Business conditions under which the Group’s core businesses operate where generally more favourable in FY2007 than those in the preceding year.

The global economy did well, expanding by 5% in 2006 despite a slight slow down in the US economy. The global growth rate was boosted by strong growth from the leading emerging economies, notably, India and China as well as an improved showing from Europe, all of which are important markets for palm oil and its derivative products such as oleochemicals and specialty fats. The global market was also characterised by surplus liquidity which fueled interests in M&A activities and property acquisitions. On another dimension, global interests in renewable energy sources, global warming and environmental issues have reached unprecedented levels not experienced before. These have significant positive ramifications on vegetable oil prices and their sustained demand.

On the local front, a sanguine Malaysian economy, which grew by 5.9% in 2006, positive market sentiments and keen interests in prime properties helped to ignite demand in selective property segments.

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