Milacron Inc. 2004 Long-Term
    Incentive Plan Incorporated by
    reference to the companys
    Form S-1
    filed on June 25, 2004 (Registration
    No. 333-116892)10
.25

Form of Performance Based
    Restricted Shares Award Agreement Incorporated by
    reference to the companys
    Form 8-K
    filed on February 17, 200510
.26

Form of Restricted
    Shares Award Agreement Incorporated by
    reference to the companys
    Form 8-K
    filed on February 17, 2005 120




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##### Table of Contents



Exhibit No.



Page10
.27

Form of Notice of Award of
    Deferred Shares for Directors Incorporated by
    reference to the companys
    Form 8-K
    filed on February 17, 200510
.28

Form of Phantom Share
    Account Agreement Performance Incorporated by
    reference to the companys
    Form 8-K
    filed on February 17, 200510
.29

Form of Phantom Share
    Account Agreement Incorporated by
    reference to the companys
    Form 8-K
    filed on February 17, 200510
.30

Milacron Inc. Plan for the
    Deferral of Directors Compensation, as amended Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 1998 (File
    No. 001-08485)10
.31

Milacron Inc. Director Deferred
    Compensation Plan Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended March 31, 200510
.32

Milacron Inc. Retirement Plan for
    Non-Employee Directors, as amended Incorporated by
    reference to the companys
    Form 10-K
    for the for the fiscal year ended December 31, 1998 (File
    No. 001-08485)10
.33

Milacron Retirement Plan for
    Non-Employee Directors, as amended February 10, 2004 Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200310
.34

Rights Agreement dated as of
    February 5, 1999, between Milacron Inc. and ChaseMellon
    Shareholder Services, LLC, as Rights Agent Incorporated by
    reference to the companys Registration Statementon
    Form 8-A
    (File
    No. 001-08485)10
.35

Amendment No. 1 to Rights
    Agreement dated as of March 11, 2004 among Milacron Inc.
    and Mellon Investor Services LLC Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200310
.36

Amendment No. 2 to Rights
    Agreement dated as of June 9, 2004 among Milacron Inc. and
    Mellon Investor Services LLC Incorporated by
    reference to the companys
    Form S-1
    filed on June 25, 2004 (Registration
    No. 333-116892)10
.37

Financing Agreement dated as of
    June 10, 2004 by and among Milacron Inc. and certain
    subsidiaries as Borrowers, certain subsidiaries as Guarantors,
    the Lenders from time to time party thereto, JPMorgan Chase Bank
    as Administrative and Collateral Agent, Wells Fargo Foothill,
    LLC as Documentation Agent and J.P. Morgan Business Credit
    Corp., as Sole Lead Arranger and Book Manager Incorporated by
    reference to the companys
    Form S-1
    filed on June 25, 2004 (Registration
    No. 333-116892)10
.38

First Amendment to Financing
    Agreement dated as of September 28, 2004 among Milacron
    Inc., each subsidiary of Milacron Inc. listed as a borrower or
    Guarantor, the Lenders and JPMorgan Chase Bank as administrative
    agent and collateral agent Incorporated by
    reference to the companys
    Form 8-K
    dated September 28, 200410
.39

Limited Waiver, Consent and Second
    Amendment to Financing Agreement, dated as of November 8,
    2004 among Milacron Inc., each subsidiary of Milacron Inc.
    listed as a Borrower or a guarantor, the Lenders and JPMorgan
    Chase Bank as administrative agent and collateral agent Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended September 30, 2004 121




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##### Table of Contents



Exhibit No.



Page10
.40

Third Amendment to Financing
    Agreement dated as of February 11, 2005 among Milacron
    Inc., each subsidiary listed as a borrower or guarantor, the
    Lenders and JPMorgan Chase Bank, National Association, as
    administrative agent and collateral agent Incorporated by
    reference to the companys
    Form 8-K
    filed on February 17, 200510
.41

Fourth Amendment to Financing
    Agreement, dated as of July 29, 2005 among Milacron
    Inc.,each subsidiary of Milacron listed as a borrower or a
    guarantor, the Lenders party thereto and JPMorgan Chase Bank,
    National Association, as administrative agent and collateral
    agent Incorporated by
    reference to the companys
    Form 8-K
    dated July 29, 200510
.42

Limited Waiver to Financing
    Agreement, dated as of March 14, 2005 among Milacron Inc.,
    each subsidiary of Milacron listed as borrower or a guarantor,
    the Lenders and JPMorgan Chase Bank, National Association, as
    administrative agent and collateral agent Incorporated by
    reference to the companys
    Form 8-K
    dated March 16, 200510
.43

Limited Waiver No. 2 to
    Financing Agreement, dated as of March 16, 2005 among
    Milacron, Inc., each subsidiary of Milacron listed as a borrower
    or a guarantor, the Lenders and JPMorgan Chase Bank, National
    Association, as administrative agent and collateral agent Incorporated by
    reference to the companys
    Form 8-K
    dated March 16, 200510
.44

Limited Waiver No. 3 to
    Financing Agreement, dated as of June 29, 2005 among
    Milacron Inc., each subsidiary of Milacron listed as a borrower
    or a guarantor, the Lenders and JPMorgan Chase Bank, National
    Association, as administrative agent and collateral agent Incorporated by
    reference to the companys
    Form 8-K
    dated June 29, 200510
.45

ISDA 2002 Master Agreement dated
    as of July 28, 2004 between JPMorgan Chase Bank and
    Milacron Inc. and the schedule and Swap Transaction letter
    agreement related thereto Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended September 30, 200410
.46

Swap Transaction (Revision) Letter
    Agreement between Milacron Inc. and JPMorgan Chase Bank, N.A Incorporated by
    reference to the companys
    Form 10-Q
    for the quarter ended March 31, 200510
.47

Registration Rights Agreement
    dated as of march 12, 2004 among Milacron Inc., Glencore
    Finance AG and Mizuho International plc Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200310
.48

Note Purchase Agreement dated
    as of March 12, 2004 among Milacron Inc., Glencore Finance
    AG and Mizuho International plc Incorporated by
    reference to the companys
    Form 10-K
    for the fiscal year ended December 31, 200310
.49

Letter Amendment to
    Note Purchase Agreement dated April 5, 2004 among
    Milacron Inc., Glencore Finance AG and Mizuho International plc Incorporated by
    reference to the companys
    Form S-1
    filed on June 25, 2004 (Registration
    No. 333-116892)10
.50

Letter Amendment to
    Note Purchase Agreement dated June 7, 2004 among
    Milacron Inc., Glencore Finance AG and Mizuho International plc Incorporated by
    reference to the companys
    Form S-1
    filed on June 25, 2004 (Registration
    No. 333-116892)10
.51

Contingent Warrant Agreement dated
    March 12, 2003 by and among Milacron Inc., Glencore Finance
    AG and Mizuho International plc Incorporated by
    reference to the companys
    Form S-1
    filed on June 25, 2004 (Registration
    No. 333-116892) 122




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##### Table of Contents



Exhibit No.



Page10
.52

Amended and restated Financing
    Agreement dated as of March 31, 2004 among Milacron Inc.
    and certain subsidiaries as Borrowers, certain subsidiaries as
    Guarantors, the Lenders from time to time party thereto, and
    Credit Suisse First Boston, Cayman Islands Branch, as
    Administrative and Collateral Agent Incorporated by
    reference to the companys
    Form 8-K
    dated March 31, 200410
.53

Asset Purchase Agreement dated as
    of January 23, 1996, between Cincinnati Milacron Inc., a
    Delaware corporation, The Fairchild Corporation, a Delaware
    Corporation, RHI Holdings, Inc., a Delaware corporation, and the
    Designated Purchasers and Sellers named therein Incorporated herein by
    reference to the companys
    Form 8-K
    dated January  26, 199610
.54

Purchase and Sale Agreement
    between UNOVA, Inc., UNOVA Industrial Automation Systems, Inc.,
    UNOVA U.K. Limited and Cincinnati Milacron Inc. dated
    August 20, 1998 Incorporated by
    reference to the companys
    Form 8-K
    dated October 2, 1998 (File
    No. 001-08485)10
.55

Purchase and Sale Agreement
    between Johnson Controls, Inc., Hoover Universal, Inc. and
    Cincinnati Milacron Inc., dated August 3, 1998 Incorporated by
    reference to the companys
    Form 8-K
    dated September 20, 1998 (File
    No. 001-08485)10
.56

Stock Purchase Agreement dated as
    of May 3, 2002 among Milacron Inc., Milacron B.V., and
    Kennametal Inc. Incorporated by
    reference to the companys
    Form 8-K
    dated May 3, 200210
.57

Stock Purchase Agreement dated as
    of June 17, 2002 between Milacron Inc., and Sandvik AB Incorporated by
    reference to the companys
    Form 8-K
    dated June 17, 200210
.58

Limited Waiver and Fifth Amendment
    to Financing Agreement Incorporated by
    reference to the companys
    Form 8-K
    dated February 10, 200610
.59

Form of Restricted Stock Agreement Incorporated by
    reference to the companys
    Form 8-K
    dated February 23, 200610
.60

Form of Phantom Share Account
    Agreement Incorporated by
    reference to the companys
    Form 8-K
    dated February 23, 200610
.61

Milacron Inc. 2002 Short-Term
    Incentive Plan, as amended February 23, 2006 Incorporated by
    reference to the companys
    Form 8-K
    dated February 23, 200610
.62

Form of Notice of Common Stock
    Credit Incorporated by
    reference to the companys
    Form 8-K
    dated February 23, 200611
.

Statement Regarding Computation of
    Per-Share Earnings15
.

Letter Regarding Unaudited Interim
    Financial Information  not applicable18
.

Letter Regarding Change in
    Accounting Principles  not applicable19
.

Report Furnished to Security
    Holders  not applicable21
.

Subsidiaries of the Registrant22
.

Published Report Regarding Matters
    Submitted to Vote of Security Holders - not applicable23
.

Consent of Experts and Counsel24
.

Power of
    Attorney  not applicable31
.

Certifications pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002:31
.1.

Certification pursuant to
    Section 302 of the Sarbanes-Oxley Act31
.2.

Certification pursuant to
    Section 302 of the Sarbanes-Oxley Act32
.

Certification pursuant to
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 200299
.

Additional
    Exhibits  not applicable  123




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##### Table of Contents



Item 15
    (b) 
    Index
    to Certain Exhibits and Financial Statement Schedules Filed
    Herewith  Exhibit 11

Statement Regarding Computation of
    Per-Share EarningsExhibit 21

Subsidiaries of the RegistrantExhibit 23

Consent of Experts and CounselExhibit 31.1

Certification pursuant to
    Section 302 of the Sarbanes-Oxley ActExhibit 31.2

Certification pursuant to
    Section 302 of the Sarbanes-Oxley ActExhibit 32

Certification pursuant to
    18 U.S.C. Section 1350, as adopted pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002  124




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##### Table of Contents



MILACRON
    INC. AND SUBSIDIARIES
 SCHEDULE II  VALUATION AND
    QUALIFYING ACCOUNTS AND RESERVES
 Years ended 2005, 2004 and 2003
   Col. A

Col. B


Col. C


Col. D


Col. EAdditionsBalance at


Charged to








BalanceBeginning


Cost and


Other


Deductions


at EndDescription

of Period


Expenses


-Describe


-Describe


of Period(In thousands)Year ended 2005Allowance for doubtful accounts

$
12,060


$
2,804


$
(812
)(a)

$
(5,014
)(b)

$
9,038Restructuring and consolidation
    reserves

$
2,838


$
485


$
(190
)(a)

$
(1,670
)(b)

$
1,384(79
)(c)Allowance for inventory
    obsolescence

$
29,708


$
1,352


$
(2,146
)(a)

$
(2,533
)(b)

$
26,381Year ended 2004Allowance for doubtful accounts

$
15,087


$
1,742


$
327
(a)

$
(5,096
)(b)

$
12,060Restructuring and consolidation
    reserves

$
6,505


$
2,698


$
69
(a)

$
(6,235
)(b)

$
2,838(199
)(c)Allowance for inventory
    obsolescence

$
27,007


$
7,393


$
1,488
(a)

$
(6,180
)(b)

$
29,708Year ended 2003Allowance for doubtful accounts

$
12,354


$
4,610


$
1,261
(a)

$
(3,138
)(b)

$
15,087Restructuring and consolidation
    reserves

$
5,362


$
9,387


$
648
(a)

$
(7,206
)(b)

$
6,505(1,686
)(c)Allowance for inventory
    obsolescence

$
24,169


$
5,416


$
2,738
(a)

$
(5,316
)(b)

$
27,007     (a)
    
    Represents foreign currency translation adjustments during the
    year.(b)
    
    Represents amounts charged against the reserves during the year.(c)
    
    Represents reversals of excess reserves. 125




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##### Table of Contents



SIGNATURES    Milacron Inc.
  By:
    /s/  Ronald
    D. Brown  Ronald D. Brown;
 Chairman, President and Chief Executive Officer,
    Director (Chief Executive Officer)
   By:
    /s/  Ross
    A. Anderson  Ross A. Anderson;
 Vice President   Finance and Chief
    Financial
    Officer (Chief Financial Officer)
   By:
    /s/  Danny
    L. Gamez  Danny L. Gamez; Controller
 (Chief Accounting Officer)
      /s/  Darryl
    F. AllenDarryl
    F. Allen; March 13, 2006(Director)

/s/  Sallie
    B. BaileySallie
    B. Bailey; March 13, 2006(Director)/s/  David
    L. BurnerDavid
    L. Burner; March 13, 2006(Director)

/s/  H.
    Christopher DeCotiisH.
    Christopher DeCotiis; March 13, 2006(Director)/s/  Steven
    N. IsaacsSteven
    N. Isaacs; March 13, 2006(Director)

/s/  Mark
    L. SegalMark
    L. Segal; March 13, 2006(Director)/s/  Dr. Joseph
    A. StegerDr.
    Joseph A. Steger; March 13, 2006(Director)

/s/  Duane
    K. StullichDuane
    K. Stullich; March 13, 2006(Director)/s/  Charles
    F. C. TurnerCharles
    F. C. Turner; March 13, 2006(Director)

/s/  Larry
    D. YostLarry
    D. Yost; March 13, 2006(Director)  126