ESG Elektroniksystem- und Logistik-GmbH reorganised at the beginning of 2003. The system and software house is now organised into five divisions, compared with three previously. The individual divisions are

System Development, Military and Public Agencies Division

IT System Integration, Military and Public Agencies Division

Logistics, Military and Public Agencies Division

Automotive Division

Business Development Division

In taking this step, ESG is tuning its organisational structure to changes in the markets in which it is active and also to its corporate strategy. The new IT System Integration Division and the existing System Development Division, for example, illustrate that the Company will in future focus on expanding its core competences in the development and integration of electronic and logistic systems. The new Automotive Division, which has emerged from the former Industrial Systems and Services Division, underpins the growing enormous significance ESG attaches to its automobile business. The turnover recorded by the company alone in this area represents a double-figure increase over the previous year. Subjects that are still in the development phase at ESG (telecommunications and transportation) will receive the necessary special attention in the new Business Development Division.

The beginning of the year also saw the number of staff employed at ESG rise above the 1000 mark. The last time ESG had a comparable staffing level was at the beginning of the 1980s. A large-scale cut-back was necessary at that time due to the cuts in defence spending, last but not least due to completion of the TORNADO combat aircraft’s development phase. As a direct result of its successes in non-military markets, however, ESG has succeeded in successively increasing the number of staff over the past ten years.

ESG, one of Germany’s leading system and software houses, last year recorded a turnover of more than €140 million, compared with €126 million in 2001. Precise business figures for 2002 are expected in the next few weeks. One reason for the continuing success of the Company over the years is the technological transfer between military and non-military projects, which is resolutely practised. ESG will continue to pursue its recipe for success with its new organisational structure.