These
are among the strengths we count upon to enable ST to adjust
to rapidly changing industry conditions. Today the market is
in flux, responding to excessive inventory build-ups in many
sectors. Economic forecasts diverge widely on whether we are
facing a "soft landing" or a true recession.
STMicroelectronics' success within a broad range of business
and market conditions is well-documented. We have enjoyed an
above-average track record in times of cyclical industry downturns,
yet have posted exceptional growth during periods of favorable
market conditions. We believe that this combination of relative
resiliency and outperformance on the upside is a consequence
of several factors:
Balance The diversity of our products,
targeted applications and geographic mix all come together to
provide strong growth potential without the risks associated
with a one product or one application company.
Customers The success of the companies
that comprise our network of strategic alliances and key customers
reflects positively on ST's products, aptitude and TQM culture.
Manufacturing The systematic application
of manufacturing science, strict adherence to TQM and modular
capital investment programs give ST a global manufacturing machine
that is among the most efficient in the industry.
Financial Position The Company's
financial strength is reflected by: internal cash generation
which amounted to $2.6 billion in 2000; its cash and cash equivalents
position of $2.3 billion at year-end 2000; and, ST's proven
ability to access the capital markets in order to finance growth.
|
 |
Corporate Culture None of the above-cited competitive
advantages can lead to success without a cohesive corporate
culture that rewards individual dedication, innovative thinking,
customer service and excellent execution. As a global company,
ST is committed to putting the individual at the center of the
business enterprise and to maintaining its leadership in protecting
the environment.
We take particular pride in our Company's worldwide leadership
role in the area of environmental preservation. Our strong commitment
to this cause is part of our fundamental belief in the ethical
obligations of business enterprises to Society. ST remains determined
to protect the world's severely threatened environment for the
benefit of today's inhabitants as well as to ensure the welfare
of future generations.
This ethical position is strongly supported by our conviction
that environmentally-minded companies are intrinsically more
competitive and therefore able to generate higher returns for
their shareholders. ST's history and performance demonstrate
the validity of this assumption. In fact, ST is the top ranked
semiconductor company on the Dow Jones Sustainability Group
Index, which identifies companies that "not only manage
the standard economic factors affecting their business, but
the environmental and social factors as well." |
|
Additionally,
we were the only semiconductor company to receive a AAA rating
in eco-efficiency from Innovest Strategic Value Advisors and
were recipients of both the EPA Climate Protection Award in
1999 and the Akira Inoue Award for Outstanding Achievement in
Environmental, Health and Safety in the Semiconductor Industry
in the year 2000.
Gartner-Dataquest has ranked ST as the world's 6th largest semiconductor
company, based on year 2000 revenues. This is a formidable achievement,
having been 14th only 5 years ago. If you extract from the list
those companies that generate a majority of their total revenues
from semiconductor sales, the three largest are: Intel, Texas
Instruments and STMicroelectronics, in that order.
The year 2001 will be challenging. We are confident, however,
that the past will be a precursor for the future, enabling ST
to once again distinguish itself by outperforming the markets
we serve. To this end we will rely on our fundamental strengths
as well as the ongoing support of all of our stakeholders.
I would like to personally extend my appreciation to everyone
who contributed to ST's record performance in 2000 and to reaffirm
our commitment to our employees, strategic partners, customers
and shareholders.
Pasquale Pistorio
President and
Chief Executive Officer |
