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Advanced Technologies. The table that follows sets out revenue and profitability for thissegment.Year Ended December 31,(dollars in thousands) 2011 2010 2009Revenue $ 233,364 $ 234,700 $ 194,380Gross Margin 33,774 32,510 25,128Gross Margin % 14 % 14 % 13 %Operating Income 16,661 16,934 12,366Operating Income % 7 % 7 % 6 %Our Advanced Technologies segment operating income results in 2011 were similar to those in2010. Our Advanced Technologies segment's 2010 revenue and operating income were higherthan 2009 due to higher levels of entertainment industry contracts, U.S. Navy engineeringservices and Department of Defense manufacturing projects.We anticipate our Advanced Technologies 2012 operating income will be higher than that of2011 due to higher levels of entertainment industry contracts and improved execution on U.S.Navy vessel service work.Unallocated Expenses. Our unallocated expenses, i.e., those not associated with a specificbusiness segment, within gross margin consist of expenses related to our incentive anddeferred compensation plans, including restricted stock and bonuses, as well as other generalexpenses. Through 2010, a portion of our restricted stock expense varied with the market priceof our common stock. Our unallocated expenses within operating income consist of thosewithin gross margin plus general and administrative expenses related to corporate functions.The table that follows sets out our unallocated expenses.Year Ended December 31,(dollars in thousands) 2011 2010 2009Gross margin expenses $ (81,219) $ (72,753) $ (65,263)% of revenue 4 % 4 % 4 %Operating expenses (111,941 ) (100,484 ) (90,306)% of revenue 5 % 5 % 5 %Our unallocated gross margin and operating expenses increased in each of 2011 and 2010,primarily due to higher compensation related to incentive plans. In 2011, we also incurredadditional expenses associated with acquisition-related activities and international taxrestructuring.Other. The table that follows sets forth our significant financial statement items below theoperating income line.Year Ended December 31,(dollars in thousands) 2011 2010 2009Interest income $ 888 $ 580 $ 694Interest expense, net of amounts capitalized (1,096) (6,010 ) (7,781)Equity earnings of unconsolidated affiliates 3,801 2,078 3,242Other income (expense), net (539) (926 ) 1,504Provision for income taxes 102,227 104,691 101,422Interest expense decreased in 2011 and 2010, primarily from lower interest rates on LIBORbasedborrowings under our revolving credit agreement and term loan, and lower debt levels.We did not capitalize any interest in 2011. We capitalized $0.3 million of interest in 2010 andless than $0.1 million of interest in 2009. Interest expense in 2010 included $2.9 million toterminate an interest rate hedge.2011 Annual Report 19