Valued stockholders,

The rapid economic expansion which characterized our country the past few years decelerated during 2007. Despite the two important elections we had and some unsettling developments occurring in neighboring countries we successfully managed to maintain economic stability as a nation during these challenging times. My business experience of over half a century tells me that 2007 will be remembered for its positive characteristics. Meanwhile, our company left behind a year that was filled with striking success stories which had been in the planning and execution phases for some time.

Undoubtedly, the most important event to take place in Turkey last year was the general election, which took place on July 22. The single party victory emerging from the elections was the most conclusive confirmation of the political stability which continues since 2002. The fact that one party has remained in office allowed for an advantage in terms of the speed with which the decision-making processes of the government takes place.

During both its previous and present terms, the Justice and Development Party (AKP) government has bravely tackled chronic economic issues, resulting in inflation dropping to a single digit, the local currency continuing to strengthen and exports increasing substantially.

It is apparent that the problematic matter of social security, which has created a significant burden on the country’s budget for many years, will be handled during 2008. Steps that will generate concrete results need to be taken with respect to the foreign trade deficit and both the public and private sector organizations must provide support to the government in its search for solutions. Although the continued infusion of foreign capital is encouraging, the foreign debt and problems related to the high interest level are still matters that need to be dealt with.

There are clear signs of contraction in the local market for 2008. I trust that Borusan will counteract this tendency with our increasing competitive strength and offshore activities. Borusan has become a well-respected entity in the international arena as a result of our collaborations with our global partners and the efforts of our companies to expand into international markets.

Because of our strong structural attributes we have been able to maintain a growth which is significantly above that of the nation’s economy. As explained by the Chairman of the Board of Directors, Mr. A. Ahmet Kocabıyık, in the following pages, we were once again quite successful last year as well.

Our company is taking great strides forward in our primary areas of activity. On the one hand, we have won important tenders in both local and global markets. On the other hand, working hand in hand with our partners, we are following through with such strategically important investment projects as the long awaited hot-rolled steel, which is of vital importance to our national economy. I am also closely monitoring our investments, related to increasing the production capacity of flat steel and steel pipe, with much pleasure. These are the types of industrialization endeavors that our country’s economy has needed since the formation of the Republic.

On behalf of my family and myself, I would like to thank all our employees, from the youngest to the oldest, who have contributed their efforts in the successful attainment of these challenging targets.

Asım Kocabıyık Founder and Honorary Chairman