MIRA INFORM REPORT

Report Date :

11.04.2007

IDENTIFICATION DETAILS

Name :	PETRA FOODS LIMITED
Registered Office :	^111 Somerset Road, #16-01, Singapore Power Building, Singapore – 238164
Country :	Singapore
Financials (as on) :	31.12.2006
Date of Incorporation :	^22/08/1984
Com. Reg. No.:	^198403096C
Legal Form :	^Pub Ltd Co
Line of Business :	Manufacturing and Marketing of Cocoa Ingredients and Chocolate Confectionery Products and Investment Holding

RATING & COMMENTS

MIRA’s Rating :

A

RATING		STATUS	PROPOSED CREDIT LINE
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large

Status :	Good
Payment Behaviour :	Regular
Litigation :	Clear

Subject Company

PETRA FOODS LIMITED

Line Of Business 

MANUFACTURING AND MARKETING OF COCOA INGREDIENTS AND CHOCOLATE CONFECTIONERY PRODUCTS AND INVESTMENT HOLDING

Parent Company

FREMONT INVESTMENT LIMITED

(PERCENTAGE OF SHAREHOLDING: 53.69%)

Financial Elements

FY 2006

CONSOLIDATED

Sales : US$522,850,000

Networth : US$171,953,000

Paid-Up Capital : US$95,767,000

Net result : US$29,130,000

Net Margin(%) : 5.57

Return on Equity(%) : 16.94

Leverage Ratio : 1.25

COMPANY IDENTIFICATION

^{Subject Company : PETRA FOODS LIMITED}

^{Former Name : PETRA FOODS PTE LTD}

^{Business Address: 111 SOMERSET ROAD}

^#16-01

^{SINGAPORE POWER BUILDING}

^{Town: SINGAPORE}

^{Postcode: 238164}

^{County: -}

^{Country: Singapore}

^{Telephone: 6477 5600}

^{Fax: 6887 5181}

^{ROC Number: 198403096C}

^{Reg. Town: -}

PREVIOUS IDENTIFICATION

^{PETRA FOODS PTE LTD}

^{DATE OF CHANGE OF NAME: 05/10/2004}

SUMMARY

^{All amounts in this report are in: USD unless otherwise stated}

^{Legal Form: Pub Ltd Co}

^{Date Inc.: 22/08/1984}

^{Previous Legal Form: -}

^{Summary year : 31/12/2006}

^{Sales: 522,850,000}

^{Networth : 171,953,000}

^{Capital: -}

^{Paid-Up Capital: 95,767,000}

^{Employees: 4,118}

^{Net result : 29,130,000}

^{Share value: -}

^{AUDTIOR: PRICEWATERHOUSECOOPERS}

^{BASED ON ACRA'S RECORD AS AT 09/04/2007}

^{NO. OF SHARES CURRENCY AMOUNT}

^{ISSUED ORDINARY 532,277,000 SGD 162,615,357.00}

^{PAID UP ORDINARY - SGD 162,615,357.00}

REFERENCES

^{Litigation: Yes}

^{Company status : TRADING}

^{Started : 22/08/1984}

PRINCIPAL(S)

^{CHUANG TIONG CHOON S2000217D Managing Director}

DIRECTOR(S)

^{DAVINDER SINGH S/O AMAR SINGH S1242206G Director}

^{Appointed on : 12/06/2001}

^{Street : 18 RAMSGATE ROAD}

^{Town: SINGAPORE}

^{Postcode: 437137}

^{Country: Singapore}

^{CHUANG TIONG KIE S1326974B Director}

^{Appointed on : 31/05/2001}

^{Street : 15 ROBIN ROAD}

^{EMERALD COURT}

^{Town: SINGAPORE}

^{Postcode: 258196}

^{Country: Singapore}

^{CHUANG TIONG CHOON S2000217D Director}

^{Appointed on : 01/11/1989}

^{Street : 19 TANGLIN HILL}

^{Town: SINGAPORE}

^{Postcode: 248052}

^{Country: Singapore}

^{CHUANG TIONG LIEP @ CHIT KO KO S2009176B Director}

^{Appointed on : 02/03/1999}

^{Street : 131 DUCHESS AVENUE}

^{DUCHESS GARDEN}

^{Town: SINGAPORE}

^{Postcode: 269161}

^{Country: Singapore}

^{CHUANG YOK HOA S2010505D Company Secretary}

^{Appointed on : 16/10/1984}

^{Street : 802 DUNEARN ROAD}

^{Town: SINGAPORE}

^{Postcode: 289670}

^{Country: Singapore}

^{LIAN KIM SENG S2586702E Company Secretary}

^{Appointed on : 06/07/2001}

^{Street : 41 JURONG EAST AVENUE 1}

^#05-02

^{PARC OASIS}

^{Town: SINGAPORE}

^{Postcode: 609777}

^{Country: Singapore}

^{PEDRO FRANCISCO MATA BRUCKMANN 141913783 Director}

^{Appointed on : 12/06/2001}

^{Street : 297 GREENS FARMS ROAD}

^{GREEN FARMS CT06838}

^Town:

^Postcode:

^{Country: United States}

^{JOSEPHINE PRICE 761072539 Director}

^{Appointed on : 12/06/2001}

^{Street : 4A, BEST VIEW COURT}

^{66 MACDONNELL ROAD}

^{MID LEVELS}

^Town:

^Postcode:

^{Country: Hong Kong}

^{CHUANG TIONG CHOON S2000217D Managing Director}

^{Appointed on : 05/11/2004}

^{Street : 19 TANGLIN HILL}

^{Town: SINGAPORE}

^{Postcode: 248052}

^{Country: Singapore}

^{ANTHONY MICHAEL DEAN S2719602J Director}

^{Appointed on : 06/05/2005}

^{Street : 53 VICTORIA PARK ROAD}

^{Town: SINGAPORE}

^{Postcode: 266527}

^{Country: Singapore}

^{CHUA KOON CHEK S0033540A Director}

^{Appointed on : 01/08/2005}

^{Street : 11 BARKER ROAD}

^{Town: SINGAPORE}

^{Postcode: 309876}

^{Country: Singapore}

FORMER DIRECTOR(S)

^{CHUNG TAI KWOK S2182090C}

^{QUEK SEE SENG 3575751}

^{CHEAH LEONG TEEN S2535396Z}

^{RICHARD OWEN PYVIS E3004564}

ACTIVITY(IES)

^{FOOD PRODUCTS Code:9460}

^{INVESTMENT COMPANIES Code:12095}

^{HOLDING COMPANIES Code:11320}

^{BASED ON ACRA'S RECORD AS AT 09/04/2007}

^{1) WHOLESALE OF FRUITS AND VEGETABLES; FOOD PRODUCTS}

CHARGES

^{Date: 14/03/2005}

^{Comments : CHARGE NO : C200501505, C200501504, C200501503}

^{SECURED : 0.00 AND ALL MONIES OWING}

^{CHARGEE : FORTIS BANK S.A./N.A. (DISCHARGED)}

^{Date: 14/03/2005}

^{Comments : CHARGE NO : C200501506 (DISCHARGED)}

^{SECURED : 0.00 AND ALL MONIES OWING}

^{CHARGEE : COOPERATIEVE CENTRALE RAIFEISEN-BOERENLEENBANK B.A.}

^{Date: 11/12/1995}

^{Comments : CHARGE NO : 9507609 (DISHCARGED)}

^{SECURED : 0.00 ALL MONIES OWING}

^{CHARGEE : SOCIETE GENERALE}

^{Date: 29/07/1993}

^{Comments : CHARGE NO : 9303294 (DISHCARGED)}

^{SECURED : 0.00 ALL MONIES OWING}

^{CHARGEE : BHF-BANK AKTIENSELLSCHAFT}

^{Date: 22/03/1995}

^{Comments : CHARGE NO : 9501711 (DISCHARGED)}

^{SECURED : 0.00 AND ALL MONIES OWING}

^{CHARGEE : COOPERATIVE CENTRALE RAIFFEISEN-BOERENLEENBANK BA}

^{Date: 24/07/1993}

^{Comments : CHARGE NO : 9303183 (DISCHARGED)}

^{SECURED : 0.00 ALL MONIES OWING}

^{CHARGEE : CREDIT LYONNAIS}

^{Date: 21/11/1995}

^{Comments : CHARGE NO : 9507160 (DISCHARGED)}

^{SECURED : ALL MONIES OWING}

^{CHARGEE : KREDIETBANK N.V.}

^{Date: 20/02/1995}

^{Comments : CHARGE NO :9501040 (DISCHARGED)}

^{SECURED : 0.00 ALL MONIES OWING}

^{CHARGEE : ABN AMRO BANK N.V.}

^{Date: 03/06/1993 Amount: 150,000}

^{Comments : CHARGE NO : 9302334 (DISHCARGED)}

^{SECURED :150,000.00 U.S. DOLLAR}

^{CHARGEE : ABN AMRO BANK N.V.}

^{Date: 30/06/1998}

^{Comments : CHARGE NO : 199803355 (DISCHARGED)}

^{SECURED : 0.00 AND ALL MONIES OWING}

^{CHARGEE(S) : KBC BANK N.V.}

^{Date: 13/05/1995}

^{Comments : CHARGE NO : 9502885 (DISCHARGED)}

^{SECURED : NIL}

^{CHARGEE(S) : CREDIT LYONNAIS}

^{Date: 02/08/2000 Amount: 1,000,000}

^{Comments : CHARGE NO: 200003559 (DISCHARGED)}

^{CHARGEE: OVERSEAS UNION BANK LIMITED}

^{SECURED: S$1,000,000.00 AND ALL MONIES OWING}

^{Date: 01/08/2000 Amount: 230,000}

^{Comments : CHARGE NO: 200003547 (DISHCARGED)}

^{CHARGEE: COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEEBANK}

^{Date: 17/05/2000}

^{Comments : CHARGE NO: 200002170/200002169 (DISHCARGED)}

^{CHARGEE: BANQUE NATIONALE DE PARIS}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{Date: 09/11/2001}

^{Comments : CHARGE NO: 200105515, 200105514 (DISCHARGED)}

^{SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE (s) : FORTIS BANK S.A./N.V.}

^{Date: 10/10/2003}

^{Comments : CHARGE NO : C200304821,C200304817 (DISCHARGED)}

^{SECURED : 0.00 AND ALL MONIES OWING}

^{CHARGEE : SUMITOMO MITSUI BANKING CORPORATION SINGAPORE BRANCH}

^{Date: 01/10/2003}

^{Comments : CHARGE NO : C200304665}

^{SECURED : 0.00 AND ALL MONIES OWING}

^{CHARGEE : DEG-DEUTSCHE INVESTITIONS - UND ENTWICKLUNGSGESELLSCHAFT}

^GMBH

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

BANKERS

^{UNITED OVERSEAS BANK LIMITED}

^{FORTIS BANK S.A./N.V.}

^{KBC BANK N.V.}

^{SUMITOMO MITSUI BANKING CORPORATION SINGAPORE BRANCH}

^{OVERSEAS UNION BANK LIMITED}

^{COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEENBANK B.A.}

^{(RABOBANK NEDERLAND)}

ASSOCIATED COMPANY(IES)

^{PT CERES - MEIJI INDOTAMA}

^Indonesia

SHAREHOLDERS(S)

^{MCKEESON INVESTMENTS PTE LTD 6,000,000 Company}

^{Street : 900 SOUTH WOODLANDS DRIVE}

^#04-03

^{Town: SINGAPORE}

^{Postcode: 730900}

^{Country: Singapore}

^{BERLIAN ENTERPRIESE LIMITED 10,777,000 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Virgin Islands (British)}

^{RAFFLES NOMINEES PTE LTD 280,944,049 Company}

^{Street :}

^{Town: SINGAPORE}

^Postcode:

^{Country: Singapore}

^{DBS NOMINEES PTE LTD 49,335,620 Company}

^{Street :}

^{Town: SINGAPORE}

^Postcode:

^{Country: Singapore}

^{CITIBANK NOMINEES SINGAPORE PTE LTD 26,418,410 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{MORGAN STANLEY ASIA (S) SECURITIES 31,276,000 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{HSBC (SINGAPORE) NOMINEES PTE LTD 65,341,900 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{THE ASIA LIFE ASSURANCE SOCIETY LTD 5,144,000 Company}

^{Street :}

^{Town: SINGAPORE}

^Postcode:

^{Country: Singapore}

^{DBS VICKERS SECURITIES (S) PTE LTD 2,741,000 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{KIE SAW SIM 3,688,000 Private Person}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{CHUANG MYING HWA @ MYING MYING 1,968,000 Private Person}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{CHUANG YOK HOA @ MA LIN ZI 2,855,000 Private Person}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{UNITED OVERSEAS BANK NOMINEES (PTE) 8,404,570 Company}

^{Street : 28 BOAT QUAY}

^{Town: SINGAPORE}

^{Postcode: 049818}

^{Country: Singapore}

^{UOB KAY HIAN PTE LTD 1,629,000 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{MAYBAN NOMINEES (SINGAPORE) PTE LTD 2,250,000 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{MERYLL LYNCH (S) PTE LTD 2,119,100 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{DBSN SERVICES PTE LTD 20,147,884 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{ANG LILY 800,000 Private Person}

^{Street :}

^{Town: SINGAPORE}

^Postcode:

^{Country: Singapore}

^{CHIN KOON YEW 655,000 Private Person}

^{Street :}

^{Town: SINGAPORE}

^Postcode:

^{Country: Singapore}

^{YEO CHEE CHIOW 550,000 Private Person}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

FORMER SHAREHOLDER(S)

^{FREMONT INVESTMENTS PL 2,299,998}

^{FULLERTON INVESTMENT PL 80,000}

^{WAKEFIELD INVESTMENT PL 80,000}

^{FREMONT INVESTMENT LIMITED 277,741,000}

^{CHUNG TAI KWOK 1}

^{CHEAH LEONG TEEN 1}

^{P.T.SEDERHANA DJAJA 600,000}

^{MCKEESON HOLDINGS LIMITED 14,250,000}

^{CANZONE LIMITED 22,248,000}

^{DB NOMINEES (S) PTE LTD 3,191,643}

HOLDING COMPANY

^{FREMONT INVESTMENT LIMITED UF02351K % : 53.69}

SUBSIDIARY(IES)

^{MCKEESON CONSULTANTS PRIVATE LIMITED}

^Singapore

^{PT PERUSAHAAN INDUSTRI CERES}

Indonesia

^{PT GENERAL FOOD INDUSTRIES}

Indonesia

^{PT NIRWANA LESTARI}

Indonesia

^{DELFI COCOA ( MALAYSIA) SDN BHD}

^Malaysia

^{CERES SIME CONFECTIONERY SDN BHD}

^Malaysia

^{SIAM COCOA PRODUCTS CO LTD}

^Thailand

^{COCOA SPECIALITIES INC}

Philippines

^{DELFI CHOCOLATE MANUFACTURING S.A}

Switzerland

^{PETRA-SPT MARKETING PTE LTD}

^Singapore

^{DELFI COCOA INVESTMENTS 1 PTE LTD}

Singapore

^{DELFI COCOA USA, INC.}

United States of America

^{DELFI SINGAPORE PTE. LTD.}

Singapore

^{DELFI MARKETING SDN BHD}

Malaysia

^{DELFI FOODS, INC.}

Philippines

^{DELFI MARKETING INC.}

Philippines

PAYMENT HISTORY AND EXPERIENCES

Trade Morality: AVERAGE

Liquidity : SUFFICIANT

Payments : REGULAR

Trend : UPWARD

Financial Situation: AVERAGE

LITIGATION(S)

^{Type Of Case: Magistrate Court - W/S}

^{Case Number: MCS12361/1996}

Defendant PETRA FOODS LIMITED ROC # : 198403096C

^{Type Of Case: Magistrate Court - W/S}

^{Case Number: MCS06817/1994}

Defendant PETRA FOODS LIMITED ROC # : 198403096C

FINANCIAL ELEMENTS

^{All amounts in this report are in : USD}

^{Audit Qualification: UNQUALIFIED (CLEAN) UNQUALIFIED (CLEAN)UNQUALIFIED (CLEAN)}

^{Balance Sheet Date: 31/12/2006 31/12/2005 31/12/2004}

^{Number of weeks: 52 52 52}

^{Consolidation Code: CONSOLIDATED CONSOLIDATED CONSOLIDATED}

^{--- ASSETS}

^{Preliminary Exp 3,770,000 1,810,000 1,409,000}

^{Intangible Fixed Assets: 14,931,000 11,036,000 11,242,000}

^{Tangible Fixed Assets: 140,917,000 112,481,000 79,885,000}

^{Investments 3,065,000 2,864,000 2,956,000}

^{Total Fixed Assets: 162,683,000 128,191,000 95,492,000}

^{Inventories: 111,920,000 93,809,000 101,451,000}

^{Receivables: 62,775,000 45,033,000 39,084,000}

^{Cash,Banks, Securitis: 10,023,000 5,374,000 23,339,000}

^{Other current assets: 21,289,000 14,387,000 12,397,000}

^{Total Current Assets: 206,007,000 158,603,000 176,271,000}

^{TOTAL ASSETS: 368,690,000 286,794,000 271,763,000}

^{--- LIABILITIES}

^{Equity capital: 95,767,000 95,767,000 31,788,000}

^{Reserves: -1,853,000 -3,762,000 -3,921,000}

^{Profit & loss Account: 78,039,000 59,781,000 43,737,000}

^{Other: - 403,000 426,000}

^{Surplus equity: - - 63,869,000}

^{TOTAL EQUITY: 171,953,000 152,189,000 135,899,000}

^{Long Term Loans: 35,285,000 23,657,000 26,074,000}

^{L/T deffered taxes: 3,857,000 1,297,000 1,227,000}

^{Other long term Liab.: 6,176,000 3,502,000 2,849,000}

^{Total L/T Liabilities: 45,318,000 28,456,000 30,150,000}

^{Trade Creditors: 37,211,000 22,249,000 22,105,000}

^{Prepay. & Def. charges: 15,277,000 8,630,000 4,991,000}

^{Short term liabilities: 1,242,000 215,000 156,000}

^{Due to Bank: 86,051,000 63,346,000 39,328,000}

^{Provisions: 2,349,000 3,323,000 3,108,000}

^{Other Short term Liab.: 9,289,000 8,386,000 36,026,000}

^{Total short term Liab.: 151,419,000 106,149,000 105,714,000}

^{TOTAL LIABILITIES: 196,737,000 134,605,000 135,864,000}

PROFIT & LOSS ACCOUNT

^{Net Sales 522,850,000 439,324,000 383,926,000}

^{Gross Profit: 104,093,000 83,804,000 73,792,000}

^{Result of ordinary operations - - 30,752,000}

^{NET RESULT BEFORE TAX: 37,265,000 29,918,000 23,572,000}

^{Tax : 8,135,000 6,667,000 5,621,000}

^{Net income/loss year: 29,130,000 23,251,000 17,951,000}

^{Interest Paid: 8,635,000 4,958,000 7,124,000}

^{Depreciation: 11,269,000 8,710,000 7,966,000}

^{Dividends: 10,633,000 7,358,000 4,000,000}

^{Purchases,Sces & Other}

^{Goods: 418,757,000 355,520,000 -}

^{Wages and Salaries: 34,115,000 25,486,000 21,108,000}

^{Financial Income: 306,000 147,000 156,000}

RATIOS

^{31/12/2006 31/12/2005 31/12/2004}

^{Turnover per employee: 126966.97 106683.83 93231.18}

^{Net result / Turnover(%): 0.06 0.05 0.05}

^{Fin. Charges / Turnover(%):0.02 0.01 0.02}

^{Stock / Turnover(%): 0.21 0.21 0.26}

^{Net Margin(%): 5.57 5.29 4.68}

^{Return on Equity(%): 16.94 15.28 13.21}

^{Return on Assets(%): 7.90 8.11 6.61}

^{Dividends Coverage: 2.74 3.16 4.49}

^{Net Working capital: 54588000.00 52454000.00 70557000.00}

^{Cash Ratio: 0.07 0.05 0.22}

^{Quick Ratio: 0.48 0.47 0.59}

^{Current ratio: 1.36 1.49 1.67}

^{Receivables Turnover: 43.22 36.90 36.65}

^{Leverage Ratio: 1.25 0.95 1.09}

^{Net Margin : (100*Net income loss year)/Net sales}

^{Return on Equity : (100*Net income loss year)/Total equity}

^{Return on Assets : (100*Net income loss year)/Total fixed assets}

^{Dividends Coverage : Net income loss year/Dividends}

^{Net Working capital : Total current assets - Total short term liabilities}

^{Cash Ratio : Cash Bank securities/Total short term liabilities}

^{Quick Ratio : (Cash Bank securities+Receivables)/Total Short term liabilities}

^{Current ratio : Total current assets/Total short term liabilities}

^{Inventory Turnover : (360*Inventories)/Net sales}

^{Receivables Turnover : (Receivable*360)/Net sales}

^{Leverage Ratio : Total liabilities/(Total equity-Intangible assets)}

FINANCIAL COMMENTS

^{THE FINANCIAL CONDITION OF THE GROUP WAS SEEN TO BE FAIR IN VIEW OF THE FOLLOWING:}

^{NET WORTH:}

^{THE BALANCE SHEET WAS CONSIDERED PASSABLE WITH NET WORTH IMPROVED BY 12.99% FROM US$152,189,000 IN FY 2005 TO US$171,953,000 IN FY 2006. THIS WAS DUE TO HIGHER ACCUMULATED PROFIT OF US$78,039,000 (2005: US$59,781,000); A RISE OF 30.54% FROM THE PRIOR FINANCIAL YEAR.}

^LEVERAGE:

^{IN THE SHORT-TERM, SUBJECT WAS LARGELY FINANCED BY AMOUNT DUE TO BANKS WHICH MADE UP 56.83% (2005: 59.68%) OF THE TOTAL CURRENT LIABILITIES AND AMOUNTED TO US$86,051,000 (2005: US$63,346,000). THE BREAKDOWN IS AS FOLLOWS:}

^SECURED

^{-BANK OVERDRAFTS - 2006: - (2005: US$27,728,000)}

^{-BANK BORROWINGS - 2006: US$7,987,000 (2005: US$10,793,000)}

^{-TRADE FINANCE - 2006: US$ 523,000 (2005: US$24,825,000)}

^UNSECURED

^{-BANK OVERDRAFTS - 2006: US$28,508,000 (2005: -)}

^{-BANK BORROWINGS - 2006: US$20,717,000 (2005: -)}

^{-TRADE FINANCE - 2006: US$28,316,000 (2005: -)}

^{IN THE LONG-TERM, SUBJECT WAS LARGELY FINANCED BY LONG-TERM LOANS WHICH MADE UP 77.86% (2005: 83.14%) OF THE TOTAL CURRENT LIABILITIES AND AMOUNTED TO US$35,285,000 (2005: US$23,657,000). THE BREAKDOWN IS AS FOLLOWS:}

^SECURED

^{-BANK BORROWINGS - 2006: US$13,463,000 (2005: US$23,657,000)}

^UNSECURED

^{-BANK BORROWINGS - 2006: US$21,822,000 (2005: -)}

^{IN ALL, LEVERAGE RATIO ROSE FROM 0.95 TIMES TO 1.25 TIMES AS A RESULT OF A GREATER RISE IN TOTAL LIABILITIES THAN TOTAL EQUITY.}

^LIQUIDITY:

^{IN GENERAL, SUBJECT'S LIQUIDITY SITUATION WAS PASSABLE AS SEEN FROM THE CHANGES IN NET WORKING CAPITAL AND LIQUIDITY RATIOS. CURRENT RATIO FELL TO 1.36 TIMES, DOWN FROM 1.49 TIMES AND QUICK RATIO IMPROVED TO 0.48 TIMES FROM 0.47 TIMES IN FY 2005.}

^{NET WORKING CAPITAL IMPROVED BY 4.07% FROM US$52,454,000 IN FY 2005 TO US$54,588,000.}

^{CASH AND CASH EQUIVALENTS COMPRISE OF:}

^{-CASH AT BANK AND ON HAND - 2006: US$10,023,000 (2005: US$4,767,000)}

^{-SHORT-TERM BANK DEPOSITS - 2006: - (2005: US$ 607,000)}

^{PROFITABILITY:}

^{REVENUE POSTED AN INCREASE OF 19.01% FROM US$439,324,000 IN FY 2005 TO US$522,850,000 AND NET PROFIT ROSE BY 25.28% TO US$29,130,000 (2005: US$23,251,000). HENCE, NET MARGIN ROSE TO 5.57% (2005: 5.29%).}

^REVENUE:

^{-SALES OF GOODS - 2006: US$507,902,000 (2005: US$426,244,000)}

^{-PROCESSING FEES - 2006: US$ 14,948,000 (2005: US$ 13,080,000)}

^{DEBT SERVICING:}

^{DEBT SERVICING PROBLEMS MIGHT NOT BE EXPECTED IF REVENUE AND EARNINGS CAN BE MAINTAINED AND PAYMENT BY TRADE DEBTORS ARE FORTHCOMING.}

^{AVERAGE COLLECTION PERIOD HAS INCREASED FROM 36.90 DAYS TO 43.22 DAYS. A HIGHER AVERAGE COLLECTION PERIOD POSES GREATER RISK OF TURNING INTO BAD DEBTS. HOWEVER, IT IS STILL WORTH NOTING THAT DEBT SERVICING ABILITY MAY NOT BE AFFECTED IF TRADE RECEIVABLES ARE FORTHCOMING.}

^{NON-CURRENT ASSETS:}

^{THE FOLLOWING ITEMS ARE CLASSIFIED UNDER PRELIMINARY:}

^{-LOAN TO ASSOCIATED COMPANY - 2006: US$2,319,000 (2005: - )}

^{-DEFERRED INCOME TAX ASSETS - 2006: US$ 658,000 (2004: US$1,288,000)}

^{-DEPOSITS PAID - 2006: US$ 793,000 (2004: US$ 522,000)}

^{NOTES TO THE FINANCIAL STATEMENTS:}

^BORROWINGS

^{IN MAY 2006, THE COMPANY REFINANCED ITS SECURED REVOLVING TRADE FINANCE WITH BILATERAL FACILITIES FROM VARIOUS BANKS ON AN UNSECURED BASIS.}

^{SECURITY GRANTED}

^{BANK BORROWINGS OF SOME OF THE SUBSIDIARIES OF THE COMPANY ARE SECURED BY PROPERTY PLANT AND EQUIPMENT. FINANCE LEASE LIABILITIES OF THE GROUP ARE SECURED BY THE RIGHTS TO THE LEASED PROPERTY, PLANT AND EQUIPMENT, WHICH COULD REVERT TO THE LESSOR IN THE EVENT OF DEFAULT BY THE GROUP.}

^{THE NON-CURRENT BORROWINGS (EXCLUDING FINANCE LEASE LIABILITIES) HAVE THE FOLLOWING MATURITY:}

^{BETWEEN TWO TO FIVE YEARS - 2006: US$34,535,000 (2005: US$22,447,000)}

^{LATER THAN FIVE YEARS - 2006: US$750,000 (2005: US$1,210,000)}

^{THE WEIGHTED AVERAGE EFFECTIVE INTEREST RATES OF TOTAL BORROWINGS AT THE BALANCE SHEET DATE ARE AS FOLLOWS:}

^{UNITED STATES DOLLAR - 2006: 6.0% (2005: 6.0%)}

^{INDONESIAN RUPIAH - 2006: 13.9% (2005: 14.3%)}

^{OTHERS - 2006: 6.8% (2005: 7.0%)}

^{THE BORROWINGS ARE RE-PRICED ON VARYING DATES WITHIN 6 MONTHS FROM BALANCE SHEET DATE.}

^{CONTINGENT LIABILITIES}

^{AS OF BALANCE SHEET DATE, THE COMPANY HAS ISSUED CORPORATE GUARANTEES AND A STANDBY LETTER OF CREDIT TO BANKS FOR ITS SUBSIDIARIES' BANK BORROWINGS OF US$35,932,000 (2005: US$27,530,000).}

^{EVENTS AFTER BALANCE SHEET DATE}

^{ON 11 JANUARY 2007, THE COMPANY ISSUED A 5-YEAR FIXED RATE OF S$60 MILLION MEDIUM TERM NOTE UNDER THE S$300 MILLION MEDIUM TERM NOTE PROGRAMME ESTABLISHED ON 4 DECEMBER 2006. THE NOTES ARE UNSECURED AND SWAPPED INTO USD, BEARING A FIXED INTEREST RATE OF 6.18% PER ANNUM AND ARE USED TO REFINANCE EXISTING WORKING CAPITAL BORROWINGS.}

^{ON 14 FEBRUARY 2007, THE COMPANY INCREASED ITS PAID UP CAPITAL IN DELFI MARKETING SDN BHD, A WHOLLY OWNED SUBSIDIARY IN MALAYSIA FROM RM5,675,000 TO RM10,750,000. THE NEW SHARES WERE SETTLED BY WAY OF CAPITALISING THE FULL AMOUNT OF A LOAN OWING BY DELFI MARKETING SDN BHD TO THE COMPANY.}

^{ON 1 MARCH 2007, THE COMPANT ENTERED INTO A SHAREHOLDERS' AND SHARE SUBSCRIPTION AGREEMENT THROUGH WHICH IT ACQUIRED A 60% EQUITY STAKE IN PETRA ARMAJARO HOLDINGS PTE LTD, AN INVESTMENT HOLDING COMPANY INCORPORATED IN SINGAPORE THAT UNDERTAKES THE MANUFACTURE, SALE AND DISTRIBUTION OF PREMIUM COCOA INGREDIENTS IN THE EUROPEAN MARKET.}

^{THE REMAINING 40% EQUITY IS HELD BY ARMAJARO HOLDINGS LIMITED ("ARMAJARO"), A GLOBAL COMMODITIES TRADING AND FINANCIAL SERVICES GROUP.}

^{THROUGH ITS WHOLLY-OWNED SUBSIDIARIES, PETRA ARMAJARO HOLDINGS PTE LTD}

^{HOLDS THE FOLLOWING ASSETS:}

^{NAME OF SUBSIDIARY ASSETS ACQUIRED}

^{DELFI COCOA (EUROPE) GMBH A COCOA INGREDIENTS MANUFACTURING}

^{FACTORY LOCATED IN HAMBURG, GERMANY}

^{DELFI NORD CACAO SAS A SPECIALIST COCOA BUTTER FACILITY}

^{LOCATED IN DUNKIRK, FRANCE}

^{DELFI COCOA (EUROPE) BV AN EXISTING CORES AND SUPPLY CHAIN}

^{MANAGEMENT TEAM BASED IN HOLLAND}

^{AND "NORDCACAO" BRAND UNDER WHICH THE}

^{SPECIALISED BUTTER IS CURRENTLY MARKETED}

^{TOTAL AMOUNT FOR THE COMPANY'S 60% EQUITY STAKE WAS EURO16 MILLION (US$20.96 MILLION) PAID IN CASH. THE PURCHASE CONSIDERATION WAS ARRIVED AT ON A WILLING-BUYER WILLING-SELLER BASIS AFTER TAKING INTO ACCOUNT INTER ALIA THE FINANCIAL CONDITION, THE MANUFACTURING CAPABILITIES OF THE ASSETS, CUSTOMER BASE AND CASH-FLOW GENERATING CAPABILITIES OF THE ASSETS ACQUIRED. THE ACQUISITION WAS FUNDED THROUGH INTERNAL SOURCES AND BANK BORROWINGS. THE MANAGEMENT IS IN THE PROCESS OF ASCERTAINING THE FAIR VALUES OF NET ASSETS ACQUIRED, FOLLOWING WHICH GOODWILL ARISING FROM ACQUISITION WILL BE DETERMINED.}

^{BUSINESS SEGMENTS}

^SALES

^{EXTERNAL SALES}

^{-COCOA INGREDIENTS - 2006: US$327,435,000 (2005: US$301,640,000)}

^{-BRANDED CONSUMER - 2006: US$195,415,000 (2005: US$137,684,0000)}

^{INTER-SEGMENT SALES}

^{-COCOA INGREDIENTS - 2006: US$13,055,000 (2005: US$ 14,555,000)}

^{-BRANDED CONSUMER - 2006: - (2005: - )}

^{ELIMINATION - 2006: US$-13,055,000 (2005: US$-14,555,000)}

^{TOTAL - 2006: US$522,850,000 (2005: US$439,324,000)}

^{GEOGRAPHICAL SEGMENTS}

^{INDONESIA - 2006: US$163,681,000 (2005: US$132,196,000)}

^{JAPAN - 2006: US$ 44,419,000 (2005: US$ 35,686,000)}

^{SINGAPORE - 2006: US$ 40,785,000 (2005: US$ 35,333,000)}

^{PHILIPPINES - 2006: US$ 24,927,000 (2005: US$ 15,782,000)}

^{MALAYSIA - 2006: US$ 19,310,000 (2005: US$ 12,916,000)}

^{THAILAND - 2006: US$ 6,528,000 (2005: US$ 6,585,000)}

^{OTHER COUNTRIES}

^{IN ASIA - 2006: US$ 22,737,000 (2005: US$ 21,102,000)}

^{EUROPE - 2006: US$ 78,582,000 (2005: US$ 67,383,000)}

^{AUSTRALIA - 2006: US$ 39,526,000 (2005: US$ 39,747,000)}

^{NORTH AMERICA - 2006: US$35,764,000 (2005: US$ 33,330,000)}

^{MIDDLE EAST - 2006: US$16,699,000 (2005: US$ 19,548,000)}

^{SOUTH AMERICA- 2006: US$20,454,000 (2005: US$ 16,083,000)}

^{AFRICA - 2006: US$ 9,438,000 (2005: US$ 3,633,000)}

^{ELIMINATION - 2006: - (2005: - )}

^{INDONESIA - 2006: US$522,850,000 (2005: US$439,324,000)}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 22/08/1984 AS A LIMITED PRIVATE COMPANY AND IS TRADING UNDER ITS NAMESTYLE AS "PETRA FOODS PTE LTD".}

^{SUBSEQUENTLY, ON 05/10/2004, THE COMPANY CHANGED TO ITS PRESENT NAMESTYLE AS "PETRA FOODS LIMITED" AND IS TRADING AS A PUBLIC COMPANY LIMITED BY SHARES.}

^{AS AT 09/04/2007, THE COMPANY HAS ISSUED AND PAID-UP CAPITAL OF 532,277,000 SHARES OF A VALUE OF S$162,615,357.}

^{PRINCIPAL ACTIVITIES:}

^{SUBJECT IS REGISTERED WITH THE ACCOUNTING & CORPORATE REGULATORY AUTHORITY (ACRA) TO BE PRINCIPALLY ENGAGED IN THE BUSINESS OF:}

^{1) WHOLESALE OF FRUITS AND VEGETABLES; FOOD PRODUCTS}

^{2) OTHER INVESTMENT HOLDING COMPANIES; INVESTMENT HOLDING}

^{DURING THE FINANCIAL YEAR UNDER REVIEW, THE PRINCIPAL ACTIVITIES OF THE COMPANY CONSIST OF MANUFACTURING AND MARKETING OF COCOA INGREDIENTS AND CHOCOLATE CONFECTIONERY PORDUCTS AND INVESTMENT HOLDING.}

^{FROM THE RESEARCH DONE, THE FOLLOWING INFORMATION WAS GATHERED:}

^{BACKGROUND OF THE SUBJECT:}

^LISTINGS

^{* LISTED ON 5 NOVEMBER 2004 ON SGX MAINBOARD}

^{THE GROUP IS PRINCIPALLY ENGAGED IN THE MANUFACTURE AND SUPPLY OF COCOA INGREDIENTS, NAMELY COCOA POWDER, COCOA BUTTER AND COCOA LIQUOR. IT ALSO MANUFACTURES AND OR DISTRIBUTES BRANDED CONSUMER PRODUCTS, PRIMARILY CHOCOLATE CONFECTIONERY. THE GROUP IS ONE OF THE WORLD'S MAJOR MANUFACTURERS AND SUPPLIERS OF COCOA INGREDIENTS.}

^{THE GROUP PRODUCES COCOA INGREDIENTS IN SIX COUNTRIES AND SUPPLIES ITS PRODUCTS TO CUSTOMERS, INCLUDING LEADING INTERNATIONAL FOOD AND BEVERAGE COMPANIES, IN OVER 30 COUNTRIES WORLD-WIDE. IT ALSO MANUFACTURES, DISTRIBUTES AND/OR SELLS BRANDED CONSUMER GOODS IN INDONESIA AND OTHER COUNTRIES IN ASIA AND ITS PORTFOLIO OF BRANDS INCLUDES SOME PRODUCTS WHICH ARE LEADERS IN THEIR CATEGORIES. THE GROUP ALSO DISTRIBUTES THIRD PARTY BRANDS IN INDONESIA, SINGAPORE AND MALAYSIA, CAPITALISING ON ITS EXISTING DISTRIBUTION CHANNELS.}

^{SUBJECT ENGAGES IN THE FOLLOWING ACTIVITIES:}

^{* MANUFACTURER AND SUPPLIER OF COCOA INGREDIENTS, NAMELY COCOA POWDER, COCOA BUTTER AND COCOA LIQUOR DISTRIBUTOR OF CHOCOLATE CONFECTIONERY IN INDONESIA, MALAYSIA AND SINGAPORE}

^{TWO DISTINCT OPERATIONS:}

^{* COCOA INGREDIENTS DIVISION}

^{* BRANDED CONSUMER DIVISION}

^{IN THE INDONESIAN ARCHIPELAGO THEIR NETWORK COMPRISES OVER 70,000 MODERN AND TRADITIONAL RETAIL OUTLETS}

^{DISTRIBUTE THIRD-PARTY CHOCOLATE CONSUMER BRANDS:}

^{* VAN HOUTEN}

^{* TOBLERONE}

^{* MEIJI}

^{* FISHERMAN'S FRIEND}

^{* GUYLIAN}

^{* ETC}

^{AGENTS FOR:}

^{* DELFI (CH)}

^{* ELIZABETH SHAW (GB)}

^{* PEZAZZ (AT)}

^{* GARDEN (HK)}

^{* LOACKER (IT)}

^{* PEZ (AT)}

^{TRADE NAMES:}

^{* DELFI CHOCOLATE AND BISCUITS (CH)}

^{* TOP CHOCOLATE & BISCUITS}

^{* SILVER QUEEN CHOCOLATE & BISCUITS}

^{* SELAMAT CHOCOLATE & BISCUITS}

^{* CHACHA CHOCOLATE & BISCUITS}

^{SOME OF SUBJECT'S CLIENTS:}

^{* NESTLE}

^{* CADBURY}

^{* THE MARS GROUP}

^{* ARNOTT'S}

^{* A.B. FOODS}

^{* BARRY CALLEBAUT}

^{* THE MEIJI GROUP}

^{PRINCIPAL OPERATIONS:}

^{* MALAYSIA}

^{* INDONESIA}

^{* THAILAND}

^{* THE PHILIPPINES}

^{* BRAZIL}

^{* MEXICO}

^{SIX OVERSEAS COCOA PROCESSING FACILITIES:}

^{* JOHOR, MALAYSIA}

^{* BANDUNG, INDONESIA}

^{* CHACHOENGSAO PROVINCE, THAILAND}

^{* BULACAN, THE PHILIPPINES}

^{* BAHIA, BRAZIL}

^{* MEXICO CITY, MEXICO}

^{TWO OVERSEAS CHOCOLATE CONFECTIONERY PRODUCTION FACILITIES:}

^{* KLANG, MALAYSIA}

^{* BANDUNG, INDONESIA}

^{NEWS: PETRA FOODS COMPLETES ACQUISITION OF MAJORITY STAKE IN EUROPEAN COCOA INGREDIENTS OPERATIONS}

^"EXTRACTS"

^{-SOURCE: SGX WEBSITE}

^{DATE: 01/03/2007}

^{SINGAPORE - FURTHER TO AN ANNOUNCEMENT RELEASED ON FEBRUARY 23, 2007, PETRA FOODS LIMITED ("PETRA FOODS" OR "THE GROUP"), ONE OF THE WORLD'S MAJOR MANUFACTURERS AND SUPPLIERS OF PREMIUM COCOA INGREDIENTS AND BRANDED CONSUMER CONFECTIONERY PRODUCTS, ANNOUNCED TODAY THAT IT HAS SIGNED THE SHAREHOLDER AGREEMENT AND CONCLUDED THE TRANSACTION TO ACQUIRE A MAJORITY 60% STAKE IN A JOINT VENTURE ("JV") THAT WILL UNDERTAKE THE MANUFACTURE, SALE AND DISTRIBUTION OF PREMIUM COCOA INGREDIENTS IN THE EUROPEAN MARKET.}

^{PETRA FOODS IS ALSO PLEASED TO ANNOUNCE THAT THE JV HAS CLEARED ALL THE NECESSARY REGULATORY HURDLES WITH THE RECENT APPROVAL SECURED FROM THE GERMAN FEDERAL CARTEL OFFICE ("FCO").}

^{TO RECAP ON THE ACQUISITION, PETRA FOODS ACQUIRED A 60% EQUITY STAKE IN THE JV FOR EURO 16 MILLION (US$20.96 MILLION) WITH THE REMAINING 40% STAKE HELD BY PARTNER ARMAJARO HOLDINGS LIMITED THROUGH ONE OF ITS SUBSIDIARIES.}

^{THE JV COMPANY IS NAMED PETRA ARMAJARO HOLDINGS PTE. LTD. AND IS BASE IN SINGAPORE. THROUGH ITS WHOLLY-OWNED SUBSIDIARIES, THE JV HOLDS THE FOLLOWING ASSETS: (1) A COCOA INGREDIENTS MANUFACTURING FACTORY LOCATED IN HAMBURG, GERMANY OWNED BY DELFI COCOA (EUROPE) GMBH ("DCEG" (2) A SPECIALISED COCOA BUTTER FACILITY LOCATED IN DUNKIRK, FRANCE, OWNED BY DELFI NORD CACAO SAS ("DNCS")' (3) THE EXISTING CORE SALES AND SUPPLY-CHAIN MANAGEMENT TEAM BASED IN HOLLAND UNDER DELFI COCOA (EUROPE) BV ("DCEB"); AND (4) THE "NORDCACAO" BRAND UNDER WHICH THE SPECIALISED BUTTER IS CURRENTLY MARKETED.}

^{WITH THIS ACQUISITION, PETRA FOODS' COCOA INGREDIENTS DIVISION WILL PROCESS IN EXCESS OF 300,000 MT OF COCOA BEANS PER ANNUM WHICH FIRMLY CEMENTS THE GROUP'S POSITION AS ONE OF THE WORLD'S LARGEST COCOA INGRDIENTS PROCESSOR. IN TERMS OF MARKET SHARE, THIS WILL GIVE PETRA FOODS APPROXIMATELY 10% OF THE WORLD'S TOTAL GRINDING CAPACITY.}

^{NO OTHER TRADE INFORMATION IS AVAILABLE AS TELE-INTERVIEW WAS NOT GRANTED BY SUBJECT'S PERSONNEL ON 11/04/2007.}

^{THE COMPANY'S IMMEDIATE HOLDING CORPORATION IS FREMONT INVESTMENT LIMITED, INCORPORATED IN LIBERIA. THE INTERMEDIATE HOLDING CORPORATIO IS AERODROME INTERNATIONAL LIMITED, INCORPORATED IN THE BRITISH VIRGIN ISLANDS. THE ULTIMATE HOLDING CORPORATION IS SG TRUST (ASIA) LTD, A SINGAPORE REGISTERED TRUST COMPANY.}

^{NUMBER OF EMPLOYEES:}

^{* COMPANY - 2006: - (2005: - )}

^{* GROUP - 2006: NOT AVAILABLE (2005: 4,118; 2004: 3,582)}

^{REGISTERED AND BUSINESS ADDRESS:}

^{111 SOMERSET ROAD}

^{#16-01 SINGAPORE POWER BUILDING}

^{SINGAPORE 238164}

^{- RENTED PREMISE}

^{- OWNED BY SINGAPORE POWER LIMITED}

^{- DATE OF CHANGE OF ADDRESS: 18/11/2006}

^{- HEADQUARTER}

^WEBSITE:

^{http://www.petrafoods.com}

^EMAIL:

^{enquiry@petrafoods.com}

MANAGEMENT

^{THE DIRECTORS AT THE TIME OF THE REPORT ARE:}

^{1) PEDRO FRANCISCO MATA BRUCKMANN, AN AMERICAN}

^{- BASED IN UNITED STATES OF AMERICA.}

^{2) JOSEPHINE PRICE, A BRITISH}

^{- BASED IN HONG KONG.}

^{3) RICHARD OWEN PYVIS, AN AUSTRALIAN}

^{- BASED IN AUSTRALIA.}

^{4) CHUA KOON CHEK, A SINGAPOREAN}

^{- OTHER DIRECTORSHIP(S) IN OUR DATABASE:}

^{DIETHELM KELLER PROPERTY & INVESTMENT PTE. LTD.}

^{DIETHELM SCANSTYLE (PRIVATE) LTD}

^{DIETHELM KELLER ENGINEERING PTE. LTD.}

^{HARPERS MARKETING PTE LTD}

^{5) DAVINDER SINGH S/O AMAR SINGH, A SINGAPOREAN}

^{- OTHER DIRECTORSHIP(S) IN OUR DATABASE:}

^{SINGAPORE AIRLINES LIMITED}

^{SINGAPORE TECHNOLOGIES PTE LTD}

^{DREW & NAPIER LLC}

^{ZAGRO ASIA LIMITED}

^{6) CHUANG TONG KIE, A SINGAPOREAN}

^{- HOLDS NO OTHER DIRECTORSHIP IN OUR DATABASE.}

^{7) CHUANG TIONG CHOON, A SINGAPOREAN}

^{- OTHER DIRECTORSHIP(S) IN OUR DATABASE:}

^{PETRA-SPT MARKETING PTE LTD}

^{8) CHUANG TIONG LIEP, A SINGAPOREAN}

^{- OTHER DIRECTORSHIP(S) IN OUR DATABASE:}

^{PETRA-SPT MARKETING PTE LTD}

^{CERES SIME MARKETING SDN BHD}

^{9) ANTHONY MICHAEL DEAN, A SINGAPORE PERMANENT RESIDENT}

^{- HOLDS NO OTHER DIRECTORSHIP IN OUR DATABASE.}

Singapore’s Country Rating 2006

Investment Grade

IN SINGAPORE, THE POLITICAL SITUATION APPEARS TO BE VERY STABLE.

ECONOMIC GROWTH IS BECOMING MORE MODERATE AS INVESTMENT HAS BEEN FLAT DUE TO INCREASING OIL PRICES AND LESS BUOYANT DEMAND FOR ELECTRONIC PRODUCTS.

ECONOMIC PERFORMANCE HAS REMAINED STRONG, UNDERPINNED BY PHARMACEUTICALS AND SERVICES. EXPORTS HAS BENEFITED FROM THE STEADINESS OF DEMAND FROM ITS MAIN TRADING PARTNERS, MALAYSIA, THE UNITED STATES, CHINA AND HONG KONG. OTHER THAN ITS BALANCED PUBLIC SECTOR ACCOUNTS, LIMITED FOREIGN DEBT AND COMFORTABLE FOREIGN CURRENCY RESERVES HAVE CONTRIBUTED TO SINGAPORE’S STRONG FINANCIAL CONDITION.

AS THE ELECTRONICS SECTOR FACES COMPETITION FROM THE ASIAN ECONOMIES, SINGAPORE HAS BEEN PURSUING DIVERSIFICATION STRATEGY THAT HAS BEEN CONSOLIDATING ITS POSITION. PHARMACEUTICALS ALREADY REPRESENT 10% OF EXPORTS IN COMPARATIVE TO ITS INSIGNIFICANT CONTRIBUTION IN YEAR 1995. ELECTRONICS SECTOR SECTOR’S SHARE HAS DECLINED FROM 80% TO 60% DURING THE SAME PERIOD. THERE IS HIGH RELIANCE ON DEVELOPMENT OF PETROCHEMICAL PRODUCTS, HIGH VALUE-ADDED SERVICES AND BIOTECHNOLOGIES.

ASSETS

• ONE OF THE MOST OPEN ECONOMIES IN THE WORLD WITH EXPORTS PLAYING A MAJOR ROLE IN ITS PERFORMANCE.
• ONE OF ASIA’S MOST ADVANCED COUNTRIES IN QUALITY COMPETITIVENESS TERMS.
• WORKFORCE’S EDUCATION AND SKILL LEVEL IS VERY HIGH.
• A MAJOR EXPORT OF CAPITAL IN ASIA, PARTICULARLY THE STATE-OWNED HOLDING COMPANY, TEMASEK.
• THE BUSINESS ENVIRONMENT HAS BEEN VERY FAVOURABLE.
• GREAT POLITICAL STABILITY.

WEAKNESSES

• ECONOMY REMAINED OVERSPECIALISED IN THE ELECTRONICS SECTOR.
• MUST ACCELERATE DIVERSIFICATION IN SERVICES TO MAINTAIN ITS LEAD OVER OTHER ASIAN ECONOMIES
• REFORMS ARE STILL NEEDED TO FOSTER INNOVATION AND EDUCATION-SYSTEM MODERNIZATION.
• AGING POPULATION COULD ULTIMATELY AFFECT ECONOMIC PERFORMANCE.

WHOLESALE AND RETAIL TRADE SECTOR

PAST PERFORMANCE

DOMESTIC WHOLESALE TRADE INDEX

DOMESTIC WHOLESALE TRADE IN 4Q 2006 HAS DECLINED BY 6.9%. EXCLUDING PETROLEUM, DOMESTIC SALES REMAINED AT SIMILAR LEVEL COMPARED TO THE PREVIOUS QUARTER.

GENERAL WHOLESALE TRADE POSTED THE LARGEST SALES DECREASE OF 16.6%, FOLLOWED BY THE SECTORS OF PETROLEUM AND PETROLEUM PRODUCTS OF 15.7% AND HOUSEHOLD EQUIPMENT AND FURNITURE OF 13.2%.

FOREIGN WHOLESALE TRADE INDEX

ON A QUARTER-TO-QUARTER BASIS, OVERALL FOREIGN WHOLESALE TRADE CONTRACTED BY 7.9% IN 4Q 2006 AFTER TWO QUARTERS OF POSITIVE GROWTH. FOREIGN SALES WENT DOWN BY 1.6%, EXCLUDING PETROLEUM.

RETAIL TRADE

IN GENERAL, RETAIL SALES GREW BY 7.9% IN 4Q 2006, UP FROM THE 5.2% IN THE PREVIOUS QUARTER. THIS BROUGHT FULL YEAR GROWTH FOR 2006 TO 6.9%, DOWN FROM 9.0% IN 2005. EXCLUDING MOTOR VEHICLE SALES, RETAIL SALES ROSE 4.1%, SLOWING FROM THE 7.2% GAIN IN THE PREVIOUS YEAR.

MOST RETAIL SECTORS REPORTED BRISK BUSINESS IN DEC. 2006. SALES OF RECREATIONAL GOODS, DEPARTMENT STORES, WEARING APPAREL AND FOOTWEAR, FURNITURE AND HOUSEHOLD EQUIPMENT, WATCHES AND JEWELLERY CLIMBED BY 36.6% TO 44.2% IN DEC. 2006 COMPARED TO THE PREVIOUS MONTH.

LIKEWISE, RETAILERS OF OPTICAL GOODS AND BOOKS, TELECOMMUNICATIONS APPARATUS AND COMPUTERS, FOOD AND BEVERAGES, MEDICAL GOODS AND TOILETRIES AND SUPERMARKETS ENJOYED GROWTH BETWEEN 12.7% TO 26.0%.

OUTLOOK

FOR WHOLESALE TRADE, A NET WEIGHTED BALANCE OF 11% OF FIRMS ANTICIPATES BUSINESS TO BE LESS BRISK FOR COMING MONTHS. THOSE DEALING IN JEWELLERY AND WATCHES, INDUSTRIAL MACHINERY AND EQUIPMENT, TELECOMMUNICATIONS EQUIPMENT AND ELECTRONIC COMPONENTS ARE AMONG THOSE WHO FORESEE SLOWER BUSINESS IN THE COMING MONTHS.

FOR RETAILERS, A NET WEIGHTED BALANCE OF 8%, FORECAST THE BUSINESS CONDITIONS TO IMPROVE IN THE NEXT SIX MONTHS. DEPARTMENT STORES OWNERS AND RETAILERS OF FURNITURE AND FURNISHINGS ARE OPTIMISTIC ABOUT THE BUSINESS PROSPECTS.

EXTRACTED FROM: MINISTRY OF TRADE AND INDUSTRY, SINGAPORE

SINGAPORE DEPARTMENT OF STATISTICS

TODAY

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average/normal.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
NR		In view of the lack of information, we have no basis upon which to recommend credit dealings	No Rating

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions