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sales growth. The increase in deferred income taxes resulted primarily from the recording of a$12.3 million deferred tax asset arising from the tax benefit relating to share options granted to our UKemployees partially offset by the usage of U.K. net operating loss carryforwards. The decrease inemployee compensation and benefits payable resulted primarily from 2004 fiscal year bonuses beinglower than 2003 fiscal year bonuses. The decrease in deferred revenue resulted from a change inpayment terms with a major customer where certain payments were no longer made in advance ofshipment together with a reduction in orders on hand from that customer.Cash provided by operating activities of $19.0 million in our 2003 fiscal year resulted primarilyfrom net income from continuing operations after excluding non-cash charges of $57.3 million,$5.0 million, $4.7 million and $1.6 million for non-cash equity compensation, depreciation, privateequity costs and payments paid by an employee benefit trust, respectively. In addition, $9.2 million ofcash provided by operating activities in our 2003 fiscal year was due to an increase of deferred revenuerelated to a change in contractual payment terms in our 2003 fiscal year with one of our majorcustomers. Increases in accounts payable, employee compensation and benefits payable and otheraccrued liabilities of $5.2 million, $4.8 million and $4.0 million respectively also contributed to cashprovided by operating activities. The increase in these items resulted primarily from underlying salesgrowth and payments made by an employee benefit trust. These increases were partially offset byincreases in inventory and accounts receivable of $9.8 million and $7.8 million respectively, anddecreases in income taxes payable and deferred income tax of $1.5 million and $13.5 millionrespectively. The increase in inventory and accounts receivable are consistent with underlying salesgrowth as well as a build up of inventory in anticipation of high levels of shipments of StorageInfrastructure products in the first fiscal quarter of 2004. The decrease in income tax payable isprimarily due to payments in our 2003 fiscal year of Malaysian withholding tax liabilities related toprior fiscal years. The increase in deferred tax assets is due to a reversal of the valuation allowance fornet operating loss carryforwards related to operations in the United Kingdom. In addition, a$1.2 million repayment of a customer advance and a $1.3 million payment to a related party resulted inoperating cash outflows.Net cash used in investing activities was $49.1 million for our 2005 fiscal year, $10.4 million for our2004 fiscal year and $5.3 million for our 2003 fiscal year.Net cash used in investing activities for our 2005 fiscal year comprised $24.5 million considerationfor our acquisition of nStor, $14.2 million initial consideration for our acquisition of Oliver Design lesscash acquired of $10.3 million, $4.3 million deferred consideration related to our acquisition of ZTAutomation, $2.2 million for our purchase of partially developed intellectual property from Cap Epsilonand $17.1 million related to capital expenditure.Net cash used in investing activities for our 2004 fiscal year comprised $6.0 million in respect ofthe initial consideration for the acquisition of the business of ZT Automation LLC, $1.4 million inrespect of the purchase of intellectual property from Beyond3 and $9.0 million related to capitalexpenditure, partially offset by a $6.0 million repayment of a supplier note receivable. Additionalamounts of consideration for our acquisition of ZT Automation of up to $20.4 million are payablebased principally on a percentage of revenue generated by this business in the three years ending onDecember 31, 2006, calculated as 21.5% of cumulative revenue in excess of $19.6 million, of which$5.6 million was paid or payable as of November 30, 2005. Further payments of up to $17.2 million maybe made for the Beyond3 intellectual property of which $1.2 million is based on the achievement ofproduct delivery milestones and the remainder is based on a percentage of operating profit generatedby the products. No additional amounts were paid or payable in connection with the Beyond 3intellectual property as of November 30, 2005. The supplier note receivable is described in thediscussion of the results of continuing operations for our 2004 fiscal year.56