As of the end of September, Hyundai Heavy Industries recorded £Ü5.8 trillion in combined sales, achieving 70% of its annual target. Every effort will be exerted to reach our sales goal for 2003 within the time remaining. In the meantime, new orders received in the first nine months stood at $8.18 billion, far exceeding our yearly target of $7.3 billion.

HHI has recently scored a number of notable accomplishments in its key business sectors. Shipbuilding has inaugurated a plant to build submarines ordered by the Republic of Korea Navy. From the 14,850m3 site-fully automated and featuring the very latest production equipment-the division will construct and deliver three 1,800-ton class submarines for the Korea Navy by the year 2009.

Offshore & Engineering received an order from the Chinese consortium of CNOOC and SINOPEC for a largescale subsea gas pipeline project valued at $130 million. The division will perform installation design and pipeline laying including hydraulic test work for the 472km-long pipeline.

Electro Electric Systems is planning to enter China in a major way with the construction of a production facility in Jiangsu Province. Through a joint venture with China¡¯s Nanzi Tonghua Electrical Group, the envisioned plant will produce switchgears, and low- & medium-voltage circuit breakers in the initial phase, and later high-voltage transformers, power electronics and other high valueadded electrical equipment.

In an agreement with Beijing Jingcheng Machinery Electric Holding Company, Engine & Machinery will enter the Chinese robot market. The division¡¯s new Beijing-based subsidiary, which commenced construction of a robot manufacturing plant in September, is targeting its share of the Chinese industrial robot market at 25% by the year 2006.

HHI recently celebrated the opening of its technology center in Torrance, California. Jointly established with Enova Systems Inc. of the US, the Hyundai Enova Innovative Technology Center (HEITC) will focus on developing technology for power equipment of electric vehicles and advanced power management and conversion programs.

This research center is expected to accelerate HHI¡¯s efforts to foster the creation of promising new business lines, while building a ¡°global technology network.¡±

All of these developments serve to chart our progress toward becoming a global leader in the heavy industries field. The entire staff and management of Hyundai Heavy Industries remain as committed as ever to realizing this corporate vision.

We cordially ask for your continued support and patronage.