MIRA INFORM REPORT

Report Date :

02.05.2008

IDENTIFICATION DETAILS

Name :	K.T.S. (SINGAPORE) PTE. LTD.

Registered Office :	^{190 Middle Road} ^#09-01/07 ^{Fortune Centre} ¹⁸⁸⁹⁷⁹

Country :	Singapore

Financials (as on) :	31.12.2006

Date of Incorporation :	^06.07.1974

Com. Reg. No.:	^197401224C

Legal Form :	^{Pte Ltd}

Line of Business :	Timber Merchants, Agents and Representatives and Investment Dealings

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 :	Slow

Litigation :	Clear

Subject Company

K.T.S. (SINGAPORE) PTE. LTD.

Line Of Business

TIMBER MERCHANTS, AGENTS AND REPRESENTATIVES AND INVESTMENT DEALINGS

Parent Company

N.A.

Financial Elements

FY 2006

CONSOLIDATED

Sales : S$45,486,160

Networth : S$20,285,303

Paid-Up Capital : S$ 5,000,000

Net result : S$ 1,340,369

Net Margin(%) : 2.95

Return on Equity(%) : 6.61

Leverage Ratio : 0.43

COMPANY IDENTIFICATION

^{Subject Company : K.T.S. (SINGAPORE) PTE LTD}

^{Former Name :
-}

^{Business Address : 190 MIDDLE ROAD}

^#09-01/07

^{FORTUNE CENTRE}

^{Town :
SINGAPORE}

^{Postcode :
188979}

^{County :
-}

^{Country :
Singapore}

^{Telephone : 6336 6077}

^{Fax :
6339 0715}

^{ROC Number :
197401224C}

^{Reg. Town : -}

SUMMARY

^{Legal Form : Pte Ltd}

^{Date Inc. : 06/07/1974}

^{Previous Legal Form : -}

^{Summary year :
31/12/2006}

^{Sales :
45,486,160}

^{Networth : 20,285,303}

^{Capital :
-}

^{Paid-Up Capital : 5,000,000}

^{Employees : 30}

^{Net result : 1,340,369}

^{Share value : 1}

^{Auditor :
ERNST & YOUNG}

^{(FORMER NAME 'ERNST
& WHINNEY & ARTHUR YOUNG')}

REFERENCES

^{Litigation : No}

^{Company status : TRADING}

^{Started :
06/07/1974}

PRINCIPAL(S)

^{LAU LEE KONG HENRY K308128 Managing Director}

DIRECTOR(S)

^{TEONG ENG SIONG S0000074D Director}

^{Appointed on : 06/07/1974}

^{Street : 95 MARINE PARADE ROAD}

^#08-01

^{MARINE POINT}

^{Town: SINGAPORE}

^{Postcode: 449271}

^{Country: Singapore}

^{LAU NGI CHONG K219176 Director}

^{Appointed on : 11/07/1981}

^{Street : P
O BOX 29 SIMUNJAN}

^KUCHING

^{Town: SARAWAK}

^Postcode:

^{Country: Malaysia}

^{LAU LEE KONG HENRY K308128 Director}

^{Appointed on : 11/07/1981}

^{Street : 15 ORCHARD BOULEVARD}

^#17-15

^{WESTWOOD APARTMENTS}

^{Town: SINGAPORE}

^{Postcode: 248644}

^{Country: Singapore}

^{LAU SWEE NGUONG @ LAU
SUI GUANG 320616-13- Director}

^{Appointed on : 07/01/1975}

^{Street : 72-74
MARKET ROAD}

^SIBU

^{Town: SARAWAK}

^Postcode:

^{Country: Malaysia}

^{LAU LEE MING K135859 Director}

^{Appointed on : 01/07/1991}

^{Street : 72-74
MARKET ROAD}

^SIBU

^{EAST MALAYSIA}

^{Town: SARAWAK}

^Postcode:

^{Country: Malaysia}

^{LAU HIENG ING K127897 Director}

^{Appointed on : 15/07/1977}

^{Street : NO 8 LAYANG LAYANG ROAD}

^SIBU

^{Town: SARAWAK}

^Postcode:

^{Country: Malaysia}

^{KIU CHUAN GUNG K218453 Director}

^{Appointed on : 15/07/1977}

^{Street : 172
FOOCHOW ROAD 1}

^KUCHING

^{Town: SARAWAK}

^Postcode:

^{Country: Malaysia}

^{DATO STEPHEN LAU LEE
KIONG 550201-13- Director}

^{Appointed on : 22/06/2000}

^{Street : PARKVIEW
TOWER, 69 JLN TABUAN}

^{LEVEL 8, KUCHING}

^{Town: SARAWAK}

^{Postcode: 93100}

^{Country: Malaysia}

^{HENG KHIAM NENG S7235890B Company Secretary}

^{Appointed on : 28/02/2008}

^{Street : 29
CHENG SOON GARDEN}

^{CHENG SOON GARDEN}

^{Town: SINGAPORE}

^{Postcode: 599805}

^{Country: Singapore}

FORMER DIRECTOR(S)

^{CHENG HWA CHUANG S2504243C}

^{CHIO KEE YUNG K312959}

^{LAU CHANG NGUONG K317721}

^{LAU HUI SIONG K590236}

^{DATUK LAU HUI KANG K312691}

^{NGO SIONG KENG @ CHOO
SIONG KENG K221444}

ACTIVITY(IES)

^{TIMBER - WHSLE Code:
21690}

^{INVESTMENT COMPANIES Code: 12095}

^{BASED ON ACRA'S RECORD}

^{1. WHOLESALE OF SAWN
TIMBER, PLYWOOD AND RELATED PRODUCTS;}

^{TIMBER MERCHANTS, AGENTS
AND REPRESENTATIVES}

^{2. OTHER INVESTMENT
HOLDING COMPANIES;}

^{INVESTMENT DEALINGS}

CHARGES

^{Comments : 15 KRANJI WAY}

^{SINGAPORE 739428}

^{ANNUAL VALUE:
330,000 TAX RATE: 12.00%}

^{Date: 04/12/1992}

^{Comments : CHARGE NO : 9205189}

^{SECURED : 0.00
AND ALL MONIES OWING}

^{CHARGEE : STANDARD CHARTERED BANK}

^{Date: 10/12/1975 Amount: 800,000}

^{Comments : CHARGE NO : 7501292}

^{SECURED: 800,000.00 ( SINGAPORE DOLLAR )}

^{CHARGEE : THE
CHARTERED BANK}

^{Date: 20/01/1978 Amount: 400,000}

^{Comments : CHARGE NO : 7800130}

^{SECURED: 400,000.00 ( SINGAPORE DOLLAR )}

^{CHARGEE : STANDARD CHARTERED BANK}

^{Date: 19/07/1983 Amount: 1,925,000}

^{Comments : CHARGE NO : 8303365}

^{CHARGEE : STANDARD CHARTERED BANK}

^{SECURED: 1,925,000.00 ( SINGAPORE DOLLAR )}

^{Date: 28/06/1984 Amount: 1,700,000}

^{Comments : CHARGE NO : 8402992}

^{SECURED: 1,700,000.00 ( SINGAPORE DOLLAR)}

^{CHARGEE : STANDARD
CHARTERED BANK}

^{Date: 11/03/1980 Amount: 3,675,000}

^{Comments : CHARGE NO : 8000625}

^{SECURED: 3,675,000.00
( SINGAPORE DOLLAR)}

^{CHARGEE : THE
CHARTERED BANK}

^{Date: 19/07/1983 Amount: 1,925,000}

^{Comments : CHARGE NO : 8303366}

^{SECURED: 1,925,000.00 ( SINGAPORE DOLLAR)}

^{CHARGEE : STANDARD CHARTERED BANK}

^{Date: 19/10/1976 Amount: 200,000}

^{Comments : CAHRGE NO : 7601414}

^{SECURED: 200,000.00 ( SINGAPORE DOLLAR )}

^{CHARGEE : STANDARD CHARTERED BANK}

^{Date: 29/04/1983 Amount: 3,675,000}

^{Comments : CHARGE NO : 8301959}

^{SECURED: 3,675,000.00 ( SINGAPORE DOLLAR )}

^{CHARGEE : STANDARD
CHARTERED BANK}

^{Date: 28/06/1984 Amount: 1,700,000}

^{Comments : CHARGE NO : 8402993}

^{SECURED: 1,700,000.00 ( SINGAPORE DOLLAR )}

^{CHARGEE : STANDARD CHARTERED BANK}

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

BANKERS

^{STANDARD CHARTERED BANK}

^{CHARTERED BANK THE [KL]}

SHAREHOLDERS(S)

^{K T S HOLDINGS SDN
BHD
2,500,000 Company}

^{Street : 72-74 MARKET RD SIBU}

^SARAWAK

^{Town: SARAWAK}

^Postcode:

^{Country: Malaysia}

^{TEONG ENG SIONG
60,000 Private Person}

^{Street : 95 MARINE PARADE ROAD}

^#08-01

^{MARINE POINT}

^{Town: SINGAPORE}

^{Postcode: 449271}

^{Country: Singapore}

^{PRIME LUMBER HOLDINGS
LIMITED
2,440,000 Company}

^{Street : P O BOX 71 CRAIGMUIR CHAMBERS}

^{ROAD TOWN TORTOLA}

^{BRITISH VIRGIN ISLANDS}

^{Town: TORTOLA}

^Postcode:

^{Country: Virgin Islands (British)}

FORMER SHAREHOLDER(S)

^{HWA SEN HOLDINGS
BHD 200,000}

^{KUCHING LUMBER HOLDINGS
BHD 200,000}

^{HUA LIM HOLDINGS
BHD 200,000}

^{HOCK TONG HIN SAWMILL CO
BHD 200,000}

SUBSIDIARY(IES)

^{KAHAR TRADING SINGAPORE
PTE LTD}

^{KTS REALTY PTE LTD}

^{GLOBAL TECHNOLOGY IND
PTE LTD}

PAYMENT HISTORY AND EXPERIENCES

^{Trade Morality: AVERAGE}

^{Liquidity : ABUNDANT}

^{Payments : SLOW}

^{Trend : LEVEL}

^{Financial Situation: AVERAGE}

FINANCIAL ELEMENTS

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

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

^{Date Account Lodged: 06/07/2007}

^{Balance Sheet Date: 31/12/2006 31/12/2005}

^{Number of weeks: 52 52}

^{Consolidation Code: CONSOLIDATED CONSOLIDATED}

^{---
ASSETS ---}

^{Preliminary Exp 131,439
131,439}

^{Tangible Fixed
Assets: 3,877,423 4,096,084}

^{Investments 12,000 12,000}

^{Total Fixed Assets: 4,020,862 4,239,523}

^{Inventories: 852,304 780,250}

^{Receivables: 3,221,542 2,003,855}

^{Cash,Banks,
Securitis: 18,158,901 14,898,038}

^{Other current assets: 2,888,041 2,834,773}

^{Total Current Assets: 25,120,788 20,516,916}

^{TOTAL ASSETS: 29,141,650 24,756,439}

^{---
LIABILITIES ---}

^{Equity capital: 5,000,000 5,000,000}

^{Profit & lost Account: 14,045,881 12,709,171}

^{Other: 1,239,422 1,235,763}

^{Total Equity: 20,285,303 18,944,934}

^{Other long term
Liab.: 1,294,000 1,878,000}

^{Total L/T Liabilities: 1,294,000 1,878,000}

^{Trade Creditors: 6,869,051 3,481,151}

^{Prepay. & Def.
charges: 140,657 45,685}

^{Advanced payments: 73,543 76,982}

^{Provisions: 364,678 241,080}

^{Other Short term
Liab.: 14,418 88,607}

^{Total short term Liab.: 7,462,347 3,933,505}

^{TOTAL LIABILITIES: 8,756,347 5,811,505}

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

^{Net Sales 45,486,160 59,581,650}

^{Purchases,Sces & Other
Goods: 38,182,973 49,924,947}

^{Gross Profit: 7,303,187 9,656,703}

^{NET RESULT BEFORE
TAX: 1,708,548 1,120,003}

^{Tax :
368,179 272,083}

^{Net income/loss year: 1,340,369 847,920}

^{Depreciation: 222,105 220,785}

^{Dividends:
500,000}

^{Directors Emoluments: 256,788 256,789}

^{Wages and Salaries: 1,560,847 1,623,538}

RATIOS

^{31/12/2006 31/12/2005}

^{Turnover per
employee: 1516205.33 1986055.00}

^{Net result /
Turnover(%): 0.03 0.01}

^{Stock / Turnover(%): 0.02 0.01}

^{Net Margin(%): 2.95 1.42}

^{Return on Equity(%): 6.61 4.48}

^{Return on Assets(%): 4.60 3.43}

^{Dividends Coverage:
1.70}

^{Net Working capital: 17658441.00 16583411.00}

^{Cash Ratio: 2.43 3.79}

^{Quick Ratio: 2.87 4.30}

^{Current ratio: 3.37 5.22}

^{Receivables Turnover: 25.50 12.11}

^{Leverage Ratio: 0.43}^0.31

^{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)/1000}

^{Cash Ratio : Cash Bank
securities/Total short term liabilities}

^{Quick Ratio : (Cash Bank
securities+Receivables)/Total Short term liabilities}

^{Current ratio : Total current
assets/Total short term liabilities}

^{Inventory Turnover : (360*Inventories)/Net sales}

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

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

FINANCIAL COMMENTS

^{FOR THE FINANCIAL YEAR
2006/2005, THE BALANCE SHEET COULD NOT BE} ^{BALANCED. THE TOTAL ASSETS IS GREATER THAN TOTAL NET WORTH AND
TOTAL} ^{LIABILITIES BY S$100,000. AS SUCH, FOR THE FINANCIAL ANALYSIS,
IT WILL} ^{ONLY COVER PROFITABILITY, DEBT SERVICING AND INTEREST
COVERAGE (IF} ^ANY).

^{THE FINANCIAL CONDITION
OF THE GROUP WAS SEEN TO BE FAIR IN VIEW OF} ^{THE FOLLOWING:}

^{PROFITABILITY:}

^{REVENUE POSTED A DECREASE OF 23.66% FROM
S$59,581,650 IN 2005 TO} ^{S$45,486,160 BUT NET PROFIT ROSE BY 58.08% TO S$1,340,369 (2005:} ^{S$847,920). HENCE, NET MARGIN ROSE TO 2.95% (2005: 1.42%).}

^{DEBT SERVICING:}

^{DEBT SERVICING PROBLEMS
MIGHT NOT BE EXPECTED IF REVENUE AND EARNINGS} ^{CAN BE MAINTAINED AND PAYMENT BY TRADE
DEBTORS ARE FORTHCOMING.}

^{NOTES TO THE FINANCIAL STATEMENTS:}

^{BANKING FACILITIES}

^{THE BANKING FACILITIES
GRANTED AT THE COMPANY LEVEL ARE SECURED AND}

^{GUARANTEED BY: -}

^{(A) A FIRST LEGAL
MORTGAGE ON THE LEASEHOLD PROPERTIES OF A SUBSIDIARY}

^{COMPANY; AND}

^{(B) A FIRST FIXED CHARGE
OF S$8,700,000 OVER THE COMPANY'S PROPERTY,}

^{PLANT AND MACHINERY, GOODWILL, UNCALLED
CAPITAL, STOCKS, BOOK} ^{DEBTS AND BILLS RECEIVABLES AND A FIRST FLOATING CHARGE OVER ALL} ^{OTHER ASSETS TOGETHER WITH A COLLATERAL MORTGAGE OVER THE PROPERTY} ^{SITUATED
AT 15 KRANJI WAY, SINGAPORE.}

BACKGROUND/OPERATION

^{THE COMPANY WAS
INCORPORATED IN THE REPUBLIC OF SINGAPORE ON} ^{06/07/1974 AS A LIMITED PRIVATE COMPANY
AND IS TRADING UNDER ITS} ^{PRESENT NAMESTYLE AS "K.T.S.
(SINGAPORE) PTE. LTD.".}

^{THE COMPANY HAS AN
ISSUED AND PAID-UP CAPITAL OF} ^{5,000,000 SHARES, OF A VALUE OF S$5,000,000.}

^{PRINCIPAL ACTIVITIES:}

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

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

^{1. WHOLESALE OF SAWN
TIMBER, PLYWOOD AND RELATED PRODUCTS;}

^{TIMBER MERCHANTS, AGENTS
AND REPRESENTATIVES}

^{2. OTHER INVESTMENT
HOLDING COMPANIES;}

^{INVESTMENT DEALINGS}

^{DURING THE FINANCIAL
YEAR(S), UNDER REVIEW, SUBJECT'S PRINCIPAL} ^{ACTIVITIES ARE THOSE OF TIMBER MERCHANTS, AGENTS AND
REPRESENTATIVES} ^{AND INVESTMENT DEALINGS.}

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

^{SUBJECT ENGAGES IN THE
FOLLOWING ACTIVITIES:}

^{* TRADING OF TIMBER}

^{* WHOLESALE OF SAWN
TIMBER, PLYWOOD AND RELATED PRODUCTS}

^{PRODUCTS DEALINGS:}

^{* TIMBER AND RELATED
PRODUCTS}

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

^{* SINGAPORE TIMBER
ASSOCIATION}

^{* SINGAPORE BUSINESS
FEDERATION}

^{NUMBER OF EMPLOYEES:}

^{* 30 (AS OF 2006)}

^{FROM THE TELE-INTERVIEW
CONDUCTED, SUBJECT PERSONNEL WAS} ^{ONLY WILLING TO CONFIRM ITS ADDRESS AND CONTACTS. THE IMPORTS AND} ^{EXPORTS WERE REJECTED. NO OTHER TRADE INFORMATION WAS AVAILABLE}

^{NUMBER OF EMPLOYEES (31
DECEMBER):}

^{* COMPANY - 2006: NOT
AVAILABLE (2005: NOT AVAILABLE)}

^{REGISTERED AND BUSINESS
ADDRESS:}

^{190 MIDDLE ROAD}

^#09-01/07

^{FORTUNE CENTRE}

^{SINGAPORE 188979}

^{DATE OF CHANGE OF
ADDRESS: -}

^{- PROPERTY RECORD WAS
NOT AVAILABLE}

^{WEBSITE : -}

^{EMAIL :
ktssgp@singnet.com.sg}

MANAGEMENT

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

^{1) STEPHEN LAU LEE
KIONG, A MALAYSIAN}

^{- BASED IN MALAYSIA.}

^{2) LAU HIENG ING, A
MALAYSIAN}

^{- BASED IN MALAYSIA.}

^{3) LAU LEE MING, A
MALAYSIAN}

^{- BASED IN MALAYSIA.}

^{4) KIU CHUAN GUNG, A
MALAYSIAN}

^{- BASED IN MALAYSIA.}

^{5) LAU NGI CHONG, A
MALAYSIAN}

^{- BASED IN MALAYSIA.}

^{6) HENRY LAU LEE KONG, A
MALAYSIAN}

^{- BASED IN SINGAPORE.}

^{7) LAU SWEE NGUONG @ LAU
SUI GUANG, A MALAYSIAN}

^{- BASED IN MALAYSIA.}

^{8) TEONG ENG SIONG, A
SINGAPOREAN}

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

^{ROYALE INDIANA
INVESTMENT HOLDINGS}

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

THE WHOLESALE AND RETAIL TRADE SECTOR GREW BY 6.0% IN 4Q 2007, SLOWER THAN THE 6.8% GROWTH IN 3Q 2007. RETAIL SALES FELL BY 2.5%, FOLLOWING A 1.5% GROWTH IN 3Q 2007.

DOMESTIC WHOLESALE TRADE INDEX

THE OVERALL DOMESTIC WHOLESALE TRADE ROSE BY 22.2% IN 4Q 2007 OVER 4Q 2006.

EXCLUDING PETROLEUM, DOMESTIC SALES GREW BY 4.8%.

THE RISE IN THE OVERALL INDEX WAS MAINLY DUE TO HIGHER SALES OF PETROLEUM AND PETROLEUM PRODUCTS (47.3%), TIMBER, PAINTS AND CONSTRUCTION MATERIALS (29.8%). OTHER WHOLESALE SEGMENTS THAT REPORTED DOUBLE-DIGIT GROWTH WERE WHOLESALING OF GENERAL WHOLESALE TRADE, HOUSEHOLD EQUIPMENT AND FURNITURE AND CHEMICALS AND CHEMICAL PRODUCTS.

ON THE OTHER HAND, WHOLESALE SEGMENT THAT REPORTED LOWER SALES WERE ELECTRONIC COMPONENTS (-35.8%).

AT CONSTANT PRICES, THE OVERALL DOMESTIC WHOLESALE TRADE ROSE BY 1.6% IN 4Q 2007 OVER 4Q 2006. EXCLUDING PETROLEUM, DOMESTIC SALES ROSE SLIGHTLY BY 0.2%.

ON A QUARTER-OVER-QUARTER BASIS, THE OVERALL DOMESTIC WHOLESALE TRADE IN 4Q 2007 ROSE BY 7.1% OVER 3Q 2007. EXCLUDING PETROLEUM, DOMESTIC SALES CONTRACTED BY 2.9%.

THE MAJORTIY OF THE WHOLESALE SECTORS RECORDED HIGHER DOMESTIC SALES IN 4Q 2007 OVER PREVIOUS QUARTER. PETROLEUM AND PETROLEUM PRODUCTS EXPANDED BY 20.0%. GENERAL WHOLESALE TRADE AND INDUSTRIAL AND CONSTRUCTION MACHINERY ALSO REGISTERED

DOUBLE-DIGIT GROWTH OVER PREVIOUS QUARTER.

ON THE OTHER HAND, SALES OF FOOD, BEVERAGES AND TOBACCO AND ELECTRONIC COMPONENTS FELL IN 4Q 2007 OVER 3Q 2007.

FOREIGN WHOLESALE TRADE INDEX

THE OVERALL FOREIGN WHOLESALE TRADE FOR 4Q 2007 ROSE BY 27.0%, IN COMPARISON TO 4Q 2006. EXCLUDING PETROLEUM, IT EXPANDED BY 15.3%

MOST OF THE SECTORS REPORTED HIGHER SALES. DOUBLE-DIGIT GROWTH RATES FOR OVERSEAS SALES WERE RECORDED BY FOOD, BEVERAGES AND TOBACCO (40.6%) PETROLEUM AND PETROLEUM PRODUCTS (39.9%) SHIP CHANDLERS AND BUNKERING (24.3%) INDUSTRIAL AND CONSTRUCTION MACHINERY (18.2%) CHEMICALS AND CHEMICAL PRODUCTS (16.4%) ELECTRONIC COMPONENTS (12.1%) TIMBER, PAINT AND CONSTRUCTION MATERIALS (11.1%).

ON THE OTHER HAND, OVERSEAS SALES OF TELECOMMUNICATIONS AND COMPUTERS FELL BY 2.8%

IN 4Q 2007 OVER 4Q 2006.

AT CONSTANT PRICES, THE OVERALL INDEX ROSE BY 11.5% IN 4Q 2007 OVER 4Q 2006.

EXCLUDING PETROLEUM, FOREIGN WHOLESALE TRADE GREW BY 15.1%.

ON A QUARTER-OVER-QUARTER BASIS, THE OVERALL FOREIGN WHOLESALE TRADE IN 4Q 2007 ROSE BY 11.7% OVER 3Q 2007. EXCLUDING PETROLEUM, IT GREW BY 6.0%.

ALL WHOLESALE SECTORS RECORDED BETTER BUSINESS IN 4Q 2007 WITH THE EXCEPTION OF THE ELECTRONIC COMPONENTS SECTOR. THOSE SECTORS THAT REGISTERED DOUBLE-DIGIT GROWTH WERE WHOLESALE SECTORS OF PETROLEUM AND PETROLEUM PRODUCTS, TELECOMMUNICATIONS AND COMPUTERS, INDUSTRIAL AND CONSTRUCTION MACHINERY AND CHEMICALS AND CHEMICAL PRODUCTS.

RETAIL TRADE

THE OVERALL RETAIL SALES CONTRACTED BY 2.5%, IN CONTRAST TO THE 1.5% GROWTH IN 3Q 2007. THE SECTOR THAT RECORDED THE LARGEST DECLINE WERE MOTOR VEHICLES, FOLLOWED BY PROVISION AND SUNDRY SHOPS, FOOD AND BEVERAGES, WATCHES AND JEWELLERY AND MEDICAL GOODS AND TOILETRIES. EXCLUDING MOTOR VEHICLES, RETAIL SALES ROSE BY 5.2%, A DECLINE FROM THE 6.O% GROWTH IN 3Q 2007.

NEWS

SURPRISING DROP IN RETAIL SALES

RETAIL SALES FELL UNEXPECTEDLY IN FEBRUARY, THE FIRST TIME IN SEVEN MONTHS, AS INFLATION HIT 26 YEAR HIGHS AND WORRIES GREW ABOUT THE WORLD ECONOMY. SHOPS, SUPERMARKETS AND OTHER RETAILERS SAW REVENUES FELL 1.3% FROM A YEAR EARLIER, AS CAR SALES DECLINED 10.6% AND FOOD AND BEVERAGES SALES PLUNGED 21.8%.

THE OVERALL CONTRACTION BY THE SECTOR WOULD HAVE BEEN BIGGER IF NOT FOR MUCH HIGHER PRICES THIS YEAR. IN CONSTANT PRICES TERMS, SALES FELL 5.7%. THIS IS THE WORST READING SINCE THE 5.0% DECLINE IN MARCH 2007, IF ONE WERE TO IGNORE THE 2.0% CONTRACTION IN JULY THAT WAS DUE TO THE HIKE IN THE GOODS AND SERVICES TAX,” SAID HSBC ECONOMIST PRAKRITI SOFAT.

ANALYSTS SAID RISING LIVING COSTS AND UNCERTAINTY ABOUT THE ECONOMY WOULD AFFECT SINGAPORE CONSUMER’S SPENDING THIS YEAR. MANY, HOWEVER, REMAIN LARGELY OPTIMISTIC ABOUT THE DOMESTIC RETAIL SCENE, SAYING THE POOR FEBRUARY SHOWING COULD BE A STATISTICAL BLIP.

DOMESTIC DEMAND CONDITIONS REMAIN POSITIVE, HELPED BY THE GOVERNMENT WHICH IS GIVING CASH FROM LAST YEAR’S SURPLUS TO THE WHOLE POPULATION AND ISSUING FOOD VOUCHERS TO THE POOR. “LOW INTEREST RATES AND A HEALHY JOBS MARKET SHOULD KEEP SPENDING FIRM,” SAID HSBC’S MS SOFAT. SHE ADDED THAT FEBRUARY’S DECLINE WAS DUE LARGELY TO A HIGH BASE SET THE PREVIOUS YEAR AND PREDICTED THAT MARCH SALES WOULD BOUNCE BACK WITH A 15.0% SURGE. ALSO, IF COMPARED WITH JANUARY, FEBRUARY SALES ROSE 8.8% AFTER ADJUSTING FOR SEASONAL EFFECTS. THIS WAS THE STRONGEST PERFORMANCE IN FOUR YEARS, SHE SAID.

CIMB-GK ECONOMIST SONG SENG WUN SAID MUCH OF THE POOR PERFORMANCE CAME ON THE BACK OF WEAKER CAR SALES. EXCLUDING THOSE, RETAIL SALES WOULD HAVE RISEN 2.9%. CAR SALES HAVE BEEN HURT SINCE OCTOBER BY RISING CERTIFICATE OF ENTITLEMENT PRICES, CAUSED BY AN EXPECTED CUT IN QUOTAS FROM NEXT MONTH AND SURGING PUMP PRICES.

OUTLOOK

GENERALLY, WHOLESALERS ARE POSITIVE ABOUT THEIR BUSINESS PROSPECTS IN THE COMING MONTHS, WITH A NET WEIGHTED BALANCE OF 4% OF FIRMS EXPRESSING POSITIVE BUSINESS SENTIMENTS. THE MAJORITY OF WHOLESALERS OF PETROLEUM AND PETROLEUM PRODUCTS, CHEMICALS AND CHEMICAL PRODUCTS, INDUSTRIAL MACHINERY AND EQUIPMENT AND COMPUTERS AND ACCESSORIES FORECAST BUSINESS OUTLOOK TO REMAIN THE SAME IN THE FIRST SIX MONTHS OF 2008 COMPARED WITH THE LAST SIX MONTHS IN 2007.

A NET WEIGHTED BALANCE OF 12% OF RETAILERS PREDICTS LESS FAVOURABLE BUSINESS CONDITIONS FOR THE PERIOD ENDING JUNE 2008. AS A RESULT OF THE REDUCED CERTIFICATE OF ENTITLEMENT (COE) QUOTA, MOTOR VEHICLES RETAILERS ARE ESPECIALLY CONCERNED WITH THE SALES.

EXTRACTED FROM: MINISTRY OF TRADE AND INDUSTRY, SINGAPORE

SINGAPORE DEPARTMENT OF STATISTICS

THE STRAITS TIMES

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