MIRA INFORM REPORT

Report Date :

05.10.2007

IDENTIFICATION DETAILS

Name :	R1 INTERNATIONAL PTE LTD
Registered Office :	^8 Robinson Road, #05-00^, Cosco Building, Singapore^– 048544
Country :	Singapore
Financials (as on) :	30.06.2006
Date of Incorporation :	^20/07/2001
Com. Reg. No.:	^200104842R
Legal Form :	^Pte Ltd
Line of Business :	Trading of Natural Rubber and Latex

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

R1 INTERNATIONAL PTE LTD

Line Of Business 

TRADING OF NATURAL RUBBER AND LATEX

Parent Company

--

Financial Elements

FY 2006

CONSOLIDATED

Sales : USD729,060,844

Networth : USD13,861,691

Paid-Up Capital : USD7,000,000

Net result : USD2,365,745

Net Margin(%) : 0.32

Return on Equity(%) : 17.07

Leverage Ratio : 3.91

COMPANY IDENTIFICATION

^{Subject Company: R1 INTERNATIONAL PTE LTD}

^{Former Name: -}

^{Business Address: 8 ROBINSON ROAD}

^#05-00

^{COSCO BUILDING}

^{Town: SINGAPORE}

^{Postcode: 048544}

^{County: -}

^{Country: Singapore}

^{Telephone: 6557 4399}

^{Fax: 6536 0828/ 6538 3393}

^{ROC Number: 200104842R}

^{Reg. Town: -}

SUMMARY

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

^{Legal Form: Pte Ltd}

^{Date Inc.: 20/07/2001}

^{Previous Legal Form: -}

^{Summary year: 30/09/2006}

^{Sales: 729,060,844}

^{Net worth: 13,861,691}

^{Capital: -}

^{Paid-Up Capital: 7,000,000}

^{Employees: 15}

^{Net result: 2,365,745}

^{Share value: -}

^{Auditor: ERNST & YOUNG}

REFERENCES

^{Litigation: No}

^{Company status: TRADING}

^{Started: 20/07/2001}

PRINCIPAL(S)

^{SANDANA DASS S2712656A Managing Director}

DIRECTOR(S)

^{DATO' WIRA SYED ABDUL JABBAR BIN 391208-02- Director}

^{Appointed on: 15/01/2004}

^{Street: 23 JALAN 7 KENNENSAH HEIGHTS}

^{ULU KELANG, AMPANG}

^{Town: SELANGOR}

^{Postcode: 68000}

^{Country: Malaysia}

^{DATUK DR MAHMOOD ABD KADIR 480330-01- Director}

^{Appointed on: 15/01/2004}

^{Street: 1 JLANA 12/2 TAMAN TUN ABDUL RAZAK}

^AMPANG

^{Town: SELANGOR}

^{Postcode: 68000}

^{Country: Malaysia}

^{DR PONGSAK KERDV ONGBUNDIT L683164 Director}

^{Appointed on: 23/07/2001}

^{Street: VON BUNDIT CO 20/5 GOMARAPAT}

^ROAD

^{Town: PHUKET}

^{Postcode: 83000}

^{Country: Thailand}

^{PAYUNGSAK KERDVONBUNDIT K334595 Alternate Director}

^{Appointed on: 17/12/2001}

^{Street: 20/5 GOMARAPAT ROAD}

^{Town: PHUKET}

^{Postcode: 83000}

^{Country: Thailand}

^{JERAL SYLVESTER D'SOUZA F5525755T Director}

^{Appointed on: 20/07/2001}

^{Street: 19 BINJAI WALK}

^{BINJAI PARK}

^{Town: SINGAPORE}

^{Postcode: 589748}

^{Country: Singapore}

^{SYED MUNIRUL HASAN S2715581B Alternate Director}

^{Appointed on: 17/12/2001}

^{Street: 14 LEONIE HILL ROAD}

^#10-16

^FUTURA

^{Town: SINGAPORE}

^{Postcode: 239193}

^{Country: Singapore}

^{CHAN YOKE HENG IRENE S1459389F Company Secretary}

^{Appointed on: 24/07/2001}

^{Street: 997 BUKIT TIMAH ROAD}

^#08-04

^{CASA ESPERANZA}

^{Town: SINGAPORE}

^{Postcode: 589633}

^{Country: Singapore}

^{NG SWAN CHU @ LINDA SOEWARNI S2165246F Director}

^{Appointed on: 11/02/2004}

^{Street: 18 JALAN TANAH PUTEH}

^{Town: SINGAPORE}

^{Postcode: 457341}

^{Country: Singapore}

FORMER DIRECTOR(S)

^{AZNI BINTI ARIFFIN 701013-09-}

ACTIVITY(IES)

^{RUBBER - SYNTHETIC Code:18675}

^{LATEX - LIQUID Code:12885}

^{TRADING COMPANIES Code:22190}

^{BASED ON ACRA'S RECORD AS AT 29/09/2007}

^{1) PROCESSING OF RUBBER (INCLUDING PROCESSING OF RUBBER LATEX)}

CHARGES

^{Date: 13/03/2002}

^{Comments: CHARGE NO: 200201216}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE(S): BUMIPUTRA-C0MMERCE BANK BHD}

^{Date: 12/03/2002}

^{Comments: CHARGE NO: 200201207}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

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

^{Date: 18/01/2002}

^{Comments: CHARGE NO: 200200300}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

^{CHARGEE(S): BUMIPUTRA-COMMERCE BANK BHD}

^{Date: 18/12/2001}

^{Comments: CHARGE NO: 200106119}

^{AMOUNT SECURED: 0.00 AND ALL MONIES OWING}

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

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

BANKERS

^{BUMIPUTRA-COMMERCE BANK BHD}

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

SHAREHOLDERS(S)

^{SANDANA DASS 350,000 Private Person}

^{Street: 15 LAKME TERRACE}

^{OPERA ESTATE}

^{Town: SINGAPORE}

^{Postcode: 456879}

^{Country: Singapore}

^{MARDEC INTERNATIONAL SDN BHD 3,150,000 Company}

^{Street: BANGUNAN MARDEC}

^{JALAN KERJA AYER LAMA}

^AMPANG

^{Town: SELANGOR}

^{Postcode: 68000}

^{Country: Malaysia}

^{CARGILL ASIA PACIFIC LTD 1,750,000 Company}

^{Street: 5615 MCGINTY ROAD}

^{WEST WAYZATA}

^{Town: -}

^{Postcode: -}

^{Country: United States}

^{KIAN IN LIMITED 1,050,000 Company}

^{Street: 125 MAIN STREET}

^{P.O. BOX 144, ROAD TOWN}

^{Town: TORTOLA}

^{Postcode: -}

^{Country: Virgin Islands (British)}

^{THAVEESAK HOLDING CO. LTD 700,000 Company}

^{Street: 20/05 GOMARAPAT ROAD}

^{Town: PHUKET}

^{Postcode: 83000}

^{Country: Thailand}

FORMER SHAREHOLDER(S)

^{RI HOLDINGS (L) INCORPORATED 7,000,000}

SUBSIDIARY(IES)

^{R1 INTERNATIONAL MALAYSIA SDN BHD}

^{R1 INTERNATIONAL (THAILAND) LTD}

^{R1 INTERNATIONAL JAPAN LIMITED}

^{R1 INTERNATIONAL TRADING (SHANGHAI) CO LIMITED}

^{R1 INTERNATIONAL (INDIA) PTE LTD}

^{R1 DELTA CIS PTE LTD}

PAYMENT HISTORY AND EXPERIENCES

^{Trade Morality: AVERAGE}

^{Liquidity: SUFFICIENT}

^{Payments: REGULAR}

^{Trend: DOWNWARD}

^{Financial Situation: AVERAGE}

LITIGATION(S)

No Litigation In Our Database

FINANCIAL ELEMENTS

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

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

^{Date Account Lodged: 10/05/2007}

^{Balance Sheet Date: 30/06/2006 30/09/2005 30/09/2004}

^{Number of weeks: 52 52 52}

^{Consolidation Code: CONSOLIDATED CONSOLIDATED CONSOLIDATED}

^{--- ASSETS}

^{Preliminary Exp 62,758 52,421 83,516}

^{Tangible Fixed Assets: 91,278 115,654 107,204}

^{Investments 1,544,666 1,070,915 1,070,915}

^{Total Fixed Assets: 1,698,702 1,238,990 1,261,635}

^{Inventories: 1,925,989 1,147,893 409,189}

^{Receivables: 50,075,415 26,572,880 20,601,305}

^{Cash,Banks,Securities: 6,331,100 5,345,226 7,892,902}

^{Other current assets: 8,009,709 2,782,323 805,291}

^{Total Current Assets: 66,342,213 35,848,322 29,708,687}

^{TOTAL ASSETS: 68,040,915 37,087,312 30,970,322}

^{--- LIABILITIES}

^{Equity capital: 7,000,000 7,000,000 7,000,000}

^{Reserves: -16,576 -4,772 813}

^{Profit & loss Account: 6,489,676 3,815,671 3,442,080}

^{Other: 388,591 178,448 67,105}

^{Total Equity: 13,861,691 10,989,347 10,509,998}

^{L/T deferred taxes: 10,490 1,250 -}

^{Other long term Liab.: - - 15,885}

^{Total L/T Liabilities: 10,490 1,250 15,885}

^{Trade Creditors: 32,215,045 14,284,165 9,423,147}

^{Prepay. & Def. charges: 2,436,309 1,489,879 -}

^{Short term liabilities: - 14,936 15,088}

^{Due to Bank: 17,461,808 8,135,358 8,750,000}

^{Provisions: 444,714 554,718 511,788}

^{Other Short term Liab.: 1,610,858 1,617,659 1,744,416}

^{Total short term Liab.: 54,168,734 26,096,715 20,444,439}

^{TOTAL LIABILITIES: 54,179,224 26,097,965 20,460,324}

^{PROFIT & LOSS ACCOUNT}

^{Net Sales 729,060,844 372,507,216 342,939,865}

^{Purchases,Sces & Other Goods: 721,051,152 364,601,564 335,141,375}

^{Gross Profit: 8,009,692 7,905,652 7,798,490}

^{Result of ordinary operations 4,538,294 3,368,915 3,673,989}

^{NET RESULT BEFORE TAX: 2,908,007 2,995,475 3,459,934}

^{Tax: 542,262 561,047 499,788}

^{Net income/loss year: 2,365,745 2,434,428 2,953,041}

^{Interest Paid: 1,713,449 502,035 241,609}

^{Depreciation: 77,258 61,651 91,979}

^{Dividends: - - 152,000}

^{Directors Emoluments: 451,087 347,404 286,280}

^{Wages and Salaries: 2,454,852 2,597,519 -}

^{Financial Income: 68,727 122,265 27,554}

RATIOS

^{30/06/2006 30/09/2005 30/09/2004}

^{Turnover per employee: 48604056.27 24833814.40 22862657.67}

^{Net result / Turnover(%): 0.00 0.01 0.01}

^{Net Margin(%): 0.32 0.65 0.86}

^{Return on Equity(%): 17.07 22.15 28.10}

^{Return on Assets(%): 3.48 6.56 9.54}

^{Dividends Coverage: - - 19.43}

^{Net Working capital: 12173479.00 9751607.00 9264248.00}

^{Cash Ratio: 0.12 0.20 0.39}

^{Quick Ratio: 1.04 1.22 1.39}

^{Current ratio: 1.22 1.37 1.45}

^{Receivables Turnover: 24.73 25.68 21.63}

^{Leverage Ratio: 3.91 2.37 1.95}

^{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 26.14% FROM USD10,989,347 IN 2005 TO USD13,861,691 IN 2006.}

^{THIS WAS DUE TO HIGHER RESERVES OF USD6,489,676 (2005: USD3,815,671); A RISE OF 70.08% FROM THE PRIOR FINANCIAL YEAR.}

^LEVERAGE:

^{IN THE SHORT-TERM, SUBJECT WAS LARGELY FINANCED BY TRADE CREDITORS WHICH MADE UP 59.47% (2005: 54.74%) OF THE TOTAL CURRENT LIABILITIES AND AMOUNTED TO S$32,215,045 (2005: USD14,284,165). THE BREAKDOWN IS AS FOLLOWS:}

^{-TRADE CREDITORS - 2006: USD16,825,905 (2005: USD5,307,271)}

^{-RELATED COMPANIES - 2006: USD15,389,140 (2005: USD8,976,894)}

^{AMOUNTS DUE TO BANKS, WHICH CONSIST OF A BANK OVERDRAFT, AMOUNTED TO USD797,970 (2005: - ).}

^{SUBJECT'S LONG TERM LIABILITY, WHICH CONSIST OF DEFERRED TAX LIABILITIES, ROSE SHARPLY BY 7.39 TIMES TO USD10,490 (2005: USD1,250).}

^{IN ALL, LEVERAGE RATIO ROSE FROM 2.37 TIMES TO 3.91 TIMES AS A RESULT OF A MORE THAN PROPORTIONATE RISE IN TOTAL LIABILITIES AS COMPARED TO THE RISE IN TOTAL EQUITY.}

^LIQUIDITY:

^{IN GENERAL, SUBJECT'S LIQUIDITY SITUATION WAS PASSABLE AS SEEN FROM THE RISE IN NET WORKING CAPITAL BY 24.84% TO USD12,173,479 (2005: USD9,751,607).}

^{HOWEVER, CURRENT RATIO FELL TO 1.22 TIMES, DOWN FROM 1.37 TIMES AND QUICK RATIO DECREASED TO 1.04 TIMES FROM 1.22 TIMES IN 2005.}

^{PROFITABILITY:}

^{REVENUE POSTED AN INCREASE OF 95.72% FROM USD372,507,216 IN 2005 TO USD729,060,844 BUT NET PROFIT DROPPED BY 2.82% TO USD2,365,745 (2005: USD2,434,428).}

^{THIS COULD BE DUE TO LOWER GROSS MARGIN OF 1.10% IN 2006 (2005: 2.12%).}

^{HENCE, NET MARGIN FELL TO 0.32% (2005: 0.65%).}

^{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 AS SHOWN BY ITS INTEREST COVERAGE RATIO OF 2.70 TIMES}

^{(2005: 6.97 TIMES).}

^{NON-CURRENT ASSETS:}

^{THE FOLLOWING ITEM IS CLASSIFIED UNDER PRELIMINARY:}

^{-DEFERRED TAX ASSET - 2006: USD62,758 (2005: USD52,421)}

^{NOTES TO THE FINANCIAL STATEMENTS:}

^{TERM LOAN (SECURED)}

^{THE BANK TERM LOAN IS SECURED BY A DEBENTURE OVER FIXED AND FLOATING, PRESENT AND FUTURE ASSETS OF THE COMPANY AND CORPORATE GUARANTEE OF A SUBSIDIARY COMPANY, RI INTERNATIONAL MALAYSIA SDN BHD. INTEREST ISCHARGED AT A RATE OF 5.005% - 6.350% (2005: 3% - 5%) AND 5.005% - 9.00% (2005: 3% - 7.25%) PER ANNUM FOR THE COMPANY AND THE GROUP RESPECTIVELY.}

^{BANK OVERDRAFT}

^{THE BANK OVERDRAFT IS SECURED BY A DEBENTURE INCORPORATING A CHARGE OVERALL FIXED AND FLOATING ASSETS, INCLUDING BUT NOT LIMITED TO LOANS, RECIEVABLES, AND MONIES DULY REGISTERED AND CORPORATE GUARANTEES OF THE SUBSIDIARY COMPANIES.}

^{CONTINGENT LIABILITIES (UNSECURED)}

^{AS AT 30 SEPTEMBER 2006, THE COMPANY AND THE GROUP HAD CERTAIN OUTSTANDING LETTERS OF CREDIT AMOUNTING TO APPROXIMATELY USD3,878,707 (2005: USD1,331,843).}

^{DURING THE FINANCIAL YEAR, THE COMPANY AND ITS SUBSIDIARY COMPANIES PROVIDED GUARANTEE FOR BANKING FACILITIES AMOUNTING TO USD47.5 (2005: USD50.5 MILLION) BY A CHARGE OVER ALL FIXED AND FLOATING ASSETS, INCLUDING BUT NOT LIMITED TO STOCKS, RECIEVABLE AND MONIES OF THE COMPANY AND THE SUBSIDIARY COMPANY, AND BY CORPORATE GUARANTEES OF OTHER SUBSIDIARY COMPANIES ON A PARI PASSU BASIS. IN ADDITION, THE COMPANY ASSIGNED INSURANCES FOR SHIPMENT OF GOODS AS ADDITIONAL SECURITY FOR BANKING FACILITIES GRANTED.}

^{SUBSEQUENT EVENTS}

^{ON 12 DECEMBER 2006, THE COMPANY ENTERED INTO A JOINT VENTURE AGREEMENT WITH DELTA EXPORTS PTE LTD FOR THE TRADING OF NATURAL AND SYNTHETIC RUBBER, THE CAPITAL INJECTION BY THE COMPANY IS EXPECTED TO BE USD510,000.}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 20/07/2001 AS A LIMITED PRIVATE COMPANY AND IS TRADING UNDER THE PRESENT NAMESTYLE OF "R1 INTERNATIONAL PTE LTD".}

^{AS AT 29/09/2007, THE COMPANY HAS AN ISSUED AND PAID-UP CAPITAL OF 7,000,000 SHARES, OF A VALUE OF USD7,000,000.}

^{PRINCIPAL ACTIVITIES:}

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

^{1) PROCESSING OF RUBBER (INCLUDING PROCESSING OF RUBBER LATEX)}

^{DURING THE FINANCIAL YEAR(S), UNDER REVIEW, THE PRINCIPAL ACTIVITY OF THE COMPANY IS THE TRADING OF NATURAL RUBBER AND LATEX. FROM THE RESEARCH DONE, THE FOLLOWING INFORMATION WAS GATHERED:}

^ACTIVITIES

^{- TRADING OF NATURAL RUBBER AND LATEX}

^{NUMBER OF EMPLOYEES}

^{- ABOUT 15}

^{IMPORT COUNTRIES}

^{- THAILAND, MALAYSIA, ETC}

^{EXPORT COUNTRIES}

^{- WORLDWIDE}

^{TERMS OF PAYMENT}

^{- TERMS OF IMPORT: 30-90 DAYS TERMS}

^{- TERMS OF EXPORT: 30-90 DAY TERMS}

^{SUBJECT IS A MEMBER OF FOLLOWING ENTITIES}

^{- SINGAPORE COMMODITY EXCHANGE LIMITED (SICOM)}

^{- SINGAPORE BUSINESS FEDERATION}

^{- SINGAPORE CHINESE CHAMBER OF COMMERCE & INDUSTRY}

^{NO OTHER TRADE INFORMATION WAS MADE AVAILABLE AS TELE-INTERVIEW WAS NOT GRANTED ON 05/10/2007.}

^{NUMBER OF EMPLOYEES (30 SEPTEMBER)}

^{- GROUP - 2006: NOT AVAILABLE (2005: NOT AVAILABLE)}

^{REGISTERED & BUSINESS ADDRESSES:}

^{8 ROBINSON ROAD}

^{#05-00 CPSCO BUILDING}

^{SINGAPORE 048544}

^{DATE OF CHANGE OF ADDRESS: -}

^{-- OFFICE}

^E-MAIL:

^{http://www.r1international.com/contact.cfm}

^WEBSITE:

^{http://www.r1international.com (UNDER MAINTANENCE)}

MANAGEMENT

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

^{(1) DATO' WIRA SYED ABDUL JABBAR BIN SYED HASSAN, A MALAYSIAN}

^{- BASED IN MALAYSIA}

^{(2) DATUK DR. MAHMOOD ABD. KADIR, A MALAYSIAN}

^{- BASED IN MALAYSIA}

^{(3) DR PONGSAK KERDV ONGBUNDIT, A THAI}

^{- BASED IN THAILAND}

^{(4) JERAL SYLVESTER D'SOUZA, A BRITISH}

^{- BASED IN SINGAPORE}

^{(5) NG SWAN CHU @ LINDA SOEWARNI WIDJAJA, A SINGAPORE PERMANENT RESIDENT}

^{- HOLDS OTHER DIRECTORSHIPS IN OUR DATABASE}

^{NEW CONTINENT ENTERPRISES (PRIVATE) LIMITED}

^{(6) SANDANA DASS, A SINGAPORE PERMANENT RESIDENT}

^{- HOLDS NO OTHER DIRECTORSHIP IN OUR DATABASE}

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

THE OVERALL DOMESTIC WHOLESALE TRADE DECLINED BY 7.5% IN Q1 2007. EXCLUDING PETROLEUM, DOMESTIC SALES FELL BY 7.4%. SECTORS OF ELECTRONIC COMPONENTS, SHIP CHANDLERS AND BUNKERING, INDUSTRIAL AND CONSTRUCTION MACHINERY REPORTED DECLINES OF 11.6% TO 23.8%.

HOWEVER, WHOLESALERS OF FOOD, BEVERAGES AND TOBACCO REGISTERED HIGHER TURNOVER OF 5.4%.

FOREIGN WHOLESALE TRADE INDEX

THE OVERALL FOREIGN WHOLESALE TRADE IN QUARTER 1 2007 FELL BY 7.6%. EXCLUDING PETROLEUM, FOREIGN SALES DECLINED BY 8.0%. MOST WHOLESALE SECTORS REPORTED LOWER OVERSEAS RECEIPTS IN QUARTER 1 2007 COMPARED TO THE PREVIOUS QUARTER, EXCEPT HOUSEHOLD EQUIPMENT AND FURNITURE SECTOR. SHIP CHANDLERS & BUNKERING REPORTED THE LARGEST DECLINE OF 18.3% IN QUARTER 1 2007, FOLLOWED BY FOOD BEVERAGES & TOBACCO SECTOR OF 17.7%.

RETAIL TRADE

THE OVERALL RETAIL SALES ROSE MARGINALLY BY 0.7% IN QUARTER 2 2007, COMPARED TO QUARTER 2 2006. EXCLUDING MOTOR VEHICLES, RETAIL SALES ROSE BY 5.1%. SALES OF OPTICAL GOODS & BOOKS, FURNITURE & HOUSEHOLD EQUIPMENT AND SUPERMARKETS ENJOYED STRONG GROWTHS OVER A YEAR AGO. PROVISION & SUNDRY SHOPS, WATCHES AND JEWELLERY, DEPARTMENT STORES AND WEARING APPAREL & FOOTWEAR SECTORS ALSO REPORTED HIGHER SALES OF 4.35 TO 5.9% RESPECTIVELY.

HOWEVER, RETAILERS OF MOTOR VEHICLES, FOOD & BEVERAGES, TELECOMMUNICATIONS APPARATUS & COMPUTERS AND PETROL SERVICES STATIONS REPORTED LOWER SALES.

OUTLOOK

GENERALLY, WHOLESALERS EXPECT TO DO WELL FOR THE NEXT 6 MONTHS, WITH A POSITIVE NET WEIGHTED BALANCE OF 17%. DEALERS OF FOOD & BEVERAGES, TROPICAL PRODUCE, TEXTILES & LEATHER GOODS AND HOUSEHOLD ELECTRICAL APPLIANCE & EQUIPMENT ARE AMONG THOSE WHO ARE OPTIMISTIC.

RETAIL TRADE FIRMS ANTICIPATE BUSINESS TO BE LESS BRISK FOR THE NEXT 6 MONTHS. IN PARTICULAR, DEPARTMENT STORES, SUPERMARKETS AND RETAILERS OF MOTOR VEHICLES EXPECT SLOWER BUSINESS IN THE COMING MONTHS.

EXTRACTED FROM: MINISTRY OF TRADE AND INDUSTRY, SINGAPORE

SINGAPORE DEPARTMENT OF STATISTICS

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%)

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