Chairman Statement

ANOTHER SOLID PERFORMANCE ALL ROUND

Tai Sin's achievements of the past 12 months are borne out by our financial results. These show significant, acrossthe- board gains vis-a-vis the year before.

Compared with the financial year ended June 30, 2006, Tai Sin's revenue jumped 26.9% to $232.72 million. Pre-tax profit shot up by 81.1% to $26.16 million. This generated a historically high consolidated profit after taxation of $20.93 million, or 83.6% above the previous year's record of $11.40 million.

The Group's accelerated growth in revenue and income was primarily driven by cable and wire sales, which increased 39.5% year-on-year to $145.78 million. Overall, our manufacturing activities grew revenue by 32.7% while delivering an 82.6% surge in profits.

Sales of electrical equipment expanded 20.5% to total $81.03 million, thereby contributing heftily to an 17.5% rise in revenue for the Group's distribution segment. On the back of these gratifying results, Earnings Per Share ("EPS") rose 78.8% from 3.30 cents to 5.90 cents.

LOOKING BACK

Several factors account for the Group's strong top and bottom lines.

High copper prices, which peaked at almost US$8,000 per metric tonne during the year, helped produce our cable and wire segment's outstanding report card.

It should also be noted that the Group achieved its successes against the backdrop of a thriving construction industry, which continues to keep determined pace with sustained economic growth in Singapore and around the region. Having emerged from an almost decade-long slump following the 1997 Asian financial crisis, developers are making up for lost time with heavy order books for infrastructural, residential and commercial installations.

This upswing in construction and building activity across much of Asia provides us with great impetus to extend our market leadership regionally. Indeed, FY2007 witnessed a substantial expansion of the Group's presence in Vietnam and the Middle East.

Given our ambition to intensively internationalise the Group's reach, we decided in the last year it was time to re-energise our image in the market.

RESTRUCTURED AND RE-ENERGISED

Towards that end, we have undertaken a corporate branding initiative to align all our companies with the Tai Sin corporate identity in the Group's brand architecture. Our businesses are now uniquely classified by company function, rather than product type, into four clusters under the Tai Sin corporate brand:

• Manufacturing
• Distribution
• Services
• Strategic Investment

The above reclassification has given rise to an even more efficient structure for our operations while providing greater transparency to our stakeholders and customers. It brings our core competencies into strategic focus, thereby reinforcing our new position as Asia's Leading Electric Solutions Company.

The Group's distribution companies, for instance, have taken advantage of their own in-company clusterisation actions to further enhance their relationships with their business partners. In the process, this has enabled them to acquire a wider, high-yield customer base. Hence, the distribution segment's much improved revenue in the year under review.

LOOKING AHEAD

As usual, we're keeping a close eye on copper prices, the present volatility of which could adversely affect the Group's financial performance in the near future. On the whole, however, we remain upbeat about our prospects.

Despite housing concerns threatening a US slowdown, the world economy is holding up well even after four consecutive years of sturdy growth.

Asia, in particular, boasts multiple bright spots on the economic topography. Intra-regional trade will continue to be spearheaded by the scorching pace of industrialisation in China and India, spurred by Japan's relentless export machinery and fuelled by massive projects in the Middle East. Elsewhere on the continent, consumer spending amidst positive business sentiment shows little sign of abating - which suggests the uptrends in the construction and building industry are not about to level off anytime some.

In other words, opportunities abound for the Group to assert its market leadership over an ever widening regional footprint. We have embarked on a number of initiatives to take full advantage of any promising business opportunities.

For one, we have established a joint venture in Vietnam, currently in the grip of a construction boom, to manufacture electric cables and wires for both domestic consumption and export into the surrounding Indo-China markets. The Dien Quang - Tai Sin Cable Company Limited factory in Binh Duong Province officially begins operations in September 2007. Vietnam's vast project supply offers the Group much scope in the provision of not just cables and wires, but lightings and other electrical materials as well. Our joint venture had been preceded by the formation of a representative office in the country in 2005 to explore various business options.

For our next engine of growth, we are looking to the Middle East. So far, we have set up a branch office in Dubai to tap into supply opportunities, presented by mega-scale developments, for cables, switches and lamps. This base office will also help the Group explore further afield in the United Arab Emirates and access neighbouring re-export markets all the way to the African continent.

At the same time, we have increased the Group's cable manufacturing capacities at our Singapore and Malaysia factories to capitalise on the building frenzy closer to home. The Republic alone has a long order list of constructions ranging from integrated resorts to downtown MRT lines to new projects occasioned by multiple en-bloc sales. Across the Causeway, Malaysia's Iskandar Development Region should keep our local operations busy in the next couple of years at least.

The Group's distribution companies stand to benefit from events in the wider economy as well. This cluster's growth will be boosted by the continuing diversification of Singapore's manufacturing sector, and by the persistent strength of the chemical, oil and gas, marine and biomedical industries.

DIVIDENDS

The Board is pleased to recommend a final dividend of 1.00 cent. The proposed total payout of $3.922 million is subject to members' approval at the Group's AGM to be convened on October 30, 2007.

IN APPRECIATION

In September 2007, we bade farewell to six of our Directors: Mr. Lin Chen Mou, Mr. Chia Ah Heng, Mr. Lim Chai Lai @ Louis Lim Chai Lai, Mr. Chang Chai Woon, Mr. Sim Yeong Soon and Mr. Lee Lien-Shen (Alternate Director to Mr. Lin Chen Mou). They voluntarily resigned their seats to facilitate the reconstitution of the Board with the objective of enhancing its effectiveness and independence. The new Board, a majority of whom (including the Chairman) are independent, now comprises five Directors instead of the original eleven.

On behalf of the Board, I would like to express our appreciation for the contributions the outgoing Directors have made to the strategic direction, progress and prosperity of the Tai Sin Group.

At the same time, we welcome Mr. Tay Joo Soon, who has been appointed as the Group's Non-Executive Director.

As we close the books on another good year for the Group, I wish to record our appreciation, too, to the many individuals and organisations without whom our success past, present and future would have been unimaginable. This esteemed list includes our customers, bankers, suppliers and principals, business partners and associates as well as the various statutory boards and government agencies we have worked with to advance our business.

Certainly not to be forgotten are our shareholders: thank you for your faith in Tai Sin. We look forward to repaying them in dividends yet again, and continually, in the years ahead.

Last, though definitely not least, I salute all Tai Sin employees. You have every reason to take pride in our success, which you have helped to make possible with your talent and industry.