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United Industrial Corporation Limited summary financial report 2005 -

units of the 88-unit The Paterson (bringing the total number of units sold to 66), were sold last year.

Local Office & Retail Investments In the face of strong competition from newer office spaces, the Group has and will continue to pursue a strategy of upgrading its investment buildings in order to deliver better value to its tenants and improve rental yield. The occupancy rate of the UIC Building held firm at 90%. However, Stamford Court registered a decline in occupancy from 99% to 94%.

The Group’s commitment to upgrading was clearly demonstrated in the massive remodelling works of Marina Square Shopping Mall, whose transformation should anchor the Mall as the premier shopping and lifestyle destination in the Marina Centre area in the years to come. The occupancy of the Mall was 98% at the end of 2005, with the remaining 2% of tenants expected to commence business in early 2006. At West Mall, the Group’s suburban mall in Bukit Batok, occupancy was maintained at 100% and rental revenue rose by 7% to $22 million.

Overseas Investments Under the Group’s regional expansion strategy in Malaysia, one of our subsidiary companies entered into conditional agreements with indigenous parties to acquire land in Selangor for a proposed landed housing development.

In China, the Group’s 36%-owned Sheraton Tianjin Hotel in the He Xi District of Tianjin, recorded operating profits of $6.7 million in 2005 with an average occupancy rate of 70%.

The sale of Eau Claire Place II in Calgary, Canada, earned a net profit of $5.4 million, and the sale of Atrium Court in Glasgow, Scotland, yielded a net profit of $7.0 million.

Non-Property Business As a result of further business consolidation, the UIC Technologies Group improved its revenue by 9% to $51 million in 2005. Pre-tax profit reached $1 million in 2005 as compared with $0.4 million in 2004.

Mandatory Offer for UIC On 5 October 2005, Summit Top Investments Limited (“Summit Top”), a related corporation of Telegraph Developments Ltd (“Telegraph”), which had acquired shares, which when aggregated with shares held by Telegraph, resulted in a 30.0008% interest in the shareholding of the Company, announced a mandatory offer (“Offer”) for the remaining shares of the Company as required by the Singapore Code on Take-overs and Mergers. Summit Top’s cash offer of $1.09 per share was conditional upon it obtaining more than 50% of UIC shares.

The Board’s directors independent of the Offer appointed Merrill Lynch (Singapore) Pte. Ltd. (“Merrill Lynch”) as Independent Financial Adviser and concurred with Merrill Lynch’s opinion that the Offer was “not fair, from a financial point of view, for the shareholders as a whole”. Hence, they recommended non-acceptance of the Offer.

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