IOI Group

(As Per Year ending 30 June 2007)

The plantation statistics are tabulated as follows:

Crop Statement

YEAR ENDED 30 JUNE	2007	2006	2005	2004	2003
Oil Palm
Mature area harvested (hectare)	138,282	136,455	132,679	122,401	95,450
FFB production (tonne)	3,694,535	3,674,483	3,657,776	2,927,194	2,396,231
Yield per mature hectare (tonne)	26.72	26.93	27.57	23.91	25.10
Mill production
Crude palm oil	793,452	805,627	815,790	677,319	597,515
Palm kernel	185,418	188,235	192,446	157,243	143,307
Oil Extraction rate (%)
Crude palm oil	21.33	21.38	21.59	21.54	21.82
Palm kernel	4.98	5.00	5.09	5.00	5.23
Average selling price (RM/tonne)
Crude palm oil	1,759	1,386	1,453	1,575	1,461
Palm kernel	958	928	1,005	794	711
Operating profit (RM/mature hectare)	6,728	4,560	5,783	5,300	5,576
Rubber
Mature area tapped (hectare)	568	619	1,054	1,249	1,605
Rubber production ('000 kg)	1,723	1,234	1,730	2,329	3,615
Yield per mature hectare (kg)	3,034	1,993	1,641	1,865	2,252
Average selling price (RM/kg)	3.24	5.23	4.88	5.27	4.15
Operating profit (RM/mature hectare)	10,144	7,583	4,356	4,380	3,850

Crop Mix		Oil palm Hectarage… By Age

Area Statement (In Hectares)

YEAR ENDED 30 JUNE	2007	2006	2005	2004	2003
Oil Palm
Mature	139,798	135,860	135,291	131,333	107,108
Immature	9,073	8,195	8,405	13,727	17,095
	148,871	144,055	143,696	145,060	124,203

Rubber
Mature	568	568	1,035	1,172	1,397

Others	386	403	433	495	590
Total planted area	149,825	145,026	145,164	146,727	126,190
Nursery	98	75	76	67	142
Estate under development	1,650	–	682	461	805
Housing project	1,202	1,201	1,150	1,158	1,162
Labour lines, buildings sites and infrastructure	16,675	12,347	11,442	10,089	8,034
Total area	169,450	158,649	158,514	158,502	136,333

Oil Palm Hectarage... by Region

Operations Review

For the financial year under review, the Group’s estates produced a total of 3.69 million MT of FFB, almost the same level as the previous year.

The average FFB yield per hectare for FY2007 was slightly lower compared to previous financial year. Yields were somewhat affected by unfavourable weather and lingering effect of the cyclical “biological tree-stress” suffered last year. With the lower FFB yield for FY2007 at 26.72 MT (FY2006 - 26.93 MT) per mature hectare and coupled with a slightly lower oil extraction rate of 21.33% (FY2006 - 21.38%) the average CPO yield declined to 5.70 MT per mature hectare as compared to a yield of 5.76 MT per mature hectare for FY2006. Nevertheless, the CPO yield achieved by our Group is still approximately 50% higher than the national average of 3.8-4.0 MT per mature hectare. The Group’s CPO yield trend for the last 5 years are as follows:

Oil Yield Per Mature Hectare

TThe best performing estate which is Moynod Estate, achieved a yield of 7.82 MT of CPO per hectare for FY2007.

For FY2007, the Group’s plantation business, recorded an operating profit of RM926.9 million, an increase of 46% over FY2006’s RM636.3 million. Main driver for increase in profitability was the hike in CPO prices which more than offset higher sales tax and the cooking oil cess introduced on 1 June 2007.

The cess and tax for the year were as follows:

	FY 2007 RM'000	FY 2006 RM'000
MPOB cess	11,901	12,085
Rubber	-	125
Cooking Oil cess	6,244	-
	18,145	12,210
Sabah sales tax	80,704	61,132
	98,849	73,342

Operating profit per mature hectare for oil palm increased by 48% to RM6,728 per hectare for the financial year under review as compared to RM4,560 per hectare for the previous financial year.

For capital expenditure, the Division spent a total of RM62.1 million in FY2007 as compared to RM59.3 million in FY2006. The capital expenditure is primarily incurred on new planting, staff quarters, road and bridges, agricultural equipment as well as the upgrade and expansion of milling capacity. As for replanting expenditure, RM18.6 million was charged out in the financial year just ended compared to RM12.4 million for the previous financial year.

Mature Oil Palm Area/FFB Production

Outlook and Prospect

On the price front, it is a given that prices for FY2008 will average significantly higher than FY2007; in our view at least 30% higher, in view of bullish fundamentals. Current spot month of September 2007, CIF Europe prices for rapeoil, soyoil and sunflower oil are all above USD1,000 PMT whilst crude oil is above USD80 per barrel. It is therefore likely that palm oil price will move to another record high again to close the price gap if the other oil prices stay at these high levels. There should therefore be a substantial jump in earnings level for FY2008, in line with the price increase.

Plantation Statistics