Dear friends and colleagues:

The frequency of extreme weather events has increased significantly in recent years.The disasters associated with these events have led to widespread loss of life and property. Progress in international negotiations on carbon reduction has been glacial compared to the accelerating pace of global warming. In December, 2011, the United Nations Climate Change Conference (COP17) held in Durban, South Africa, extended the "Kyoto Protocol" that was originally set to expire in 2012. The extension was intended to give all parties more time to discuss and implement a new climate agreement before 2012. The lack of commitment shown by more than 190 countries around the world to emission reduction and their conservative action plans are quite troubling. We must step forward as a corporate citizen and leverage our core capabilities to reduce the emission of greenhouse gases and slow the onset of global warming.

Delta Group's mission is "To provide innovative, clean and energy-efficient solutions for a better tomorrow." Delta has long been committed to constantly improving the efficiency of our products as part of our everyday operations. Today, most of Delta's power management products have surpassed 90% energy efficiency, such as our photovoltaic (PV) inverters with a conversion efficiency of over 98%, and telecom power supplies with 97% efficiency. Apart from continuing to improve the efficiency of our power supply products even further, we are also actively moving towards total solutions that integrate Delta software and hardware to create smart green life applications that are more energy-efficient and easy to use. An example of this is our display solutions.Besides maintaining our lead in high-end projection systems, we have integrated hardware, system software and advanced display technologies with the humanities and the arts. At the National Grand Theater in Beijing last year, two of Delta's 30,000 lumen high resolution projectors displayed the main scenery for the performance of the "The Peony Pavilion", a Chinese Kun opera composed by the great literary master, Mr. Kenneth Hsien-yung Pai.

We also continue to promote green buildings for their significant environmental benefits. The Delta Taoyuan Technology Center completed at the end of 2011 introduces our company's energy-saving and industrial automation products and control systems. The green building also makes use of solar panels, LED lighting, water resource processing and renewable energy equipment. The energy-saving installations are expected to save more than 5 Million NTD in electricity costs, cut water consumption by 75% and reduce CO2 emissions by more than 1,000 tons. The new Min-Chuang Elementary School in the Namasia District of Kaohsiung City, rebuilt after Typhoon Morakot, is expected to be 65% more energy efficient than conventional school buildings of the same size. By using Delta's solar and wind power generation systems, the school library can achieve "sustainable zero energy consumption" and will provide students with a comfortable and
green learning environment.

Looking back on 2011, Delta received the "Distinguished Accomplishment Award"from the Chinese Professional Management Association, the 2011 Top Three "Best CEO "for technology/hardware in Asia from Institutional Investor magazine, an A+ rating in transparency and information disclosure from the Securities & Futures Institute, the "Annual CSR Championship Award" from Global Views Magazine as well as the "Corporate Citizenship Award" and "Most Admired Company in the Electronics Industry" from CommonWealth magazine. Delta was also chosen for the first time for the DJSI World Index and DJSI Asia/Pacific Index of the 2011/2012 Dow Jones Sustainability Indexes (DJSI). The inclusion signified recognition by international investors that the sustainable development of Delta now rivals that of leading global enterprises.

The environmental crises of the 21st century represent green opportunities for business. Delta will leverage our strengths in environmental protection and energy saving to create both company and product value. At the same time, we will harness these strengths to spur on continued growth and innovation at Delta.