...CORPORATE NEWS

BOUSTEAD ACHIEVES RM191 MILLION IN NET PROFIT

KUALA LUMPUR, March 30, 2006 - Boustead Holdings Berhad (Boustead) continued to enhance shareholders value by registering a 60% increase in net profit to RM191 million on the back of a turnover of RM1.9 billion for the year ended December 31, 2005.

Earnings per share for this period increased to 32 sen from 21 sen while net tangible asset per share as at December 31, 2005 stands at RM2.69.

The Board of Directors is recommending a further dividend payment of 12% for the year, subject to shareholders' approval at the Group's Annual General Meeting today. This latest dividend payment would bring a total distribution of 32%, translating into a yield of 9%.

YBhg. Tan Sri Dato' Lodin Wok Kamaruddin, Group Managing Director, Boustead, said, "For the coming financial year, our sights are on our downstream petroleum retail and naval ship building businesses. We are confident that these two new elements will help shore-up our profitability and improve our diversity. "To complement these new business prospects, we are bullish on our Plantation, Property and Finance and Investment Divisions as well."

While the Plantation and Property Divisions remain the core growth drivers of Boustead, 2005 saw unparalleled contribution from the Finance and Investment Division, which recorded a pre-tax profit of RM73 million.

According to YBhg. Tan Sri Dato' Lodin, the Group's banking arm, Affin Holdings Berhad, had successfully reduced non-performing loans (NPL) to 14% in 2005 from 24% the previous year. "We intend to bring our NPLs down to a single digit figure in the current financial year via aggressive recovery programmes and at the same time expansion of our loan base."

"We have streamlined a host of business operations within the Affin Holdings Group and this should position us further in achieving our goals of being a serious participant in the nation's banking and financial industry."

In terms of new earning streams, the Group's successful entry as a significant participant into the downstream petroleum retail sector, with the completion of the acquisition of a 70% stake in BP Malaysia Sdn Bhd in 2005, have already seen tangible contributions to the Group's bottom-line. For the last quarter of 2005, the operations of Boustead Petroleum Marketing, as the new entity is now called, contributed a pre-tax profit of RM25 million on a gross revenue of RM650 million.

"We are confident that we will grow this business even further by tapping business synergies between existing trading activities of the Boustead Group, the marketing and sale of petroleum products, as well as the effective utilisation of the Group's existing land banks," YBhg. Tan Sri Dato' Lodin added.

On the same score, Boustead expects its investment in PSCI, which currently has in the pipeline a RM5.3 billion contract with the Government of Malaysia to design, construct and deliver six offshore patrol vessels (OPVs), to offer the Group a strategic leverage to make further in-roads into this multi-billion Ringgit industry.

"Currently, two of the vessels are in their testing phase and are scheduled to be delivered by middle of this year. The Group will then focus its efforts on ensuring the successful delivery of the remaining four OPVs on schedule. to meet its contractual obligations to the Malaysian government," YBhg. Tan Sri Dato' Lodin said.

"Despite an erratic and fluctuating palm oil market for the previous financial year, the Plantation Division was able to register a pre-tax operating profit of RM34 million on the back of a turnover of RM446 million. For 2006, we have renewed confidence that crude palm oil prices will remain steady and healthy. Already in the first three months of the year, we have seen prices hovering between around RM1,400 per metric tonne, which is a clear sign of improvement."

"As far as the Property Division is concerned, its contribution of a pre-tax profit of RM55 million on the back of a turnover of RM309 million for the period, should strengthen given that we expect our Property Investment and Property Development sub-divisions to improve handsomely for 2006."

"Our KPIs which have always been in place have been more succinct in the new financial year and as such pressure is on all divisions to deliver. It is without a doubt that as one of the notable GLCs in the country, we are fully cognisant of our social obligation to surpass our shareholders' and stakeholders' expectations."

"We believe we have continued on this course particularly over the last few years and we do not expect to waver on this obligation," YBhg. Tan Sri Dato' Lodin concluded.

Since its inception as a modest trading entity for more than 178 years, the Boustead Group has grown by leaps and bounds to comprise more than 80 subsidiary and associate companies, and has substantial interests in various sectors of the Malaysian economy. The Group's operations are focused in five key areas; plantation, finance & investment, property, manufacturing and services. The Group's combined paid-up capital is currently RM296 million, while the Group's shareholders' funds as at December 31, 2005 stood at RM1.7 billion.