8 We are pleased to inform you that  2004  was another  remarkable year for Diodes Incorporated. While the semiconductor industry generally  experienced a year of solid demand, we again yielded record results. Our  36 % growth in  revenues for  2004  once again exceeded the discrete  semiconductor sector by a factor of nearly two times.  We continued to strengthen our balance sheet and  generate positive cash from operations even as we built working capital in support of our growth and  invested over  $26  million in capital expenditures  to expand our manufacturing capacity for next- generation devices. Our strong performance is based on a core operating  strategy that has served us well in both strong and  weak markets over the past several years. This strategy  has three essential elements: First, to position Diodes as an innovation leader for discrete devices and provider of integrated  solutions. We have stepped up the pace of develop- ment of core intellectual property that enables us to transcend the current limits of performance, size and power consumption.  Second, to continually pursue manufacturing excellence  in order to establish an industry-leading cost structure,  maintain the flexibility to rapidly respond to changing  customer needs, and sustain our unmatched reputation  for product quality. Third, to exercise rigorous fiscal discipline in order to  ensure that our organization is lean, we optimize our  working capital performance, and every dollar we invest in capital equipment and research and development  earns multiple returns for our shareholders.  These are the fundamental principles that have been  behind Diodes’ success in recent years – and we  believe they offer a compelling formula for sustained  performance in the future.  Our fiscal results are the tangible expression of this  success. In the past year: Revenues increased  35.6 % to a record  $185.7  million.  This compares to the  2004  discrete semiconductor  growth of  18.1 %. • Sales of new products reached a record level of  16 %  of total sales. • We continued to diversify into higher-margin  product lines, improving our gross profit margin  600  bps to  32.7 %. • DEAR SHAREHOLDERS