In the first three years of U.S. operation, Enron Energy Services has been squarely focused on Fortune 1000 customers. But U.K.-based Enron Direct has successfully penetrated the immense medium-size business market, proving that we can sell energy to smaller enterprises in a truly open retail market.

Since gaining regulatory approval in February 1999 through the end of 2000, Enron Direct has acquired more than 130,000 gas and power customers, and continues to grow at a substantial rate. The profitability of these smaller accounts comes from Enron’s long-term price risk management capability and Enron Direct’s low-cost sales channels. Our high expectations for medium-size businesses are reflected by the rapid expansion of the European operation. Enron Directo already is active in Madrid, Spain, and similar businesses will be launched in other countries as well.

It is our strong belief that Enron is uniquely positioned to benefit both in the United States and Europe from the world’s steady shift toward deregulated energy markets. We will continue to provide sensible market solutions for the effective management of energy costs, and will continue to build a dynamic global retail business to drive company profits and sustain our reputation for innovation.