A utility, by its very nature, is fueled by customer relationships. At UIL, we’re no longer just a regional utility. Yet, even as we’ve changed with deregulation, establishing emerging growth businesses outside of the electrical utility domain, the fact remains — customer relationships are still the building block of our success.

This fact stands out against a backdrop of economic uncertainty, as do the numbers we’ve highlighted for you in these pages. Despite the stock market’s decline, UIL held strong, with a consistent dividend yield (5.7% at this writing at the stock price of $52.50) supported

by solid earnings and strong cash flow. The growth strategy in our non-utility businesses hasn’t veered from our strong and steady path. We’ve become leaders in service niches that demand sophisticated products and services — where few companies possess the determination, knowledge and technical acumen to venture. In all, we’ve proven ourselves as long-term players.

We continue to strive for a strong connection with our customers by remaining committed to their needs and continuing to upgrade our services. And we are focused on goals that our managers are empowered to fulfill. At the same time, we are resilient, willing to learn and adjust as change affects our business.

Steady as we grow. As a small cap service company, UIL’s performance has been steady and predictable. For investors looking for a way to avoid the rocks under the waves, we hold the advantage of being a “known player” that has already established a consistent pattern through years of economic fluctuation and uncertainty.

While the tragedies that our nation suffered last year had a deep personal impact on everyone here at UIL, the effect on our financial performance has been minimal. Even though growth rates in our utility’s service territory have not been high, our earnings come out of a return on an equity base, and that continues to be strong. A year of reduced manufacturing and economic activity has been felt throughout the country, but it has not significantly affected our financial performance.

If your criterion is value, UIL stock was well worth holding in 2001, a fact that remains true in 2002. UIL beat the mid-year earnings guidance numbers we provided in 2001, with year-end earnings per share of $4.21. Though our utility earnings were down compared with the previous year, they have been offset in part by our non-utility businesses and investments, and we expect to see earnings from our non-utility businesses more than make up for waning utility earnings.