MIRA INFORM REPORT

Report Date :

25.05.2007

IDENTIFICATION DETAILS

Name :	FARLIN TIMBERS PTE LTD
Registered Office :	^435 Orchard Road, #21-01^, Wisma Atria, Singapore – 238877
Country :	Singapore
Financials (as on) :	30.06.2004
Date of Incorporation :	^03/08/1994
Com. Reg. No.:	^199405441Z
Legal Form :	^Exempt Pte Ltd
Line of Business :	Timber Exporters & Importers

RATING & COMMENTS

MIRA’s Rating :

Ba

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Satisfactory
Payment Behaviour :	Regular
Litigation :	Clear

Subject Company

FARLIN TIMBERS PTE LTD

Line Of Business 

TIMBER EXPORTERS & IMPORTERS

Parent Company

--

Financial Elements

FY2004

COMPANY

Sales : S$277,294,746

Networth : S$ 14,116,955

Paid-Up Capital : S$ 10,000,000

Net result : S$ 1,732,898

Net Margin(%) : 0.62

Return on Equity(%) : 12.28

Leverage Ratio : 2.98 TIMES

COMPANY IDENTIFICATION

^{Subject Company : FARLIN TIMBERS PTE LTD}

^{Former Name : VIRGIN WOOD PRODUCTS PTE LTD}

^{Business Address : 435 ORCHARD ROAD}

^#21-01

^{WISMA ATRIA}

^{Town : SINGAPORE}

^{Postcode : 238877}

^{County : -}

^{Country : Singapore}

^{Telephone : 6398 1188}

^{Fax : 6398 1177}

^{ROC Number : 199405441Z}

^{Reg. Town : -}

PREVIOUS IDENTIFICATION

^{VIRGIN WOOD PRODUCTS PTE LTD (DATE OF CHANGE OF NAME: 02/10/1997)}

^{FARLIN TIMBERS PTE LTD (DATE OF CHANGE OF NAME: 01/12/1995)}

SUMMARY

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

^{Legal Form : Exempt Pte Ltd}

^{Date Inc. : 03/08/1994}

^{Previous Legal Form : Pte Ltd}

^{Summary year : 30/06/2004}

^{Sales : 277,294,746}

^{Net Worth : 14,116,955}

^{Capital : 50,000,000}

^{Paid-Up Capital : 10,000,000}

^{Employees : 12}

^{Net Result : 1,732,898}

^{Share value : 1}

^{Auditor : J K MEDORA & CO}

REFERENCES

^{Litigation : No}

^{Company status : TRADING}

^{Started : 03/08/1994}

PRINCIPAL(S)

^{MOHAMMED FAROUK S2715761J Director}

DIRECTOR(S)

^{PEH POH CHIN S6840069D Director}

^{Appointed on : 01/06/2000}

^{Street : 198 BOON LAY DRIVE}

^#03-51

^{Town : SINGAPORE}

^{Postcode : 640198}

^{Country : Singapore}

^{PEH POH CHIN S6840069D Company Secretary}

^{Appointed on : 31/08/2003}

^{Street : 198 BOON LAY DRIVE}

^#03-51

^{Town : SINGAPORE}

^{Postcode : 640198}

^{Country : Singapore}

^{SEET BENG CHOO JEANNE S1234059A Company Secretary}

^{Appointed on : 31/08/2003}

^{Street : 529 HOUGANG AVENUE 6}

^#07-263

^{Town : SINGAPORE}

^{Postcode : 530529}

^{Country : Singapore}

^{MOHAMMED FAROUK S2715761J Director}

^{Appointed on : 03/08/1994}

^{Street : 95 GRANGE ROAD}

^#17-11

^{GRANGE RESIDENCES}

^{Town : SINGAPORE}

^{Postcode : 249616}

^{Country : Singapore}

FORMER DIRECTOR(S)

^{WONG LAI LENG S1176982I}

^{KOH NGIN JOO JULIE S2586980Z}

ACTIVITY (IES)

^{TRADING COMPANIES Code: 22190}

^{TIMBER - WHSLE Code: 21690}

^{COMMISSION MERCHANTS Code: 4990}

^{ENGINEERING CONSULTANCY SERVICES Code: 7865}

^{BASED ON ACRA'S RECORD AS AT 21/05/2007}

^{1) ENGINEERING ACTIVITIES; WHOLESALE TRADE}

2) WHOLESALE OF AGRICULTURAL RAW MATERIAL, LIVE ANIMALS, FOOD, BEVERAGES AND TOBACCO; TIMBER WHOLESALING

CHARGES

^{Date : 28/10/2004}

^{Comments : CHARGE NO: C200405343}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE(S): BNP PARIBAS}

^{Date : 29/06/2004}

^{Comments : CHARGENO: C200403104}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE: KBC BANK N.V}

^{Date : 06/04/2004}

^{Comments : CHARGE NO: C200401744}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE: SCOIETE GENERALE}

^{Date : 06/04/2004}

^{Comments : CHARGE NO: C200401743}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE: SOCIETE GENERALE}

^{Date : 17/03/2004}

^{Comments : CHARGE NO: C200401264}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE: INDIAN BANK}

^{Date : 21/10/2003}

^{Comments : CHARGE NO: C200304968 (DISCHARGED)}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE: MOSCOW NARODNY BANK LTD}

^{Date : 12/08/2003}

^{Comments : CHARGE NO: C200303838 (DISCHARGED)}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE: DBS BANK LTD}

^{Date : 25/06/1999}

^{Comments : CHARGE NO: 199902396 (DISCHARGED)}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE: MEEPIERSON N.V.}

^{Date : 19/02/2002}

^{Comments : CHARGE NO: 200200829}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

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

^{Date : 16/02/2001}

^{Comments : CHARGE NO: 200100775 (DISCHARGED)}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE (S): FLEET NATIONAL PARK}

^{Date : 06/03/2003}

^{Comments : CHARGE NO: C200301008}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE: KBC BANK N.V.}

^{Date : 04/06/2003}

^{Comments : CHARGE NO: C200302591 (DISCHARGED)}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE: RAIFFEISEN ZENTRALBANK OESTERREICH AKTIENGESELLSCHAFT}

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

BANKERS

^{ABN AMRO BANK NV}

^{KBC BANK N.V.}

^{RAIFFEISEN ZENTRALBANK OESTERREICH AKTIENGESELLSCHAFT}

^{UCO BANK}

^{DBS BANK LTD.}

SHAREHOLDERS(S)

^{MOHAMMED FAROUK 47,920,826 Private Person}

^{Street : 95 GRANGE ROAD}

^#17-11

^{GRANGE RESIDENCES}

^{Town : SINGAPORE}

^{Postcode : 249616}

^{Country : Singapore}

FORMER SHAREHOLDER(S)

^{KOH NGIN JOO JULIE 1}

^{MOHAMMED FARROKH 99,999}

^{SOUTAHVEN INTERNATIONAL LIMITED 3,400,000}

^{LISI VELAVELA FARROKH 1}

SUBSIDIARY (IES)

No Participation In Our Database

PAYMENT HISTORY AND EXPERIENCES

^{Trade Morality : AVERAGE}

^{Liquidity : UNKNOWN}

^{Payments : REGULAR}

^{Trend : LEVEL}

^{Financial Situation : UNKNOWN}

LITIGATION(S)

No Litigation In Our Database

FINANCIAL ELEMENTS

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

^{Audit Qualification: UNQUALIFIED UNQUALIFIED UNQUALIFIED}

^{(CLEAN) (CLEAN) (CLEAN)}

^{Date Account Lodged: 30/08/2004}

^{Balance Sheet Date: 30/06/2004 30/06/2003 30/06/2002}

^{Number of weeks: 52 52 52}

^{Consolidation Code: COMPANY COMPANY COMPANY}

^{--- ASSETS ---}

^{Preliminary Exp - - 12,400}

^{Tangible Fixed Assets: 220,291 16,017 104,208}

^{Total Fixed Assets: 220,291 16,017 116,608}

^{Inventories: 27,835,393 7,674,292 14,922,076}

^{Receivables: 4,917,998 6,385,539 9,806,343}

^{Cash,Banks, Securities: 11,557,155 8,321,164 4,249,444}

^{Other current assets: 11,609,036 8,435,439 1,963,695}

^{Total Current Assets: 55,919,582 30,816,434 30,941,558}

^{TOTAL ASSETS: 56,139,873 30,832,451 31,058,166}

^{--- LIABILITIES ---}

^{Equity capital: 10,000,000 10,000,000 8,500,000}

^{Profit & loss Account: 4,116,955 2,384,057 1,526,049}

^{Total Equity: 14,116,955 12,384,057 10,026,049}

^{L/T deferred taxes: 800 2,400 -}

^{Total L/T Liabilities: 800 2,400 -}

^{Trade Creditors: 17,136,035 1,816,897 532,056}

^{Due to Bank: 22,714,399 16,046,870 20,166,320}

^{Provisions: 455,895 218,231 113,000}

^{Other Short term Liab.: 1,620,669 342,156 76,717}

^{Prepay. & Def. charges: 95,120 21,840 144,024}

^{Total short term Liab.: 42,022,118 18,445,994 21,032,117}

^{TOTAL LIABILITIES: 42,022,918 18,448,394 21,032,117}

PROFIT & LOSS ACCOUNT

^{Net Sales 277,294,746 157,908,847 112,626,460}

^{Gross Profit: 4,888,171 3,378,968 2,469,011}

^{Result of ordinary operations 1,962,533 1,035,590 430,848}

^{NET RESULT BEFORE TAX: 2,181,298 1,085,808 664,691}

^{Tax : 448,400 227,800 55,802}

^{Net income/loss year: 1,732,898 858,008 608,889}

^{Interest Paid: 1,670,578 1,897,031 1,673,341}

^{Depreciation: 126,162 88,191 174,419}

^{Directors Emoluments: 379,350 168,000 168,000}

^{Wages and Salaries: 667,909 616,693 486,874}

^{Financial Income: 81,565 30,674 -}

RATIOS

^{30/06/2004 30/06/2003 30/06/2002}

^{Turnover per employee: 23107895.50 13159070.58 9385538.33}

^{Net result / Turnover(%): 0.01 0.01 0.01}

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

^{Stock / Turnover(%): 0.10 0.05 0.13}

^{Net Margin(%): 0.62 0.54 0.54}

^{Return on Equity(%): 12.28 6.93 6.07}

^{Return on Assets(%): 3.09 2.78 1.96}

^{Net Working capital: 13897464.00 12370440.00 9909441.00}

^{Cash Ratio: 0.28 0.45 0.20}

^{Quick Ratio: 0.39 0.80 0.67}

^{Current ratio: 1.33 1.67 1.47}

^{Receivables Turnover: 6.38 14.56 31.35}

^{Leverage Ratio: 2.98 1.49 2.10}

^{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}

^{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

^{LIMITED EXEMPT PRIVATE COMPANY}

^{WHERE THE SHARES OF A PRIVATE COMPANY ARE NOT OWNED BY ANY CORPORATE BODY AND THERE ARE NO MORE THAN 20 MEMBERS, THE PRIVATE COMPANY IS KNOWN AS AN EXEMPT PRIVATE COMPANY.}

^{AN EXEMPT PRIVATE COMPANY ENJOYS A GREATER AMOUNT OF PRIVACY THAN A PRIVATE COMPANY. IT IS NOT REQUIRED TO FILE ACCOUNTS WITH THE REGISTRAR IF IT CAN PRODUCE A CERTIFICATE SIGNED BY ONE OF ITS DIRECTORS, SECRETARY AND AUDITOR CONFIRMING THE FOLLOWING POINTS:}

^{1. THE COMPANY IS AN EXEMPT PRIVATE COMPANY.}

^{2. THE AUDITED ACCOUNTS HAVE BEEN TABLED BEFORE THE SHAREHOLDERS AT THE ANNUAL GENERAL MEETING.}

^{3. THE COMPANY IS ABLE TO MEET ITS LIABILITIES.}

^{THERE IS THEREFORE NO DISCLOSURE TO THE PUBLIC OF THE ACCOUNTS OF THE COMPANY ALTHOUGH THE ACCOUNTS STILL HAVE TO BE AUDITED EVERY YEAR AND APPROVED AT AN ANNUAL GENERAL MEETING OF THE COMPANY.}

^{A PRIVATE COMPANY THAT IS WHOLLY OWNED BY THE GOVERNMENT MAY BECOME AN EXEMPT PRIVATE COMPANY IF THE MINISTER FOR FINANCE, IN THE NATIONAL INTEREST, DECLARES IT TO BE SUCH BY A GAZETTE NOTIFICATION.}

^{EXEMPT FROM AUDIT}

^{AN EXEMPT PRIVATE COMPANY IS EXEMPT FROM AUDIT REQUIREMENTS IF THE STARTING DATE OF ITS FINANCIAL YEAR IS BETWEEN 15 MAY 2003 AND 31 MAY 2004 AND ITS TURNOVER FOR THAT FINANCIAL YEAR DOES NOT EXCEED $2.5 MILLION. FOR FINANCIAL YEARS STARTING 1 JUNE 2004, THE AMOUNT OF THE TURNOVER HAS BEEN RAISED TO $5 MILLION. THESE COMPANIES ARE STILL REQUIRED TO MAINTAIN PROPER ACCOUNTING.}

^{* THE LATEST FINANCIAL STATEMENTS FILED IN BY THE COMPANY AS AT YEAR ENDED 30/06/2006 ARE NOT AVAILABLE. FY2004 FINANCIALS SERVE AS A REFERENCE ONLY. AS SUCH, ADVERSE CHECKS ON THE LOCAL DIRECTORS WILL BE CONDUCTED.}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 03/08/1994 AS A LIMITED PRIVATE COMPANY AND WAS FORMERLY KNOWN AS "FARLIN TIMBERS PTE LTD".}

^{ON 01/12/1995, SUBJECT CHANGED ITS NAMESTYLE TO "VIRGIN WOOD PRODUCTS PTE LTD".}

^{SUBSEQUENTLY ON 02/10/1997, SUBJECT AGAIN CHANGED TO ITS PRESENT NAMESTYLE OF "FARLIN TIMBERS PTE LTD" AND IS TRADING AS A LIMITED EXEMPT PRIVATE COMPANY.}

^{AS AT 21/05/2007, SUBJECT HAS AN ISSUED AND PAID-UP CAPITAL OF 47,920,826 SHARES OF A VALUE OF S$47,920,826.}

^{PRINCIPAL ACTIVITIES:}

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

^{1) ENGINEERING ACTIVITIES; WHOLESALE TRADE}

^{2) WHOLESALE OF AGRICULTURAL RAW MATERIAL, LIVE ANIMALS, FOOD, BEVERAGES AND TOBACCO;}

^{TIMBER WHOLESALING}

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

^{SUBJECT IS LISTED IN THE SINGAPORE LOCAL DIRECTORY UNDER THE CLASSIFICATION OF: TIMBER EXPORTERS & IMPORTERS.}

^{SUBJECT ENGAGES IN THE FOLLOWING ACTIVITY:}

^{* TRADING IN HARD WOODS AND TEAK LOGS}

^{IMPORT COUNTRIES:}

^{* WEST AFRICA}

^{- GABON}

^{- GHANA}

^{- IVORY COAST}

^{- NIGERIA}

^{- CAMEROON}

^{* SOUTH AMERICA}

^{- VENEZUELA}

^{- ECUADOR}

^{- PANAMA}

^{- GUYANA}

^{* SOUTH EAST ASIA}

^{- MALAYSIA}

^{- MYANMAR}

^{- NEW ZEALAND}

^{- PAPUA NEW GUINEA}

^{EXPORT COUNTRIES:}

^{* INDIA}

^{* CHINA}

^{* BANGLADESH}

^{* VIETNAM}

^{* MIDDLE EAST}

^{SOME OF SUBJECT'S CLIENTS:}

^{* PRABHAT GROUP, ETC}

^{TERMS OF PAYMENT:}

^{* CUSTOMERS: LETTERS OF CREDIT, DOCUMENTS AGAINST PAYMENT}

^{NUMBER OF EMPLOYEES (30 JUNE):}

^{* COMPANY - 2005: NOT AVAILABLE (2004: 12; 2003: 12; 2002: 12)}

^{SUBJECT IS A MEMBER OF THE FOLLOWING ENTITY:}

^{* SINGAPORE INTERNATIONAL CHAMBERS OF COMMERCE}

^AWARDS:

^{* TOP ENTERPRISE 50 COMPANY AWARD 2006 (RANKED NUMBER 9)}

^{* TOP ENTERPRISE 50 COMPANY AWARD 2005 (RANKED NUMBER 11)}

^{* SINGAPORE 1000 COMPANY AWARD 2005 (RANKED NUMBER 59)}

^{FROM THE TELE-INTERVIEW CONDUCTED ON 25/05/2007, SUBJECT REVEALED THAT THERE ARE 11 EMPLOYEES IN THE COMPANY.}

^{NO OTHER INFORMATION WAS GATHERED VIA THE TELE-INTERVIEW CONDUCTED.}

^{REGISTERED AND BUSINESS ADDRESS:}

^{435 ORCHARD ROAD}

^#21-01

^{WISMA ATRIA}

^{SINGAPORE 238877}

^{DATE OF CHANGE OF ADDRESS: 25/10/2004}

^{-- RENTED PREMISE}

^{-- OWNED BY: HSBC INSTITUTIONAL TRUST SERVICES (SINGAPORE) LIMITED}

^WEBSITE:

^{* http://www.farlingroup.com}

^EMAIL:

^{* farlintimbers@farlingroup.com}

MANAGEMENT

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

^{1) MOHAMMED FAROUK, A SINGAPORE PERMANENT RESIDENT}

^{- HOLDS OTHER DIRECTORSHIP AS RECORDED IN OUR DATABASE}

^{VIRGIN TIMBERS PTE LTD}

^{2) PEH POH CHIN, A SINGAPOREAN}

^{- HOLDS OTHER DIRECTORSHIPS AS RECORDED IN OUR DATABASE}

^{GANGES TECHNOLOGIES PTE LTD}

^{VIRGIN TIMBERS PTE LTD}

^{ANASIDAH PTE LTD}

^{BLOOMWOOD PTE LTD}

^{KARLVELLA PTE LTD}

ADVERSE ON DIRECTORS

^{DIRECTOR'S NAME: MOHAMMED FAROUK}

^{ADVERSE REPORT AGAINST DIRECTOR: NIL}

^{PROPERTY OWNERSHIP: OWNS 1}

^{ANNUAL VALUE: S$108,000}

^{CO-OWNER: NIL}

^{DIRECTOR'S NAME: PEH POH CHIN}

^{ADVERSE REPORT AGAINST DIRECTOR: NIL}

^{PROPERTY OWNERSHIP: NIL}

^{ANNUAL VALUE: NA}

^{CO-OWNER: NA}

^{ANNUAL VALUE IS THE ESTIMATED ANNUAL RENT THE PROPERTY CAN FETCH IF IT WERE RENTED OUT. THE ANNUAL VALUE IS DETERMINED IN THE SAME MANNER REGARDLESS OF WHETHER THE PROPERTY IS LET-OUT, OWNER-OCCUPIED OR VACANT.}

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.

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%.

SECTORS OF INDUSTRIAL AND CONSTRUCTION MACHINERY AND ELECTRONIC COMPONENTS REGISTERED GROWTHS OF 17.0% AND 12.3%, RESPECTIVELY.

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.

THE SECTORS OF PETROLEUM AND PETROLEUM PRODUCTS AND ELECTRONIC COMPONENTS MARKED LOWER OVERSEAS SALE OF 14.2% AND 11.6% RESPECTIVELY IN 4Q 2006 OVER 3Q 2006.

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