MIRA INFORM REPORT

Report Date :

26.12.2007

IDENTIFICATION DETAILS

Name :	^EUTECH INSTRUMENTS PTE LTD
Registered Office :	^55 Ayer Rajah Crescent, #04-16/24, Singapore – 139949
Country :	^Singapore
Financials (as on) :	31.12.2005
Date of Incorporation :	^19/09/1996
Com. Reg. No.:	^199606802C
Legal Form :	^Pte Ltd
Line of Business :	^Manufacture of Electronic Industrial and Scientific Instruments

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

^{EUTECH INSTRUMENTS PTE LTD}

Line Of Business 

^{MANUFACTURE OF ELECTRONIC INDUSTRIAL AND SCIENTIFIC INSTRUMENTS}

Parent Company

^{COLE-PARMER INSTRUMENT COMPANY}

^{(PERCENTAGE OF SHAREHOLDING: 96.00%)}

Financial Elements

^{FY 2005}

^CONSOLIDATED

^{Sales : S$28,121,169}

^{Networth : S$28,876,294}

^{Paid-Up Capital : S$2,000,000}

^{Net result : S$7,254,287}

^{Net Margin(%) : 25.80}

^{Return on Equity(%) : 25.12}

^{Leverage Ratio : 0.23}

COMPANY IDENTIFICATION

^{Subject Company : EUTECH INSTRUMENTS PTE LTD}

^{Former Name :}

^{Business Address: 55 AYER RAJAH CRESCENT}

^#04-16/24

^{Town: SINGAPORE}

^{Postcode: 139949}

^{Country: Singapore}

^{Telephone: 6778 6876}

^{Fax: 6773 0836}

^{ROC Number: 199606802C}

^{Reg. Town:}

SUMMARY

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

^{Legal Form: Pte Ltd}

^{Date Inc.: 19/09/1996}

^{Summary year : 31/03/2005}

^{Sales: 28,121,169}

^{Networth : 28,876,294}

^{Capital: 2,150,000}

^{Paid-Up Capital: 2,000,000}

^Employees:

^{Net result : 7,254,287}

^{Share value: 1}

^{AUDITOR : DELOITTE & TOUCHE}

REFERENCES

^{Litigation : No}

^{Company status : TRADING}

^{Started : 19/09/1996}

PRINCIPAL(S)

^{BHASKAR NARAYANAN S2597401H Managing Director}

DIRECTOR(S)

^{BHASKAR NARAYANAN S2597401H Managing Director}

^{Appointed on : 05/11/2001}

^{Street : 117 JALAN KAMPONG CHANTEK}

^{BINJAI CREST}

^{Town: SINGAPORE}

^{Postcode: 588659}

^{Country: Singapore}

^{BHASKAR NARAYANAN S2597401H Director}

^{Appointed on : 19/09/1996}

^{Street : 117 JALAN KAMPONG CHANTEK}

^{BINJAI CREST}

^{Town: SINGAPORE}

^{Postcode: 588659}

^{Country: Singapore}

^{RONALD LIEW MENG FAI S2626450B Director}

^{Appointed on : 09/11/2006}

^{Street : 346 YISHUN AVENUE 11}

^#11-123

^{Town: SINGAPORE}

^{Postcode: 760346}

^{Country: Singapore}

^{PETRUS THOMAS ADRAINUS VAN DER NH7122729 Director}

^{Appointed on : 15/03/2007}

^{Street : NW MOLENWG 43,}

^{Town: SH HALSTEREN}

^{Postcode: 4661}

^{Country: Netherlands}

^{SOPHIA LIM SIEW FAY S2664520D Company Secretary}

^{Appointed on : 30/11/2007}

^{Street : 806 BEDOK RESERVOIR ROAD}

^#14-04

^BAYWATER

^{Town: SINGAPORE}

^{Postcode: 479243}

^{Country: Singapore}

FORMER DIRECTOR(S)

^{TANG CHEE LIN S0112148J}

^{HARITHARAN GUNASINGHAM S2203239I}

^{PRASAD RAJA S2634609F}

^{JEROME J COLE 085326905}

^{JOHN C PARMER 151825861}

^{MEISTER PAUL MATTHEW 015098890}

^{TODD MICHAEL DUCHENE 103406525}

^{KOH NGIN JOO JULIE S2586980Z}

ACTIVITY(IES)

^{SCIENTIFIC APPARATUS And INSTRUMENTS - MFRS And WH Code:19028}

^{BASED ON ACRA'S RECORD AS AT 18/12/2007}

^{1) MANUFACTURING OF ELECTRICAL/ELECTRONIC MEASURING AND CONTROLLING DEVICES (EG METERS)}

^{ACTIVITIES STATED IN FINANCIAL STATEMENTS:}

^{MANUFACTURE OF ELECTRONIC INDUSTRIAL AND SCIENTIFIC INSTRUMENTS, THE WHOLESALE OF PROFESSIONAL, SCIENTIFIC AND PRECISION EQUIPMENT}

CHARGES

No Charges On Premises/Property In Our Database

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

SHAREHOLDERS(S)

^{COLE-PARMER INSTRUMENT COMPANY 2,000,000 Company}

^{Street : 625 BUNKER COURT}

^{VERNON HILLS}

^{Town: ILLINOIS}

^{Postcode: 60015}

^{Country: United States}

^{BHASKAR NARAYANAN 50,000 Private Person}

^{Street : 117 JALAN KAMPONG CHANTEK}

^{BINJAI CREST}

^{Town: SINGAPORE}

^{Postcode: 588659}

^{Country: Singapore}

FORMER SHAREHOLDER(S)

^{EUTECH CYBERNETICS PTE LTD 1,320,000}

HOLDING COMPANY

^{COLE-PARMER INSTRUMENT COMPANY UF21235N % : 96.00}

SUBSIDIARY(IES)

^{EUTECH INSTRUMENTS SDN BHD}

^{EUTECH INSTRUMENTS EUROPE B.V.}

PAYMENT HISTORY AND EXPERIENCES

^{Trade Morality: AVERAGE}

^{Liquidity : ABUNDANT}

^{Payments : REGULAR}

^{Trend : UPWARD}

^{Financial Situation: GOOD}

FINANCIAL ELEMENTS

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

^{Date Account Lodged: 29/08/2006}

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

^{Number of weeks: 52 52}

^{Consolidation Code: CONSOLIDATED CONSOLIDATED}

^{--- ASSETS ---}

^{Preliminary Exp 3,198,937 3,267,186}

^{Intangible Fixed Assets: 339,708 339,708}

^{Tangible Fixed Assets: 633,303 557,407}

^{Total Fixed Assets: 4,171,948 4,164,301}

^{Inventories: 3,856,200 4,154,330}

^{Receivables: 3,672,096 2,762,385}

^{Cash,Banks, Securitis: 22,694,978 8,886,731}

^{Other current assets: 1,127,060 6,570,997}

^{Total Current Assets: 31,350,334 22,374,443}

^{TOTAL ASSETS: 35,522,282 26,538,744}

^{--- LIABILITIES ---}

^{Equity capital: 2,000,000 2,000,000}

^{Reserves: -71,125 -136,532}

^{Profit & lost Account: 26,746,572 19,553,663}

^{Other: 200,847 190,156}

^{Total Equity: 28,876,294 21,607,287}

^{L/T deffered taxes: 229,717 235,000}

^{Other long term Liab.: 1,669,000 1,289,785}

^{Total L/T Liabilities: 1,898,717 1,524,785}

^{Trade Creditors: 1,386,136 753,178}

^{Prepay. & Def. charges: 1,141,006 1,156,150}

^{Provisions: 1,168,856 962,215}

^{Other Short term Liab.: 1,051,273 535,129}

^{Total short term Liab.: 4,747,271 3,406,672}

^{TOTAL LIABILITIES: 6,645,988 4,931,457}

^{PROFIT & LOSS ACCOUNT}

^{Net Sales 28,121,169 24,950,652}

^{NET RESULT BEFORE TAX: 8,537,652 7,024,024}

^{Tax : 1,283,365 862,699}

^{Net income/loss year: 7,254,287 6,161,325}

^{Interest Paid: 12,107 11,386}

^{Depreciation: 258,630 243,793}

^{Directors Emoluments: 1,101,759 727,691}

^{Wages and Salaries: 4,881,717 4,241,163}

RATIOS

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

^{Net result / Turnover(%): 0.26 0.25}

^{Stock / Turnover(%): 0.14 0.17}

^{Net Margin(%): 25.80 24.69}

^{Return on Equity(%): 25.12 28.52}

^{Return on Assets(%): 20.42 23.22}

^{Net Working capital: 26603063.00 18967771.00}

^{Cash Ratio: 4.78 2.61}

^{Quick Ratio: 5.55 3.42}

^{Current ratio: 6.60 6.57}

^{Receivables Turnover: 47.01 39.86}

^{Leverage Ratio: 0.23 0.23}

^{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}

^{Net Working capital : (Total current assets/Total short term liabilities)/1000}

^{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 STABLE IN VIEW OF THE FOLLOWING:}

^{NET WORTH:}

^{THE BALANCE SHEET WAS CONSIDERED ADEQUATE WITH NET WORTH IMPROVED BY 33.64% FROM S$21,607,287 IN FY 2004TO S$28,876,294 IN FY 2005 THIS WAS DUE TO HIGHER ACCUMULATED PROFIT OF S$26,746,572 (2004 S$19,553,663); A RISE OF 36.78% FROM THE PRIOR FINANCIAL YEAR.}

^LEVERAGE:

^{IN THE SHORT-TERM, SUBJECT WAS LARGELY FINANCED BY TRADE CREDITORS WHICH MADE UP 29.19% (2004 22.11%) OF THE TOTAL CURRENT LIABILITIES AND AMOUNTED TO S$1,386,136 (2004 S$753,178). THE BREAKDOWN IS AS FOLLOWS:}

^{-OUTSIDE PARTIES- 2005: S$1,386,136 (2004: S$753,178)}

^{IN THE LONG-TERM, SUBJECT WAS LARGELY FINANCED BY PREFERENCE SHARES LIABILITIES WHICH AMOUNTS TO S$1,669,000 (2004: S$1,289,785).}

^{IN ALL, LEVERAGE RATIO REMAINED CONSTANT AT 0.23 TIMES AS THE PERCENTAGE INCREASE IN TOTAL LIABILITIES WAS OFFSETTED BY THE INCREASE IN TOTAL EQUITY.}

^LIQUIDITY:

^{IN GENERAL, SUBJECT'S LIQUIDITY SITUATION WAS ADEQUATE AS SEEN FROM THE RISE IN NET WORKING CAPITAL AND LIQUIDITY RATIOS. CURRENT RATIO ROSE TO 6.60 TIMES, FROM 6.57 TIMES AND QUICK RATIO IMPROVED TO 5.55 TIMES FROM 3.42 TIMES IN FY 2004}

^{SIMILARLY, NET WORKING CAPITAL IMPROVED BY 40.25% FROM S$18,967,771 IN FY 2004 O S$26,603,063.}

^{PROFITABILITY:}

^{REVENUE POSTED AN INCREASE OF 12.70% FROM S$24,950,652 IN FY 2004 O S$28,121,169 NET PROFIT ROSE BY 17.74% TO S$7,254,287 (2004 S$6,161,325). HENCE, NET MARGIN ROSE TO 25.80% (2004: 24.69%).}

^REVENUE:

^{-SALE OF GOODS- 2005: S$28,121,169 (2004: S$24,950,652)}

^{DEBT SERVICING:}

^{DEBT SERVICING PROBLEMS MIGHT NOT BE EXPECTED IF REVENUE AND EARNINGS CAN BE MAINTAINED AND PAYMENT BY TRADE DEBTORS ARE FORTHCOMING. IN ADDITION, ITS INTEREST COVERAGE WAS HEALTHY CONSIDERING THAT ITS INTEREST EXPENSES WERE LOW AT S$12,107 IN FY 2005 (2004: S$11,386).}

^{NON-CURRENT ASSETS:}

^{THE FOLLOWING ITEMS ARE CLASSIFIED UNDER PRELIMINARY:}

^{-DEVELOPMENT COST- 2005: S$3,191,894 (2004: S$3,226,823)}

^{-DEFERRED TAX ASSETS- 2005: S$399,708 (2004: S$399,708)}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 18/12/2007 AS A LIMITED PRIVATE COMPANY AND IS TRADING UNDER ITS PRESENT NAMESTYLE AS "EUTECH INSTRUMENTS PTE LTD".}

^{AS AT 18/12/2007, THE COMPANY HAS AN ISSUED AND PAID-UP CAPITAL OF 2,000,000 SHARES, OF A VALUE OF S$2,060,000 AND 50,000 PREFERENCE SHARES, OF A VALUE OF S$50,000}

^{PRINCIPAL ACTIVITIES:}

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

^{1) MANUFACTURING OF ELECTRICAL/ELECTRONIC MEASURING AND CONTROLLING DEVICES (EG METERS)}

^{2) WHOLESALE OF PROFESSIONAL, SCIENTIFIC AND PRECISION EQUIPMENT}

^{DURING THE FINANCIAL YEAR UNDER REVIEW, SUBJECT'S PRINCIPAL ACTIVITIES ARE MANUFACTURE OF ELECTRONIC INDUSTRIAL AND SCIENTIFIC INSTRUMENTS, THE WHOLESALE OF PROFESSIONAL, SCIENTIFIC AND PRECISION EQUIPMENT.}

^{THE COMPANY IS A SUBSIDIARY OF COLE-PARMER INSTRUMENT COMPANY, INCORPORATED IN THE UNITED STATES OF AMERICA. THE COMPANY'S ULTIMATE HOLDING COMPANY IS FISHER SCIENTIFIC INTERNATIONAL INC., INCORPORATED IN THE UNITED STATES OF AMERICA.}

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

^BACKGROUND:

^{ESTABLISHED IN 1990, EUTECH INSTRUMENTS IS A LEADING ISO9001-CERTIFIED COMPANY DEDICATED TO THE DESIGN AND MANUFACTURE OF SENSOR-BASED INSTRUMENTS FOR WATER QUALITY ANALYSIS. A PIONEER IN THE DEVELOPMENT OF ASIC-BASED (APPLICATION SPECIFIC INTEGRATED CIRCUIT) INSTRUMENTS AND THE WORLD'S FIRST WINDOWS® CE-DRIVEN COLOUR TOUCHSCREEN RESEARCH-GRADE BENCH METER, EUTECH HAS GAINED INTERNATIONAL RECOGNITION FOR ITS ACHIEVEMENTS IN SENSOR TECHNOLOGY, SOFTWARE PROGRAMMING AND PRODUCT DESIGN. THE EXTENSIVE PRODUCT LINE INCLUDES INSTRUMENTS WITH PROPRIETARY PATENTS AND TRADEMARKS.}

^{EUTECH PRODUCTS ARE MARKETED IN OVER SEVENTY COUNTRIES WORLDWIDE, THROUGH AN EXTENSIVE NETWORK OF ASSOCIATE COMPANIES AND DISTRIBUTORS, WITH MANUFACTURING FACILITIES IN SINGAPORE AND MALAYSIA. EUTECH INSTRUMENTS SINGAPORE HAS A FULL FLEDGED VALUE-CHAIN OPERATION WHICH COMPRISES R&D, MANUFACTURING, MARKETING, CUSTOMER SERVICE AND LOGISTICS FOR WORLDWIDE SUPPORT TO CUSTOMERS.}

^PRODUCTS:

^{* BENCHTOP}

^{* PALMTOP}

^{* PORTABLES}

^{* POCKET METERS}

^{* COLORIMETER}

^{* THERMOMETERS}

^{* ELECTRODES}

^{NO OTHER TRADE INFORMATION IS AVAILABLE AS TELE-INTERVIEW WAS NOT GRANTED BY SUBJECT'S PERSONNEL ON 26/12/2007.}

^{NUMBER OF EMPLOYEES (31 DECEMBER):}

^{* COMPANY - 2005: NOT AVAILABLE (2004: NOT AVAILABLE)}

^{* GROUP - 2005: NOT AVAILABLE (2004: NOT AVAILABLE)}

^{REGISTERED AND BUSINESS ADDRESS:}

^{55 AYER RAJAH CRESCENT}

^#04-19/24

^{SINGAPORE 139949}

^{DATE OF CHANGE OF ADDRESS: -}

^{WEBSITE: http://www.eutechinst.com}

^{EMAIL: eutech@thermofisher.com}

MANAGEMENT

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

^{1) PETRUS THOMAS, A DUTCH}

^{BASED IN AMERICA}

^{2) BHASKAR NARAYANAN, SINGAPORE PERMANENT RESIDENT}

^{- HOLDS OTHER DIRECTORSHIP(S) AS RECORDED IN OUR DATABASE.}

^{SCIENTIFIC PRODUCTS (ASIA PACIFIC) PTE. LTD.}

^{3) LIEW MENG FAI RONALD, A SINGAPOREAN}

^{- HOLDS OTHER DIRECTORSHIP(S) AS RECORDED IN OUR DATABASE.}

^{FISHER SCIENTIFIC PTE LTD}

Singapore’s Country Rating 2007

Investment Grade

IN SINGAPORE, THE POLITICAL SITUATION REMAINS STABLE.

SINGAPORE BOASTS THE BEST GOVERNANCE IN ASIA, WITH AN EFFECTIVE LEGAL SYSTEM FACILITATING DEBT COLLECTION AND TO A HIGH DEGREE OF FINANCIAL TRANSPARENCY.

EXTERNAL ACCOUNTS HAVE REMAINED SUBSTANTIALLY IN SURPLUS, CONTRIBUTED TO THE DYNAMISM OF THE ELECTRONICS AND PHARMACEUTICALS SECTORS AND TO REPATRIATION OF PROFITS FROM SINGAPORE INVESTMENTS. THE FINANCIAL AND TOURISM SECTORS HAVE ALSO CONTRIBUTED TO THE LARGE CURRENT ACCOUNT SURPLUS.

SINGAPORE CONTINUES TO KEENLY WELCOME FOREIGN INVESTMENT AND OFFERS A VERY OPEN AND WELL-PLANNED ECONOMIC AND POLITICAL ENVIRONMENT. IT HAS BEEN IMPLEMENTING AMBITIOUS DIVERSIFICATION STRATEGY, FOCUSED PARTICULARLY ON THE CHEMICALS AND PHARMACEUTICAL SECTORS.

THE GOVERNMENT USES FOREIGN DIRECT INVESTMENT TO DEVELOP PRIORITY SECTORS (ELECTRONICS, CHEMICALS, BIOTECHNOLOGY). THE AIM IS TO ENCOURAGE THE GROWTH OF HIGH ADDED-VALUE ACTIVITIES AND TURN SINGAPORE INTO A REGIONAL HUB FOR FOREIGN INVESTORS INTERESTED IN ASIA.

CERTAIN SECTORS (MEDIA, LEGAL AND FINANCIAL SERVICES) ARE HOWEVER ONLY PARTIALLY OPEN TO FOREIGN INVESTMENT. THESE SECTORS ARE SLOWLY OPENING UP, BUT THE PROGRESS IS SLOW.

AFTER HIGH GROWTH IN 2006, BUOYED BY THE DYNAMISM OF BOTH EXPORTS AND HOUSEHOLD CONSUMPTION, A SLOWDOWN IS EXPECTED IN 2007.

ASSETS

• MAJOR EXPORTER OF CAPITAL IN ASIA, NOTABLY VIA THE STATE-OWNED TEMASEK HOLDING COMPANY.
• HIGH QUALITY COMPETITIVENESS IN ASIA
• EXCELLENT BUSINESS CLIMATE
• POLITICAL STABILITY.

WEAKNESSES

• SKILLED MANPOWER HAS BEEN LACKING IN THE SECTORS TARGETED FOR DEVELOPMENT.
• AN AGEING POPULATION COULD, ULTIMATELY, AFFECT ECONOMIC PERFORMANCE.
• GROWING INEQUALITY AND THE EMERGENCE OF LONG-TERM UNEMPLOYMENT AMONG THE LEAST SKILLED COULD GENERATE SOCIAL TENSIONS.
• BEING THE WORLD’S MOST OPEN ECONOMY, IT HAS BEEN VULNERABLE TO WORLD ECONOMIC DOWNTURNS.

Manufacturing sector

PAST PERFORMANCE

THE MANUFACTURING SECTOR GREW BY 18.8% COMPARED TO Q2 OF 2006, RIDING ON STRONG GROWTH FROM THE BIOMEDICAL MANUFACTURING AND TRANSPORT ENGINEERING CLUSTERS. TOTAL MANUFACTURING OUTPUT GREW BY 7.8% COMPARED TO OUTPUT IN THE SAME PERIOD LAST YEAR.

BIOMEDICAL MANUFACTURING CLUSTER REBOUNDED FROM ITS CONTRACTION IN MARCH. SPEARHEADING THE JUMP OF 98.5% IN APRIL’S OUTPUT OVER APRIL LAST YEAR WAS THE PHARMACEUTICALS SEGMENT. THE PRODUCTION OF ACTIVE PHARMACEUTICAL INGREDIENTS SHOT UP BY 120.5% THIS APRIL DUE TO THE VERY LOW OUTPUT LEVEL LAST APRIL. THE MEDICAL TECHNOLOGY SEGMENT CONTINUED TO EXPAND ITS OUTPUT OF MEDICAL DEVICES AND APPLIANCES BY 16.1%. THE GROWTH OF BOTH SEGMENTS PUSHED CUMULATIVE OUTPUT OF THE WHOLE CLUSTER UP BY 10.5% IN THE FIRST FOUR MONTHS OF THIS YEAR COMPARED TO THE SAME PERIOD IN 2006.

TRANSPORT ENGINEERING CLUSTER RECORDED ITS FOURTH CONSECUTIVE MONTHLY YEAR-ON-YEAR GROWTH IN 2007. Q2 GROWTH OF 24.4% WAS CONTRIBUTED BY ALL THREE SEGMENTS. THE MARINE & OFFSHORE SEGMENT GREW 32.0% AS SHIPYARDS QUICKENED THEIR PACE OF SHIPBUILDING, SHIP CONVERSION AND SHIP REPAIRING. THE AEROSPACE SEGMENT GREW 13.5% WITH MORE REPAIRS COMPLETED FOR COMMERCIAL AIRCRAFTS. THE LAND TRANSPORT SEGMENT GREW 38.0% WITH HIGHER PRODUCTION OF LAND VEHICLE EQUIPMENT TO MEET LOCAL AND OVERSEAS ORDERS. CUMULATIVELY, THE CLUSTER GREW 23.9% IN THE FIRST FOUR MONTHS OF 2007 COMPARED TO THE SAME PERIOD LAST YEAR.

THE ELECTRONICS CLUSTER’S OUTPUT IN Q2 INCREASED BY 7.4% COMPARED TO Q2 OF 2006, BOOSTED MAINLY BY THE 18.0% INCREASE IN THE PRODUCTION OF SEMICONDUCTORS. THE ELECTRONIC MODULES AND COMPONENTS SEGMENT GREW 5.5%. ON THE OTHER HAND, CONTRACTIONS WERE SEEN IN THE OUTPUT OF INFOCOMMS & CONSUMER ELECTRONICS (-10.1%), DATA STORAGE (-2.8%) AND COMPUTER PERIPHERALS (-0.2%). FOR THE FIRST FOUR MONTHS OF THIS YEAR, THE ELECTRONICS CLUSTER GREW CUMULATIVELY BY 3.9% COMPARED TO THE SAME PERIOD IN 2006.

THE CHEMICALS CLUSTER GREW 4.1% IN Q2 COMPARED TO LAST YEAR'S SECOND QUARTER. THE OUTPUT OF PETROLEUM ROSE 21.7% FROM A YEAR AGO WHEN OUTPUT WAS LOW ARISING FROM MAINTENANCE SHUTDOWNS IN SOME REFINERY PLANTS. THE PRODUCTION OF PETROCHEMICALS FELL SLIGHTLY BY 0.6%. THE OUTPUT OF SPECIALTY CHEMICALS SHRANK 9.6% ON ACCOUNT OF LESS OUTPUT OF EPOXY COMPOUNDS, MINERAL OIL ADDITIVES AND CHEMICAL CATALYSTS. THE CLUSTER RECORDED A CUMULATIVE GROWTH OF 1.8% IN THE FIRST FOUR MONTHS OF 2007 COMPARED TO THE SAME PERIOD LAST YEAR.

OUTPUT OF THE PRECISION ENGINEERING CLUSTER FELL BY 2.5% IN Q2 2007. THIS CAME FROM THE CONTRACTIONS OF 1.4% AND 3.2% FOR THE MACHINERY & SYSTEMS SEGMENT AND PRECISION MODULES & COMPONENTS SEGMENT RESPECTIVELY. CUMULATIVELY, THE FIRST FOUR MONTHS’ OUTPUT THIS YEAR WAS 0.9% LESS THAN THE OUTPUT IN THE SAME PERIOD OF 2006.

THE GENERAL MANUFACTURING INDUSTRIES GREW 11.3% YEAR-ON-YEAR IN Q2 2007. THE FOOD, BEVERAGES AND TOBACCO INDUSTRIES CONTRIBUTED LARGELY TO THE GROWTH WITH OUTPUT INCREASES OF 18.3%. THE MISCELLANEOUS INDUSTRIES ALSO GREW 14.9%. CUMULATIVE OUTPUT FOR THIS GROUP OF INDUSTRIES GREW 9.8% IN THE FIRST FOUR MONTHS OF THIS YEAR COMPARED TO THE SAME PERIOD IN 2006.

OUTLOOK

THE MANUFACTURING SECTOR IS MORE OPTIMISTIC IN THE NEXT SIX MONTHS ENDING SEPTEMBER 2007, COMPARED TO THE FIRST QUARTER OF THE YEAR. OVERALL, A WEIGHTED 30% OF MANUFACTURERS FORESEE AN IMPROVED OUTLOOK, WHILE 4% PREDICT DETERIORATION. THIS RESULTS IN A NET WEIGHTED BALANCE OF 26% OF MANUFACTURERS EXPECTING BUSINESS CONDITIONS TO IMPROVE, WHICH IS HIGHER THAN THE 7% RECORDED A QUARTER AGO. THE POSITIVE BUSINESS SENTIMENT IS LED BY THE ELECTRONICS CLUSTER.

BUSINESS OUTLOOK IN THE BIOMEDICAL MANUFACTURING CLUSTER REMAINS RELATIVELY STABLE FOR THE NEXT SIX MONTHS ENDING SEPTEMBER 2007, COMPARED TO THE FIRST QUARTER OF THE YEAR. IN BOTH THE PHARMACEUTICAL AND MEDICAL TECHNOLOGY SEGMENTS, OUTPUT FORECAST IS ANTICIPATED TO BE HIGHER IN THE SECOND QUARTER OF 2007, COMPARED TO THE FIRST QUARTER, IN PREPARATION FOR ORDERS AND DELIVERIES TO BE MADE IN THE SAME PERIOD.

THE TRANSPORT ENGINEERING CLUSTER REMAINS POSITIVE ABOUT BUSINESS PROSPECTS IN THE NEXT SIX MONTHS ENDING SEPTEMBER 2007, COMPARED TO LAST QUARTER. THE MARINE & OFFSHORE ENGINEERING SEGMENT REMAINS ROBUST, WITH THE MAJORITY OF SHIPYARDS ANTICIPATING HIGHER LEVELS OF REPAIRING AND CONVERSION ACTIVITIES IN SECOND QUARTER OF 2007, COMPARED WITH THE FIRST QUARTER OF THE YEAR. STRONGER PERFORMANCE IS ALSO ANTICIPATED IN THE AEROSPACE SEGMENT ON A QUARTER TO QUARTER BASIS, AS AIRCRAFT REPAIR AND SERVICING ACTIVITIES INCREASE IN LINE WITH MORE OVERSEAS ORDERS AND EXPORTS. OUTPUT IN THE LAND TRANSPORT SEGMENT IS ALSO EXPECTED TO RISE IN THE SECOND QUARTER OF THE YEAR, COMPARED WITH A QUARTER AGO, IN FULFILLMENT OF CONTRACTUAL ORDERS.

THE ELECTRONICS CLUSTER IS SIGNIFICANTLY MORE OPTIMISTIC COMPARED TO THE FIRST QUARTER OF THE YEAR. A NET WEIGHTED BALANCE OF 38% OF MANUFACTURERS EXPECTS BUSINESS CONDITIONS TO IMPROVE IN THE NEXT SIX MONTHS ENDING SEPTEMBER 2007, COMPARED TO A NET WEIGHTED BALANCE OF -1% RECORDED IN THE FIRST QUARTER. IN PARTICULAR, MANUFACTURERS IN THE COMPUTER PERIPHERALS AND INFOCOMMS AND CONSUMER ELECTRONICS SEGMENTS ARE MORE BULLISH DUE TO NEW PRODUCT INTRODUCTIONS AND AN EXPECTED PICK UP IN MARKET DEMAND FOLLOWING THE FIRST QUARTER SEASONAL LULL. CHIP MAKERS ALSO PREDICT SUSTAINED GLOBAL DEMAND OVER THE SECOND AND THIRD QUARTERS OF THE YEAR, AS EVIDENCED BY AN EXPECTED INCREASE IN EXPORT ORDERS AND SALES. PRODUCTION IN ALL SEGMENTS OF THE CLUSTER IS EXPECTED TO RISE IN THE SECOND QUARTER, OVER THE LOW LEVELS IN THE FIRST QUARTER OF 2007. IN TERMS OF EMPLOYMENT OUTLOOK, A NET WEIGHTED 24% OF THE ELECTRONICS CLUSTER IS EXPECTED TO HIRE MORE WORKERS IN THE SECOND QUARTER OF 2007, AS PRODUCTION AND SALES INCREASE.

IN THE CHEMICALS CLUSTER, A NET WEIGHTED 10% OF MANUFACTURERS EXPECT THE BUSINESS ENVIRONMENT IN THE SECTOR TO IMPROVE IN THE NEXT SIX MONTHS ENDING SEPTEMBER 2007. FIRMS IN THE SPECIALTIES AND OTHER CHEMICALS SEGMENTS ARE MORE OPTIMISTIC AS THE TREND OF SALES LEVEL DURING THE APRIL TO SEPTEMBER PERIOD IS EXPECTED TO RISE, FOLLOWING SEASONAL WEAKNESS IN THE FIRST THREE MONTHS OF 2007. OUTPUT IN ALL SEGMENTS OF THE CLUSTER IS PROJECTED TO INCREASE IN THE SECOND QUARTER OF THE YEAR, AS COMPARED TO THE FIRST. THE ONLY EXCEPTION IS IN THE PETROLEUM REFINERY SEGMENT, WHERE SOME MAINTENANCE DOWNTIME IS PLANNED DURING THIS PERIOD.

A NET WEIGHTED BALANCE OF 24% OF THE PRECISION ENGINEERING CLUSTER EXPECT AN IMPROVEMENT IN THE OPERATING ENVIRONMENT IN THE NEXT SIX MONTHS ENDING SEPTEMBER 2007, AS COMPARED TO ONLY 4% RECORDED A QUARTER AGO. ON THE PRODUCTION FRONT, A TURNAROUND FROM THE SEASONALLY WEAK FIRST QUARTER IS ALSO EXPECTED. THE MACHINERY & SYSTEMS SEGMENT FORECAST AN INCREASE IN THE OUTPUT OF INDUSTRIAL PROCESS CONTROL EQUIPMENT AND SEMICONDUCTOR ASSEMBLY AND TESTING EQUIPMENT, IN VIEW OF HIGHER ORDERS AND DELIVERIES ANTICIPATED IN THE SECOND QUARTER OF 2007. MANUFACTURERS IN THE PRECISION MODULES & COMPONENTS SEGMENT EXPECT AN INCREASE IN PRODUCTION DUE TO THE INTRODUCTION OF SOME NEW PRODUCT LINES, AND IN RESPONSE TO HIGHER ORDER LEVELS. MOREOVER, SINGAPORE'S PRECISION ENGINEERING SECTOR IS GROWING AND INCREASING ITS OUTPUT ANNUALLY AND IS EXPECTED TO GENERATE S$28 BILLION BY 2010.

EXTRACTED FROM: MINISTRY OF TRADE AND INDUSTRY, SINGAPORE

SINGAPORE DEPARTMENT OF STATISTICS

economic development board

CONTACT SINGAPORE

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.	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%)

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