MIRA INFORM REPORT

Report Date :

19.03.2008

IDENTIFICATION DETAILS

Name :	BRADY CORPORATION ASIA PTE. LTD.

Formerly Known As :	^{BRADY TECHNOLOGIES ASIA PTE. LTD}

Registered Office :	^{1 Kaki Bukit Crescent}

Country :	Singapore

Financials (as on) :	31.07.2006

Date of Incorporation :	^11.08.2004

Com. Reg. No.:	^200410080M

Legal Form :	^{Pte Ltd}

Line of Business :	Distribution of Specialised Adhesive and Topcoated Materials, Precision Die-Cut and Silt Tapes and High Performance Industrial Identification Products, Safety and Facility Identification Products

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

BRADY CORPORATION ASIA PTE. LTD.

Line Of Business

DISTRIBUTION OF SPECIALISED ADHESIVE AND TOPCOATED MATERIALS, PRECISION DIE-CUT AND SILT TAPES AND HIGH PERFORMANCE INDUSTRIAL IDENTIFICATION PRODUCTS, SAFETY AND FACILITY IDENTIFICATION PRODUCTS

Parent Company

BRADY CORPORATION ASIA PACIFIC PTE

(PERCENTAGE OF SHAREHOLDINGS: 100%)

Financial Elements

FY 2006

COMPANY

Sales : S$ 78,661,813

Networth : S$ 56,842,903

Paid-Up Capital : S$ 48,560,002

Net result : S$ 2,935,882

Net Margin(%) : 3.73

Return on Equity(%) : 5.16

Leverage Ratio : -3.98

COMPANY IDENTIFICATION

^{Subject
Company : BRADY
CORPORATION ASIA PTE. LTD.}

^{Former
Name :
BRADY TECHNOLOGIES ASIA PTE. LTD.}

^{Business
Address : 1 KAKI BUKIT CRESCENT}

^{Town :
SINGAPORE}

^{Postcode :
416236}

^{Country :
Singapore}

^{Telephone : 6477 7261/ 6477
4943}

^{Fax :
6383 2229/ 6748 8857}

^{ROC
Number :
200410080M}

^{Reg.
Town : -}

PREVIOUS IDENTIFICATION

^{BRADY
TECHNOLOGIES ASIA PTE. LTD. DATE OF
CHANGE: 01/11/2004}

SUMMARY

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

^{Legal
Form : Pte
Ltd}

^{Date
Inc. :
11/08/2004}

^{Previous
Legal Form : -}

^{Summary
year :
31/07/2006}

^{Sales :
78,661,813}

^{Networth
:
56,842,903}

^{Capital :}^-

^{Paid-Up
Capital :
48,560,002}

^{Employees : 350}

^{Net result :
2,935,882}

^{Share
value : 1}

^{Auditor :
DELOITTE & TOUCHE}

^{BASED
ON ACRA'S RECORD}

^{NO OF SHARE CURRENCY AMOUNT}

^{ISSUED
ORDINARY 3 SGD 36,174,791.92}

^{ISSUED
PREFERENCE 21,555,877 SGD 66,215,800.00}

^{PAID-UP
ORDINARY - SGD 36,174,791.92}

^{PAID-UP
PREFERENCE - SGD 66,215,800.00}

REFERENCES

^{Litigation : No}

^{Company
status : TRADING}

^{Started :
11/08/2004}

PRINCIPAL(S)

^{GAY
BOON LEE MELVIN
S1658272G Director}

DIRECTOR(S)

^{FRANK
M JAEHNERT 6000112778 Director}

^{Appointed
on : 06/09/2004}

^{Street
: W
68 N1068 KENSINGTON AVENUE}

^{CEDARBURG WISCONSIN 53012}

^{Town : -}

^{Postcode :
-}

^{Country : United
States}

^{LEOW
HOCK MENG EDMUND
S1597537G Company Secretary}

^{Appointed
on : 11/08/2004}

^{Street
: 17
WATTEN VIEW}

^{WATTEN ESTATE}

^{Town :
SINGAPORE}

^{Postcode : 287135}

^{Country : Singapore}

^{THOMAS
JAMES FELMER
710093639 Director}

^{Appointed
on : 15/01/2008}

^{Street
:
8821 HILLY LANE, SAUKVILLE}

^{WI 53080}

^{Town : -}

^{Postcode :
-}

^{Country : United
States}

^{ANTHONY
ANNE CATHERINE
S1347717E Company Secretary}

^{Appointed
on : 11/08/2004}

^{Street
: 8
LORONG 29 GEYLANG}

^#07-06

^{Town :
SINGAPORE}

^{Postcode : 388064}

^{Country : Singapore}

^{GAY
BOON LEE MELVIN S1658272G Director}

^{Appointed
on : 01/08/2007}

^{Street
: 14
CACTUS DRIVE}

^#06-04

^{GRANDE VISTA}

^{Town :
SINGAPORE}

^{Postcode :
809689}

^{Country : Singapore}

FORMER DIRECTOR(S)

^{DAVID
MATHIESON
500132167}

^{RICHARD
JOHN ALLEN S1347717E}

^{SOH
LIP LEONG
S2561815G}

ACTIVITY(IES)

^{ADHESIVES
Code:
140}

^{ELECTRONIC
COMPONENTS
Code: 7605}

^{BASED
ON ACRA'S RECORD}

^{1.
MANUFACTURE OF ADHESIVES AND SEALANTS}

^{2.
MANUFACTURE OF ELECTRONIC COMPONENTS}

CHARGES

No Charges On Premises/Property In Our Database

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

BANKERS

^{UFJ
BANK LIMITED}

^{(F.K.A.
THE SANWA BANK LIMITED)}

SHAREHOLDERS(S)

^{BRADY
CORPORATION ASIA PACIFIC PTE.
21,555,880 Company}

^{Street
: 1 TEMASEK AVENUE}

^#27-01

^{MILLENIA TOWER}

^{Town: SINGAPORE}

^{Postcode: 039192}

^{Country: Singapore}

HOLDING COMPANY

^{BRADY
CORPORATION ASIA PACIFIC PTE
200409077E % : 100}

SUBSIDIARY(IES)

^{ID
TECH (CHINA) PTE. LTD.}

^{BRANDON
PRECISION PTE LTD}

^{BRADY
COMPANY INDIA PRIVATE LIMITED}

^{BRADY
CORPORATION S.E.A. PTE LTD}

PAYMENT HISTORY AND EXPERIENCES

^{Trade
Morality :
AVERAGE}

^{Liquidity
: LACKING}

^{Payments
: REGULAR}

^{Trend
:
LEVEL}

^{Financial
Situation : AVERAGE}

FINANCIAL ELEMENTS

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

^{Date
Account Lodged:
30/05/2007}

^{Balance
Sheet Date:
31/07/2006
31/07/2005}

^{Number
of weeks:
52 50}

^{Consolidation
Code: COMPANY COMPANY}

^{--- ASSETS} ^---

^{Intangible
Fixed Assets:
78,415,084
78,358,239}

^{Tangible
Fixed Assets:
6,491,994
5,878,561}

^{Investments 1,620,127 1}

^{Total Fixed Assets: 86,527,205 84,236,801}

^{Inventories: 4,509,225 4,833,467}

^{Receivables: 13,862,104 13,469,739}

^{Cash,Banks,
Securitis: 7,143,531 5,717,921}

^{Other
current assets:
30,763,845
22,352,028}

^{Total Current Assets: 56,278,705 46,373,155}

^{TOTAL ASSETS: 142,805,910 130,609,956}

^{--- LIABILITIES} ^---

^{Equity
capital:
48,560,002 79}

^{Profit
& lost Account: 8,282,901 5,347,019}

^{Surplus
equity:
-
44,659,923}

^{Total Equity: 56,842,903 50,007,021}

^{L/T
deffered taxes:
485,307
269,903}

^{Total L/T Liabilities: 485,307
269,903}

^{Trade
Creditors:
3,319,464
2,818,582}

^{Provisions: - 117,872}

^{Other
Short term Liab.:
77,973,710
73,601,702}

^{Prepay.
& Def. charges:
4,184,526
3,794,876}

^{Total short term Liab.: 85,477,700 80,333,032}

^{TOTAL LIABILITIES: 85,963,007 80,602,935}

^{--- PROFIT & LOSS ACCOUNT} ^---

^{Net
Sales
78,661,813
49,529,497}

^{Purchases,Sces
& Other Goods:
52,928,968
28,088,268}

^{Gross
Profit: 25,732,845 21,441,229}

^{NET
RESULT BEFORE TAX:
3,911,065
7,112,794}

^{Tax
:
975,183 1,765,775}

^{Net
income/loss year:
2,935,882
5,347,019}

^{Interest
Paid:
4,574,737
2,546,698}

^{Depreciation: 932,549 643,315}

^{Directors
Emoluments:
397,932
203,504}

^{Wages
and Salaries:
14,115,114
9,363,829}

RATIOS

^{31/07/2006 31/07/2005}

^{Turnover
per employee: 224748.04 141512.85}

^{Net
result / Turnover(%): 0.04 0.11}

^{Fin.
Charges / Turnover(%):0.06 0.05}

^{Stock
/ Turnover(%): 0.06 0.10}

^{Net
Margin(%): 3.73 10.80}

^{Return
on Equity(%): 5.16 10.69}

^{Return
on Assets(%): 2.06 4.09}

^{Net
Working capital: -29198995.00 -33959877.00}

^{Cash
Ratio: 0.08 0.07}

^{Quick
Ratio: 0.25 0.24}

^{Current
ratio: 0.66 0.58}

^{Receivables
Turnover: 63.44 97.90}

^{Leverage
Ratio: -3.98 -2.84}

^{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}

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

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

FINANCIAL COMMENTS

THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2005 COVERS THE PERIOD FROM 11 AUGUST 2004 (DATE OF INCORPORATION) TO 31 JULY 2005, A TOTAL OF 50 WEEKS. THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2006 COVERS THE PERIOD FROM 1 AUGUST 2005 TO 31 JULY 2006, A TOTAL OF 52 WEEKS. THUS, THE ANALYSIS MAY NOT GIVE A TRUE AND FAIR VIEW.

^{THE FINANCIAL
CONDITION OF THE COMPANY WAS SEEN TO BE FAIR IN VIEW OF}

^{THE FOLLOWING:}

^NET
WORTH:

^{THE BALANCE SHEET
WAS PASSABLE WITH NET WORTH IMPROVED BY} ^{13.67% FROM S$56,842,903 IN FY 2005 TO
S$50,007,021 IN FY 2006. THIS} ^{WAS DUE TO HIGHER ACCUMULATED PROFITS
OF S$8,282,901 (2005: S} ^{$5,347,019); A RISE OF 54.91% FROM THE PRIOR
FINANCIAL YEAR.}

^LEVERAGE:

^{IN THE SHORT-TERM,
SUBJECT WAS LARGELY FINANCED BY OTHER SHORT TERM} ^{LIABILITIES
WHICH MADE UP 91.22% (2005: 91.62%) OF THE TOTAL CURRENT} ^{LIABILITIES
AND AMOUNTED TO S$77,973,710 (2005: S$73,601,702).} ^{THE BREAKDOWN WAS
AS FOLLOWS:}

^{*HOLDING
COMPANY - 2006: S$558,360 (2005: NIL)}

^{*SUBSIDIARY
- 2006: S$595,512 (2005: NIL)}

^{*RELATED
COMPANIES - 2006: S$76,819,838 (2005: S$73,601,702)}

^{TRADE
CREDITORS ROSE BY 17.77% TO S$3,319,464 (2005: S$2,818,582).}

^{IN
ALL, LEVERAGE RATIO WORSENED FROM -2.84 TIMES TO -3.98 TIMES AS A}

^RESULT ^{OF A MORE
THAN PROPORTIONATE RISE IN TOTAL EQUITY AS COMPARED TO THE}

^{RISE
IN TOTAL LIABILITIES.}

^LIQUIDITY:

^{IN
GENERAL, SUBJECT'S LIQUIDITY SITUATION WAS INADEQUATE AS SEEN FROM} ^{THE DEFICIT
NET WORKING CAPITAL OF S$29,198,995 (2005: S$-33,959,877).}

^{BOTH
CURRENT AND QUICK RATIOS WERE LACKING AT 0.66 TIMES (2005: 0.58} ^{TIMES) AND
0.25 TIMES (2005: 0.24 TIMES) RESPECTIVELY.}

^{CASH
AND BANK BALANCES:}

^{*CASH
ON HAND -2006: S$2,500 (2005: S$1,500)}

^{*CASH
AT BANK - 2006: S$7,141,031 (2005: S$5,716,421)}

^{THE
SUBJECT MIGHT FACE PROBLEMS IN FULFULLING ITS SHORT-TERM} ^OBLIGATIONS.

^{PROFITABILITY:}

^{REVENUE
ROSE BY 58.82% FROM S$49,529,497 IN FY 2005 TO} ^{S$78,661,813.
HOWEVER, NET PROFIT DROPPED BY 45.09% TO S$2,935,882} ^{(2005:
S$5,347,019).}

^{THE
DROP IN NET INCOME MIGHT BE A RESULT OF THE RISE IN THE FOLLOWING}

^EXPENSES:

^{*ADMINISTRATIVE
EXPENSES - 2006: S$2,312,724 (2005: S$2,302,366)}

^{*SELLING
AND DISTRIBUTION EXPENSES - 2006: S$8,806,130 (2005: S}

^$5,720,486)

^{*OTHER
OPERATING EXPENSES - 2006: S$7,375,482 (2005: S$3,843,275)}

^{*FINANCE
COSTS - 2006: S$4,574,737 (2005: S$2,546,698)}

^{HENCE,
NET MARGIN DROPPED TO 3.73% (2005: 10.80%).}

^{DEBT SERVICING:}

^{DEBT SERVICING
PROBLEMS MIGHT NOT BE EXPECTED IF REVENUE AND EARNINGS} ^{CAN BE
MAINTAINED AND PAYMENTS BY TRADE DEBTORS ARE FORTHCOMING.} ^{THE
AVERAGE COLLECTION PERIOD HAS SHORTENED TO 63 DAYS (2005: 98} ^DAYS).

^{NOTES TO FINANCIAL STATEMENTS:}

^{ACQUISITION OF BUSINESSES}

^{(A)ON
DECEMBER 1, 2005, THE COMPANY ACQUIRED THE BUSINESS} ^{INCLUDING
THE RELATED ASSETS AND LIABILITIES OF A SUBSIDIARY. THESE} ^{TRANSACTIONS
HAVE BEEN ACCOUNTED FOR BY THE PURCHASE METHOD OF} ^ACCOUNTING.

^{(B) ON NOVEMBER 1,
2004, THE COMPANY ACQUIRED THE BUSINESSES,} ^{INCLUDING THE RELATED ASSETS AND
LIABILITIES, OF TWO FWLLOE AUBSIDIARY} ^{COMPANIES. THESE TRANSACTIONS
HAVE BEEN ACCOUNTED FOR BY THE PURCHASE} ^{METHOD OF ACCOUNTING.}

^{THE GOODWILL
ARISING ON RESTRUCTURING IS ATTRIBUTABLE TO THE} ^{ANTICIPATED
PROFITABILITY OF THE FUTURE OPERATING SYNERGIES FROM THE} ^COMBINATION.

^{THE FAIR VALUES OF
THE NET ASSETS ACQUIRED IN THE TRANSACTIONS,} ^{APPROXIMATE
THE CARRYING AMOUNT OF EACH CLASS OF THESE ASSETS AND} ^{LIABILITIES IN
THE BOOKS OF THE SUBSIDIARIES IMMEDIATELY BEFORE THE} ^{TRANSACTIONS.}

^{THE BUSINESSES
ACQUIRED FROM BRANDON PRECISION PTE LTD CONTRIBUTED} ^{$9,821,561 REVENUE
AND $1,049,105 TO THE COMPANY'S PROFIT BEFORE TAX} ^{FOR THE PERIOD
BETWEEN THE DATE OF ACQUISITION AND THE BALANCE SHEET} ^DATE.

^{THE BUSINESSES
ACQUIRED FROM BRADY TECHNOLOGIES ASIA PTE. LTD AND ID} ^{TECHNOLOGIES
PTE. LTD. CONTRIBUTED $49,529,497 REVENUE AND $7,112,794} ^{TO THE
COMPANY'S PROFIT BEFORE TAX FOR THE PERIOD BETWEEN THE DATE OF} ^{ACQUISITION
AND JULY 31, 2005.}

^{SHARE CAPITAL}

^{THE
COMPANNY WAS INCORPORATED ON AUGUST 11, 2004 WITH AN AUTHORISED}

^{SHARE CAPITAL OF $200,000 DIVIDED INTO
100,000 ORDINARY SHARES OF $ EACH AND 100,000 REDEEMABLE PREFERENCE SHARES OF
$1 EACH. AT THE DATE} ^{OF INCORPORATION, 2 ORDINARY SHARES OF $1
EACH WERE ISSUED AT PAR FOR} ^{CASH TO THE SUBSCRIBERS TO THE
MEMORANDUM OF ASSOCIATION. THE ORDINARY} ^{SHARES CARRY RIGHTS TO
RECEIVE NOTICE OF, AND TO ATTEND AND VOTE AT,} ^{GENERAL MEETINGS OF
THE COMPANY, BUT NO RIGHT TO FIXED INCOME.}

^{IN 2005, THE
COMPANY ISSUED 77 PREFERENCE SHARES OF $1 EACH TO ITS} ^{HOLDING
COMPANY AT A PREMIUM OF $579,999 EACH FOR CASH TO PROVIDE} ^{ADDITIONAL
WORKING CAPITAL. THE REDEEMABLE PREFERABLE SHARES CARRY} ^{RIGHTS TO A
FIXED NON-CUMULATIVE PREFERENTIAL DIVIDEND AT THE RATE OF} ^{SIX
PERCENT PER ANNUM ON THE PAR VALUE. THE REDEEMABLE PREFERENCE} ^{SHARES
ALSO CARRY RIGHTS TO RECEIVE NOTICE OF, AND TO ATTEND AND VOTE} ^{AT, GENERAL
MEETINGS OF THE COMPANY.}

^{DURING
THE FIANNCIAL YEAR, THE COMPANY ISSUED 3,900,000 REDEEMABLE} ^{PREFERENCE
SHARES OF $1 EACH TO ITS HOLDING COMPANY TO PROVIDE} ^{ADDITIONAL
WORKING CAPITAL. THSES REDEEMABLE PREFERENCE SHARES CARRY} ^{THE SAME
RIGHTS AS THE EXISTING PREFERENCE SHARES.}

^{THESE
PREFERENCE SHARES ARE REDEEMABLE AT THE OPTION OF THE COMPANY} ^{AND THERE IS NO DEFINED PERIOD OR DATE OVER
WHICH THE REDEMPTION CAN} ^{TAKE PLACE.}

BACKGROUND/OPERATION

^{THE
COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON} ^{11/08/2004
AS A LIMITED PRIVATE COMPANY UNDER THE NAMESTYLE OF "BRADY} ^{TECHNOLOGIES
ASIA PTE. LTD.".}

^{SUBSEQUENTLY
ON 01/11/2004, SUBJECT CHANGED TO ITS PRESENT NAMESTYLE} ^{OF
"BRADY CORPORATION ASIA PTE. LTD.".}

^{THE
COMPANY HAS AN ISSUED AND PAID-UP CAPITAL OF 3} ^{ORDINARY
SHARES, OF A VALUE OF S$36,174,791.92 AND 21,555,877} ^{PREFERENCE
SHARES OF A VALUE OF S$66,215,800.}

^{PRINCIPAL
ACTIVITIES:}

^{SUBJECT
IS REGISTERED WITH THE ACCOUNTING AND CORPORATE REGULATORY}

^{AUTHORITY
(ACRA) TO BE PRINCIPALLY ENGAGED IN THE BUSINESS OF:}

^{(1)
MANUFACTURE OF ADHESIVES AND SEALANTS}

^{(2)
MANUFACTURE OF ELECTRONIC COMPONENTS}

^{THE
COMPANY IS LISTED IN THE SINGAPORE LOCAL DIRECTORIES UNDER THE} ^{CLASSIFICATION
OF: LABEL STOCK-ADHESIVE}

^{DURING
THE FINANCIAL YEAR(S), UNDER REVIEW, SUBJECT'S PRINCIPAL} ^{ACTIVITIES
ARE THE DISTRIBUTION OF SPECIALISED ADHESIVE AND TOPCOATED} ^{MATERIALS,
PRECISION DIE-CUT AND SILT TAPES AND HIGH PERFORMANCE} ^{INDUSTRIAL
IDENTIFICATION PRODUCTS, SAFETY AND FACILITY IDENTIFICATION} ^{PRODUCTS
AND PORTABLE PRINTING SYSTEMS, PROVISION OF TAPE AND REEL} ^{SERVICES
AND THE MANUFACTURE OF IDENTIFICATION LABELS AND SIGNS.}

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

^{BACKGROUND :}

^{THE SUBJECT IS A
WHOLLY-OWNED SUBSIDIARY OF BRADY CORPORATION.} ^{FOUNDED IN
1914, BRADY IS HEADQUARTERED IN THE U.S. AND EMPLOYS MORE} ^{THAN 3000
PEOPLE WORLDWIDE. IN ASIA-PACIFIC, THEY HAVE MANUFACTURING} ^{FACILITIES
IN SINGAPORE, CHINA, SOUTH KOREA, AND AUSTRALIA. IN} ^{ADDITION TO
THESE MANUFACTURING LOCATIONS, THEY HAVE SALES AND} ^{TECHNICAL SUPPORT
OFFICES THROUGH JAPAN, MALAYSIA, THAILAND, HONG} ^{KONG, TAIWAN AND THE
PHILIPPINES. THEIR ASIA-PACIFIC HEADQUARTERS IS} ^{IN SINGAPORE.}

^{PRODUCTS
THAT ARE MARKETED ACROSS THE ASIA-PACIFIC REGION :}

^{*
HIGH-PERFORMANCE LABELS FOR CIRCUIT BOARDS}

^{*
PRECISION DIE-CUT PARTS FOR MOBILE PHONES}

^*
HDD

^{*
SAFETY SIGNS}

^{*
SAFETY-RELATED PRODUCTS}

^{*
DATA-COLLECTION SYSTEMS AND SOFTWARE}

^{*
A BROAD RANGE OF LABEL-PRINTING SYSTEMS}

^{SOME
OF SUBJECT'S CLIENTS:}

^*
COMPAQ

^*
SEAGATE

^*
NOKIA

^*
ERICSSON

^*
SOLECTRON

^*
AGILENT

^*
INTEL

^{*
TEXAS INSTRUMENTS}

^{*
MOTOROLA ELECTRONICS}

^{FROM
THE TELE-INTERVIEW CONDUCTED, THE FOLLOWING WAS} ^GATHERED:

^ACTIVITIES:

^*
LABELS

^{NUMBER
OF EMPLOYEES:}

^{*
2008: 350}

^{NO
OTHER TRADE INFORMATION WAS AVAILABLE}

^{THE COMPANY IS A
WHOLLY-OWNED SUBSIDIARY OF BRADY SINGAPORE HOLDINGS} ^{PTE. LTD.,
INCORPORATED IN TEH REPUBLIC OF SINGAPORE. THE COMPANY'S} ^{ULTIMATE
HOLDING COMPANY IS BRADY CORPORATION, INCORPORATED IN THE} ^{UNITED
STATES OF AMERICA.}

^{REGISTERED
ADDRESS:}

^{1
TEMASEK AVENUE}

^#27-01

^{MILLENIA
TOWER}

^{SINGAPORE
039192}

^{DATE
OF CHANGE OF ADDRESS: 11/08/2004}

^{BUSINESS
ADDRESS:}

^{1
KAKI BUKIT CRESCENT}

^{SINGAPORE
416236}

^{-
PROPERTY RECORD WAS NOT AVAILABLE}

^WEBSITE:

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

^EMAIL:

^{suetfong_liew@bradycorp.com}

MANAGEMENT

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

^{1)
FRANK M. JAEHNERT, A GERMAN}

^{-
BASED IN USA}

^{2)
THOMAS JAMES FELMER, AN AMERICAN}

^{-
BASED IN USA}

^{3)
GAY BOON LEE MELVIN, A SINGAPOREAN}

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

^{ID
TECHNOLOGIES PTE LTD}

^{BRADY
TECHNOLODIES ASIA PTE. LTD.}

^{BRADY
CORPORATION S.E.A. PTE LTD}

^{BRANDON
PRECISION PTE LTD}

^{BRADY
CORPORATION ASIA PACIFIC PTE. LTD.}

^{ID
TECH (CHINA) PTE. LTD.}

^{BRADY
ASIA HOLDING PTE. LTD}

^{BRADY
ASIA PACIFIC 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 10.0% IN 3Q 2007, UP FROM 8.3% IN 2Q 2007. GROWTH WAS MAINLY DUE TO THE BIOMEDICAL MANUFACTURING CLUSTER, FOLLOWED BY THE TRANSPORT ENGINEERING, ELECTRONICS AND CHEMICALS CLUSTERS. THE PRECISION ENGINEERING CLUSTER CONTINUED TO REMAIN WEAK.

WITH THE EXPANSIONS IN THE PHARMACEUTICALS AND AND MEDICAL TECHNOLOGY SEGMENTS, THE BIOMEDICAL MANUFACTURING CLUSTER GREW 29.0%, FASTER THAN THE 11.0% IN 2Q 2007.

THE PHARMACEUTICAL SEGMENT ROSE BY A SUBSTANTIAL 28.0% WITH INCREASED PRODUCTION OF SEVERAL VARIETIES OF ACTIVE PHARMACEUTICAL INGREDIENTS. THE MEDICAL TECHNOLOGY SEGMENT REGISTERED HIGHER GROWTH OF 39%, AS EXPORT DEMAND CONTINUED TO BOOST THE MANUFACTURE OF MEDICAL DEVICES AND APPLIANCES.

THE TRANSPORT ENGINEERING CLUSTER ROSE BY 18.0%, COMPARED TO 31.0% IN 2Q 2007. THE MARINE AND OFFSHORE ENGINEERING SEGMENT REGISTERED A RISE IN OUTPUT BY 24.0%, WITH LOCAL SHIPYARDS ENGAGING ON A NUMBER OF SHIP-BUILDING, SHIP REPAIRING AND SHIP CONVERSION PROJECTS. SOME OF WHICH ARE DUE FOR DELIVERY IN 2008. LIKEWISE, ACTIVITY IN OIL RIG FABRICATION CONTINUED TO GROW AT A STRONG PACE. THE AEROSPACE SEGMENT GREW 7.2%, BOOSTED BY THE INCREASED DEMAND FOR COMMERCIAL AIRCRAFT REPAIRS. THE LAND TRANSPORT SEGMENT ROSE BY 18.0% TO MEET OVERSEAS ORDERS FOR VEHICLE PARTS.

THE ELECTRONICS CLUSTER ROSE BY 4.0%, UP FROM 1.3% IN 2Q 2007. THE PRODUCTION OF SEMICONDUCTORS GREW 9.3% WITH INCREASED PRODUCTION OF DRAMS AND CHIPS FOR WIRELESS PRODUCTS, WHILE THE DATA STORAGE SEGMENT ROSE BY 8.0%, AS HIGHER OUTPUT OF DISK MEDIA PRODUCTS COMPENSATED FOE THE LOWER OUTPUT OF DISK DRIVES, AND AS A RESULT, REVERSING SIX QUARTERS OF DECLINE.

THE CHEMICALS CLUSTER EXPANDED BY 2.6% IN 3Q 2007, SLIGHTLY LOWER THAN 3.0% IN THE PREVIOUS QUARTER. THE PETROCHEMICALS AND SPECIALTY CHEMICALS SEGMENT ROSE BY 13.0% AND 3.8% RESPECTIVELY, WHILE THE PETROLEUM SEGMENT FELL BY 4.2% ARISING FROM

MAINTENANCE SHUTDOWNS IN JULY AND AUGUST.

ALTHOUGH THE PRECISION ENGINEERING CLUSTER DECLINED BY 0.3%, ITS PERFORMANCE IMPROVED FROM THE 1.4% DECLINE IN 2Q 2007. THE OUTPUT EXPANSION OF 6.3% IN THE MACHINERY AND SYSTEMS SEGMENT WAS OFFSET BY THE CONTRACTION OF 4.6% IN THE PRECISION MODULES AND COMPONENTS SEGMENT. THIS WAS ATTRIBUTED TO SLUGGISH DEMAND FOR PRECISION COMPONENTS, METAL STAMPINGS AND BEARINGS.

GROWTH IN THE GENERAL MANUFACTURING INDUSTRIES MODERATED TO 5.9%, AFTER EXPANDING BY 8.4% IN 2Q 2007. THE FOOD, BEVERAGES AND TOBACCO INDUSTRIES SEGMENT CONTINUED TO IMPROVE, WITH A 11% INCREASE IN OUTPUT, WHILE THE PRINTING INDUSTRIES GREW BY A MORE MODEST 2.8%.

OUTLOOK

THE MANUFACTURING SECTOR EXPRESS POSITIVE SENTIMENTS IN THE MONTHS ENDING MARCH 2008. A NET WEIGHTED BALANCE OF 25% OF MANUFACTURERS FORECASTS BETTER BUSINESS CONDITIONS, SLIGHTLY HIGHER THAN THE 22.0% RECORDED IN 2Q 2007 AND 3Q 2006.

THE ELECTRONICS CLUSTER IS OPTISMTIC WITH A NET WEIGHTED BALANCE OF 33% OF FIRMS EXPECTING BETTER BUSINESS AHEAD, SIMILAR TO THE 34% RECORDED IN 2Q 2007. THOSE INVOLVED IN THE MANUFACTURING OF COMPUTER PERIPHERALS AND INFOCOMMS AND CUSTOMER ELECTRONICS EXPECT OUTPUT AND EXPORTS TO RISE DUE TO NEW PRODUCT LAUNCHES AND THE YEAR-END FESTIVE SEASON. SEMICONDUCTOR PRODUCTS EXPECT HIGHER OUTPUT AND ORDER INTAKES IN 4Q 2007 COMPARED TO 3Q 2007.

IN THE TRANSPORT ENGINEERING CLUSTER, A NET WEIGHTED BALANCE OF 33.0% OF FIRMS EXPECTS THE BUSINESS CLIMATE TO IMPROVE IN THE MONTHS ENDING MARCH 2008, BETTER THAN THE 25% OBSERVED IN 2Q 2007. THE MARINE AND OFFSHORE ENGINEERING SEGMENT FORESEES GLOBAL DEMAND FOR OIL RIGS, OILFIELD EQUIPMENT, AND SHIP CONVERSION AND REPAIRING ACTIVITIES TO CONTINUE TO RISE. PRODUCTION IS EXPECTED TO REMAIN THE SAME AS 3Q 2007 FOR AEROSPACE AND LAND TRANSPORT SEGMENTS.

IN THE CHEMICALS CLUSTER, A NET WEIGHTED BALANCE OF 22.0% OF FIRMS EXPECTS THE BUSINESS CLIMATE TO IMPROVE, COMPARED WITH 2% IN 2Q 2007. THE PETROCHEMICALS, SPECIALTIES AND OTHER CHEMICALS SEGMENTS FORECAST AN INCREASE IN PRODUCTION FOR 4Q 2007, ABOVE 3Q 2007. THIS IS ATTRIBUTED TO YEAR-END SEASONAL EFFECTS AND SEVERAL RESUMPTIONS TO NORMAL PRODUCTION FOLLOWING MAINTENANCE SHUTDOWNS IN 3Q 2007.

THE BIOMEDICAL MANUFACTURING CLUSTER IS POSITIVE ABOUT THE BUSINESS OUTLOOK.

A NET WEIGHTED BALANCE OF 22.0% OF FIRMS EXPECT BRISK BUSINESS IN THE COMING MONTHS, COMPARED TO 10.0% IN 3Q 2007. THIS IS DESPITE AN ANTICIPATED DECLINE IN PRODUCTION IN 4Q 2007 COMPARED TO 3Q 2007 IN THE PHARMACEUTICAL AND MEDICAL TECHNOLOGY SEGMENTS.

IN THE PRECISION ENGINEERING CLUSTER, A NET WEIGHTED BALANCE OF 11% OF FIRMS FORECASTS POSITIVE BUSINESS CONDITIONS, SIMILAR TO THE 12.0% RECORDED IN 3Q 2007.

THE MACHINERY AND SYSTEMS SEGMENT IS MORE OPTIMISTIC DUE TO THE BOOMING CONSTRUCTION SECTOR AND AN ANTICIPATED RECOVERY IN THE SEMICONDCUTOR INDUSTRY. PRODUCTION IS EXPECTED TO REMAIN STABLE IN THE PRECISION MODULES AND COMPONENTS SEGMENT.

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%)

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