The year 2000 was a good and very busy year for Ellwood Texas Forge - we made more than double the number of forgings compared to 1999. Oil and Gas activity in North and South America was really strong, as was our Military business.

Our safety performance was improved over 1999 and most employees have now received STOP training. We made good progress on our voluntary environmental objectives and of course maintained our ISO 14001 Certification. We likewise maintained ISO 9001 and attained AS 9000 and NADCAP approvals. Our increased activity resulted in a more than 30% increase in headcount so much effort went into training. A comprehensive employee satisfaction survey was conducted with generally very favorable results. Progress was made with several HR initiatives including our Wellness Program.

As in previous years we had considerable new product and new customer activity. We made progress with new parts for aircraft engines, industrial gas turbines, off-road vehicles, oil and gas and a variety of gear and wheel forgings for industrial applications.

ETF’s new 6,000 ton press (an $8 million investment) made its first closed die forgings in February 2000. Several parts previously made on our 11,000 ton press have been transferred to the 6,000 for greater efficiency and new parts (small gate valves, casing heads and discs) are being manufactured also. Customer and Employee reaction to the new press system has been excellent.

We expect 2001 to be another busy year. A strong US dollar, high energy costs, escalating employee costs and a variety of new parts and customers will make for a challenging year once again. As always, the key to our success in creating value for our customers will depend upon our ability to increase productivity and avoid waste. Again this year, we are pleased to thank our customers, employees, suppliers and owners for their ongoing support.

2000 Review

January 1, 2001