MIRA INFORM REPORT

Report Date :

10.03.2007

IDENTIFICATION DETAILS

Name :	VENTURE CORPORATION LIMITED

Registered Office :	^{5006 Ang Mo Kio Avenue 5, #05-01/12, Techplace II, Singapore 569873}

Country :	Singapore

Financials (as on) :	31.12.2005

Date of Incorporation :	^04/08/1984

Com. Reg. No.:	^198402886H

Legal Form :	^{Public Limited Company}

Line of Business :	Manufacturing, Design, Engineering, Customisation and Logistic Services to Electronics Companies Worldwide

RATING & COMMENTS

MIRA’s Rating :

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

VENTURE CORPORATION LIMITED

Line Of Business

MANUFACTURING, DESIGN, ENGINEERING, CUSTOMISATION AND LOGISTIC SERVICES TO ELECTRONICS COMPANIES WORLDWIDE

Parent Company

Financial Elements

FY 2005

CONSOLIDATED

Sales : S$3,238,035,000

Networth : S$1,670,784,000

Paid-Up Capital : S$67,368,000

Net result : S$201,676,000

Net Margin(%) : 6.23

Return on Equity(%) : 12.07

Leverage Ratio : 0.32

COMPANY IDENTIFICATION

^{Subject Company
: VENTURE CORPORATION LIMITED}

^{Former Name : VENTURE MANUFACTURING (SINGAPORE) LTD}

^{Business
Address : 5006 ANG MO KIO AVENUE 5}

^#05-01/12

^{TECHPLACE II}

^{Town :
SINGAPORE}

^{Postcode : 569873}

^{County :
-}

^{Country :
Singapore}

^{Telephone : 6482 1755}

^{Fax :
6482 0122}

^{ROC Number :
198402886H}

^{Reg. Town : -}

PREVIOUS IDENTIFICATION

^{VENTURE
MANUFACTURING (SINGAPORE) LTD}

^{DATE OF CHANGE
OF NAME: 17/05/2002}

VENTURE MANUFACTURING (SINGAPORE) PTE LTD

^{DATE OF CHANGE
OF NAME: 09/03/1992}

SUMMARY

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

^{Legal Form :
Pub Ltd Co}

^{Date Inc. :
04/08/1984}

^{Previous Legal
Form :
Pte Ltd}

^{Summary year :
31/12/2005}

^{Sales :
3,238,035,000}

^{Net worth :
1,670,784,000}

^{Capital :
-}

^{Paid-Up Capital :
67,368,000}

^{Employees :
11,453}

^{Net result :
201,676,000}

^{Share value :
-}

^{AUDITOR :
DELOITTE & TOUCHE}

^{BASED ON ACRA'S
RECORD AS AT 18/01/2007}

^{NO OF SHARE CURRENCY AMOUNT}

^{ISSUED
ORDINARY 272,550,577 SGD 649,039,391.37}

^{PAID-UP
ORDINARY - SGD 649,039,391.37}

REFERENCES

^{Litigation : No}

^{Company status
: TRADING}

^{Started : 04/08/1984}

PRINCIPAL(S)

^{WONG NGIT
LIONG S2549567E Managing Director}

DIRECTOR(S)

^{CECIL VIVIAN
RICHARD WONG S0280390I Director}

^{Appointed on : 06/05/1992}

^{Street : 14
JOAN ROAD}

^{CALDECOTT HILL
ESTATE}

^{Town: SINGAPORE}

^{Postcode: 298892}

^{Country: Singapore}

^{KOH LEE
BOON
S1103991Z Director}

^{Appointed on : 01/08/1996}

^{Street : 530
EAST COAST ROAD}

^#03-01

^{OCEAN PARK
CONDOMINIUM}

^{Town: SINGAPORE}

^{Postcode: 458970}

^{Country: Singapore}

^{WONG NGIT
LIONG S2549567E Director}

^{Appointed on : 20/01/1989}

^{Street : 3A CAMDEN PARK}

^{Town: SINGAPORE}

^{Postcode: 299817}

^{Country: Singapore}

^{WONG NGIT
LIONG S2549567E Managing Director}

^{Appointed on : 20/01/1989}

^{Street : 3A
CAMDEN PARK}

^{Town: SINGAPORE}

^{Postcode: 299817}

^{Country: Singapore}

^{TAN CHOON
HUAT S2537517C Director}

^{Appointed on : 06/05/1992}

^{Street : 23 REBECCA ROAD}

^{REBECCA PARK}

^{Town: SINGAPORE}

^{Postcode: 266701}

^{Country: Singapore}

^{SOO ENG
HIONG
S2547540B Director}

^{Appointed on : 18/11/2003}

^{Street : 69
DALVEY ROAD}

^{Town: SINGAPORE}

^{Postcode: 259508}

^{Country: Singapore}

^{GOH GEOK
LING S0040556F Director}

^{Appointed on : 27/02/2004}

^{Street : 37
JALAN KAMPONG CHANTEK}

^{Town: SINGAPORE}

^{Postcode: 588615}

^{Country: Singapore}

^{GOON KOK
LOON S1516396H Director}

^{Appointed on : 27/02/2004}

^{Street : 18 LIM TAI SEE WALK}

^{Town: SINGAPORE}

^{Postcode: 267785}

^{Country: Singapore}

^{YVONNE
CHOO
S0090447C Director}

^{Appointed on : 01/10/2005}

^{Street : 2 CALDECOTT CLOSE}

^{CALDECOTT HILL
ESTATE}

^{Town: SINGAPORE}

^{Postcode: 299110}

^{Country: Singapore}

FORMER DIRECTOR(S)

^{CHUA THIAM
CHWEE ANDREW S0009799C}

^{WOO BOON
HO S0020573G}

^{YVONNE
CHOO S0090447C}

^{LEONG HORN
KEE S0133649E}

^{DERRICK LEE
MEOW CHAN S0164940Z}

^{TAN KENG
BOON S0224860C}

^{TAN HO
PENG S0337314B}

^{CHAN SIN
FATT 0933503}

^{LIM YU
SIAN S1104604E}

^{DOROTHY HO LAI
YONG S1105012C}

^{TAN LAY
HONG S1592913H}

^{SOO ENG HIONG S2547540B}

^{AGUSTIN DEL
VILLAR QUE SA0750940}

^{GOPALA ACHUTA
MENON F608341}

^{PAY CHER
WEE S7039709I}

ACTIVITY(IES)

^{ELECTRONIC
COMPONENTS Code:7605}

^{CONTRACT
MANUFACTURING
Code:5460}

^{DATA PROCESSING
EQUIPMENT Code:6200}

^{BASED ON ACRA'S
RECORD AS AT 18/01/2007}

^{1) MANUFACTURE
OF COMPUTERS AND DATA PROCESSING EQUIPMENT EXCEPT COMPUTER PERIPHERAL
EQUIPMENT;}

CHARGES

No Charges On Premise/Property In Our Database

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

BANKERS

^{CITIBANK NA}

^{DBS BANK LTD.}

^{ABN AMRO BANK
N.V.}

^{JPMORGAN CHASE
BANK}

ASSOCIATED COMPANY(IES)

^{ACUMEN
ENGINEERING PTE LTD}

^Singapore

^{FISCHER TECH
LTD}

^Singapore

^{SEB PTE LTD}

^Singapore

^{HARTEC ASIA PTE
LTD}

^Singapore

SHAREHOLDERS(S)

^{RAFFLES NOMINEES
PTE LTD 10,244,562 Company}

^{Street : 000}

^{Town: SINGAPORE}

^{Postcode: 000}

^{Country: Singapore}

^{UNITED OVERSEAS
BANK NOMINEES 17,232,136 Company}

^{Street : 80
RAFFLES PLACE}

^{#UOB PLAZA}

^{Town: SINGAPORE}

^{Postcode: 048624}

^{Country: Singapore}

^{CITIBANK
CONSUMER NOMINEES PTE LTD
827,802 Company}

^{Street : 000}

^{Town: SINGAPORE}

^{Postcode: 000}

^{Country: Singapore}

^{DB NOMINEES
(SINGAPORE) PTE LTD 656,254
Company}

^{Street : 50
COLLYER QUAY}

^{OVERSEAS UNION HOUSE}

^{Town: SINGAPORE}

^{Postcode: 049321}

^{Country: Singapore}

^{TAN CHOON
HUAT 2,198,715 Private Person}

^{Street : 107A Bedok Road}

^{Town: Singapore}

^{Postcode: 469384}

^{Country: Singapore}

^{METCHEM
ENGINEERING SA
461,034 Company}

^{Street : 0000}

^Town:

^Postcode:

^{Country: Singapore}

^{PHILLIP
SECURITIES PTE LTD
401,649 Company}

^{Street : 250
NORTH BRIDGE ROAD}

^#06-00

^{RAFFLES CITY TOWER}

^{Town: SINGAPORE}

^{Postcode: 179101}

^{Country: Singapore}

^{UOB KAY HIAN
PRIVATE LIMITED 452,000 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{CITIBANK
NOMINEES S'PORE PTE LTD 30,794,705 Company}

^{Street : 3 TEMASEK AVENUE}

^#12-00

^{CENTENNIAL TOWER}

^{Town: SINGAPORE}

^{Postcode: 039190}

^{Country: Singapore}

^{DBS NOMINEES
PTE LTD 78,696,913 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{DBS VICKERS
SECURITIES (S) PTE LTD 567,935
Company}

^{Street : 8 CROSS STREET}

^#02-01

^{PWC BUILDING}

^{Town: SINGAPORE}

^{Postcode: 048424}

^{Country: Singapore}

^{MERRILL LYNCH
(SINGAPORE) PTE LTD 6,678,707 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{LIM SWEE
KWANG
454,760 Private Person}

^{Street : 79 CHAY YAN STREET}

^01-28

^{Town: SINGAPORE}

^{Postcode: 0316}

^{Country: Singapore}

^{OCBC SECURITIES
PRIVATE LTD 741,000 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{WONG NGIT
LIONG
574,619 Private Person}

^{Street : 3A CAMDEN PARK}

^{Town: SINGAPORE}

^{Postcode: 299817}

^{Country: Singapore}

^{DBSN SERVICES
PTE LTD 48,978,588 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{HSBC
(SINGAPORE) NOMINEES PTE LTD
42,226,040 Company}

^{Street : 10 COLLYER QUAY}

^#02-02

^{OCEAN BUILDING}

^{Town: SINGAPORE}

^{Postcode: 049315}

^{Country: Singapore}

^{GOODPACK
HOLDINGS PTE LTD
836,000 Company}

^{Street :}

^Town:

^Postcode:

^{Country: Singapore}

^{TEE GOON
ENG
510,000 Private Person}

^{Street : 52 WESTWOOD CRESCENT}

^{Town: SINGAPORE}

^{Postcode: 648767}

^{Country: Singapore}

^{BNP PARIBAS
NOMINEES SINGAPORE PTE
464,000 Company}

^{Street : 000}

^{Town: SINGAPORE}

^{Postcode: 000}

^{Country: Singapore}

FORMER SHAREHOLDER(S)

^{HSBC
(SINGAPORE) NOMINEES PTE LTD
34,747,827}

^{OCBC NOMINEES
SINGAPORE PTE LTD 529,000}

^{OVERSEAS UNION
BANK NOMINEES (PTE) 2,856,000}

^{SINGAPORE
NOMINEES PTE LTD 1,056,000}

^{NTUC INCOME
INSURANCE CO-OPERATIVE
1,444,000}

^{LEW KIM
SOON
1,188,780}

^{CHANG KOK CHOI
MARK 392,481}

^{HSBC PRIVATE
BANK (SUISSE) SA 508,543}

^{CIMB-GK
SECURITIES (F.K.A. G K GOH
413,365}

^{OH AH KOK
SANDY
944,554}

^{KIM ENG ONG
ASIA SECS PTE LTD 1,143,983}

^{CHOI PENG
KUM
414,395}

^{MORGAN STANLEY
ASIA (SINGAPORE) 2,278,000}

^{KIM ENG
SECURITIES (PTE) LTD
398,983}

^{SOCIETE
GENERALE SINAPORE BRANCH
439,423}

^{THE ASIA LIFE
ASSURANCE SOCIETY LTD 471,000}

^{THE CENTRAL
DEPOSITORY (PTE) 272,543,818}

^{SOO ENG
HIONG
6,759}

SUBSIDIARY(IES)

^{ADVANCED
PRODUCTS CORPORATION PTE LTD}

Singapore

^{CEBELIAN
HOLDINGS PTE LTD}

Singapore

^{EAS SECURITY
SYSTEMS PTE LTD}

Singapore

^{SHANGHAI
WAIGAOQIAO VENTURE ELECTRONICS CO., LTD}

China

^{VCL ELECTRONICS
SERVICES INDIA PRIVATE LIMITED}

India

^{VENTURE
ELECTRONICS (EUROPE) B.V.}

^{The Netherlands}

^{VENTURE HUNGARY
ELECTRONICS MANUFACTURING LTD}

Hungary

^{VENTURE
ELECTRONICS SPAIN S.L.}

Spain

^{VENTURE
ELECTRONICS (SHANGHAI) CO LTD}

China

^{VM SERVICES,
INC.}

United States of America

^{VENTURE
ELECTRONICS INTERNATIONAL, INC.}

United States of America

^{VENTURE DESIGN
SERVICES, INC.}

United States of America

^{VIPCOLOR
TECHNOLOGIES PTE LTD}

^Singapore

^{VIPCOLOR
TECHNOLOGIES USA, INC}

United States of America

^{INNOVATIVE TREK
TECHNOLOGY PTE LTD}

^Singapore

^{VENTURE
ELECTRONICS MEXICO S.A. DE C.V}

^Mexico

^{MULTITECH
SYSTEMS PTE. LTD.}

Singapore

^{TECHNOCOM
SYSTEMS SDN BHD}

Malaysia

^{PINTARMAS SDN
BHD}

Malaysia

^{V-DESIGN
SERVICES (M) SDN BHD}

Malaysia

^{PT VENTURE
ELECTRONICS INDONESIA}

Indonesia

^{VENTECH DATA
SYSTEMS PTE LTD}

Singapore

^{VENTURE ELECTRONICS
SERVICES (MALAYSIA) SDN BHD}

Malaysia

^{VENTURE
ELECTRONICS SOLUTIONS PTE LTD}

Singapore

^{VENTECH
INVESTMENTS LTD}

^{British Virgin
Islands}

^{UNIVAC
PRECISION ENGINEERING PTE LTD}

Singapore

^{UNISON
PRECISION INDUSTRIES (M) SDN BHD}

Malaysia

^{MUNIVAC SDN BHD}

Malaysia

^{UNIVAC
PRECISION, INC.}

^{United States
of America}

^{UNIVAC DESIGN
& ENGINEERING PTE LTD}

^Singapore

^{UNIVAC
PRECISION PLASTIC (SHANGHAI) CO LTD}

China

^{UNIVAC
PRECISION PLASTICS (SIP) CO., LTD}

China

^{SCINETIC
ENGINEERING PTE LTD}

Singapore

^{SCE RESOURCES
PTE LTD}

Singapore

^{SCINETIC
TECHNOLOGY (HK) LTD}

Hong Kong

PAYMENT HISTORY AND EXPERIENCES

^{Trade
Morality: GOOD}

^{Liquidity
: ABUNDANT}

^{Payments : REGULAR}

^{Trend : UPWARD}

^{Financial
Situation: GOOD}

LITIGATION(S)

No Litigation In Our Database

FINANCIAL ELEMENTS

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

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

^{Date Account Lodged: 26/05/2006}

^{Balance Sheet Date: 31/12/2005 31/12/2004 31/12/2003}

^{Number of weeks: 52 52 52}

^{Consolidation Code: CONSOLIDATED CONSOLIDATED CONSOLIDATED}

^{--- ASSETS}

^{Preliminary Exp 274,779,000 291,973,000 -}

^{Intangible Fixed Assets: 83,937,000 74,935,000
75,083,000}

^{Tangible Fixed Assets: 168,114,000 167,714,000
159,362,000}

^{Investments 21,112,000 17,810,000
70,318,000}

^{Total Fixed Assets: 547,942,000 552,432,000 304,763,000}

^{Inventories: 408,136,000
353,538,000 254,164,000}

^{Receivables: 590,598,000 481,623,000
440,521,000}

^{Cash,Banks, Securitis: 556,586,000 567,428,000
780,133,000}

^{Other current assets: 68,970,000 69,986,000
29,752,000}

^{Total Current Assets: 1,624,290,000 1,472,575,000
1,504,570,000}

^{TOTAL ASSETS: 2,172,232,000
2,025,007,000
1,809,333,000}

^{--- LIABILITIES}

^{Equity capital: 67,368,000 65,895,000 64,281,000}

^{Reserves: 2,308,000 -15,579,000
-15,211,000}

^{Reeval. Reserves: -16,103,000 - -}

^{Profit & lost Account:
1,055,471,000
1,018,198,000
871,857,000}

^{Other: 7,595,000 2,246,000
8,310,000}

^{Surplus equity: 554,145,000 501,751,000
420,131,000}

^{TOTAL EQUITY: 1,670,784,000
1,572,511,000
1,349,368,000}

^{Long Term Loans: 236,000 - -}

^{L/T deffered taxes: 2,522,000
3,577,000
2,746,000}

^{Other long term Liab.: 27,281,000 - -}

^{Total L/T Liabilities: 30,039,000 3,577,000
2,746,000}

^{Trade
Creditors: 387,151,000 373,303,000 382,237,000}

^{Prepay. & Def. charges: 47,640,000 33,657,000 -}

^{Due to Bank: 5,844,000 7,995,000
9,864,000}

^{Provisions: 3,781,000 4,012,000
5,427,000}

^{Other Short term Liab.: 26,993,000 29,952,000
59,691,000}

^{Total short term Liab.: 471,409,000 448,919,000
457,219,000}

^{TOTAL LIABILITIES: 501,448,000 452,496,000 459,965,000}

PROFIT & LOSS ACCOUNT

^{Net Sales 3,238,035,000 3,193,398,000
3,170,018,000}

^{Result of ordinary operations -
- 235,604,000}

^{NET RESULT BEFORE TAX: 207,085,000 194,563,000
250,146,000}

^{Tax : 5,409,000 5,231,000
3,613,000}

^{Net income/loss year: 201,676,000 189,332,000
240,386,000}

^{Interest Paid: 297,000 328,000 343,000}

^{Depreciation: 41,358,000 41,143,000
41,362,000}

^{Dividends: 133,973,000 42,395,000
18,484,000}

^{Directors Emoluments: 9,625,000 9,578,000
12,908,000}

^{Wages and Salaries: 217,799,000 210,642,000 179,187,000}

RATIOS

^{31/12/2005 31/12/2004
31/12/2003}

^{Turnover per employee: 282723.74 278826.33
276784.95}

^{Net result / Turnover(%): 0.06 0.06 0.08}

^{Stock / Turnover(%): 0.13 0.11 0.08}

^{Net Margin(%): 6.23 5.93 7.58}

^{Return on Equity(%): 12.07 12.04
17.81}

^{Return on Assets(%): 9.28 9.35
13.29}

^{Dividends Coverage: 1.51 4.47 13.01}

^{Net Working capital: 1152881000.00 1023656000.00
1047351000.00}

^{Cash Ratio: 1.18 1.26 1.71}

^{Quick Ratio: 2.43 2.34 2.67}

^{Current ratio: 3.45 3.28 3.29}

^{Receivables Turnover: 65.66 54.29
50.03}

^{Leverage Ratio: 0.32 0.30 0.36}

^{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 STRONG IN VIEW OF THE FOLLOWING:}

^{NET WORTH:}

^{THE BALANCE
SHEET WAS CONSIDERED STRONG WITH NET WORTH IMPROVED BY 6.25% FROM
S$1,572,511,000 IN FY 2004 TO S$1,670,784,000 IN FY 2005. THIS WAS DUE TO
HIGHER ACCUMULATED PROFIT OF S$1,055,471,000 (2004: S$1,018,198,000); A RISE OF
3.66% FROM THE PRIOR FINANCIAL YEAR.}

^LEVERAGE:

^{IN THE
SHORT-TERM, SUBJECT WAS LARGELY FINANCED BY TRADE CREDITORS WHICH MADE UP 82.13%
(2004: 83.16%) OF THE TOTAL CURRENT LIABILITIES AND AMOUNTED TO S$387,151,000
(2004: S$373,303,000). THE BREAKDOWN IS
AS FOLLOWS:}

^{-OUTSIDE
PARTIES - 2005: S$386,709,000 (2004: S$372,237,000)}

^{-ASSOCIATES -
2005: S$383,000 (2004: S$888,000)}

^{-JOINT VENTURE
- 2005: S$59,000 (2004: S$178,000)}

^{IN THE
LONG-TERM, SUBJECT WAS LARGELY FINANCED BY OTHER LONG-TERM LIABILITIES WHICH
MADE UP 90.82% (2004: -) OF THE TOTAL CURRENT LIABILITIES AND AMOUNTED TO
S$27,281,000 (2004: -). THE BREAKDOWN IS AS FOLLOWS:}

^{-EMBEDDED
DERIVATIVES - 2005: S$27,281,000 (2004: -)}

^{AMOUNT DUE TO
BANKS OF S$5,844,000 (2004: S$7,995,000) CONSISTED OF:}

^{-BANK OVERDRAFT
(UNSECURED) - 2005: S$31,000 (2004: -)}

^{-BANK LOANS -
2005: S$5,813,000 (2004: S$7,995,000)}

^{IN ALL, LEVERAGE
RATIO ROSE FROM 0.30 TIMES TO 0.32 TIMES AS A RESULT OF A GREATER RISE IN TOTAL
LIABILITIES THAN TOTAL EQUITY.}

^LIQUIDITY:

^{IN GENERAL,
SUBJECT'S LIQUIDITY SITUATION WAS HEALTHY AS SEEN FROM THE RISE IN NET WORKING
CAPITAL AND LIQUIDITY RATIOS. CURRENT RATIO ROSE TO 3.45 TIMES, UP FROM 3.28
TIMES AND QUICK RATIO IMPROVED TO 2.43 TIMES FROM 2.34 TIMES IN FY 2004.}

^{SIMILARLY, NET
WORKING CAPITAL IMPROVED BY 12.62% FROM S$1,023,656,000 IN FY 2004 TO
S$1,152,881,000.}

^{CASH AND CASH
EQUIVALENTS COMPRISE OF:}

^{-CASH - 2005:
S$99,245,000 (2004: S$90,929,000)}

^{-FIXED DEPOSITS
- 2005: S$457,341,000 (2004: S$476,499,000)}

^{PROFITABILITY:}

^{REVENUE POSTED
AN INCREASE OF 1.39% FROM S$3,193,398,000 IN FY 2004 TO S$3,238,035,000 AND NET
PROFIT ROSE BY 6.52% TO S$201,676,000 (2004: S$189,332,000). HENCE, NET MARGIN
ROSE TO 6.23% (2004: 5.93%).}

^REVENUE:

^{-RENDERING OF
ELECTRONIC MANUFACTURING AND ENGINEERING SERVICES- 2005: S$3,237,525 (2004:
S$3,191,460,000)}

^{-DIVIDEND
INCOME - 2005: S$510,000 (2004: S$1,938,000)}

^{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$297,000 IN FY
2005 (2004: S$328,000).}

^{NON-CURRENT
ASSETS:}

^{THE FOLLOWING
ITEMS ARE CLASSIFIED UNDER PRELIMINARY:}

²⁰⁰⁵

^{AVAILABLE-FOR-SALE
INVESTMENTS, AT FAIR VALUE:}

^{-QUOTED EQUITY
SHARES - 2005: S$ 13,985,000}

^{-UNQUOTED
EQUITY SHARES - 2005: S$ 1,828,000}

^{-QUOTED DEBT
SECURITIES - 2005: S$ 29,208,000}

^{-UNQUOTED DEBT
SECURITIES - 2005: S$ 60,341,000}

^{-CREDIT
DERIVATIVE NOTES - 2005: S$208,173,000}

^{ANALYSED AS:}

^{CURRENT
ASSETS - 2005: S$ 38,756,000}

^{NON-CURRENT
ASSETS - 2005: S$274,779,000}

²⁰⁰⁴

^{-QUOTED EQUITY
SHARES - 2004: S$32,948,000}

^{-IMPAIRMENT
LOSS - 2004: (S$4,211,000)}

^____________

^S$28,737,000

^{-UNQUOTED
EQUITY SHARES - 2004: S$4,027,000}

^{-IMPAIRMENT
LOSS -
2004:(S$1,000,000)}

^____________

^S$
3,027,000

^{FIXED RATE
BONDS - 2004: S$ 34,974,000}

^{CREDIT
DERIVATIVE NOTES - 2004: S$225,235,000}

^{NOTES TO THE FINANCIAL STATEMENTS}^:

^{BANK OVERDRAFT AND LOANS}

^{THE SHORT-TERM
BANK LOANS OF SUBSIDIARIES BEAR INTEREST AT RATES RANGING FROM 1.63% TO 7.15%
(2004: 1.7% TO 6.1%) PER ANNUM. THE SHORT-TERM BANK LOANS INCLUDE BANK LOANS OF
CERTAIN SUBSIDIARIES WHICH ARE COVERED BY PROPORTIONATE GUARANTEES PROVIDED BY
THE SHAREHOLDERS OF THE SUBSIDIARIES.}

^{THE LONG-TERM
BANK LOAN OF A SUBSIDIARY BEARS INTEREST AT A RATE OF 2.75% (2004: NIL) PER ANNUM. THE LONG-TERM BANK LOAN AND PART OF
THE SHORT-TERM BANK LOANS ARE SECURED BY A FIRST LEGAL MORTGAGE ON THE
SUBSIDIARY'S LEASHOLD PROPERTY AND A JOINT & SEVERAL DIRECTORS' GUARANTEE
FROM CERTAIN OF ITS DIRECTORS.}

^{GEOGRAPHICAL SEGMENTS:}

²⁰⁰⁵

^{ASIA-PACIFIC UNITED STATES}

^{(EXCLUDING OF AMERICA/}

^{SINGAPORE SINGAPORE) MEXICO/OTHERS}

^{$'000 $'000 $'000}

^REVENUE:

^{EXTERNAL SALES 2,645,519 436,724
156,242}

^{INTER-SEGMENT
SALES 294,790 1,698,465 25,426}

^{TOTAL REVENUE 2,940,309 2,134,739
181,668}

^{ELIMINATIONS GROUP}

^{$'000 $'000}

^REVENUE:

^{EXTERNAL SALES - 3,238,035}

^{INTER-SEGMENT
SALES (2,018,681) -}

^{TOTAL REVENUE (2,018,681) 3,238,035}

2004

^{ASIA-PACIFIC UNITED STATES}

^{(EXCLUDING OF AMERICA/}

^{SINGAPORE SINGAPORE) MEXICO/OTHERS}

^{$'000 $'000 $'000}

^REVENUE:

^{EXTERNAL SALES
2,727,458 350,616 115,324}

^{INTER-SEGMENT
SALES 289,050 1,637,750 12,483}

^{TOTAL REVENUE 3,016,508
1,988,366 127,807}

^{ELIMINATIONS GROUP}

^{$'000 $'000}

^REVENUE:

^{EXTERNAL SALES - 3,193,398}

^{INTER-SEGMENT
SALES (1,939,283) -}

^{TOTAL REVENUE (1,939,283) 3,193,398}

BACKGROUND/OPERATION

^{THE COMPANY WAS
INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 04/08/1984 AS A LIMITED PRIVATE
COMPANY AND IS TRADING UNDER ITS NAMESTYLE AS "VENTURE MANUFACTURING
(SINGAPORE) PTE LTD".}

^{SUBSEQUENTLY,
ON 09/03/1992, THE COMPANY CHANGED TO ITS NAMESTYLE AS "VENTURE
MANUFACTURING (SINGAPORE) LTD" AND IS TRADING AS A PUBLIC COMPANY LIMITED
BY SHARES.}

^{SUBSEQUENTLY,
ON 17/05/2002, THE COMPANY CHANGED TO ITS PRESENT NAMESTYLE AS "VENTURE
CORPORATION LIMITED".}

^{AS AT
18/01/2007, THE COMPANY HAS ISSUED AND PAID-UP CAPITAL OF 272,664,577 SHARES OF
A VALUE OF S$649,974,251.37.}

^{PRINCIPAL
ACTIVITIES:}

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

^{1)MANUFACTURE
OF PCS AND DATA PROCESSING EQUIPMENT EXCEPT PC PERIPHERAL EQUIPMENT PROVIDE
MANUFACTURING, DESIGN, LOGISTIC SERVICES TO ELECTRONICS COMPANIES}

^{DURING THE
FINANCIAL YEAR UNDER REVIEW, THE PRINCIPAL ACTIVITIES OF THE COMPANY CONSIST OF
MANUFACTURING, DESIGN, ENGINEERING, CUSTOMISATION AND LOGISTIC SERVICES TO
ELECTRONICS COMPANIES WORLDWIDE.}

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

^LISTINGS

^{* LISTED ON 27
APRIL 1992 ON SGX SESDAQ}

^{* 23 APRIL 1997
ON SGX MAINBOARD}

^{BACKGROUND OF
THE SUBJECT:}

^{VENTURE
MANUFACTURING (S) LTD WAS INCORPORATED IN 1984 TO PROVIDE CONTRACT
MANUFACTURING SERVICES TO COMPANIES IN THE ELECTRONICS AND COMPUTER-RELATED
INDUSTRIES. IN 1989, THE COMPANY FORMED THE VENTURE GROUP WITH THE MERGER AND
ACQUISITION OF MULTITECH SYSTEMS PTE LTD AND TECHNOCOM SYSTEMS SDN BHD. THE
VENTURE GROUP COMPRISES ABOUT 30 COMPANIES WITH GLOBAL CLUSTERS OF EXCELLENCE
IN SOUTH-EAST ASIA, NORTH-EAST ASIA, THE AMERICAS AND EUROPE VENTURE OFFERS
HIGH VALUE-ADDED AND HIGHLY EFFICIENT MANUFACTURING SERVICES TO MNCS USING
STATE-OF-THE-ART MANUFACTURING PROCESS TECHNOLOGY AND TEST DEVELOPMENT
CAPABILITY. IN ADDITION, VENTURE PROVIDES AN EXCELLENT RANGE OF
PRE-MANUFACTURING SERVICES INCLUDING DESIGN, PROTOTYPING AND ENGINEERING
SERVICES, AS WELL AS POST-MANUFACTURING SERVICES INCLUDING AFTER-SALES REPAIRS,
CUSTOMISATION AND FULFILLMENT LOGISTICS.}

^{SUBJECT ENGAGES
IN THE FOLLOWING ACTIVITIES:}

^{A GLOBAL
ELECTRONICS SERVICES PROVIDER ENGAGED IN MANAGING THE VALUE CHAIN OF ELECTRONIC
COMPANIES THROUGH THE PROVISION OF 3 MAIN}

^SERVICES:

^{* CONTRACT
DESIGN MANUFACTURING/ORIGINAL DESIGN MANUFACTURING (CDM/ODM)}

^{* ELECTRONICS MANUFACTURING
SERVICES (EMS)}

^{* E-FULFILLMENT
SERVICES (EFS)}

^{CONTRACT DESIGN
MANUFACTURING/ORIGINAL DESIGN MANUFACTURING (CDM/ODM)}

^CAPABILTIES:

^{* MECHANICAL
SYSTEMS DESIGN}

^{* PRECISION
PLASTIC TOOLS DESIGN}

^{* ELECTRONICS
SYSTEMS DESIGN}

^{* ASIC DESIGN}

^{* SOFTWARE
DESIGN AND DEVELOPMENT}

^{* RELIABILITY
ENGINEERING/TESTING}

^{* REGULATORY
COMPLIANCE ENGINEERING/TESTING}

^{* PRODUCT TEST
DEVELOPMENT}

^PRODUCTS:

^{* DATA CAPTURE
TERMINALS AND BASE STATIONS}

^{* MOBILE
COMPUTING AND COMMUNICATION DEVICES}

^{* PRINTING AND
IMAGING PRODUCTS}

^{* MEDICAL
DEVICES}

^{* NETWORKING
AND TELECOMMUNICATION}

^{* STORAGE
PRODUCTS AND SYSTEMS}

^{* RF
COMMUNICATION SYSTEMS AND COMPONENTS}

^{ELECTRONICS
MANUFACTURING SERVICES (EMS) INCLUDING:}

^{* COMPLEX
PRINTED CIRCUIT BOARD ASSEMBLIES (PCBA) OF MORE THAN 12 LAYERS}

^{* STRATEGIC
SUB-ASSEMBLIES, COMPLEX FIBRE OPTICS ASSEMBLIES, AND THE MANUFACTURING OF}

^{PHOTONIC SWITCHES}

^{* FULL PRODUCT
ASSEMBLIES (BOX-BUILD) ACROSS VARIOUS PRODUCT SEGMENTS}

^{* SYSTEMS
INTEGRATIONS}

^{* COMPLEX TEST
DEVELOPMENT SERVICES}

^{SUPPORTING
THESE CORE EMS OFFERINGS ARE A WIDE RANGE OF RELATED ACTIVITIES INCLUDING:}

^{* ADVANCED
MANUFACTURING TECHNOLOGIES (AMT)}

^{* NEW PRODUCT
INTRODUCTION (NPI) MANAGEMENT EXPERTISE}

^{* STRATEGIC
COMMODITY AND SUPPLIER CLUSTER MANAGEMENT}

^{* ON-SITE PROGRAM
MANAGEMENT}

^{E-FULFILLMENT
SERVICES (EFS)}

^{ADDING VALUE TO
THE ENTIRE SUPPLY CHAIN AND THE LIFE-CYCLE OF THE PRODUCT THROUGH COLLABORATIVE
PARTNERSHIPS IN:}

^{* NEW BUSINESS
MODELS}

^{* SUPPLY CHAIN
STRATEGY & MANAGEMENT}

^{* ORDER
MANAGEMENT}

^{* LOGISTICS
& MICRO-DISTRIBUTION}

^{* REVERSE
LOGISTICS}

^{* POST-SALES
TECHNICAL SUPPORT}

^{* SUPPLIER
MANAGEMENT}

^{* PRODUCT
ENGINEERING}

^{PRODUCTS
DEALINGS:}

^{* COMPUTER
PERIPHERAL PRODUCTS}

^{* BAR-CODE
SCANNERS}

^{* THERMAL
PRINTERS}

^{* DESKTOP AND
PORTABLE PRINTERS}

^{* NETWORK
PRODUCTS}

^{* MASS STORAGE
DATA PRODUCTS}

^{* DATA
COLLECTION SYSTEMS}

^{* MICROWAVE
COMMUNICATIONS PRODUCTS}

^{* FIBRE OPTICS
TRANSCEIVERS}

^{* UPS}

^{* HIGH END
IMAGING SUB-ASSEMBLIES}

^{* SECURITIES
SYSTEMS}

^{* ELECTRONICS
INSTRUMENTS}

^{* TEST &
MEASUREMENT}

^{* AUTO-MOTIVES
AND MEDICAL}

^{SOME OF
SUBJECT'S CLIENTS:}

^{* INTEL ASIA}

^{* INTERMEC}

^{* AGILENT}

^{* COHERENT}

^{* HP IMAGING
& PRINTING GROUP}

^{* IOMEGA}

^{* HP PERSONAL
LASERJET SOLUTIONS}

^{* HP SPAIN}

^{* IBM JAPAN}

^{* LEXAR}

^{* XEROX}

^{* HP}

^{* ADAPTEC}

^{* APDO}

^{* TEKTRONIX}

^{OVERSEAS
OFFICES AND MANUFACTURING FACILITIES:}

^{* MALAYSIA}

^{* INDONESIA}

^{* CHINA}

^AMERICAS

^{* UNITED STATES
OF AMERICA}

^{* MEXICO}

^EUROPE

^{* THE
NETHERLANDS}

^{* HUNGARY}

^{* SPAIN}

^{QUALITY
ASSESSMENT:}

^{* ISO 9001}

^{* QS 9000}

^{* TS 16949}

^{* ISO 14001}

^{* ODS SCHEME}

^{* OHSAS 18001}

^AWARDS:

^{* INTEL ASIA: BEST
ODM IN DESIGNING WIRELESS HANDHELD DEVICE (2005)}

^{* INTERMEC : SUPPLIER OF THE YEAR (2005)}

^{NEWS:
ACQUISITION BY VENTURE CORPORATION LIMITED OF ALL THE ISSUED SHARES OF GES
INTERNATIONAL LIMITED BY WAY OF A SCHEME OF ARRANGEMENT UNDER SECTION 210 OF THE
COMPANIES ACT, CHAPTER 50 OF SINGAPORE}

^{-SOURCE:
VENTURE CORPORATION WEBSITE}

^{DATE: 24/11/2006}

^{THE BOARD OF
DIRECTORS (THE "BOARD" OR "DIRECTORS") OF VENTURE
CORPORATION LIMITED (THE "COMPANY") REFERS TO THE ACQUISITION BY THE
COMPANY OF ALL THE ISSUED ORDINARY SHARES (THE "GES SHARES") IN GES
INTERNATIONAL LIMITED ("GES") BY WAY OF A SCHEME OF ARRANGEMENT (THE
"SCHEME") UNDER SECTION 210 OF THE COMPANIES ACT, CHAPTER 50 OF
SINGAPORE AND THE SINGAPORE CODE ON TAKE-OVERS AND MERGERS, WHICH WAS ANNOUNCED
BY THE COMPANY ON 26 JULY 2006.}

^{THE BOARD IS
PLEASED TO ANNOUNCE THAT THE ORDER OF COURT DATED 7 NOVEMBER 2006, SANCTIONING
THE SCHEME, HAS BEEN LODGED WITH THE ACCOUNTING AND CORPORATE REGULATORY
AUTHORITY ON 24 NOVEMBER 2006 AND THUS THE SCHEME HAS BECOME EFFECTIVE AS OF 24
NOVEMBER 2006.}

^{THE TRANSFER OF
THE GES SHARES FROM THE SHAREHOLDERS OF GES TO THE COMPANY IS EXPECTED TO BE
COMPLETED BY 29 NOVEMBER 2006. THE DE-LISTING OF THE GES SHARES FROM THE MAIN
BOARD OF THE SINGAPORE EXCHANGE SECURITIES TRADING LIMITED IS EXPECTED TO TAKE
PLACE ON 29 NOVEMBER 2006. AFTER THE SCHEME BECOMES EFFECTIVE AND FOLLOWING THE
TRANSFER OF THE GES SHARES TO THE COMPANY, GES WILL BECOME A WHOLLY OWNED
SUBSIDIARY OF THE COMPANY. PAYMENT FOR THE GES SHARES IS EXPECTED TO BE
DESPATCHED ON OR ABOUT 8 DECEMBER 2006.}

^{NO OTHER TRADE
INFORMATION IS AVAILABLE AS TELE-INTERVIEW WAS NOT GRANTED BY SUBJECT'S
PERSONNEL ON 16/02/2007.}

^{NUMBER OF
EMPLOYEES (31 DECEMBER):}

^{* COMPANY -
2005: - (2004: -)}

^{* GROUP - 2005: NOT AVAILABLE (2004: 11,453; 2003 :
11,553 )}

^{REGISTERED AND
BUSINESS ADDRESS:}

^{5006 ANG MO KIO
AVENUE 5}

^{#05-01/12
TECHPLACE II}

^{SINGAPORE
569873}

^{- RENTED
PREMISE}

^{- OWNED BY
BERMUDA TRUST (SINGAPORE) LIMITED}

^{- DATE OF
CHANGE OF ADDRESS: 03/01/2005}

^{OTHER BUSINESS
ADDRESSES:}

^{5004 ANG MO KIO
AVENUE 5}

^{ANG MO KIO
INDUSTRIAL PARK 2}

^{SINGAPORE
569873}

^{5012 ANG MO KIO
AVENUE 5}

^{TECHPLACE II}

^{SINGAPORE
569873}

YOUR PROVIDED CONTACT NUMBER:

FAX: 6482 1134

- PURCHASING DEPARTMENT

^WEBSITE:

^{http://www.venture.com.sg}

^EMAIL:

^{contact-us@venture.com.sg}

MANAGEMENT

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

^{1) GOH GEOK
LING, A SINGAPOREAN}

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

^{SINGAPORE TECHNOLOGIES PTE LTD}

^{YEW LIAN INVESTMENTS PTE LTD}

^{TUAS POWER LTD}

^{SEMBCORP INDUSTRIES LTD}

^{ASTI HOLDINGS LIMITED}

^{2) CECIL VIVIAN
RICHARD WONG, A SINGAPOREAN}

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

^{SINGAPORE UNITED ESTATES (PTE) LTD}

^{C. K. TANG LIMITED}

^{SINCERE WATCH LTD}

^{PAN-UNITED CORPORATION LTD}

^{BRITISH & MALAYAN TRUSTEES LTD}

^{3) KOH LEE
BOON, A SINGAPOREAN}

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

^{PENTEX-SCHWEIZER CIRCUITS LTD}

^{4) GOON KOK
LOON, A SINGAPOREAN}

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

^{SINGAPORE OFFSHORE PETROLEUM SERVICES PTE
LTD}

^{PSA INTERNATIONAL PTE LTD}

^{SINGAPORT ENGINEERING PTE LTD}

^{PSA N E ASIA PTE LTD}

^{SINGAPORE DALIAN PORT INVESTMENT PTE LTD}

^{HUANAN MINJIANG INVESTMENT PTE LTD}

^{FUJIAN STRAITS PTE LTD}

^{HUANAN RONGCHENG WAREHOUSING &
TRANSPORTATION PTE LTD}

^{SEALION FUZHOU PORT INVESTMENT PTE LTD}

^{PSA EUROPE PTE LTD}

^{PSA INDIA PTE LTD}

^{PSA S E ASIA PTE LTD}

^{KEPPEL OFFSHORE & MARINE LTD}

^{5) TAN CHOON HUAT, A SINGAPOREAN}

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

^{VS ELECTRONICS PTE LTD}

^{VENTURE ELECTRONICS SOLUTIONS PTE LTD}

^{6) SOO ENG HIONG,
A SINGAPOREAN}

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

^{UNIVAC PRECISION ENGINEERING PTE LTD}

^{MULTITECH SYSTEMS PTE. LTD.}

^{VENTECH DATA SYSTEMS PTE LTD}

^{VENTURE ELECTRONICS SERVICES (MALAYSIA)
SDN BHD}

^{TECHNOCOM SYSTEMS SDN BHD}

^{ADVANCED PRODUCTS CORPORATION PTE LTD}

^{SFI HOLDINGS PTE LTD}

^{VENTURE ELECTRONICS SOLUTIONS PTE LTD}

^{MUNIVAC SDN BHD}

^{VENTURE ELECTRONICS SERVICES (M) SDN BHD}

^{7) WONG NGIT
LIONG @ WONG GEOK KIONG, A SINGAPOREAN}

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

^{KEPPEL TATLEE BANK LIMITED}

^{UNIVAC PRECISION ENGINEERING PTE LTD}

^{SIA ENGINEERING COMPANY LIMITED}

^{MULTITECH SYSTEMS PTE. LTD.}

^{VENTECH DATA SYSTEMS PTE LTD}

^{INNOVATIVE TREK TECHNOLOGY PTE LTD}

^{ADVANCED PRODUCTS CORPORATION PTE LTD}

^{SINGAPORE EXCHANGE LIMITED}

^{VENTURE ELECTRONICS SOLUTIONS PTE LTD}

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.

Manufacturing sector

SINGAPORE'S MANUFACTURING SECTOR, WHICH MAKES UP ABOUT A QUARTER OF SINGAPORE’S ECONOMY, EXPANDED 22.5 PERCENT FROM JUNE LAST YEAR, MORE THAN TWICE THE 10.6 PER CENT PACE IN MAY. THIS WAS LED BY A SURGE IN DRUGS AND SEMICONDUCTOR OUTPUT, AND CONTINUED STRENGTH IN RIG-BUILDING. THE SURPRISINGLY STRONG JUNE NUMBERS MEAN THAT IN THE APRIL-TO-JUNE QUARTER, MANUFACTURING OUTPUT JUMPED 12.5 PER CENT.

TOTAL MANUFACTURING OUTPUT EXPANDED BY 20 PER CENT IN THE FIRST QUARTER OF 2006, IMPROVING FROM THE 14 PER CENT GROWTH IN THE PREVIOUS QUARTER. ALL CLUSTERS, EXCEPT CHEMICALS AND GENERAL MANUFACTURING, RECORDED DOUBLEDIGIT GAINS IN THE QUARTER. EXCLUDING THE BIOMEDICAL MANUFACTURING CLUSTER, MANUFACTURING OUTPUT GREW BY 15 PER CENT.

INDUSTRY CLUSTER	% GROWTH IN JUNE (YEAR-ON-YEAR)	% GROWTH IN APRIL-TO-JUNE QUARTER (YEAR-ON-YEAR)	% GROWTH IN FIRST HALF OF 2006 (YEAR-ON-YEAR)
BIOMEDICAL MANUFACTURING	59.4	15.6	29.6
TRANSPORT ENGINEERING	30.4	29.4	34.2
PRECISION ENGINEERING	15.4	10.6	12.4
ELECTRONICS	10.3	9.8	12.6
GENERAL MANUFACTURING	8.1	4.6	5.1
CHEMICALS	3.4	5.4	4.1
TOTAL	22.5	12.5	16.4

SOURCE: ECONOMIC DEVELOPMENT BOARD

PERFORMANCE BY CLUSTER

ELECTRONICS, WHICH MADE UP A THIRD OF MANUFACTURING’S CONTRIBUTION TO ECONOMIC GROWTH IN 2005, EXPANDED BY 8.6 PER CENT IN MAY, HELPED BY A 38.9 PER CENT EXPANSION IN THE SEMICONDUCTOR SEGMENT. UP CLOSE, ELECTRONICS WAS A TALE OF TWO PRODUCT SEGMENTS.

BUSINESS EXPECTATIONS FOR JULY TO DECEMBER 2006

SINGAPORE MANUFACTURERS REMAIN POSITIVE ABOUT BUSINESS PROSPECTS IN THE SECOND HALF OF THIS YEAR. OVERALL, A NET WEIGHTED 26% OF MANUFACTURERS, WHO WERE POLLED IN JUNE AND JULY SAID THEY EXPECT AN IMPROVED BUSINESS ENVIRONMENT IN THE JULY-DECEMBER PERIOD, UNCHANGED FROM THE PREVIOUS SURVEY COVERING APRIL TO SEPTEMBER.

MANUFACTURERS GENERALLY EXPECT POSITIVE CONDITIONS IN THE SECOND QUARTER OF 2006 TO BE MAINTAINED IN THE SECOND HALF OF THE YEAR. OVERALL, THE MANUFACTURING SECTOR’S OUTLOOK REMAINS ROSY, ACCORDING TO THE EDB SURVEY.

AMONG SINGAPORE’S MANUFACTURERS, ELECTRONICS MAKERS ARE THE MOST UPBEAT ABOUT THEIR PROSPECTS FOR THE SECOND HALF OF THE YEAR, DESPITE WARNINGS OF AN IMPENDING SLOWDOWN IN DEMAND FOR THEIR OUTPUT.

ACCORDING TO A SURVEY BY THE ECONOMIC DEVELOPMENT BOARD (EDB) ON BUSINESS EXPECTATIONS IN THE MANUFACTURING SECTOR, WHICH COVERED NEARLY 400 FIRMS, IT WAS REVEALED THAT 45 PERCENT OF PRODUCERS IN THE ELECTRONICS CLUSTER EXPECT THEIR CIRCUMSTANCES TO IMPROVE IN THE SECOND HALF OF THE YEAR, COMPARED WITH ONLY 26 PERCENT OF MANUFACTURERS OVERALL.

IN ADDITION, 30 PERCENT OF THE ELECTRONICS FIRMS SURVEYED SAID THEY PLANNED TO HIRE NEW STAFF OVER THE NEXT TWO MONTHS, UP FROM ONLY 7 PERCENT LAST QUARTER. THE MOOD OF OPTIMISM WAS MOST PRONOUNCED IN THE COMPUTER PERIPHERALS MARKET, WHERE AROUND 80 PERCENT OF COMPANIES POLLED EXPECT REVENUES, OUTPUT, AND STAFF NUMBERS TO GROW IN THE SHORT TERM.

SENTIMENTS WERE GRIMMER IN THE SEMICONDUCTOR INDUSTRY, WHERE JUST 10 PERCENT OF FIRMS SURVEYED EXPECT OUTPUT TO RISE IN THE THIRD QUARTER AND ONLY 35 PERCENT SEE BUSINESS CONDITIONS IMPROVING IN LATE 2006.

THE GENERALLY POSITIVE VIEWS ARE ALSO IN LINE WITH THE GOVERNMENT'S FORECASTS FOR PRODUCTION IN THE THIRD QUARTER, WHICH IS TIPPED TO RISE ON THE BACK OF EXPORT GROWTH. THERE WAS ALSO AN INDICATION THAT LOCAL MANUFACTURERS MAY BE FEELING SQUEEZED BY PRODUCERS IN LOWER-COST DESTINATIONS LIKE CHINA. NEARLY HALF OF THOSE MANUFACTURERS SAID THERE WERE OUTSIDE FACTORS AFFECTING THEIR ABILITY TO GARNER MORE EXPORT ORDERS, AND "PRICE COMPETITION FROM OVERSEAS" WAS CITED AS THE MOST IMPORTANT OF THESE.

EXTRACTED FROM:

CHANNELNEWSASIA

ECONOMIC DEVELOPMENT BOARD (EDB)

MINISTRY OF TRADE AND INDUSTRY (MTI)

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