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Table of Contents

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

For the fiscal year ended January 31, 2004

OR

For the transition period from                      to                     

Commission file number 0-13200

Astro-Med, Inc.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (401) 828-4000

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, $.05 Par Value

(Title of Class)

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.    x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule12b-2).    Yes  ¨    No  x

As of August 2, 2003, the aggregate market value of the voting common equity of the Registrant held by non-affiliates of the Registrant based on the closing price on the NASDAQ Stock Market was $25,539,704.

Indicate the number of shares outstanding (excluding treasury shares)

of each of the issuer’s classes of common stock as of March 19, 2004.

Common Stock $0.05 Par Value 4,746,501 shares.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Company’s definitive proxy statement for the 2004 annual meeting of shareholders are incorporated by reference into Part III.

Table of Contents

ASTRO-MED, INC.

FORM 10-K ANNUAL REPORT

TABLE OF CONTENTS

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ASTRO-MED, INC.

PART I

Item 1. Business

General

Astro-Med, Inc., (the Company) is an enterprise that is strategically structured to design, develop, manufacture and distribute a diverse line of technology-advanced products and services. The Company is organized around a suite of core competencies including Research & Development, Manufacturing, Information Technology and Administrative Management. The Company markets and sells its products and services through three distinct product groups; Test & Measurement (T&M), QuickLabel^® Systems (QuickLabel), and Grass-Telefactor (G-T). T&M develops and manufactures data acquisition instruments that serve the test and measurement market. QuickLabel develops and manufactures digital printers and consumable products that serve the product identification market. Grass-Telefactor develops and manufactures clinical neurophysiology (EEG and epilepsy monitoring), polysomnography (PSG – Sleep monitoring), biomedical research instrumentation and supplies that serve the life sciences market. The Company’s products are distributed both domestically and internationally through its direct sales force and authorized distributors and agents located in approximately forty countries. Approximately 29% of the Company’s sales in fiscal 2004 were made outside of the United States.

The Company and its subsidiaries and their representatives may from time to time make written or oral statements, including statements contained in the Company’s filings with the Securities and Exchange Commission (SEC) and in its reports to shareholders which constitute or contain “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 or by the SEC in its rules, regulations and releases.

All statements, other than statements of historical facts included in this annual report regarding the Company’s financial position and operating and strategic initiatives and addressing industry developments are forward-looking statements. Where, in any forward-looking statement, the Company or its management expresses an expectation or belief as to future results, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the statement of expectation or belief will result or be achieved or accomplished. Factors which could cause actual results to differ materially from those anticipated include, but are not limited to, general economic, financial and business conditions; declining demand in the test and measurement markets, especially defense and aerospace; competition in the specialty printer industry; ability to develop market acceptance of the QuickLabel color printer products and effective design of customer required features; competition in the data acquisition industry; competition in the neurophysiology industry; the impact of changes in foreign currency exchange rates on the results of operations; the ability to identify attractive acquisition candidates and to successfully effect and integrate acquisitions; the ability to realize the anticipated cost reductions from restructuring and streamlining the business; the business abilities and judgment of personnel and changes in business strategy.

Narrative Description of Business

Products

Overview

The Company develops and manufactures systems that have the ability to acquire electronic data, process, analyze, store and present the data in a variety of useable forms. The T&M data acquisition systems record scientific signals and print the output onto charts or electronic media. The QuickLabel digital printer systems and media products create product and packaging labels and tags in one or many colors. The Grass-Telefactor products electronically capture and record neurological data that maybe used to diagnose epilepsy or to study sleep disorders. The Company supplies a range of products that include the hardware, software, and supplies to customers who are in a variety of industries.

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T&M Products

The Company’s T&M products are a comprehensive line of data recording instruments for the aerospace, automotive, pulp and paper, metal mill, transportation and manufacturing industries. These recording solutions provide customers with a complete record of their data, whether they are troubleshooting a process, performing preventative maintenance or gathering mission critical data. Using contemporary technologies, T&M products are designed to handle customers ever-changing requirements now and into the future.

Telemetry Recorders

The Everest Telemetry-Recorder Workstation is the flagship product of T&M’s line of telemetry recorders. Designed for the unique requirements of the aerospace and defense industries, the Everest provides engineers with vital data on test products during pre-flight checkout and flight tests. Intended to seamlessly integrate into off-the-shelf telemetry systems, the Everest is used to test fighter planes, missiles, helicopters, satellites and commercial aircraft. During flight test, the Everest provides engineers with real-time access to data to allow them to make split second decisions and prevent costly retesting. After flight test, data from the Everest is available in both paper and digital formats, allowing engineers to analyze data faster than ever before.

Dash Series Data Acquisition Recorders

The Company’s Dash Series recorders are used as maintenance and troubleshooting tools for pulp and paper mills, power plants, transportation test centers, steel mills, automotive R&D centers and manufacturing plants. With downtime costing these facilities tens of thousands of dollars per day, the Dash Series data acquisition recorders can pay for themselves by preventing a single outage. Completely self-contained in rugged aluminum cases, the Dash Series data acquisition recorders are ideally suited for use in harsh environments where computer-based or other systems will not perform.

The Dash 2EZ, Dash 8X and Dash 18 form the Company’s Dash series of data acquisition recorders. The Dash 2EZ is the latest data acquisition recorder to be introduced and expands the Company’s reach into the handheld data recording market. With a touchscreen display, built-in chart recorder and integral data acquisition in a system weighing seven pounds, the Dash 2EZ is the ideal handheld troubleshooting tool.

Ruggedized Products

T&M’s products include a line of ruggedized products designed for military and commercial applications. The ToughWriter series are ruggedized, flightworthy cockpit printers used to print weather maps, communications and other flight critical information. The ToughWriter series meets MIL-STD requirements for shock, vibration and temperature, making it ideal for use on both commercial and military aircraft.

The ToughSwitch is an eight port, ruggedized Ethernet switch that also meets MIL-STD requirements for shock, vibration and temperature. Designed to withstand the rigors of commercial/military aviation and the harsh environments of the battlefield, the ToughSwitch is ideally suited for applications where standard or industrial grade hubs will not survive.

QuickLabel Products

The Company’s QuickLabel product line is composed of a family of high-technology digital color label printers, automatic barcode printers, labelers, and print and apply systems, as well as labeling software and consumables. Innovative QuickLabel products continue to change the way companies do business by providing just-in-time, in-plant label production capabilities and labeling automation through the Company’s advanced digital thermal transfer printing technologies. QuickLabel’s packaging, barcoding and labeling solutions are used throughout the world.

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Digital Color Label Printers

QuickLabel digital color label printers are designed to print multiple colors, text and barcodes in a single pass on labels, tags and tickets of all kinds. Using Astro-Med’s proprietary MicroCell^™ color halftoning technology, these printers create near lithographic quality labels that can be generated on and printed directly from a customer’s personal computer, mainframe or AS/400 mid-range computing platform.

The Company’s newest four-color digital label printers are the QLS-4100Xe and QLS-8100Xe. The QLS-4100Xe is the Company’s fifth-generation process color printer, which incorporates new features deriving from the Company’s research and development, thermal printing experience, and feedback from users around the world. The QLS-8100Xe, an advanced four-color digital label printer, has the capability of printing process color at widths of 8 ¹/2 inches and speeds of up to 7 inches per second. With the Company’s patented Ribbon Ration^™ technology for economizing thermal transfer ribbon, enhanced mechanical design for precise color registration, robust performance for long runs, and more user-friendly operation, the QLS-4100Xe is QuickLabel’s flagship. The QLS-8100Xe is a wide format printer that incorporates the same features and provides a solution for customers with requirements to print larger labels and signage.

QuickLabel’s digital color label printer offering also includes the following models: the QLS-2000, QLS-2001, QLS-3000, and QLS-3001. With either two or three print stations, the QLS-2000 and QLS-3000 printers represent the Company’s value line of color printers, providing color-labeling solutions for general product identification. The QLS-2001 and QLS-3001 models are used in specialty and niche applications, including the printing of Tyvek pouches used in the packaging of surgical instruments. These models also comprise the core of QuickLabel’s Apparel Printing Systems, designed to print apparel care tags, hang tags and price tickets in manufacturing environments, retail applications, and service bureau operations worldwide.

Marketing of the QuickLabel printers targets applications such as the private labeling of foods and beverages, chemicals and cleaning supplies, pharmaceutical and medical products, personal care products, and others.

Barcode Label Printers

QuickLabel has a family of barcode label printers: the Pronto series. This line of low-cost, feature-rich barcode printers includes the Pronto 442 and Pronto 472. Both of these printers have 203 dpi (dots per inch) resolution. The Pronto series also includes the high-resolution 400 dpi Pronto 474 and the 8.6” wide Pronto 843. These competitively-priced Pronto models mark the Company’s re-entry into mainline barcode printing applications and serve as important vehicles for the sale of QuickLabel’s thermal transfer ribbon and label products.

QuickLabel’s barcode printer line also includes the robust, industrial monochrome barcode printer, the Top Hand^™ QuickLabel -500 printer. With a rugged design for harsh environment applications, the Top Hand printer produces labels up to 5 inches wide at speeds of up to 10 inches per second.

QuickLabel Software

An important component of the Company’s digital printing systems is the software that produces the label formatting and the printing functionality required for successful in-plant printing. This software, marketed under the brand name Color QuickLabel^™, allows customers to tap the true power inherent in the QuickLabel printers. CQL99, a 32-bit Windows^®-based label creation and printing suite, supports high-color imaging, MicroCell^™ image halftoning, full network printing, and multiple database compatibility. CQL99 software further advances integration of the QuickLabel Systems printers within today’s high-technology production environments.

QuickLabel Automatic Label Applicators and Print & Apply Systems

To complement the QuickLabel printers, the Company manufactures a line of automatic labelers that can apply labels to all types of products, from cartons to primary product packaging to cylindrical containers.

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Applicator models include the AD-2800 and AD-2600 roll-on label applicators. The Company also offers a high-speed bottle labeling system utilizing its AD-2800 label applicator. The CPA-350, the Company’s ruggedized print and apply system, offers companies the ability to print a label on-demand and apply it to a product as it passes on a conveyor. The CPA-350 can be configured with air tamp, air blast, dual apply or corner wrap applicator heads to apply a label to two sides of the same carton or pallet.

Consumables: Thermal Transfer Ribbon and Labels

Rounding out the QuickLabel products is a wide array of printer consumables including thermal transfer ribbons in many colors and formulations, and both paper and synthetic labels and tags. A full line of high quality materials, developed and qualified by the Company, is available to guarantee a finished label that meets almost any requirements from single-use paper labels to garment labels, to outdoor signage and product labels.

Grass-Telefactor Products

The Grass-Telefactor product group offers a range of instrumentation and supplies for clinical and biomedical research applications.

Grass-Telefactor enjoys a reputation built on decades of innovative technology and thoughtful design. The clinical product line includes in-lab or in-hospital integrated systems for clinical EEG and PSG (Polysomnography), epilepsy diagnosis and surgery, critical care and intraoperative neuromonitoring. These products offer a variety of features including networking, database and report generation capabilities in addition to powerful data acquisition and analysis tools. Grass-Telefactor utilizes a Windows^®-based product line which includes the Beehive^™ Millennium used for long term epilepsy monitoring, the Comet^™ digital EEG system and the recently introduced Comet^™ digital PSG system. The products and services offered by Grass-Telefactor are used worldwide by universities, medical centers, and companies engaged in a variety of clinical and research activities.

Grass-Telefactor offers a complete line of clinical instruments and research supplies, including stimulators, transducers, electrodes and consumables. The supplies and accessories product line uses e-commerce to reach the market through the Grass-Telefactor Online Store, www.grass-telefactor.com.

Technology

The core technologies of the Company relate to (1) acquiring data, (2) conditioning the data, (3) displaying the data on hard copy, monitor, or electronic storage media, and finally (4) analyzing the data. All three-product groups of the Company—T&M, QuickLabel and G-T use these technologies.

The Company is continually improving the performance and functionality of core technologies, enabling the Company to lead the competition with innovative products.

Patents and Copyrights

The Company holds a number of product patents in the United States and in foreign countries. It has filed applications for other patents that are pending. The Company has patents covering its T&M recording products as well as several patents for its QuickLabel dual sided label printers and four-color label printers. The Company considers its patents to be important but does not believe that its business is materially dependent on them. The Company copyrights its extensive software and registers its trademarks.

Manufacturing and Supplies

The Company designs its products and manufactures many of the component parts. The balance of the parts is produced to the Company’s specifications by suppliers. Raw materials required for the manufacture of products, including parts produced to the Company’s specifications, are generally available from numerous suppliers.

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Product Development

The Company has maintained an active program of product research and development since its inception. During fiscal 2004, 2003 and 2002, the Company incurred costs of $3.7 million, $4.1 million, and $3.7 million, respectively, on Company-sponsored product development. The Company is committed to product development as a requisite to its growth and expects to continue its focus on research and development efforts in fiscal 2005.

Marketing and Competition

The Company competes worldwide in many markets including clinical and research medicine, aerospace, automotive and general manufacturing. The Company retains a competitive position in its respective markets by virtue of proprietary technology, product reputation, delivery, technical assistance and service to customers.

The products of the Company are marketed worldwide by advertising and promotion using major national and international trade journals, scientific meetings and trade shows, direct mailing campaigns, and the Internet.

The products are sold by direct field sales persons as well as independent dealers and representatives. In the United States, the Company has direct field sales people located in major cities from coast to coast specializing in either T&M’s Recorders and Data Acquisitions systems, QuickLabel’s Color Label printers and media systems, or G-T Neurological Instrumentation products. Additionally, the Company has direct field sales and service centers in Canada, England, France, Germany, Italy and Holland. In the remaining parts of the world, the Company utilizes approximately 80 independent dealers and representatives selling and marketing its products in 40 countries. In fiscal 2004, 29% of the Company’s revenues were from international sales.

The Company has a number of competitors in each of the three products groups and markets that it serves. In the T&M area, the Company feels that it leads the field in Data Acquisition Recorders. It competes with the Gould Instrument Division of SPX Technologies and Western Graphtec, the US subsidiary of Graphtec, a Japanese company.

In the Color Label Printer product group, the Company believes it leads the world in color printing using the thermal transfer printing technology. The Company introduced the very first thermal transfer color printers late in 1995 and to this date faces only one nominal competitor.

The Grass-Telefactor products of the Company are devoted to clinical applications in EEG, PSG, and Long Term Epilepsy Monitoring (LTM). There are about fourteen companies that compete in one or more of the three modalities (EEG, PSG, LTM) but none are the clear leader. The Company feels it offers superior products based upon its long history and pioneering the field since 1935. The Company, unlike most of its competitors, designs, manufactures, and produces complete systems including transducers, amplifiers, sensors, and Windows-based application software. Additionally, the Company produces a range of life science products for the research market. Many of the latter products eventually find their way into clinical applications.

No single customer accounted for 10% of the Company’s net sales in any of the last three fiscal years. The Company’s products were sold to approximately 5,000 customers.

International Sales

In fiscal 2004, 2003 and 2002, net sales to customers in various geographic areas outside the United States, primarily in Canada and Western Europe, amounted to $16.3 million, $13.0 million, and $13.8 million, respectively.

Order Backlog

The Company’s backlog fluctuates regularly. It consists of a blend of orders for end user customers as well as original equipment manufacturer customers. Manufacturing is geared to forecasted demands and applies a

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rapid turn cycle to meet customer expectations. Accordingly, the amount of order backlog does not indicate future sales trends. The Company’s backlog at January 31, 2004 and 2003 were $4.3 million and $3.3 million, respectively.

Other Information

The Company’s business is not seasonal in nature; however, the Company’s sales are impacted by the size and complexity of the transactions and as such, can cause fluctuations in sales from quarter to quarter.

Most of the Company’s products are generally warranted for one year against defects in materials or workmanship. Warranty expenses have generally averaged approximately $280,000 a year for the Company’s last five fiscal years.

As of March 19, 2004 the Company employed approximately 350 persons. The Company is generally able to satisfy its employment requirements. No employees are represented by a union. The Company believes that employee relations are good.

Item 2. Properties

The following table sets forth information regarding the Company’s principal owned properties, all of which are included in the consolidated balance sheet appearing elsewhere in this report.

The Company also leases facilities in eight locations. The following information pertains to each location:

The Company believes its facilities are well maintained, in good operating condition and generally adequate to meet its needs for the foreseeable future.

Item 3. Legal Proceedings

There are no pending or threatened legal proceedings against the Company believed to be material to the financial position or results of operations of the Company.

Item 4. Submission of Matters to a Vote of Security Holders

No matters were submitted to a vote of the Company’s security holders, through solicitation of proxies or otherwise, during the last quarter of the period covered by this report.

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PART II

Item 5. Market for the Registrant’s Common Stock and Related Stockholder Matters

The Company’s common stock trades on The NASDAQ Stock Market under the symbol ALOT. The following table sets forth dividend data and the range of high and low closing prices, as furnished by NASDAQ, for the periods indicated.

The Company had approximately 352 shareholders of record on March 19, 2004, which does not reflect shareholders with beneficial ownership in shares held in nominee name.

Shareholder Services

Shareholders of Astro-Med, Inc. who desire information about the Company are invited to contact the Investor Relations Department, Astro-Med, Inc., 600 East Greenwich Avenue, West Warwick, RI 02893 or call (401) 828-4000. Visit our Investor Relations website at www.astro-med.com. We make available free of charge on our Internet website our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. These filings are also accessible on the SEC’s website at http://www.sec.gov.

Dividend Policy

The Company began a program of paying annual cash dividends in the second quarter of fiscal 1992. The Company anticipates that it will continue to pay cash dividends on a annual basis. The Company has paid a dividend for 50 consecutive quarters.

Item 6. Selected Financial Data

(Dollars in Thousands, Except Per Share Amounts)

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

Astro-Med is a multi-national enterprise, which designs, develops, manufactures, distributes and services a broad range of products that acquire, store, analyze and present data in multiple formats. The Company organizes its structure around a core set of competencies, including research and development, manufacturing, service, marketing and distribution. It markets and sells its products and services through three business segments including:

Test and Measurement Product Group (T&M) represents a suite of telemetry recorder products sold to the aerospace and defense industries; as well as portable data acquisition recorders, which offer diagnostic and test functions to a wide range of manufacturers including paper, energy, automotive and steel fabrication.

QuickLabel Systems Product Group (QuickLabel) offers hardware, software and media products that create digital images, store the images and produce the images in color or non-color formats on a broad range of media substrates.

Grass-Telefactor Product Group (G-T) centers on diagnostic and monitoring products that, serve the clinical neurophysiology markets as well as a range of biomedical instrumentation products and supplies focused on the life sciences markets.

The Company markets and sells its products and services globally through a diverse distribution structure of sales personnel, manufacturing representatives and dealers that deliver a full complement of branded products and services to customers in our respective markets.

The Company’s growth strategy centers on product innovation made possible by research and development initiatives as well as acquisitions that strategically fit into existing core businesses. Research and development activities are funded by the Company at approximately 7% of annual sales.

Fiscal Year (FY) 2004 was a turnaround year for the Company in terms of sales, profits and cash flow. The Company realized double-digit sales growth in both its QuickLabel and Grass-Telefactor product groups as customers in both the domestic and international channels responded positively to the new product introductions. QuickLabel’s new 4100Xe and 8100Xe color printers were quickly recognized as effective solutions to product identification; product control (barcode) and product promotion (color) needs. In the Grass-Telefactor Product Group demand for the new Comet EEG and PSG Systems together with new installations and upgrades to the long term monitoring (LTM) epilepsy centers drove sales growth in this product group. Although the sales in the Test & Measurement Product Group were flat to down, in FY 2004, the Company’s new long term contracts for its ruggedized cockpit printers from two of the world’s foremost aviation manufacturers, AirBus and Boeing, strongly endorse the future of the Company’s ruggedized line of printers and accessories.

The Company’s continued success in increasing its sales revenues will be dependent on the Company’s ability to introduce new and/or enhanced product lines each year. The Company seeks to have approximately 45% of annual sales, excluding media products, generated by products developed or acquired within the past three years.

The Company improved its liquidity position significantly during the year by effectively managing its working capital, generating cash from operations and realizing proceeds from the exercise of employee stock options.

To ensure its continued growth and profitability in FY 2005, the Company will increase its capital investment in: personnel by adding salespersons in each product group; productivity by increasing in-house manufacturing capabilities through the acquisition of new equipment, such as a label press, metal fabrication press and ATE circuit board assembly fixtures; distribution by expanding our global dealer organization; and information technology by providing hardware and software tools that improve the knowledge and efficiency of our employee population.

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Results of Operations

Fiscal 2004 compared to Fiscal 2003

The Company’s sales in fiscal 2004 were $55.8 million, up from the prior year’s sales of $49.2 million. Domestic sales of $39.5 million grew 9.1% as demand for the Company’s hardware and software systems increased 15.6% from last year. This growth was especially strong in the digital printer and biomedical instrumentation product lines. Domestic media and supplies sales rose nominally over the prior year. However, color ribbon and labels sales increased 6.9% from the previous year. Sales through the international channel were especially strong in fiscal 2004 as sales reached $16.3 million, an increment of 25.4% from last year. The sales increase related to exchange rate fluctuations was 13.1% or $1.7 million. Unit volume of the Company’s hardware and software systems were particularly strong as demand for the data recorders, digital printers and biomedical instrumentation products all posted double digit growth rates in fiscal 2004. International sales of media and supply products also increased during the year with the primary drivers being growth of the Company’s color ribbon and label product lines.

Gross profit increased 27.1% to $23.0 million in fiscal 2004 from $18.1 million in fiscal 2003. The Company’s gross profit margin improved to 41.2% from 36.8%. The increase in gross profit can be attributed primarily to the higher sales volume, product mix, better manufacturing overhead absorption and lower manufacturing costs.

Selling, general and administrative spending (SG&A) increased 5.4% to $15.7 million from $14.9 million. The increase in SG&A expenses can be attributed to higher sales commissions and higher incentive compensation costs. Research & Development (R&D) expenses decreased to $3.7 million in fiscal 2004 from $4.1 million in fiscal 2003. R&D as a percentage of sales decreased to 6.6% in this fiscal year as compared 8.3% in the prior year. The decrease in R&D spending can be attributed to the workforce reduction that took place in fiscal 2003. At the end of fiscal 2003, the Company implemented an organizational restructuring in an effort to reduce costs and streamline operations. The restructuring included workforce reductions in all areas of the Company and a significant curtailment of its Pennsylvania research facility. The Company eliminated 28 employees or approximately 8% of its workforce. In fiscal 2003, the Company recorded $490,000 of restructuring and impairment charges. These charges included $364,000 of severance and related termination benefit costs and a $126,000 charge to write-down the value of equipment used at the research facility. During fiscal 2004 and 2003, a total of $349,000 of severance and related termination benefit costs were paid. The remaining $15,000 of severance and related termination benefits were reversed in fiscal 2004 as certain estimates differed from the actual amounts.

Interest income in fiscal 2004 was $202,000 up slightly from $198,000 in fiscal 2003. The increase in interest income during fiscal year 2004 can be attributed to the increase in the portfolio being tempered by lower yields on investments. Other expense, net was $63,000 as compared to last fiscal year’s other income, net of $136,000. Fiscal 2003 benefited from $145,000 of favorable foreign exchange gains while fiscal 2004 resulted in a $2,000 foreign exchange gain.

The Company recorded tax expense of $0.6 million and $0.8 million for fiscal 2004 and 2003, respectively. As a result of a review undertaken at January 31, 2003 of our cumulative loss position at that date, management

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concluded that it was appropriate to establish a full valuation allowance for its net deferred tax assets. The fiscal 2004 and 2003 provision includes a full valuation allowance for the Company’s deferred tax assets. The fiscal 2004 income tax provision does include the favorable impact of the net operating loss carryforwards and the utilization of certain other deferred tax assets that were previously fully reserved.

The Company reports three segments that mirror the Company’s sales product groups (i.e., T&M, QuickLabel and G-T). The Company evaluates segment performance based on the operating segment’s profit before corporate and financial administration expenses.

The following table summarizes selected financial information by segment:

The operating results of each segment are summarized as follows:

T&M’s sales decreased to $11.6 million in fiscal 2004 from $11.9 million in the previous year. T&M domestic sales were 11.0% lower than the prior year as a result of lower portable data recorder and chart paper sales. T&M international sales increased 37.8% as a result of the broader distribution of workstation recorder systems. T&M’s segment profit margin declined to 7.2% in fiscal 2004 from 8.5% in the previous year. The decline in T&M’s segment profit margin can be attributed to the change in sales mix.

QuickLabel’s sales increased to $25.3 million in fiscal 2004 from $21.5 million in the previous year. Fiscal 2004 domestic sales rose 17.9% from the previous year as acceptance of the Company’s suite of printer systems continued. Color printer sales increased by 40.7% and media sales increased 7.2% during fiscal year 2004. International sales grew 16.5% over the prior year primarily as a result of the favorable impact of the foreign exchange rates and higher media sales. QuickLablel’s fiscal 2004 segment profit margin improved to 11.7% up from 0.5% in the previous year. The improvement in segment profit margin is primarily attributed to the higher margins on both printer systems and media and higher volume.

G-T’s sales increased to $18.9 million in fiscal 2004 from $15.7 million in the previous year. G-T’s domestic sales were up 15.4% over the previous year while international sales were up 37.0%. The sales expansion is traceable to demand for the Company’s new clinical PSG and EEG product offerings and the higher Long-term Monitoring (LTM) product sales. The G-T’s segment operating margin increased to 14.3% in fiscal 2004 from 3.2% in the previous year. The increase in segment profit margin is primarily attributed to higher unit volume in fiscal 2004 and fiscal 2003’s one-time charge of $413,000 related to restructuring and impairment.

Fiscal 2003 compared to Fiscal 2002

The Company’s sales in fiscal 2003 were $49.2 million down from the prior year’s sales of $49.4 million. Domestic sales of $36.2 million grew by 1.4% over fiscal 2002, while international sales of $13.0 million were

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lower by 5.6% from the previous year. In the domestic channel hardware and software system sales were down 5.9% as customers deferred capital expenditures purchasing until the last quarter in fiscal 2003. However, domestic media and supply sales were healthy all year increasing by 14.1% from fiscal 2002. The weak European and other economies in our international markets had a negative impact on hardware and software sales as international sales were off by 16.8% from fiscal 2002. Notwithstanding the softness in capital expenditures internationally, media and supply volume remained healthy increasing 11.5% in fiscal 2003.

Gross profit decreased 5.2% to $18.1 million in fiscal 2003 from $19.1 million in fiscal 2002. The Company’s gross profit margin declined to 36.8% from 38.7%. The decline in gross profit can be attributed primarily to the change in sales mix.

Selling, general and administrative spending (SG&A) declined 7.5% to $14.9 million from $16.1 million. The decline in SG&A expenses can be attributed to lower personnel costs, lower advertising expenses, lower commissions and the elimination of goodwill amortization. Research & Development (R&D) expenses increased to $4.1 million in fiscal 2003 from $3.7 million in fiscal 2002. R&D as a percentage of sales increased to 8.3% in this fiscal year as compared 7.6% in the prior year.

In fiscal year 2003, the Company implemented an organizational restructuring in an effort to reduce costs and streamline operations. The restructuring included workforce reductions in all areas of the Company and a significant curtailment of its Pennsylvania research facility. The Company eliminated 28 employees or approximately 8% of its workforce. In fiscal 2003, the Company recorded $490,000 of restructuring and impairment charges. These charges included $364,000 of severance and related termination benefit costs and a $126,000 charge to write-down the value of equipment used at the research facility. At January 31, 2003, $336,000 of severance and related termination benefit costs were accrued.

Interest and dividend income declined in fiscal 2003 to $198,000 from $248,000 in fiscal 2002. The decrease is due to lower yields on investments. Other income, net for fiscal 2003 was $136,000 as compared to fiscal 2003 other income, net of $188,000.

The Company recorded tax expense of $0.8 million for fiscal 2003. This provision was primarily the result of providing a full valuation allowance for the Company’s deferred tax assets.

The Company reports three segments that mirror the Company’s sales product groups (i.e., T&M, QuickLabel and G-T). The Company evaluates segment performance based on the operating segment’s profit before corporate and financial administration expenses.

T&M’s sales decreased to $11.9 million in fiscal 2003 from $12.1 million in the previous year. Both T&M’s domestic and international sales were 1% lower than the prior year. T&M’s segment profit margin improved to 8.5% in fiscal 2003 from 5.6% in the previous year. The improvement in T&M’s margin can be attributed to a favorable change in sales mix due to sales increases in T&M’s portable recorder and cockpit printers. In addition, T&M’s margins improved as a result of lower materials costs resulting from bringing the production of certain components in-house.

QuickLabel’s sales increased to $21.6 million in fiscal 2003 from $20.9 million in the previous year. Fiscal 2003 domestic sales were 2.3% higher than the previous year while international sales rose 4.3% over the previous year. QuickLabels hardware and software system sales declined by 18.9%, while media sales increased 16.6%. QuickLabel’s fiscal 2003 segment profit margin declined to 0.5% down from 4.1% in the previous year. The decline in margin is primarily attributed to the change in sales mix. In addition, QuickLablel’s fiscal 2003 expenses include a restructuring charge of $30,000.

G-T’s sales decreased to $15.7 million in fiscal 2003 from $16.4 million in the previous year. The decline in G-T’s sales is attributed to a 23.3% decrease in G-T international sales. Domestic sales were up 1.1% over the

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previous year. The G-T’s segment operating margin declined to 3.2% in fiscal 2003 from 5.0% in the previous year. The decline in margin is primarily attributed to the $413,000 restructuring and impairment charge incurred in fiscal 2003.

Liquidity and Capital Resources

The Company expects to finance its future working capital needs, capital expenditures and acquisition requirements through internal funds. To the extent the Company’s capital and liquidity requirements are not satisfied internally, the Company may utilize a $3.5 million unsecured bank line of credit, all of which is currently available. Borrowings under this line of credit bear interest at the bank’s prime rate.

The Company’s Statements of Cash Flows for the three years ending January 31, 2004, 2003 and 2002 are included on page 29. Net cash flow provided by operating activities in fiscal year 2004 and 2003 were $4.4 million and $2.7 million, respectively. The increase in net cash flow from operations in fiscal 2004 is attributed primarily to the positive cash flow generated from the net income in fiscal 2004 versus a net loss in fiscal 2003. The Company’s cash collection cycle increased to 57 days sales outstanding from the prior year’s 53 days due to a slower collection cycle from the Company’s international customers. The Company’s inventory turns improved to 3.0 turns versus 2.8 turns in the prior year. Working capital balances at January 31, 2004 were $24.5 million, a 30% increase from the $18.8 million at January 31, 2003. The composition of fiscal 2004 year-end working capital balance includes cash and marketable securities of $12.7 million as compared to $7.3 million of cash and marketable securities at the end of last year. The cash and marketable securities balance increased as a result of the positive cash flow from operations and the $2.6 million of proceeds received from the exercise of employee stock options. See financing activities discussion below for the tax impact on the exercise of stock options.

Net cash flow used by investing activities was $4.3 million and $1.3 in fiscal 2004 and 2003, respectively. Net cash flow provided by investing activities in fiscal 2002 was $1.2 million. The change in the cash flow in investing activities in 2004 and 2003 versus 2002 is attributed to the fact the Company invested its excess cash flow in investment securities in fiscal 2004 and 2003; whereas, in 2002 the Company liquidated certain securities available for sale to fund its working capital requirements. Capital expenditures were $0.7 million, $0.6 million and $0.9 million in fiscal 2004, 2003 and 2002, respectively.

Net cash flow provided by financing activities was $1.7 million in fiscal 2004, versus net cash flow used in financing activities of $0.7 million in fiscal 2003 and fiscal 2002, respectively. The significant increase in cash flow from financing activities can be attributed to the $2.6 million of proceeds from the exercise of employee stock options. The majority of the stock acquired upon exercise of employee stock options was sold resulting in disqualified dispositions for tax purposes. Disqualified dispositions of stock acquired upon exercise of employee stock options provide the Company a tax benefit that is treated differently for book and tax purposes. For book purposes, generally accepted accounting principles require that the tax benefit associated with the disqualified dispositions be recorded in Additional Paid-in Capital (APIC) in Shareholders’ Equity. For tax purposes, the disqualified dispositions are valid expense deductions that lower the Company’s current income tax payable. At January 31, 2004, the Company had a tax benefit relating to disqualified dispositions of stock acquired upon exercise of employee stock options equal to approximately $1.5 million ($3.8 million pretax). For tax purposes, this amount will be used to offset current and future income taxes payable. For book purposes, $0.1 million of the tax benefit was recognized in APIC. The other $1.4 million of the tax benefit was recognized in APIC with a full valuation allowance.

Dividends paid for the three-years ended fiscal 2004, 2003, and 2002 were $0.7 million in each year. The Company’s annual dividend per share was $0.16 in all three years. In fiscal 2004, the Company repurchased common stock at a cost of $0.2 million. Since the inception of the stock buy back program in fiscal 1997, the Company has repurchased 939,624 shares of its common stock. At January 31, 2004, the Company has Board of Directors’ authorization to purchase an additional 218,200 shares of the Company’s common stock in the future.

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Contractual Obligations, Commitments and Contingencies

The Company has a contingent obligation relating to the Telefactor acquisition that requires the Company to pay additional consideration to the sellers if certain sales amounts are achieved during the seventy-two months following the closing of the transaction. The purchase and sales agreement contains a clause which will require the Company to pay additional purchase price of up to $3,000,000 if certain sales levels are achieved. The earnout provision is effective over a period of 72 months and expires in December of 2005. At January 31, 2004, $25,923 of additional consideration was owed to the sellers.

A summary of the Company’s contractual obligations and commitments as of January 31, 2004 is as follows:

Purchase obligations include amounts committed under legally enforceable contracts or purchase orders for goods and services with defined terms as to price, quantity, delivery and termination liability.

The Company is subject to contingencies, including legal proceedings and claims arising out of its businesses that cover a wide range of matters, including, among others, contract and employment claims, workers compensation claims, product liability, warranty and modification, adjustment or replacement of component parts of units sold.

The Company provides accruals for direct costs associated with the estimated resolution of contingencies at the earliest date at which it is deemed probable that a liability has been incurred and the amount of such liability can be reasonably estimated. Costs accrued have been estimated and are based upon an analysis of potential results, assuming a combination of litigation and settlement strategies and outcomes. While it is impossible to ascertain the ultimate legal and financial liability with respect to contingent liabilities, including lawsuits, the Company believes that the aggregate amount of such liabilities, if any, in excess of amounts provided or covered by insurance, will not have a material adverse effect on the consolidated financial position or results of operations of the Company. It is possible, however, that future results of operations for any particular future period could be materially affected by changes in our assumptions or strategies related to these contingencies or changes out of the Company’s control.

Critical Accounting Policies

The Company’s discussion and analysis of its financial condition and results of operations are based upon the Company’s Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States. (See the Notes to the Consolidated Financial Statements included elsewhere herein.) Certain of the Company’s accounting policies require the application of judgment in selecting the appropriate assumptions for calculating financial estimates. By their nature, these judgments are subject to an inherent degree of uncertainty. The Company periodically evaluates the judgments and estimates used for its critical accounting policies to ensure that such judgments and estimates are reasonable for its interim and year-end reporting requirements. These judgments and estimates are based on the Company’s historical experience, current trends and information available from other sources, as appropriate. If different conditions result from those assumptions used in the Company’s judgments, the results could be materially different from the Company’s estimates. The Company’s critical accounting policies include:

Revenue Recognition:  The majority of the Company’s product sales are recorded at the time of shipment and when persuasive evidence of an arrangement exists, the seller’s price to the buyer is fixed or determinable

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and collectibility is reasonably assured. Provisions are made at the time the related revenue is recognized for the cost of any installation or training obligations. When a sale arrangement involves training or installation the deliverables in the arrangement are evaluated to determine whether they represent separate units of accounting. This evaluation occurs at inception of the arrangement and as each item in the arrangement is delivered. The total fee from the arrangement is allocated to each unit of accounting based on its relative fair value. Fair value for each element is established generally based on the sales price charged when the same or similar element is sold separately. Revenue is recognized when revenue recognition criteria for each unit of accounting are met. When other significant obligations remain after products are delivered, revenue is recognized only after such obligations are fulfilled.

Warranty Claims and Bad Debts:  Provisions for the estimated costs for future product warranty claims and bad debts are recorded in cost of sales and selling, general and administrative expense, respectively, at the time a sale is recorded. The amounts recorded are generally based upon historically derived percentages while also factoring in any new business conditions that might impact the historical analysis such as new product introduction for warranty and bankruptcies of particular customers for bad debts. The Company also periodically evaluates the adequacy of its reserves for warranty and bad debts recorded in its consolidated balance sheet as a further test to ensure the adequacy of the recorded provisions. Warranty claims can extend far into the future and bad debt analysis often involves subjective analysis of a particular customer’s ability to pay. As a result, significant judgment is required by the Company in determining the appropriate amounts to record and such judgments may prove to be incorrect in the future. The Company believes that its procedures for estimating such amounts are reasonable and historically have not resulted in material adjustments in subsequent periods when the estimates are adjusted to the actual amounts.

Customer Returns:  Customer returns are recorded on an actual basis throughout the year and also include an estimate at the end of each reporting period for future customer returns related to sales recorded prior to the end of the period. The Company generally estimates customer returns based upon its historical experience while making adjustments for any changes in business conditions.

Inventories:  Inventories are stated at the lower of cost (first-in, first-out) or market. The Company records provisions to write-down obsolete and excess inventory to its estimated net realizable value. The process for evaluating obsolete and excess inventory consists of the Company analyzing the inventory supply on hand and estimating the net realizable value of the inventory based on historical experience, current business conditions and anticipated future sales. The Company believes that its procedures for estimating such amounts are reasonable and historically have not resulted in material adjustments in subsequent periods when the estimates are adjusted to the actual.

Income taxes:  The Company accounts for income taxes in accordance with Statement of Financial Accounting Standards (SFAS) No. 109, Accounting for Income Taxes. This SFAS requires that deferred income taxes be determined based on estimated future tax effects of differences between the tax and book bases of assets and liabilities considering the provisions of enacted tax laws. The Company has historically had prepaid income tax assets due principally to the unfavorable tax consequences of recording expenses for required book reserves for such things as, bad debts, inventory valuation, and warranty that cannot be deducted for income tax purposes until such expenses are actually paid. The Company’s deferred tax liabilities consist primarily of favorable tax consequences associated with accelerated depreciation methods for tax purposes. SFAS No. 109 requires that a valuation allowance be established when it is “more likely than not” that all or a portion of deferred tax assets will not be realized. A review of all available positive and negative evidence must be considered, including the Company’s performance, the market environment in which the Company operates, length of carryforwards periods, existing sales backlog and future sales projections. The Company had previously provided valuation allowances only for future tax benefits resulting from certain foreign losses. However, where there are cumulative losses in recent years, SFAS 109 creates a strong presumption that a valuation allowance is needed. This presumption can be overcome in very limited circumstances. As a result of our cumulative loss position at January 31, 2003 and the increased uncertainty relative to the timing of profitability in future periods at that point

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in time, the Company concluded that is was appropriate to establish a valuation allowance for our entire net deferred tax asset. The Company expects to record a full valuation allowance on future tax benefits until we can sustain an appropriate level of profitability and until such time, the Company would not expect to recognize any significant tax benefits in our future results of operations, except as those benefits are realized on the tax return.

Long-Lived Asset and Goodwill:  The impairment of Long-lived assets to be held and used are reviewed for impairment in accordance with SFAS No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets” whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. Measurement of an impairment loss for long-lived assets that management expects to hold and use is based on the fair value of the asset. Goodwill impairment reviews are performed in accordance with the provisions of SFAS No. 142, “Goodwill and Other Intangible Assets”. Management evaluates the recoverability of goodwill annually, or more frequently if events or changes in circumstances, such as declines in sales, earnings or cash flows, or material adverse changes in the business climate, indicate that the carrying value of an asset might be impaired. Goodwill is considered to be impaired when the net book value of a segment exceeds its estimated fair value. Fair values are established primarily using a discounted cash flow methodology. The determination of discounted cash flows is based on the long-range planning forecast.

New Accounting Pronouncements

In January 2003 Financial Accounting Standards Board (FASB) Interpretation No. 46, “Consolidation of Variable Interest Entities” was issued. This interpretation requires a company to consolidate variable interest entities (“VIE”) if the enterprise is a primary beneficiary (holds a majority of the variable interest) of the VIE and the VIE has specific characteristics. It also requires additional disclosures for parties involved with VIEs. In October 2003, the FASB deferred the effective date of this interpretation for all VIEs to the first reporting period after December 15, 2003. The adoption of this interpretation did not have a material impact on the Company’s consolidated financial position, results of operations or cash flows.

In April 2003, SFAS No. 149, “Amendment of Statement 133 on Derivative Instruments and Hedging Activities” was issued. The standard amends and clarifies financial reporting for derivative instruments and for hedging activities accounted for under SFAS No. 133 and was effective for contracts entered into or modified, and for hedges designated, after June 30, 2003. Adoption of the standard did not have a material impact on the Company’s consolidated financial position, results of operations or cash flows.

In May 2003, SFAS No. 150, “Accounting for Certain Instruments with Characteristics of Both Liabilities and Equity” was issued. The standard establishes how an issuer classifies and measures certain freestanding financial instruments with characteristics of liabilities and equity and requires that such instruments be classified as liabilities. The standard was effective for financial instruments entered into or modified after May 31, 2003 and was otherwise effective at the beginning of the first interim period beginning after June 15, 2003. The adoption of the standard did not have a material impact on the Company’s consolidated financial position, results of operations or cash flows.

In May 2003 the Emerging Issues Task Force reached a consensus on Issue No. 00-21, “Revenue Arrangements with Multiple Deliverables” (EITF 00-21) which became effective for revenue arrangements entered into in the third quarter of 2003. In an arrangement with multiple deliverables, EITF 00-21 provides guidance to determine (a) how the arrangement consideration should be measured, (b) whether the arrangement should be divided into separate units of accounting, and (c) how the arrangement consideration should be allocated among the separate units of accounting. The Company adopted EITF 00-21 in the third quarter. The adoption of the standard did not have a material impact on the Company’s consolidated financial position, results of operations or cash flows.

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Item 7A. Quantitative and Qualitative Disclosures about Market Risk

Foreign Exchange Risk

The Company’s financial results are affected by changes in foreign currency exchange rates or weak economic conditions in the foreign markets in which products are sold. The Company’s primary currency exposures are European Common Currency (Euro), British Pound, and Canadian Dollar. At January 31, 2004, the Company’s investment in foreign assets was $1.6 million. An overall unfavorable change in foreign exchange rates of 10% would have resulted in an additional net loss of approximately $0.1 million and a $0.3 million reduction in shareholders’ equity as a result of the impact on the cumulative translation adjustment.

The Company, on occasion, utilizes foreign exchange option contracts to minimize its exposure associated with unfavorable changes in foreign exchanges rates on certain foreign denominated receivables. At January 31, 2004, the Company did not have any open contracts. The functional currencies of the Company’s foreign affiliates are their respective local operating currencies, which are translated for consolidated financial reporting purposes into U.S. dollars.

Item 8. Financial Statements and Supplementary Data

The consolidated financial statements required under this item are submitted as a separate section of this report on the pages indicated at Item 15(a)(1). The supplementary data regarding annual results of operations is set forth in the following table.

QUARTERLY FINANCIAL DATA (Unaudited)

(Dollars in Thousands, Except Per Share Amounts)

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None

Item 9A. Controls and Procedures

As required by Rule 13a-15 under the Exchange Act of 1934, the Company carried out an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures as of the end of the period covered by this report. This evaluation was carried out under the supervision and with the participation

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of the Company’s management, including the Company’s Chairman of the Board and Chief Executive Officer and the Company’s Chief Financial Officer. Based upon that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective as of the end of the period covered by this report.

There have been no significant changes in the Company’s internal control over financial reporting during the Company’s most recent fiscal quarter that has materially affected, or is reasonably likely to affect, the Company’s internal control over financial reporting.

PART III

Item 10. Directors and Executive Officers of the Registrant

The response to this item is incorporated by reference to the Company’s definitive proxy statement for the 2004 annual meeting of shareholders.

The following is a list of the names and ages of, and the positions and offices presently held by, all executive officers of the Company. All officers serve at the pleasure of the Board of Directors.

All of the persons named above have held the positions identified since January 31, 1985, except as indicated below.

Mr. Ondis has been a Director and Chief Executive Officer since 1969. He was previously President and the Chief Financial Officer (Treasurer) of the Company from 1969 to 1985.

Mr. Pizzuti was previously a Vice President of the Company functioning as Chief Operating Officer since 1971.

Mr. O’Connell joined the Company in 1996. He previously held senior financial management positions with Cherry Tree Products Inc., IBI Corporation and Dennison Manufacturing Company. Mr. O’Connell is also Assistant Secretary of the Company.

Mr. Chatten joined the Company in December 1999 as President of Grass-Telefactor Product Group. Prior to that, Mr. Chatten was founder and President of Telefactor Corporation which was acquired by Astro-Med in December 1999.

Mr. Deeb has held the position identified since 1987. In 1985, he was named General Manager—Media Products after having been Vice President and General Manager since 1981 of a business sold by the Company in 1984.

Mr. Sullivan was appointed Vice President and Chief Technology Officer in 2000. He is an electronic engineer and has been with the Company for eighteen years.

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Mr. Petrarca was appointed Vice President of Instrument Manufacturing in November 1998. He has previously held positions as General Manager of Manufacturing, Manager of Grass Operations and Manager of Grass Sales. He has been with the Company since 1980.

Mr. Silveira joined the Company in 2000. He previously held financial management positions with Textron Inc., most recently serving in the Industrial Products, Mergers & Acquisitions group and with KPMG Peat Marwick LLP. He is a certified public accountant.

Code of Ethics

The Company has adopted a Code of Ethics which applies to all directors, officers and employees of the Company, including the Chief Executive Officer (“CEO”), Chief Operating Officer (“COO”), Chief Financial Officer (“CFO”) (who is both the principal financial and accounting officer) and Controller, as supplemented by a Code of Ethical Conduct for the Chief Executive Officer and Senior Financial Officers, which meets the requirements of a “code of ethics” as defined in Item 406 of Regulation S-K. The Company will provide a copy of the Codes to shareholders, without charge, upon request directed to the Investor Relations Contact listed on the Company’s website, www.astromed.com, under the headings “Investor Relations – Corporate Governance”. The Company intends to post the Codes on the Company’s website under “Investor Relations – Corporate Governance” and to disclose any amendment to, or waiver of, a provision of the Codes for the CEO, COO, CFO, Controller or persons performing similar functions by posting such information on its website.

Item 11. Executive Compensation

The response to this item is incorporated by reference to the Company’s definitive proxy statement for the 2004 annual meeting of shareholders.

Item 12. Security Ownership of Certain Beneficial Owners and Management

The response to this item is incorporated by reference to the Company’s definitive proxy statement for the 2004 annual meeting of shareholders.

Equity Compensation Plan Information

The following table sets forth information about the Company’s equity compensation plans as of January 31, 2004:

Additional information regarding these equity compensation plans is contained in Note 5 to the Company’s Consolidated Financial Statements included in Item 15 hereto.

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Item 13. Certain Relationships and Related Transactions

The response to this item is incorporated by reference to the Company’s definitive proxy statement for the 2004 annual meeting of shareholders.

Item 14. Principal Accountant Fees And Services

The information required by this item is incorporated herein by reference to the Company’s definitive proxy statement for the 2004 annual meeting of shareholders.

PART IV

Item 15. Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a)(1) Financial Statements:

The following consolidated financial statements of Astro-Med, Inc. and subsidiaries are incorporated by reference in Item 8:

All other schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are not required under the related instructions or are inapplicable, and therefore, have been omitted.

(a)(3) Exhibits:

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On November 18, 2003, the Company filed a Current Report on Form 8-K announcing the third quarter consolidated earnings.

On December 18, 2003, the Company filed a Current Report on Form 8-K reporting under Item 9. Regulation FD Disclosure regarding Albert W. Ondis, Chief Executive Officer, of Astro-Med, Inc., (ALOT) posted remarks concerning the Company’s current stock price and recently issued Provident Equity Research Report on Yahoo’s message board.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.

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REPORT OF INDEPENDENT AUDITORS

To the Shareholders of

Astro-Med, Inc.

We have audited the accompanying consolidated balance sheets of Astro-Med, Inc. (the “Company”) as of January 31, 2004 and 2003, and the related consolidated statements of operations, comprehensive income (loss) and changes in shareholders’ equity and cash flows for the years then ended. Our audit also included the financial statement schedule for those years listed in the Index at Item 15(a). These financial statements and schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audit. The consolidated financial statements of the Company for the year ended January 31, 2002 were audited by other auditors who have ceased operations and whose report dated March 15, 2002, expressed an unqualified opinion on those statements before the revisions described in Note 1.

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

In our opinion, financial statements referred to above present fairly, in all material respects, the consolidated financial position of Astro-Med, Inc. at January 31, 2004 and 2003, and the consolidated results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States. Also, in our opinion, the related financial statement schedule for those years, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein.

As discussed in Note 1 to the consolidated financial statements, effective February 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets.”

As discussed above, the financial statements of Astro-Med, Inc. for the year ended January 31, 2002 were audited by other auditors who have ceased operations. As described in Note 1, these financial statements have been revised to include the transitional disclosures required by Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets”, which was adopted by the Company as of February 1, 2002. Our audit procedures with respect to the disclosures in Note 1 with respect to 2002 included (a) agreeing the previously reported net loss to the previously issued financial statements and the adjustments to reported net loss representing amortization expense (including any related tax effects) recognized in those periods related to goodwill to the Company’s underlying records obtained from management, and (b) testing the mathematical accuracy of the reconciliation of adjusted net loss to reported net loss, and the related loss per share amounts. In our opinion, the disclosures for 2002 in Note 1 are appropriate. However, we were not engaged to audit, review, or apply any procedures to the 2002 financial statements of the Company other than with respect to such disclosures and, accordingly, we do not express an opinion or any other form of assurance on the 2002 financial statements taken as a whole.

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REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Shareholders of Astro-Med, Inc.:

We have audited the accompanying consolidated balance sheets of Astro-Med, Inc. (a Rhode Island Corporation) and subsidiaries as of January 31, 2002 and 2001, and the related consolidated statements of income, comprehensive income and changes in shareholders’ equity and cash flows for each of the three years in the period ended January 31, 2002. These financial statements and schedule referred to below are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

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

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Astro-Med, Inc. and subsidiaries as of January 31, 2002 and 2001, and the results of their operations and their cash flows for each of the three years in the period ended January 31, 2002, in conformity with accounting principles generally accepted in the United States.

Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The schedule listed in the index at Item 14(a)(2) is presented for purposes of complying with the Securities and Exchange Commission’s rules and is not part of the basic financial statements. This schedule has been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, fairly states in all material respects the financial data required to be set forth therein in relation to the basic financial statements taken as a whole.

Note: This report of Independent Certified Public Accountants is a copy of a previously issued Arthur Andersen LLP (“Andersen”) report and has not been reissued by Andersen. The inclusion of this previously issued Andersen report is made pursuant to Section 2.02(e) of regulation S-X. Note that this previously issued Andersen report includes references to certain fiscal years which are not required to be presented in the accompanying consolidated financial statements as of and for the year ended January 31, 2002.

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ASTRO-MED, INC.

CONSOLIDATED BALANCE SHEETS

As of January 31, 2004 and 2003

The accompanying notes are an integral part of these financial statements.

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ASTRO-MED, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

Years Ended January 31, 2004, 2003 and 2002

The accompanying notes are an integral part of these financial statements.

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ASTRO-MED, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) AND CHANGES IN

SHAREHOLDERS’ EQUITY

Years Ended January 31, 2004, 2003 and 2002