In one of the most difficult times in the airline, railway and transportation industry's history we managed to achieve significant organic growth while remaining profitable and seeing a 53% hike in revenue. An exceptional achievement by all the competent Carmenites around the world.

Not only did we start working with one of the world's largest transportation companies, Deutsche Bahn, we also widened the range of our optimization applications at many of our loyal clients. This was done with one aim in mind: to support our clients in their journey towards competitiveness and improved performance. At the end of 2001 we signed a Service agreement with one of the most sophisticated airlines in the world, Singapore Airlines. The agreement means we will provide their planning department with optimal trips/pairings as the optimal input for a qualitative rostering process. This is the starting point for an expanded range of services from Carmen for all our clients, both current and future. We will support the transportation industry by using our know-how, including human resources, concepts and tools for best practice to underpin further growth, change and profitability for our clients.

We view the future with great enthusiasm and the opportunity for Carmen lies in globalizing our company, operating in all parts of the world and at the same time widening our product suite with business critical optimization applications as well as advanced services.

The transportation industry, as one of the world's largest employers, rightly demands that value-added solution providers ensure a brighter future and help transportation companies focus on their core business.The industry has started to see the true effects of privatization, deregulation, consolidation and globalization.

Our road forward - the Carmen way - is to continue our strong commitment to R&D; and to constantly build best-of-breed optimization solutions. Our goal is to improve our clients performance and ability to adapt to a rapidly changing environment by utilizing our innovative approach. To us, the more demanding the operation is, the more excited we get. The current conditions in the industry reinforce Carmen to focus on our clients and their diversified challenges more than ever before and be a strong partner in solving these challenges with them. We measure Carmen's success through the success of our clients.

Finally, I would like to extend a warm, proud and sincere thanks to all Carmenites, partners and clients, who via seamless cooperation have created yet another fantastic year for us. All of us have a brighter future to look forward to, due to the platform we have created together.

Yours sincerely,
Per Norén, CEO