MIRA INFORM REPORT

Report Date :

04.09.2008

IDENTIFICATION DETAILS

Name :	KOCH REFINING INTERNATIONAL PTE. LTD.
Registered Office :	^260 Orchard Road ^#11-01/09 ^The Heeren ^238855
Country :	Singapore
Financials (as on) :	31.12.2006
Date of Incorporation :	^27.05.1995
Com. Reg. No.:	^199503686E
Legal Form :	^Pte Ltd
Line of Business :	International Trading in Crude Oil, Petroleum, Related by-Products and Metals

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

KOCH REFINING INTERNATIONAL PTE. LTD.

Line Of Business 

INTERNATIONAL TRADING IN CRUDE OIL, PETROLEUM, RELATED BY-PRODUCTS AND METALS

Parent Company

KS&T INTERNATIONAL HOLDINGS, LP

(PERCENTAGE OF SHAREHOLDINGS: 100.00)

Financial Elements

FY 2006

COMPANY

Sales : US$ 1,081,896,171

Networth : US$ 14,431,965

Paid-Up Capital : US$ 71,942

Net result : US$ -4,053,864

Net Margin(%) : -0.37

Return on Equity(%) : -28.09

Leverage Ratio : 17.91

COMPANY IDENTIFICATION

^{Subject Company : KOCH REFINING INTERNATIONAL PTE. LTD.}

^{Former Name : -}

^{Business Address : 260 ORCHARD ROAD #11-01/09 THE HEEREN}

^{Town : SINGAPORE}

^{Postcode : 238855}

^{Country : Singapore}

^{Telephone : 6732 7555}

^{Fax : 6835 2031}

^{ROC Number : 199503686E}

^{Reg. Town : -}

SUMMARY

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

^{Legal Form : Pte Ltd}

^{Date Inc. : 27/05/1995}

^{Previous Legal Form : -}

^{Summary year : 31/12/2006}

^{Sales : 1,081,896,171}

^{Networth : 14,431,965}

^{Capital : -}

^{Paid-Up Capital : 71,942}

^{Employees : 38}

^{Net result : -4,053,864}

^{Share value : 1}

^{Auditor : ERNST & YOUNG LLP}

^{BASED ON ACRA'S,}

^{NO. OF SHARES CURRENCY AMOUNT}

^{ISSUED ORDINARY 100,000 SGD 100,000}

^{PAID-UP ORDINARY - SGD 100,000}

REFERENCES

^{Litigation : No}

^{Company status : TRADING}

^{Started : 27/05/1995}

PRINCIPAL(S)

^{CHANG LIP KEE @ DAVID CHANG S2646540J Director}

DIRECTOR(S)

^{CHANG LIP KEE @ DAVID CHANG S2646540J Director}

^{Appointed on : 17/08/1998}

^{Street : 45 MANDALAY ROAD}

^#08-02

^{MANDALE HEIGHTS}

^{Town: SINGAPORE}

^{Postcode: 308225}

^{Country: Singapore}

^{STEPHEN PATRICK MAWER 761009879 Director}

^{Appointed on : 01/06/2000}

^{Street : 11515 QUAIL HOLLOW LANE}

^{Town: HOUSTON}

^{Postcode: 77024}

^{Country: United States}

^{YEOH KAR CHOO SHARON S2588551A Company Secretary}

^{Appointed on : 01/10/2004}

^{Street : 28 JALAN LEMBAH THOMSON}

^{NEE SOON CHOW GARDENS}

^{Town: SINGAPORE}

^{Postcode: 577499}

^{Country: Singapore}

^{RODGER EMERSON LINDWALL 439129328 Director}

^{Appointed on : 15/04/2008}

^{Street : 1436 NORTH LINDEN CIRCLE}

^{WICHITA, 67206}

^{Town: -}

^{Postcode: -}

^{Country: United States}

FORMER DIRECTOR(S)

^{F LYNN MARKEL 037136188}

^{BRADFORD TIMOTHY SANDERS 083332261}

^{LIM THIN KONG FRANCIS S1835761E}

^{THOMAS NEIL CURTIN 153496038}

^{MARC RICHARD WAUGH F2486051P}

^{WILLIAM GASTON SPENCE 083255230}

^{KEVIN JOHN WALLACE 130761962}

^{MARK DUANE WILSON 132337172}

^{MILTON BRADLEY HALL 086021371}

^{CLAUDE DOYLE KIRK 132437874}

ACTIVITY(IES)

^{PETROLEUM PRODUCTS Code: 16350}

^{METAL SPECIALTIES Code: 13890}

^{TRADING COMPANIES Code: 22190}

^{BASED ON ACRA'S RECORD}

^{1) WHOLESALE OF SOLID, LIQUID AND GASEOUS FUELS AND RELATED PRODUCTS}

^{(EG BITUMEN); TRADING & DEALING IN SOLID, LIQUID & GASEOUS}

CHARGES

No Charges On Premises/Property In Our Database

PREMISES/PROPERTY INFORMATIONS

No Premises/Property Information In Our Databases

BANKERS

^{BANK ONE, NATIONAL ASSOCIATION, SINGAPORE BRANCH}

^{STANDARD CHARTERED BANK}

^{JP MORGAN CHASE BANK N.A.}

SHAREHOLDERS(S)

^{KS&T INTERNATIONAL HOLDINGS, LP 100,000 Company}

^{Street : 4111 EAST 37TH STREET NORTH WICHIT}

^AKANSAS

^{Town : -}

^{Postcode : 67220}

^{Country : United States}

FORMER SHAREHOLDER(S)

^{KOCH PETROLEUM GROUP LP 100,000}

^{THAM SHOOK HAN 1}

^{GOH CHIN MOK MARCUS 1}

HOLDING COMPANY

^{KS&T INTERNATIONAL HOLDINGS, LP UF33435N % : 100}

SUBSIDIARY(IES)

No Participation In Our Database

PAYMENT HISTORY AND EXPERIENCES

^{Trade Morality : AVERAGE}

^{Liquidity : SUFFICIENT}

^{Payments : REGULAR}

^{Trend : DOWNWARD}

^{Financial Situation : AVERAGE}

FINANCIAL ELEMENTS

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

^{Date Account Lodged: 25/10/2007}

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

^{Number of weeks: 52 52}

^{Consolidation Code: COMPANY COMPANY}

^{--- ASSETS ---}

^{Preliminary Exp - 1,463,000}

^{Tangible Fixed Assets: 74,985 143,618}

^{Total Fixed Assets: 74,985 1,606,618}

^{Inventories: 135,954,097 76,346,460}

^{Receivables: 80,272,470 236,578,542}

^{Cash,Banks, Securitis: 20,415,845 20,057,596}

^{Other current assets: 36,126,842 10,517,307}

^{Total Current Assets: 272,769,254 343,499,905}

^{TOTAL ASSETS: 272,844,239 345,106,523}

^{--- LIABILITIES ---}

^{Equity capital: 71,942 71,942}

^{Profit & lost Account: 14,360,023 18,413,887}

^{Total Equity: 14,431,965 18,485,829}

^{Trade Creditors: 113,803,224 249,421,512}

^{Other Short term Liab.: 143,824,496 75,320,559}

^{Prepay. & Def. charges: 784,554 1,878,623}

^{Total short term Liab.: 258,412,274 326,620,694}

^{TOTAL LIABILITIES: 258,412,274 326,620,694}

^{--- PROFIT & LOSS ACCOUNT}

^{Net Sales 1,081,896,171 3,065,785,271}

^{Purchases,Sces & Other Goods: 1,062,860,096 3,013,157,245}

^{Gross Profit: 19,036,075 52,628,026}

^{Result of ordinary operations -2,622,066 -7,075,125}

^{NET RESULT BEFORE TAX: -3,072,864 -8,597,881}

^{Tax : 981,000 -742,880}

^{Net income/loss year: -4,053,864 -7,855,001}

^{Interest Paid: 1,804,104 2,255,136}

^{Depreciation: 118,263 67,346}

^{Directors Emoluments: 404,293 228,252}

^{Wages and Salaries: 5,858,121 7,047,776}

^{Financial Income: 1,241,556 797,486}

RATIOS

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

^{Turnover per employee: 28470951.87 80678559.76}

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

^{Stock / Turnover(%): 0.13 0.02}

^{Net Margin(%): -0.37 -0.26}

^{Return on Equity(%): -28.09 -42.49}

^{Return on Assets(%): -1.49 -2.28}

^{Net Working capital: 14356980.00 16879211.00}

^{Cash Ratio: 0.08 0.06}

^{Quick Ratio: 0.39 0.79}

^{Current ratio: 1.06 1.05}

^{Receivables Turnover: 26.71 27.78}

^{Leverage Ratio: 17.91 17.67}

^{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 COMPANY WAS DEEMED TO BE FAIR IN VIEW OF THE FOLLOWING:}

^{NET WORTH:}

^{THE BALANCE SHEET WAS CONSIDERED PASSABLE WITH NET WORTH DECREASING BY 21.93% AMOUNTING TO US$14,431,965 (2005: US$18,485,829). THIS WAS DUE TO LOWER ACCUMULATED PROFITS OF US$14,360,023 (2005: US$18,413,887).}

^LEVERAGE:

^{IN THE SHORT-TERM, SUBJECT WAS LARGELY FINANCED BY OTHER SHORT TERM LIABILITIES WHICH MADE UP 55.66% (2005: 23.06%) OF THE TOTAL CURRENT LIABILITIES AND AMOUNTED TO US$143,824,496 (2005: US$75,320,559). THE BREAKDOWN WAS AS FOLLOWS:}

^{*AMOUNTS DUE TO RELATED COMPANIES (NON-TRADE) - 2006: US$120,610,641}

^{(2005: US$57,000,000)}

^{*AMOUNT DUE TO ULTIMATE COMPANY (NON-TRADE) - 2006: US$15,065 (2005:}

^US$27,740)

^{*AMOUNT DUE TO ULTIMATE COMPANY - 2006: US$15,065 (2005: US$27,740)}

^{*UNREALISED TRADING LOSS - 2006: US$17,572,736 (2005: US$11,974,528)}

^{*BROKERS' MARGIN ACCOUNT - 2006: US$5,308,544 (2005: US$1,521,181)}

^{*OTHER CREDITORS - 2006: US$77,510 (2005: US$105,510)}

^{*COLLATERAL DEPOSITS - 2006: NIL (2005: US$4,557,600)}

^{*OPTION PREMIUM RECEIVED - 2006: US$240,000 (2005: US$134,000)}

^{IN THE SHORT TERM, TRADE CREDITORS DECREASED BY 54.37%, TOTALLING US$113,803,224 (2005: US$249,421,512).}

^{THE LEVERAGE RATIO ROSE TO 17.91 TIMES (2005: 17.67 TIMES) AS A RESULT OF A GREATER DROP IN TOTAL EQUITY THAN THE DROP IN TOTAL LIABILITIES. A LOWER RATIO WOULD BE MORE DESIRABLE AS THE LOWER THE RATIO, THE GREATER THE FINANCIAL SAFETY AND OPERATING FREEDOM FOR THE COMPANY.}

^LIQUIDITY:

^{THE OVERALL LIQUIDITY OF THE COMPANY WAS FAIR BUT HAD DECLINED. NET WORKING CAPITAL POSTED LOWER AT US$14,356,980 (2005: US$16,879,211).}

^{CURRENT RATIO ROSE SLIGHTLY TO 1.06 TIMES (2005: 1.05 TIMES) WHILE QUICK RATIO DROPPED TO 0.39 TIMES (2005: 0.79 TIMES).}

^{PROFITABILITY:}

^{REVENUE FOR FY2006 FELL BY 64.71%, TOTALLING US$1,081,896,171 (2005: US$3,065,785,271). THE COMPANY INCURRED A LOWER NET LOSS IN FY2006 OF US$4,053,864 (2005: US$-7,855,001), NARROWING BY 48.39% FROM THE PRIOR FINANCIAL YEAR.}

^{THIS WAS ATTRIBUTED TO A TRADING LOSS IN FY2006 OF US$11,717,364}

^{(2005: US$50,113,044).}

^{THUS, NET MARGIN WAS ADVERSE AT -0.37% (2005: -0.26%).}

^{DEBT SERVICING:}

^{DEBT SERVICING PROBLEMS MIGHT NOT BE ANTICIPATED IN VIEW OF THE}

^{SUFFICIENT NET WORKING CAPITAL AND IF TRADE RECEIVABLES WERE FORTHCOMING. HOWEVER, IT SHOULD BE NOTED WITH CAUTION OF THE NET LOSS POSITION.}

^{AVERAGE COLLECTION PERIOD HAS SHORTENED TO 27 DAYS (2005: 28 DAYS).}

^{NON-CURRENT ASSETS}

^{THE FOLLOWING ITEM WAS CLASSIFIED UNDER PRELIMINARY:}

^{*DEFERRED TAXATION - 2006: NIL (2005: US$1,463,000)}

^{NOTES TO THE FINANCIAL STATEMENTS:}

^{TRADING RESULTS, NET (LOSS)}

^{NET TRADING RESULTS REPRESENTS THE NET RESULTS ON TRADING OF SWAPS, FUTURES AND FORWARD CONTRACTS AND THE UNREALISED GAINS OR LOSSES ON THE REVALUATION OF OUTSTANDING TRADING INSTRUMENTS AT THE PREVAILING MARKET PRICES AT THE BALANCE SHEET DATE.}

^{MANAGEMENT IS UNABLE TO OBTAIN PRICING OF CERTAIN FORWARD}

^{CONTRACTS FOR COMMODITIES SUCH AS HSFO FROM EXTERNAL SOURCES. THE COMPANY HAS THUS RELIED ON TRADER'S CALL TO MARK-TO-MARKET THE RESPECTIVE COMMODITIES. UNREALISED LOSS ON FINANCIAL INSTRUMENTS IN REALTION TO RELATED COMMODITIES BASED ON TRADERS' EVALUATION OF THE FORWARD PRICES OF COMMODITY WHERE NO ACTIVE MARKET EXIST AMOUNTS TO US$2,095,012 (2005: US$2,214,713).}

BACKGROUND/OPERATION

^{THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON 27/05/1995 AS LIMITED PRIVATE COMPANY AND IS TRADING UNDER THE PRESENT NAMESTYLE AS "KOCH REFINING INTERNATIONAL PTE. LTD.".}

^{THE COMPANY HAS AN ISSUED AND PAID-UP CAPITAL OF 100,000 SHARES OF A VALUE OF S$100,000.}

^{PRINCIPAL ACTIVITIES:}

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

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

^{1) WHOLESALE OF SOLID, LIQUID AND GASEOUS FUELS AND RELATED PRODUCTS}

^{(EG BITUMEN); TRADING & DEALING IN SOLID, LIQUID & GASEOUS}

^{FUELS & RELATED PRODUCTS}

^{THE COMPANY IS LISTED IN THE SINGAPORE LOCAL DIRECTORY UNDER THE CLASSIFICATION OF: OILS - PETROLEUM.}

^{DURING THE FINANCIAL YEAR UNDER REVIEW, THE PRINCIPAL ACTIVITIES OF THE COMPANY ARE THOSE RELATING TO INTERNATIONAL TRADING IN CRUDE OIL, PETROLEUM, RELATED BY-PRODUCTS AND METALS.}

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

^{SUBJECT IS IN THE TRADING OF CRUDE AND CHEMICAL PRODUCTS, AFTERMARKET AND CAPITAL EQUIPMENT SALES AND SERVICE. SUBJECT IS ALSO INVOLVED IN PETROLEUM PRODUCTS, CHEMICALS, STEEL AND PRECIOUS AND INDUSTRIAL METALS TRADING WITH TRADING PARTNERS IN ASIA AND AUSTRALIA.}

^{SUBJECT ENGAGES IN THE FOLLOWING ACTIVITIES:}

^{* TRADING, PETROLEUM, ASPHALT, NATURAL GAS, GAS LIQUIDS, CHEMICALS,}

^{PLASTICS & FIBRES, CHEMICAL TECHNOLOGY EQUIPMENT, MINERALS,}

^{FERTILIZERS, RANCHING, SECURITIES, FINANCE, OTHER VENTURES &}

^INVESTMENTS.

^PRODUCTS:

^{* OIL WELL EQUIPMENT, SUPPLIES & SERVICES}

^{* PETROLEUM CHEMICALS}

^{* CHEMICALS BY APPLICATIONS}

^{NO OTHER TRADE INFORMATION WAS AVAILABLE AS TELE-INTERVIEW WAS NOT GRANTED BY SUBJECT'S PERSONNEL}

^{THE COMPANY IS A WHOLLY-OWNED SUBSIDIARY OF KS&T SINAGPORE HOLDING LLC, INCORPORATED IN THE UNITED STATES OF AMERICA. THE ULTIMATE HOLDING COMPANY IS KOCH INDUSTRIES INC., ALSO INCORPORATED IN THE UNITED STATES OF AMERICA.}

^{NUMBER OF EMPLOYEES (31 DECEMBER):}

^{* COMPANY - 2006: 38 (2005: 40; 2004: 38; 2003: 36; 2002: 32)}

^{THE COMPANY HAS A FOREIGN BRANCH IN THE NETHERLANDS WHICH WAS CLOSED}

^{DURING THE FINANCIAL YEAR.}

^{REGISTERED ADDRESS:}

^{138 ROBINSON ROAD}

^#17-00

^{THE CORPORATE OFFICE}

^{SINGAPORE 068906}

^{DATE OF CHANGE OF ADDRESS: 01/11/2001}

^{BUSINESS ADDRESS:}

^{260 ORCHARD ROAD}

^#11-01/09

^{THE HEEREN}

^{SINGAPORE 238855}

^{- RENTED PREMISE}

^{- PREMISE OWNED BY: ATLAS ICE (SINGAPORE) PRIVATE LIMITED}

^{ADDRESS PROVIDED BY CLIENT:}

^{16 RAFFLES QUAY}

^#23-01

^{HONG LEONG BUILDING}

^{SINGAPORE 48581}

^{- CANNOT BE CONFIRMED}

^WEBSITES:

^{http://www.kochind.com}

^{http://www.ksandt.com}

^EMAIL:

^{singinfo@kochind.com}

^{changd@kochind.com}

MANAGEMENT

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

^{1) RODGER EMERSON LINDWALL, AN AMERICAN}

^{- BASED IN THE UNITED STATES OF AMERICA.}

^{2) STEPHEN PARTRICK MAWER, A BRITISH}

^{- BASED IN THE UNITED STATES OF AMERICA.}

^{3) CHANG LIP KEE @ DAVID CHANG, A SINGAPORE PERMANENT RESIDENT}

^{- HOLDS NO OTHER DIRECTORSHIPS AS RECORDED 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

THE WHOLESALE AND RETAIL TRADE SECTOR GREW BY 5.2% IN 1Q 2008, SLOWER THAN THE 6.0% GROWTH IN 4Q 2007. NON-OIL RE-EXPORTS GREW BY 2.0% IN 1Q 2008, IN CONTRAST TO THE 1.2% DECLINE IN 4Q 2007. EXCLUDING MOTOR VEHICLES, RETAIL SALES ROSE BY A MODERATE 1.4% IN 1Q 2008, FOLLOWING A HIGHER 9.9% GROWTH IN 4Q 2007.

DOMESTIC WHOLESALE TRADE INDEX

THE OVERALL DOMESTIC WHOLESALE TRADE FELL BY 7.1% IN 1Q 2008 OVER 4Q 2007.

EXCLUDING PETROLEUM, DOMESTIC SALES FELL BY 6.5%.

AFTER SEASONAL ADJUSTMENT, DOMESTIC SALES ROSE BY 4.4% IN 1Q 2008 OVER 4Q 2007.

EXCLUDING PETROLEUM, DOMESTIC SALES ROSE BY 2.7%.

ON A YEAR-ON-YEAR BASIS, THE OVERALL DOMESTIC WHOLESALE TRADE GREW BY 26.5% OVER THE PREVIOUS YEAR. EXCLUDING PETROLEUM, DOMESTIC SALES ROSE BY 12.2%. AFTER REMOVING PRICE EFFECT, THE OVERALL DOMESTIC WHOLESALE TRADE GREW BY 2.8% IN 1Q 2008 OVER 1Q 2007.

ON A QUARTER-OVER-QUARTER BASIS, MOST WHOLESALE SECTORS REPORTED LOWER DOMESTIC SALES AFTER RECORDING BRISK BUSINESS IN THE PREVIOUS QUARTER.

GENERAL WHOLESALE TRADE FELL BY 24.6% IN 1Q 2008, AFTER RECORDING HIGHER SALES OF 26.8% IN 4Q 2007. THE SALES OF TELECOMMUNICATIONS AND COMPUTERS, INDUSTRIAL AND CONSTRUCTION MACHINERY, AND HOUSEHOLD EQUIPMENT AND FURNITURE REPORTED LOWER SALES BY 13.3% 15.3% IN 1Q 2008.

DOMESTIC SALES OF PETROLEUM AND PETROLEUM PRODUCTS FELL BY 7.7% IN 1Q 2008 OVER 4Q 2007. AFTER ADJUSTING FOR PRICE CHANGES, SALES DECLINED BY 12.4%.

ON THE OTHER HAND, SHIP CHANDLERS AND BUNKERING, FOOD, BEVERAGES AND TOBACCO RECORDED HIGHER TURNOVER OF 8.8% AND 0.8% OVER THE PREVIOUS QUARTER RESPECTIVELY.

MAJORITY OF THE WHOLESALE SECTORS RECORDED HIGHER DOMESTIC SALES IN 1Q 2008 OVER 1Q 2007.

THE GROWTH IN THE OVERALL DOMESTIC SALES WAS MAINLY CONTRIBUTED BY PETROLEUM AND

PETROLEUM PRODUCTS, SHIP CHANDLERS AND BUNKERING, AND GENERAL WHOLESALE TRADE, WHICH REPORTED HIGHER SALES OF 42.9% TO 47.4%. AFTER ADJUSTING FOR PRICE CHANGES, THE TRADING VOLUME CHANGED MARGINALLY FOR PETROLEUM AND PETROLEUM PRODUCTS, SHIP CHANDLERS AND BUNKERING WHILE THE SALE VOLUME ROSE BY 27.8% FOR GENERAL WHOLESALERS.

OTHER SECTORS THAT RECORDED BETTER SALES INCLUDE TIMBER, PAINTS AND CONSTRUCTION MATERIALS (20.3%) CHEMICALS AND CHEMICAL PRODUCTS (8.7%) INDUSTRIAL AND CONSTRUCTION MACHINERY (7.6%) TRANSPORT EQUIPMENT (7.2%) AND FOOD, BEVERAGES AND TOBACCO (0.7%).

CONVERSELY, DOMESTIC SALES OF ELECTRONIC COMPONENTS FELL BY 10.9%, THE FIFTH CONSECUTIVE QUARTER OF DECLINE SINCE 1Q 2007. AFTER REMOVING PRICE CHANGES, SALES OF ELECTRONIC COMPONENTS FELL BY 3.6%. WHOLESALE VALUES OF TELECOMMUNICATIONS AND COMPUTERS, AND HOUSEHOLD EQUIPMENT AND FURNITURE ALSO DECLINED MARGINALLY IN 1Q 2008. AFTER REMOVING PRICE CHANGES, SALES OF THE TWO SECTORS ROSE COMPARED TO A YEAR AGO.

FOREIGN WHOLESALE TRADE INDEX

FOREIGN WHOLESALE TRADE SALES FELL MARGINALLY BY 0.6% IN 1Q 2008 OVER 4Q 2007.

EXCLUDING PETROLEUM, SALES FELL BY 2.4%.

AFTER SEASONAL ADJUSTMENT, FOREIGN SALES ROSE BY 5.6% OVER 4Q 2007. EXCLUDING PETROLEUM, SALES ROSE BY 5.2%.

ON A YEAR-ON-YEAR BASIS, FOREIGN WHOLESALE SALES ROSE BY 31.4% OVER 1Q 2007.

EXCLUDING PETROLEUM, SALES ROSE BY 18.3%. AFTER REMOVING PRICE EFFECT, OVERSEAS SALES ROSE BY 6.7% OVER 1Q 2007.

COMPARED TO 4Q 2007, THERE WAS MIXED PERFORMANCE IN FOREIGN SALES AMONG THE WHOLESALE SECTORS IN 1Q 2008.

FOOD, BEVERAGES AND TOBACCO WHOLESALERS REPORTED HIGHER OVERSEAS SALES OF 16.0% IN 1Q 2008 OVER 4Q 2007, THE LARGEST INCREASE AMONG ALL SECTORS. IT WAS FOLLOWED BY GENERAL WHOLESALE TRADE (9.4%) SHIP CHANDLERS AND BUNKERING (4.7%) AND WHOLESALING OF CHEMICALS AND CHEMICAL PRODUCTS (2.2%).

SALES OF PETROLEUM AND PETROLEUM PRODUCTS ROSE SLIGHTLY BY 1.3% IN 1Q 2008 OVER 4Q 2007. HOWEVER, AFTER ADJUSTING FOR PRICE CHANGES, THE SALES VOLUME FELL BY 3.8%.

CONVERSELY, FOREIGN SALES OF HOUSEHOLD EQUIPMENT AND FURNITURE, TELECOMMUNICATIONS AND COMPUTERS, TIMBER, PAINTS AND CONSTRUCTION MATERIALS, TRANSPORT EQUIPMENT, INDUSTRIAL AND CONSTRUCTION MACHINERY AND ELECTRONIC COMPONENTS FELL IN 1Q 2008 OVER 4Q 2007.

COMPARED TO A YEAR AGO, SOME WHOLESALE SECTORS REPORTED DOUBLE-DIGIT GROWTHS IN FOREIGN SALES IN 1Q 2008 WHILE OTHERS FELL.

WHOLESALING OF FOOD, BEVERAGES AND TOBACCO CONTINUED TO RECORD HIGH GROWTH RATES IN FOREIGN SALES, WITH HIGHER TURNOVER OF 89.0% IN 1Q 2008 OVER A YEAR AGO. AFTER ADJUSTING FOR PRICES, SALES VOLUME ROSE BY 72.9% OVER A YEAR AGO.

WITH HIGHER FUEL PRICES. WHOLESALE SECTORS OF PETROLEUM AND PETROLEUM PRODUCTS, SHIP CHANDLERS AND BUNKERINH REPORTED HIGHER FOREIGN SALES OF 49.2% AND 46.3% RESPECTIVELY OVER A YEAR AGO. AFTER REMOVING PRICE EFFECT, THE SALES VOLUME OF

PETROLEUM AND PETROLEUM PRODUCTS FELL BY 3.1% WHILE SALES VOLUME OF SHIP CHANDLERS AND BUNKERING HELD ITS LEVEL.

GENERAL WHOLESALE TRADE, CHEMICALS AND CHEMICAL PRODUCTS, TRANSPORT EQUIPMENT, AND

INDUSTRIAL AND CONSTRUCTION MACHINERY ALSO REGISTERED STRONG SALES GROWTHS BETWEEN 10.5% TO 47.4%.

CONVERSELY, FOREIGN SALES DECLINED IN 1Q 2008 FOR HOUSEHOLD EQUIPMENT AND FURNITURE, TIMBER, PAINTS AND CONSTRUCTION MATERIALS, ELECTRONIC COMPONENTS, AND

TELECOMMUNICATIONS AND COMPUTERS. THE SALES FELL BY 4.3% TO 8.7% FOR THESE SECTORS COMPARED TO 1Q 2007.

NEWS

MARCH RETAIL GROWTH FUELLED BY PETROL PRICES

THE VALUE OF PETROL SALES IN MARCH SOARED 39%, AS A RESULT OF RISING CRUDE OIL PRICES, EVEN THOUGH THE ACTUAL VOLUME WAS ONLY MARGINALLY HIGHER.

PETROL STATION SALES POSTED THE FASTEST GROWTH OF ALL RETAIL SEGMENTS IN MARCH, ACCORDING TO FIGURES THE DEPARTMENT OF STATISTICS RELEASED YESTERDAY.

PETROL SALES ROSE 28.2% IN FEBRUARY.

MOST RETAIL SEGMENTS POSTED HIGHER GROWTH MARCH AFTER A WEAKER SHOWING IN FEBRUARY FOR THE COMPUTERS, FURNITURE, OPTICAL GOODS AND BOOKS SEGMENTS. BUT MOTOR VEHICLES FELL 8.1% FROM MARCH 2007 AS A RESULT OF THE ESCALATING PETROL PRICES. CRUDE OIL HIT ALMOST US$127 A BARREL RECENTLY.

THE SUPERMARKET AND FOOD AND BEVERAGE SEGMENTS ALSO REPORTED LOWER SALES ACTIVITY THAN IN FEBRUARY, WITH FALLS OF 4.7% AND 11.9%, RESPECTIVELY.

OVERALL RETAIL SALES ROSE BY 5.6% COMPARED TO MARCH 2007. EXCLUDING MOTOR VEHICLES, SALES VOLUME ROSE BY 12.5%.

OCBC ECONOMIST SELENA LING NOTED THE RETAIL NUMBERS INDICATED RELATIVELY HEALTHY CONSUMER SPENDING. “THIS IS A TESTIMONY TO THE FACT THAT THE SINGAPOREAN ECONOMY IS STILL ENJOYING BROAD-BASED GROWTH DESPITE THE GLOBAL SLOWDOWN,” SHE SAID.

THE TOTAL VALUE OF RETAIL SALES IN MARCH WAS ESTIMATED AT S$2.89 BILLION, COMPARED WITH S$2.59 BILLION IN FEBRUARY.

OUTLOOK

GENERALLY, WHOLESALERS ARE POSITIVE ABOUT THEIR BUSINESS PROSPECTS IN THE COMING MONTHS, WITH A NET WEIGHTED BALANCE OF 9% OF FIRMS EXPRESSING POSITIVE BUSINESS SENTIMENTS. THOSE DEALING IN TROPICAL PRODUCE, WEARING APPAREL AND FOOTWEAR, AND INDUSTRIAL MACHINERY AND EQUIPMENT ARE THE ONES EXPRESSING OPTIMISM.

A NET WEIGHTED BALANCE OF 29% OF RETAILERS PREDICTS LESS FAVOURABLE BUSINESS CONDITIONS FOR THE PERIOD ENDING SEPTEMBER 2008. SUPERMARKETS AND RETAILERS OF JEWWELLERY AND WATCHES EXPECT SLOWER BUSINESS AFTER THE FESTIVE PERIOD. 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

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.44.37
UK Pound	1	Rs.78.09
Euro	1	Rs.63.41

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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