Chairman s Statement

Contents 1 Chairman s Statement 2 Operations Review 2 5-Year Financial Summary 3 Directors Information 4 Corporate Information 4 Information on Key Management Staff 5 Corporate Governance Report 12 Report of the Directors 14 Statement by Directors 15 Auditors Report 16 Balance Sheets 17 Consolidated Profit and Loss Account 18 Consolidated Statement of Changes in Equity 19 Consolidated Statement of Cash Flows 21 Notes to the Financial Statements 40 Details of Investment Properties 41 Statistics of Shareholdings 43 Notice of Annual General Meeting 45 Proxy Form

Chairman s Statement Dear Shareholders On behalf of the Board of Directors of Links Island Holdings Limited, I would like to present the annual financial statements and audited accounts for the financial year ended 31 December 2004. The Group s performance for FY2004 continued to be adversely affected by the disruption in and restriction of sea sand export by the regional authorities. Although the Group has since focused on the chartering of vessels and dredging services, there has been a low level of chartering activities and an absence of reclamation projects. This has led to a significantly lower turnover in FY2004 of S$0.38 million for the Group as compared to S$3.18 million in FY2003. Coupled with a provision made for doubtful debts and a deficit arising from the revaluation of investment properties, the Group registered a loss of S$3.53 million in FY2004. The NTA per share of the Group as at 31 December 2004 was 6.41 cents. The Group had also undertaken disposals of older vessels that were underutilized due to the sand disruption and is continually exploring and implementing cost cutting measures to streamline operations to reduce costs. Nevertheless, given the uncertainty surrounding the viability of the core business of the Group, we will continue to study diversifying into other areas of operations. On 8 October 2004, the Company entered into an agreement with its controlling shareholder, Manhattan Investments Pte Ltd ( MIPL ), to acquire from MIPL, 50% of the issued share capital of each of ASL Energy Pte. Ltd. ( ASLE ), Lian Beng Energy Pte. Ltd. ( LBE ) and Tat Hong Energy Pte. Ltd. ( THE ) (collectively referred to as Joint Venture Companies ) and shareholder s loans advanced by MIPL to ASLE, LBE and THE ( Acquisition ). The operations of ASLE, LBE, THE and their respective subsidiaries form an integrated chain with coal mining business in Indonesia. Over the past few years, there has been an unprecedented expansion in the world coal market. The Indonesian coal industry has grown exponentially to become one of the world s significant exporters. The Group, through the Acquisition, will have the opportunity to penetrate the booming coal mining industry in the region. The energy sector, a major industry with a growing market, is a potential economically feasible business. Currently, there are few companies in Singapore in the energy industry and the Group may be able to create a market niche. The Acquisition was approved by shareholders at an Extraordinary General Meeting held on 2 December 2004. We are most pleased to inform that the Acquisition was completed on 25 February 2005. We endeavour to achieve operational profitability in FY2005 with the completion of the Acquisition and the opportunities that will be generated therefrom. The Group will also continue to explore other business opportunities. We would like to express our sincere appreciation to the directors who have resigned from the Board for their invaluable contributions for the past years and welcome the newly appointed directors to the Board. With the new Board, support from management and staff, as well as new operations the Group will undertake, we look forward to enjoying future success with you. Sincerely, Dato Low Tuck Kwong Executive Chairman 28 February 2005 Singapore 1

Operations Review The Group s performance continued to be adversely affected by the disruption in and restriction of sea sand export by the regional authorities. Due to the low level of chartering activities and an absence of reclamation projects in FY2004, the Group s turnover saw a significant decline of 88.06% from S$3.18 million to S$0.38 million as compared to FY2003. 2 The Group has been disposing off its older and underutilized vessels since latter part of FY2003. 3 vessels were disposed off in FY2004 as compared to 26 vessels disposed off in FY2003. Accordingly, there was a decline of 53.13% in depreciation expenses as a result of fewer vessels held by the Group as compared to FY2003. A deficit arising from the revaluation of investment properties amounting to S$0.49 million and a provision for doubtful trade debts amounting to S$0.90 million were included in the other operating expenses of S$2.30 million for FY2004. 5-Year Financial Summary 25 20 15 Total Turnover (Loss)/Profit after Tax 13.634 22.222 4 3 2 1 1.371 3.728 20 15 NTA per Share 16.82 17.75 16.09 (S$ m) 10 5 0 9.565 3.183 0.38 2000 2001 2002 2003 2004 (S$ m) 0-1 -2-3 -4 (0.477) (3.296) (3.534) 2000 2001 2002 2003 2004 (cents) 10 5 0 8.00 6.41 2000 2001 2002 2003 2004 Year Year Year

Directors Information The business and working experiences of the Directors are set out as follows: Dato Low Tuck Kwong Executive Chairman Mr Loo Woei Harng Chief Executive Officer and Managing Director Mr Tan Kwee Huat, Jason Executive Director Dr Tan Eng Liang Non-Executive and Independent Director Dr Ng Pock Too Non-Executive and Independent Director Dr Wan Soon Bee Non-Executive and Independent Director Mr Low Yi Ngo Non-Executive Director Dato Low was appointed Executive Chairman of the Company on 1 June 2004. Dato Low holds a Senior Cambridge Certificate. He previously held office as Chairman of Sum Cheong Group of Companies from 1988 to early 1996. From 1997, Dato Low focused his attention on Indonesia, where he started activities in 1971. He is also a President director of PT. Gunungbayan Pratamacoal and owns coal-mining concessions in Kalimantan through his interests in several Indonesian companies. Dato Low also holds directorships in many companies with diverse interests located in Singapore, Indonesia, Malaysia, Australia and British Virgin Islands. Mr Loo was appointed Chief Executive Officer and Managing Director of the Company on 1 June 2004. He is responsible for the overall business direction and day-today management of the affairs of the Group. Mr Loo first started his career in 1981 as an engineer. He has designed and supervised constructions of buildings and civil engineering structures. Mr Loo holds a Bachelor (Hon.) Degree in Engineering and Master in Science (Civil Engineering). Mr Loo is a director in Manhattan Investments Pte Ltd and its related companies. Mr Tan was appointed Executive Director of the Company on 31 January 2000. He holds a Diploma in Civil Engineering from the Singapore Polytechnic and a Diploma in Management Studies from the Singapore Institute of Management. Mr Tan joined the Group since 1992 and has been involved in several dredging and reclamation projects both in Singapore and overseas. He is responsible for the overall planning and management of the project operations and marketing of the Group. Dr Tan was appointed Non-Executive and Independent Director of the Company on 31 January 2000. Dr Tan has a Doctorate from Oxford University, England and has been awarded the Public Service Star (BBM), Public Service Star (BAR) and the Meritorious Service Medal by the Singapore Government. He was also a Member of Parliament from 1972 to 1980, the Senior Minister of State for National Development from 1975 to 1978 and Senior Minister of State for Finance from 1978 to 1979. Dr Tan is also a director of the following public listed companies: Progen Holdings Ltd, Pokka Corporation (Singapore) Limited, United Engineers Limited, Ezra Holdings Limited and Tung Lok Restaurant (2000) Limited. Dr Ng was appointed Non- Executive Director of the Company on 21 June 2004. He graduated with a Bachelor of Science Division One Honours Degree in Mechanical Engineering from University of New Brunswick, Canada. Dr Ng was also conferred an Honorary Doctor of Law Degree in recognition of his contribution to Singapore s successful development. Dr Ng is currently the chairman of NTUC Income. He is also President, Asia Pacific of Hamilton Sundstrand Corporation. Dr Ng s past appointments included: elected Member of Parliament, Political Secretary in the Prime Minister s Office, CEO of Sembawang Group and Chairman of Jurong Engineering Ltd. Dr Wan was appointed Non- Executive and Independent Director of the Company on 21 June 2004. He holds a Dottore Ingegnere Degree in Electronics Engineering from the University of Pisa, Italy. Dr Wan was a Member of Parliament from 1981 to 2001 during which this period, he held the positions of Political Secretary and Minister of State in the Prime Minister s Office. He was also the Deputy Secretary-General of NTUC from 1981 to 1987. He has served in numerous governmental committees and labour organizations. Dr Wan is currently a director in Lian Beng Group Ltd and Chemical Industries Far East Ltd. His past directorships included: executive chairman of OCWS Logistics, Singapore Airlines Ltd, FHTK Holdings Ltd, and chairman of Comfort Group Ltd from 1987 to 1998. Dr Wan remained an advisor to Comfort Group Ltd until 1999. Mr Low was appointed Non-Executive Director of the Company on 4 February 2005. He obtained his Bachelor of Mechanical and Production Engineering from Nanyang Technological University in 2004. Prior to joining the Company, Mr Low worked as a project coordinator in Manhattan Investments Pte Ltd and he was responsible for the development of existing and new projects for coal mining in Indonesia. Mr Low was also highly involved in systems establishment, problem solving and staff recruitment for the coal mining sites. 3

4 CORPORATE INFORMATION BOARD OF DIRECTORS Executive Directors Dato Low Tuck Kwong (Chairman, appointed with effect from 1 June 2004) Mr Loo Woei Harng (CEO and Managing Director, appointed with effect from 1 June 2004) Mr Tan Kwee Huat, Jason Non-Executive and Independent Directors Dr Tan Eng Liang Dr Ng Pock Too (appointed with effect from 21 June 2004) Dr Wan Soon Bee (appointed with effect from 21 June 2004) Non-Executive Director Mr Low Yi Ngo (appointed with effect from 4 February 2005) AUDIT COMMITTEE Dr Tan Eng Liang (Chairman) Dr Ng Pock Too (appointed with effect from 21 June 2004) Mr Low Yi Ngo (appointed with effect from 4 February 2005) NOMINATING COMMITTEE Dr Wan Soon Bee (Chairman, appointed with effect from 21 June 2004) Dr Ng Pock Too (appointed with effect from 4 February 2005) Dr Tan Eng Liang REMUNERATION COMMITTEE Dr Ng Pock Too (Chairman, appointed with effect from 4 February 2005) Dr Wan Soon Bee (appointed with effect from 21 June 2004) Mr Low Yi Ngo (appointed with effect from 4 February 2005) AUDITORS Ernst & Young Certified Public Accountants 10 Collyer Quay #21-01 Ocean Building Singapore 049315 Partner-in-charge: Mr Yen Heng Fook (appointed with effect from the financial year ended 31 December 2004) COMPANY SECRETARIES Ms Yvonne Choo Ms Teo Soo Lin SHARE REGISTRAR Lim Associates (Pte) Ltd 10 Collyer Quay #19-08 Ocean Building Singapore 049315 REGISTERED OFFICE 18 Jalan Masjid #B1-01 Kembangan Plaza Singapore 418944 Ms Tan Kwee Huang, Vivian Group Senior Manager (Administration and Purchasing) Ms Tan joined the Company in July 1999 and is responsible for personnel and administrative matters of the Group, including recruitment and training. She is also in charge of the Purchasing department. Prior to joining the Company, Ms Tan was an Assistant Administration Manager with Panalpina World Transport (S) Pte Ltd, reporting to its Human Resource Director. She was responsible for general administrative matters and personnel related matters involving recruitment, payroll and training. Ms Tan was also Executive Secretary and Administrative Assistant for Astratech Pte Ltd and Sinsin Food Industries Pte Ltd between 1988 and 1995. INFORMATION ON KEY MANAGEMENT STAFF Ms Teo Soo Lin Group Financial Controller and Company Secretary Ms Teo joined the Company in March 2001 and is responsible for the Group s accounts, financial, budgeting, tax and corporate secretarial matters. Prior to joining the Company, Ms Teo worked with a local public accounting firm since 1998. She obtained her Bachelor of Accountancy from Nanyang Technological University in 1998 and is a member of the Institute of Certified Public Accountants of Singapore. Mr Chong Swee Ann, Thomas Group Senior Manager (Operations) Mr Chong joined the Company in March 1992 and is responsible for the Group s project operations. Prior to joining the Company, Mr Chong worked with Straits Engineers Contracting Pte Ltd from 1989 to 1992 where he was a site supervisor in charge of dredging and reclamation works.

5 CORPORATE GOVERNANCE REPORT Links Island Holdings Limited (the Company ) recognises the importance of and is committed to maintaining a high standard of corporate governance within the Company and its subsidiaries (the Group ). Good corporate governance establishes and maintains an ethical environment in the Group, which strives to enhance the interests of all shareholders. This report describes the Company s corporate governance processes and activities with specific references to the Code of Corporate Governance (the Code )(references in brackets are to the Principles of the Code). 1. Board of Directors (the Board ) The Company is headed by an effective Board to lead and control its affairs. (Principle 1) The Board currently comprises seven directors, four of whom are nonexecutive directors. All non-executive directors, except for Mr Low Yi Ngo, are independent. The independent directors constitute more than one-third of the Board and provide a strong and independent element. This also helps to ensure that no individual or small group of individuals dominate the decision-making process of the Board. (Principle 2) The roles of the Chairman and Chief Executive Officer (the CEO ) are separate. The Chairman, Dato Low Tuck Kwong, is an executive director who is involved in significant corporate matters. The Chairman ensures that Board meetings are held when necessary and sets the Board meeting agenda. The Chairman also reviews board papers before they are presented to the Board and ensures that Board members are provided with complete, adequate and timely information. The CEO and Managing Director, Mr Loo Woei Harng, is an executive director who is responsible for the overall business direction and day-to-day management of the affairs of the Group. The Chairman and the CEO are not related. As no one individual holds considerable concentration of power, the Board considers the objectives of the Code to have been met. (Principle 3) The Board is of the view that the current Board size is appropriate for its present operations. Together, the directors have wide-ranging business and financial experiences that are valuable to the Company. A brief description of the background of each director is set out under Directors Information on page 3. The Company does not have a formal training programme for the directors but newly appointed directors are given training appropriate to the level of their previous experiences. There is also an orientation programme for newly appointed directors under which the management will brief the new directors about the Company and the Group. All directors are encouraged to undergo relevant training programmes to further enhance their skills and knowledge particularly on relevant new laws, regulations and changing commercial risks on a continuous basis. The principal functions of the Board are: (a) reviewing and approving the Group s corporate and strategic direction, annual budgets, major funding and investment proposals; (b) reviewing the financial performance and advising regularly on the performance, position and prospect of the Group; (c) approving the nominations to the Board by Nominating Committee, and endorsing the appointments of management team and/or external auditors; (d) reviewing and approving the remuneration packages for the Board and senior management as recommended by Remuneration Committee; and (e) ensuring accurate, adequate and timely reporting to, and communication with shareholders.

6 To facilitate effective management, specific responsibilities have been delegated to three Board committees (Audit, Nominating and Remuneration Committees), each of which has its own written terms of reference and details of which are set out below. The Executive Committee was abolished in February 2005 after taking into consideration the present operations of the Group. The Board meets at least four times a year and at other times as appropriate. Details on the number of meetings (including those of the Board committees) held in the year and the attendances of directors at these meetings are provided on page 11. In order to ensure that the Board is able to fulfill its responsibilities, the management provides the Board with complete, adequate and timely information prior to Board meeting and on an on-going basis. (Principle 6) The directors have separate and independent access to the Company s senior management and the Company Secretaries. Should directors, whether as a group or individually, need independent professional advice, the management will, upon direction from the Board, appoint a professional advisor selected by the group or individual, and approved by the Chairman, to render the advice. The cost of such professional advice will be borne by the Company. (Principle 6) The roles of the Company Secretaries are clearly defined and cover all the responsibilities of a Company Secretary and include the responsibility for ensuring that Board procedures are followed and that applicable rules and regulations are compiled with. The Company Secretaries attend all Board meetings. 2. Nominating Committee (the NC ) The NC comprises three non-executive and independent directors, namely Dr Wan Soon Bee, who is the chairman of the NC, Dr Tan Eng Liang and Dr Ng Pock Too. The NC, which has its written terms of reference, is responsible for making recommendations to the Board on all Board appointments and re-appointments. Under the Articles of Association of the Company, at least one-third of the directors (or if their number is not a multiple of three, the number nearest to but not greater than onethird) is required to retire by rotation. The Managing Director is however not subject to rotation. (Principle 4) The Company is contemplating a change in its Articles of Association to have all directors, including the Managing Director, subject to retirement by rotation. The NC performs the following functions: (a) reviews regularly the Board structure, size and composition and makes recommendations to the Board with regards to any adjustments that are deemed necessary and also on the appointment of new executive and non-executive directors; (b) (c) identifies and nominates candidates for the approval of the Board, determining annually whether or not a director is independent, to fill Board vacancies as and when they arise as well as put in place plans for succession, in particular for the Chairman; and conducts a formal assessment of the effectiveness of the Board as a whole and the contribution by each director to the effectiveness of the Board. In evaluating the Board s performance, the NC considers a set of quantitative and qualitative performance criteria. The criteria adopted in assessing each individual director are attendance at Board and Board committees meetings, and his contributions. (Principle 5)

7 Despite some of the directors having other board representations, the NC is satisfied that these directors are able to and have adequately carried out their duties as directors of the Company. The NC has also reviewed the independence of Dr Tan Eng Liang, Dr Ng Pock Too and Dr Wan Soon Bee, and is satisfied that there are no relationships that would deem them not to be independent. The NC had recommended that the five directors, Dato Low Tuck Kwong, Dr Ng Pock Too, Dr Wan Soon Bee, Mr Low Yi Ngo and Mr Tan Kwee Huat, Jason, retiring at the forthcoming annual general meeting, be re-elected. The Board accepted the NC s recommendation and accordingly, these directors will be offering themselves for re-election at the forthcoming annual general meeting. Mr Loo Woei Harng, the CEO and Managing Director of the Company, is not subject to retirement by rotation in accordance with the Company s Articles of Association. 3. Audit Committee (the AC ) The AC comprises three non-executive directors, namely Dr Tan Eng Liang, who is the chairman of the AC, Dr Ng Pock Too and Mr Low Yi Ngo. Except for Mr Low Yi Ngo, all the AC members are independent. (Principle 11) The AC, which carries out its functions in accordance with the Singapore Companies Act, Cap. 50 and its written terms of references, performs the following delegated functions: (a) reviews with the management the adequacy of the Company s internal controls in respect of management, business and service systems and practices; (b) reviews legal and regulatory matters that might have a material impact on the financial statements, related compliance policies and programmes and any reports received from regulators; (c) reviews the half-year and full year financial statements before their announcements; (d) reviews the audit plans of the external auditors of the Company and ensures the adequacy of the Company s system of accounting controls and the co-operation given by the Company s management to the external auditors; (e) reviews the interim and annual financial statements and the external auditors report of the Company before their submission to the Board; (f) reviews the cost effectiveness, independence and objectivity of the external auditors, and the nature and extent of non-audit services provided by them; (g) nominates the external auditors; and (h) reviews the interested person transactions in accordance with the requirements of the listing rules of the Singapore Exchange Securities Trading Limited (the SGX-ST ). The AC is empowered to investigate any matter relating to the Group s accounting, auditing, internal controls and financial practices brought to its attention with full access to records, resources and personnel to enable it to discharge its functions properly. The AC had two meetings during the financial year ended 31 December 2004. The AC met with the external auditors without the presence of the management and reviewed the overall scope of the external audit and the assistance given by management to the auditors. The AC also reviewed the volume of non-audit services amounting to S$0.165 million provided by the external auditors to the Group and was satisfied that the nature and extent of such services will not prejudice the independence and objectivity of the external auditors. The AC is pleased to confirm their re-nomination. The AC had reviewed interested person transactions conducted during the financial year ended 31 December 2004 and was satisfied that the interested person transactions amounting to S$0.23 million were conducted at arm s length.

8 4. Remuneration Committee (the RC ) The RC comprises three non-executive directors, namely Dr Ng Pock Too, who is the chairman of the RC, Mr Low Yi Ngo and Dr Wan Soon Bee. Except for Mr Low Yi Ngo, the RC members are independent. The objective of the RC is to facilitate appropriateness, transparency and accountability to shareholders on issues of remuneration of the directors and senior management in the Company. No director is involved in deciding his own remuneration. (Principle 7) The principal functions of the RC are: (a) reviewing and recommending to the Board, in consultation with the management, a framework of remuneration and to ensure that all aspects of remuneration including directors fees, salaries, allowances, bonuses, options and benefits-in-kind should be covered; (b) determining the specific remuneration packages and terms of employment for each of the executive directors of the Company including those employees related to the executive directors and controlling shareholders of the Company; (c) ensuring that the remuneration packages are competitive and sufficient to attract, retain and motivate personnel of the required quality to run the Company successfully, after taking into account their respective job scopes and levels of responsibilities; (d) determining a fixed appointment period for directors in the case of service agreements, after which they are subject to re-election and reviewing the compensation commitments of the directors service agreements, if any, in the event of early termination; and (e) ensuring that the remuneration of non-executive directors is appropriate to their individual level of contribution, taking into account factors such as effort and time spent, and responsibilities of the directors. During the financial year ended 31 December 2004, the Company had entered into a service agreement each with Dato Low Tuck Kwong and Mr Loo Woei Harng respectively for a fixed period of three years. Mr Tan Kwee Huat, Jason s service agreement was also renewed for a further period of one year. In addition, pursuant to a review of the remuneration packages of the Chairman and executive directors, in particular, their service agreements, the RC had decided to delete a clause in their respective service agreements pertaining to the directors profit sharing scheme. As a result of such clause deletion, the directors profit sharing scheme was abolished. Disclosure on remuneration (a) Directors remuneration Remuneration band Salary Bonus Director s fee and names of directors 2004 2003 2004 2003 2004 2003 < S$200,000 Dato Low Tuck Kwong 92.3% 7.7% Mr Loo Woei Harng 92.3% 7.7% Mr Tan Kwee Huat, Jason 92.3% 92.3% 7.7% 7.7%

9 (a) Directors remuneration Remuneration band Salary Bonus Director s fee and names of directors 2004 2003 2004 2003 2004 2003 Dr Tan Eng Liang 100% 100% Dr Ng Pock Too 100% Dr Wan Soon Bee 100% (b) Remuneration of top 5 key executives (who are not directors) Remuneration band and names of key executives Salary Bonus (who are not directors) 2004 2003 2004 2003 < S$100,000 Mr Chong Swee Ann 92.3% 92.3% 7.7% 7.7% Ms Tan Kwee Huang, Vivian 91.0% 91.5% 9.0% 8.5% Ms Teo Soo Lin 91.7% 91.5% 8.3% 8.5% Mr Yap Koon Ong 92.3% 92.3% 7.7% 7.7% Mr Foo Kon Poh 92.3% 92.3% 7.7% 7.7% (c) Remuneration of employee who is an immediate family member of a director One of the employees of the Company is an immediate family member of one executive director and the remuneration of this employee did not exceed S$150,000 during the financial year ended 31 December 2004. The Board has recommended the following, which had been reviewed by the RC, for shareholders approval at the forthcoming annual general meeting of the Company: (a) fees payable to Dr Ng Pock Too and Dr Wan Soon Bee, who were both appointed on 21 June 2004, for the financial year ended 31 December 2004; and (b) fees payable to all independent directors for the financial year ending 31 December 2005. 5. Risk Management Policies and Processes The Company sets and establishes risk management guidelines, policies and procedures for all divisions. As such, the Company is able to be consistent and put in place various control mechanisms.

In addition, all transactions are put throught a risk analysis whenever new projects are embarked upon and all necessary steps to manage risks in projects will be taken. The financial team also assists in the risk management process by identifying and highlighting areas of concern while conducting financial checks. 6. Internal Controls The Board believes that, in the absence of any evidence to the contrary, the system of internal controls maintained by the management and that was in place throughout the financial year and up to the date of this report is adequate to safeguard the shareholders investment and the Company s assets and provides reasonable, but not absolute, assurance against material financial misstatements or loss, and include the safeguarding of assets, the maintenance of proper accounting records, the reliability of financial information, compliance with appropriate legislation, regulation and best practice, and identification and containment of business risk. The Board notes that no system of internal control could provide absolute assurance against the occurrence of material errors, poor judgment in decision-making, human error, losses, fraud or other irregularities. (Principle 12) 10 7. Internal Audit At present, the Company does not have in place an internal audit function as the Board is of the view that this is not necessary under current circumstances, taking into account the corporate structure and scope of the Company s operations. (Principle 13) 8. Communications to the Board and Shareholders The Board is accountable to the shareholders while the management is accountable to the Board. (Principle 10) The Company releases its results bi-annually and is considering releasing its results voluntarily on a quarterly basis, as the Group s operations expand. The Board is mindful of its obligations to provide timely and fair disclosure of material information in accordance with the Corporate Disclosure Policy of the SGX-ST. Results and annual reports are released on SGXNET. A copy of the Annual Report and Notice of Annual General Meeting is also sent to every shareholder. (Principle 14) Shareholders are encouraged to attend the annual general meetings to ensure a high level of accountability. The annual general meeting is the principal forum for dialogue with shareholders. The Board welcomes views of shareholders on matters affecting the Company. (Principle 15) 9. Dealings in the Company s Securities The Group has adopted a Code of Best Practices to provide guidance to its officers with regards to dealing in the Company s securities in compliance with the SGX- ST Best Practices Guide. The Company and its officers are prohibited from dealing in the Company s securities prior to the announcement of a matter that involves material unpublished pricesensitive information in relation to the Group, as well as during the period commencing one month before the announcement of the Company s financial statements for the half-year or financial year, ending on the date of the announcement of the relevant results.

10. Directors Attendances at Board and Board Committees Meetings Board Audit Remuneration Nominating Committee (1) Committee (1) (8) Committee (1) Number of Meetings Held Attended Held Attended Held Attended Held Attended Board Members Dato Low Tuck Kwong (2) 7 1 Mr Loo Woei Harng (2) 7 4 Mr Tan Kwee Huat, Jason 7 7 2 2 Dr Tan Eng Liang 7 7 2 2 Dr Ng Pock Too (3) 7 4 2 1 1 1 Dr Wan Soon Bee (3) 7 3 1 1 Mr Low Yi Ngo (4) Mr Chong Thim Pheng, Winstedt (5) 7 3 Ms Tan Kwee Hiang, Cynthia (6) 7 7 Mr Wong Kok Hoe (7) 7 6 2 1 2 2 Mr Sim Wee Leong (7) 7 7 2 2 1 1 2 2 11 Notes: (1) There was a revision in the composition of Board Committees on 21 June 2004 and 4 February 2005. (2) Both Dato Low Tuck Kwong and Mr Loo Woei Harng were appointed on 1 June 2004. (3) Both Dr Ng Pock Too and Dr Wan Soon Bee were appointed on 21 June 2004. (4) Mr Low Yi Ngo was appointed on 4 February 2005. (5) Mr Chong Thim Pheng, Winstedt resigned on 1 June 2004. (6) Ms Tan Kwee Hiang, Cynthia resigned on 13 February 2005. (7) Both Mr Wong Kok Hoe and Mr Sim Wee Leong resigned on 4 February 2005. (8) The RC meeting for the financial year ended 31 December 2004 had been conducted by way of a resolution in writing of the members of the RC. On Behalf of the Board of Directors, Mr Loo Woei Harng Director Mr Tan Kwee Huat, Jason Director 28 February 2005 Singapore

Report of the Directors The directors are pleased to present their report to the members together with the audited consolidated financial statements of Links Island Holdings Limited (the Company ) and its subsidiary companies (the Group ) for the financial year ended 31 December 2004 and balance sheet of the Company as at 31 December 2004. Directors The directors of the Company in office at the date of this report are: 12 Dato Low Tuck Kwong (Appointed on 1 June 2004) Mr Loo Woei Harng (Appointed on 1 June 2004) Mr Tan Kwee Huat, Jason Dr Tan Eng Liang Dr Ng Pock Too (Appointed on 21 June 2004) Dr Wan Soon Bee (Appointed on 21 June 2004) Mr Low Yi Ngo (Appointed on 4 February 2005) In accordance with Article 104 of the Company s Articles of Association, Mr Tan Kwee Huat, Jason, retires and, being eligible, offers himself for re-election. In accordance with Article 108 of the Company s Articles of Association, Dato Low Tuck Kwong, Dr Ng Pock Too, Dr Wan Soon Bee and Mr Low Yi Ngo retire and, being eligible, offer themselves for re-election. Arrangements to enable directors to acquire shares and debentures Neither at the end of nor at any time during the financial year was the Company a party to any arrangement whose object is to enable the directors of the Company to acquire benefits by means of the acquisition of shares or debentures of the Company or any other body corporate. Directors interests in shares and debentures The following directors, who held office at the end of the financial year, had, according to the register of directors shareholdings required to be kept under Section 164 of the Singapore Companies Act, an interest in shares of the Company, as stated below: Direct interest Deemed interest At At beginning beginning of the year/ At end of of the year/ At end of Name of directors date of appointment the year date of appointment the year The Company Ordinary shares of $0.08 each Dato Low Tuck Kwong 78,000,000 78,000,000 Ms Tan Kwee Hiang, Cynthia* 66,398,090 27,398,090 79,301,910 40,301,910 Mr Tan Kwee Huat, Jason 150,000 150,000 *Ms Tan Kwee Hiang, Cynthia has resigned as director of the Company on 13 February 2005. The directors interests in the shares of the Company as at 21 January 2005 were the same as those as at 31 December 2004.

By virtue of Section 7 of the Singapore Companies Act, Dato Low Tuck Kwong and Ms Tan Kwee Hiang, Cynthia are deemed to be interested in the shares held by the Company in all its subsidiary companies. No other director had any interest in any shares or debentures of the Company or related corporations either at the beginning or the end of the financial year and on 21 January 2005. Directors contractual benefits Except as disclosed in the financial statements, since the end of the previous financial year, no director of the Company has received or become entitled to receive a benefit by reason of a contract made by the Company or a related corporation with the director or with a firm of which the director is a member, or with a company in which the director has a substantial financial interest. Audit committee The Audit Committee performed the functions specified in the Singapore Companies Act. The functions performed are detailed in the Corporate Governance Report. 13 Options There is presently no option scheme on unissued shares of the Company. Auditors Ernst & Young have expressed their willingness to accept re-appointment as auditors. On behalf of the board of directors, Mr Loo Woei Harng Director Mr Tan Kwee Huat, Jason Director 28 February 2005 Singapore

Statement by Directors Pursuant to Section 201(15) We, Mr Loo Woei Harng and Mr Tan Kwee Huat, Jason, being two of the directors of Links Island Holdings Limited, do hereby state that, in the opinion of the directors, (i) (ii) the accompanying balance sheets, consolidated profit and loss account, consolidated statement of changes in equity and consolidated cash flow statement together with notes thereto, set out on pages 16 to 39 are drawn up so as to give a true and fair view of the state of affairs of the Company and of the Group as at 31 December 2004, and of the results of the business, changes in equity and cash flows of the Group for the financial year then ended, and at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they fall due. 14 On behalf of the board of directors, Mr Loo Woei Harng Director Mr Tan Kwee Huat, Jason Director 28 February 2005 Singapore

Auditors Report to the Members of Links Island Holdings Limited We have audited the accompanying financial statements of Links Island Holdings Limited (the Company ) and its subsidiary companies (the Group ) set out on pages 16 to 39. These financial statements are the responsibility of the Company s directors. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the directors, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, (a) the consolidated financial statements of the Group and the balance sheet of the Company are properly drawn up in accordance with the provisions of the Singapore Companies Act (the Act ) and Singapore Financial Reporting Standards so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 December 2004, and of the results, changes in equity and cash flows of the Group for the financial year ended on that date; and 15 (b) the accounting and other records required by the Act to be kept by the Company and its subsidiary companies incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act. ERNST & YOUNG Certified Public Accountants 28 February 2005 Singapore

Balance Sheets as at 31 December 2004 Group Company Notes 2004 2003 2004 2003 $ $ $ $ 16 Fixed assets 3 4,378,439 6,203,238 1,455,838 1,585,539 Investment in subsidiary companies 4 5,530,000 8,930,000 Investment properties 5 2,350,000 2,840,500 2,350,000 2,840,500 Negative goodwill 6 Current assets Trade debtors 7 87,747 986,623 65,050 6,781 Other debtors, deposits and prepayments 8 448,698 266,905 405,921 9,845 Tax recoverable 301,708 301,708 Due from subsidiary companies (trade) 9 578,499 709,986 Due from subsidiary companies (non-trade) 10 2,547 67,139 Loan to a subsidiary company 10 675,645 Fixed deposits 11 5,255,121 7,049,846 5,255,121 3,281,751 Cash and bank balances 2,320,533 701,353 404,895 104,996 8,112,099 9,306,435 6,712,033 5,157,851 Current liabilities Trade creditors 87,573 264,667 1,534 16,067 Other creditors and accruals 12 328,497 147,958 243,104 62,326 Provision for taxation 30,492 9,131 30,492 Loan from a subsidiary company 10 2,000,000 446,562 421,756 2,275,130 78,393 Net current assets 7,665,537 8,884,679 4,436,903 5,079,458 Deferred taxation 21 (184,322) (184,322) (13,694) (13,694) 14,209,654 17,744,095 13,759,047 18,421,803 Share capital 13 17,733,333 17,733,333 17,733,333 17,733,333 Share premium 14 2,478,622 2,478,622 2,478,622 2,478,622 Accumulated losses 15 (6,002,301) (2,467,860) (6,452,908) (1,790,152) 14,209,654 17,744,095 13,759,047 18,421,803 The accounting policies and explanatory notes on pages 21 to 39 form an integral part of the financial statements.

Consolidated Profit and Loss Account for the financial year ended 31 December 2004 Group Notes 2004 2003 $ $ Turnover 16 379,879 3,183,060 Other operating income 17 737,908 2,372,140 Fuel expenses (95,802) (279,826) Charter expenses (147,987) Personnel expenses 18 (1,349,336) (1,986,083) Depreciation of fixed assets 3 (966,109) (2,061,114) Other operating expenses (2,304,633) (2,972,064) Operating loss before exceptional item 19 (3,598,093) (1,891,874) Exceptional item 20 (1,474,700) 17 Operating loss before taxation (3,598,093) (3,366,574) Interest income from fixed deposits 51,603 35,441 Loss before taxation (3,546,490) (3,331,133) Taxation 21 12,049 34,683 Loss for the financial year (3,534,441) (3,296,450) Loss per share (cents) 22 - basic (1.59) (1.49) - diluted (1.59) (1.49) The accounting policies and explanatory notes on pages 21 to 39 form an integral part of the financial statements.

Consolidated Statement of Changes in Equity for the financial year ended 31 December 2004 Accumulated Share Share (losses)/ capital premium profits Total $ $ $ $ As at 1 January 2003 22,166,667 10,591,621 2,903,390 35,661,678 Loss for the financial year (3,296,450) (3,296,450) Dividends (Note 23) (2,074,800) (2,074,800) Share premium cancelled in connection with a Capital Reduction exercise (8,112,999) (8,112,999) Share capital reduction in connection with a Capital Reduction exercise (4,433,334) (4,433,334) 18 As at 31 December 2003 17,733,333 2,478,622 (2,467,860) 17,744,095 Loss for the financial year (3,534,441) (3,534,441) As at 31 December 2004 17,733,333 2,478,622 (6,002,301) 14,209,654 The accounting policies and explanatory notes on pages 21 to 39 form an integral part of the financial statements.

Consolidated Statement of Cash Flows for the financial year ended 31 December 2004 Note 2004 2003 $ $ Cash flows from operating activities Loss before taxation (3,546,490) (3,331,133) Adjustments: Depreciation of fixed assets 966,109 2,061,114 Allowance for doubtful trade debts 896,214 1,131,077 Allowance for insurance claims receivable 15,000 Amortisation of negative goodwill (126,888) Gain on disposal of fixed assets - net (717,413) (2,102,910) Deficit arising from revaluation of investment properties 490,500 149,500 Loss on disposal of other investment 1,474,700 Interest income (51,603) (35,441) Dividend income (124,875) Operating cash flow before reinvestment in working capital (1,962,683) (889,856) Decrease/(increase) in : Trade debtors 2,662 (339,408) Other debtors, deposits and prepayments (181,793) 203,702 (Decrease)/increase in : Trade creditors (177,094) (726,061) Other creditors and accruals 180,539 (35,019) Cash used in operations (2,138,369) (1,786,642) Income taxes refund 335,118 29,309 Net cash used in operating activities (1,803,251) (1,757,333) Cash flows from investing activities Purchase of fixed assets (224,586) (89,607) Proceeds from disposal of fixed assets 1,800,689 10,968,956 Proceeds from disposal of other investment 361,500 Payment of cash distribution (7,758,333) Net cash generated from investing activities 1,576,103 3,482,516 Cash flows from financing activities Dividends paid (2,074,800) Interest received 51,603 35,441 Dividend received 124,875 Movement in pledged fixed deposits (38,000) Net cash generated from/(used in) financing activities 51,603 (1,952,484) Net decrease in cash and cash equivalents (175,545) (227,301) Cash and cash equivalents at beginning of financial year 7,713,199 7,940,500 19 Cash and cash equivalents at end of financial year A 7,537,654 7,713,199

Consolidated Statement of Cash Flows for the financial year ended 31 December 2004 (cont d) A. Cash and cash equivalents Cash and cash equivalents included in the consolidated statement of cash flows comprise the following balance sheet captions: 2004 2003 $ $ Cash and bank balances 2,320,533 701,353 Fixed deposits 5,255,121 7,049,846 Less: Pledged fixed deposits (Note 11) (38,000) (38,000) Cash and cash equivalents 7,537,654 7,713,199 20 The accounting policies and explanatory notes on pages 21 to 39 form an integral part of the financial statements.

Notes to the Financial Statements 31 December 2004 1. Corporate information Links Island Holdings Limited is a limited liability company domiciled and incorporated in Singapore. The registered office of Links Island Holdings Limited is located at 18 Jalan Masjid, #B1-01 Kembangan Plaza, Singapore 418944. The principal activities of the Company are those of investment holding and the provision of management services. The principal activities of the subsidiary companies are as shown in Note 4 to the financial statements. The Group operates in Singapore. The Group and Company employed 32 employees as of 31 December 2004 (2003 : 35). 2. Significant accounting policies (a) Basis of preparation 21 The financial statements have been prepared in accordance with Singapore Financial Reporting Standards ( FRS ) as required by the Singapore Companies Act. (b) The financial statements have been prepared on a historical cost basis except for investment properties which are carried at revalued amounts. The accounting policies have been consistently applied by the Company and the Group and are consistent with those used in the previous financial year. The financial statements are presented in Singapore dollars ($). Principles of consolidation The consolidated financial statements comprise financial statements of the Company and all its subsidiary companies. The results of subsidiary companies acquired or disposed of during the financial year are included in or excluded from the consolidated financial statements with effect from the respective dates of acquisition or disposal. All intercompany balances and transactions, and any unrealised profit or loss on intercompany transactions are eliminated on consolidation. When a subsidiary is acquired, any difference between the consideration paid and the fair values of the net assets acquired represents goodwill or negative goodwill. Positive goodwill (ie. the excess of cost of acquisition over the fair value of the net identifiable assets acquired) is recognised as an asset in the balance sheet and amortised on a systematic basis over its useful life during which future economic benefits are expected to flow to the enterprise. For negative goodwill (ie. the excess of the fair value of the net identifiable assets acquired over the cost of acquisition) that does not relate to identifiable expected future losses and expenses that can be measured reliably at the date of acquisition and does not exceed the fair values of acquired identifiable non-monetary assets, it is recognised as income on a systematic basis over the remaining weighted average useful life of five years of the identifiable acquired/depreciable assets.

2. Significant accounting policies (cont d) (c) Subsidiary companies A subsidiary company is a company in which the Group, directly or indirectly, holds more than 50% of the issued share capital, or controls more than half of the voting power, or controls the composition of the board of directors. An assessment of investment in subsidiary companies is performed when there is any indication that the asset has been impaired or the impairment losses recognised in the previous years no longer exist. (d) Foreign currencies 22 Transactions in foreign currencies are measured in Singapore dollars and recorded at exchange rates approximating those ruling at the transaction dates. Foreign currency monetary assets and liabilities at the balance sheet date are measured using the exchange rates ruling at that date. Non-monetary assets and liabilities are measured using the exchange rates ruling at the transaction dates or, in the case of items carried at fair value, the exchange rates that existed when the values were determined. All resultant exchange differences are recognised in the profit and loss account. (e) Fixed assets and depreciation Fixed assets are stated at cost less accumulated depreciation and any allowance for impairment loss. The cost of an asset comprises its purchase price and any directly attributable costs of bringing the asset to working condition for its intended use. Expenditure for additions, improvements and renewals is capitalised and expenditure for maintenance and repairs is charged to the profit and loss account. When assets are sold or retired, their costs and accumulated depreciation are removed from the financial statements and any gain or loss resulting from their disposals is included in the profit and loss account. Deferred drydocking expenditure relates to expenditure incurred for major overhauls of vessels, which is deferred when incurred and amortised over a period from the current drydocking date to the next estimated drydocking date (normally 2.5 years). When significant drydocking expenditure recurs prior to the expiry of the amortisation period, the remaining unamortised expenditure of previous drydocking is expensed in the month of subsequent drydocking. Fixed assets are depreciated using the straight-line method to write-off the cost over their estimated useful lives. The estimated useful lives have been taken as follows: Vessels - 10 years Marine equipment - 5 years Furniture, fittings and office equipment - 5 years Renovation - 5 years Motor vehicles - 3 years Deferred drydocking expenditure - 2.5 years Freehold property - 50 years

2. Significant accounting policies (cont d) (e) Fixed assets and depreciation (cont d) Fully depreciated assets are retained in the financial statements until they are no longer in use and no further charge for depreciation is made in respect of these assets. The useful life and depreciation method are reviewed annually to ensure that the method and period of depreciation are consistent with the expected pattern of economic benefits from items of fixed assets. (f) Investment properties Investment properties are those properties held on a long-term basis for the primary purpose of producing rental income and are carried at revalued amounts. Revaluation is performed by directors annually based on open market value. (g) (h) An independent professional valuation is performed once in every three years. The surplus on revaluation is credited directly to revaluation reserve unless it reverses a previous revaluation decrease relating to the same class of assets, which was previously recognised as an expense. In these circumstances, the increase is recognised as income to the extent of the previous write down. Any deficit on revaluation is recognised as an expense unless it reverses a previous surplus relating to that asset, in which case it is charged against any related revaluation surplus, to the extent that the decrease does not exceed the amount held in the revaluation surplus in respect of that same class of assets. Any balance remaining in the revaluation surplus in respect of an investment property, is transferred directly to accumulated profits on retirement or disposal of the property. Cash and cash equivalents Cash and cash equivalents comprise cash on hand and in banks and fixed deposits, less fixed deposits pledged to secure banking facilities, and are subject to insignificant risk of changes in values. Cash on hand and in banks and fixed deposits which are held to maturity are carried at cost. Trade and other receivables Trade and other receivables, which generally have been granted on between 30-90 day credit terms, are recognised and carried at original invoice amount less an allowance for any uncollectible amounts. An estimate for doubtful debts is made when collection of the full amount is no longer probable. Bad debts are written off as incurred. Receivables from subsidiary companies are recognised and carried at cost less an allowance for any uncollectible amounts. 23