We're exceeding some of the models from which we worked.

HTS technology is attracting strong attention for a broad range of military and commercial applications. In addition to future U.S. Navy generators, HTS wire is currently powering ship propulsion motors, electric grid power cables, synchronous condensers and specialty magnets. We value the opportunity to work once more with our strategic alliance partner, Northrop Grumman, in developing a key component of the Navy's integrated power systems for its future all-electric ships.

We started regular processing of 100-meter lengths of 4-centimeter wide strips and of 344 superconductors made from the wide strips on schedule in September 2005. At that time, we also began to order new full- scale manufacturing equipment for our pilot manufacturing line -- ahead of our original schedule. We expect to achieve a manufacturing capacity of 300,000 meters per year of 344 superconductors by December 2007.

Kevin has made significant contributions to American Superconductor since he joined our team. While we are sorry to see Kevin depart, we wish him every success in his new position. At the same time, we are pleased to have Tom Rosa, who has worked very closely with Kevin and me, move into the position of interim CFO.

We'll clearly have to be hiring more people to account for that major scale-up in production.

This wire is the future of our company. This is probably the first second-generation wire sold by anyone, anywhere in the world. That's the major achievement here.