Chairman's Statement

On behalf of the Board of Directors of Multi-Purpose Holdings Berhad, I am delighted to present the Annual Report and Audited Financial Statements of the Group and the Company for the financial year ended 31 December 2007.

Corporate Development

The Group adopted the strategy of focussing on the core businesses, namely, gaming, stockbroking and financial services. This plan has benefited the Group as they have done exceptionally well during the year under review and the remarkable performance has translated in a substantial jump in earnings per share from 16.8 sen per share to 40.3 sen per share.

For the year under review, the Group reported an all time high turnover, surpassing the RM 3.2 billion mark, a substantial improvement of 609% over the past year. Profit before tax of RM 680 million is also an important milestone which is 249% higher than the profit before tax of RM 194.7 million recorded in 2006. The acquisition of additional shares in Magnum Corporation Berhad ("MCB") primarily contributed to the improved financial performance as the results of MCB were consolidated as a subsidiary as compared to equity accounting in the previous financial year. The strong growth performance of the regional equity markets has resulted in extraordinary gains on the disposal of quoted investments and properties. The Group as a whole has, amidst market volatility, managed to withstand US subprime loan crisis and global economic slowdown.

On 20 November 2007, the Company signed a Heads of Agreement with CVC Asia Pacific Limited ("CVC") with the intention to privatise MCB via Selective Capital Repayment. The Privatisation Proposals will enable our Company to retain a 51% equity interest in MCB and at the same time offer an opportunity for our Company to bring in CVC, a leading global private equity firm with a proven track record in creating value in its investments, including gaming businesses, as a business partner.

Barring unforeseen circumstances and subject to approval and confirmation of the High Court of Malaya, the proposed Privatisation of MCB is expected to be completed by the second quarter of 2008. With CVC as business partner, we believe it will complement the continuing efforts of the Group to enhance the future performance of the Gaming Division.

Operational Review

Gaming Division

Profit before tax of the gaming sector at RM 526.5 million is 40.4% higher than the previous financial year. Contributions from the property & leisure business and investment holding activities as in nonrecurring gains on disposal of properties and quoted investments enhanced the profit as well.

The extraordinary gains from the disposal of properties and quoted investments further strengthened the cash position of MCB. For the first time, MCB made substantial return to shareholders by way of special dividends totaling 70 sen per share. This is in addition to an interim dividend of 6 sen per share paid on 14 July 2007.

Stockbroking Division

A.A. Anthony Securities Sdn. Bhd. ("AAAS"), the Stockbroking Division registered a profit before tax of RM 33.3 million representing an increase of 6% over the preceding year. The improved performance of the equity market has resulted in higher revenue. However, the subprime loan crisis in US has caused uncertainties and volatility in the fourth quarter.

During the year, AAAS has established two new branches in Nusa Bestari and Teluk Intan while other branches are operational for the full year. The Division has also received approval to engage in Unquoted Debts Securities Trading and will undertake steps to develop this new revenue stream.

With the entrance of foreign participation following the liberalisation of the equity market, keen competitions will occur. AAAS will continue to take advantage of any opportunities to increase its pool of dealers and remisiers and to expand its geographical business presence. It will also continue its efforts to strengthen its frontline services and enhance operating efficiency.

Financial Services Division

The insurance arm of the Group, Multi-Purpose Insurans Bhd ("MPIB"), achieved unprecedented success with the gross premium at an all time high of RM 283.2 million and profit before tax of RM34.0 million, an increase of 14.6% and 31.7% respectively from the previous year. The growth in gross premium as well as extraordinary gains from investments were the main contributors to the outstanding performance.

To attain sustainable growth and profitability in an environment of intense competition, MPIB will continue to expand its agency network nationwide to capture larger market share of broking business, develop its motor franchise, direct corporate as well as corporate agency businesses and personal line businesses. MPIB has also embarked on Quality Service Initiative to transform and enhance its delivery standards to customers.

Outlook

The year ahead is anticipated to be challenging with the spillover effect of the subprime loan crisis, escalating crude oil, and commodity prices resulting in inflationary risk and global economic slowdown. However the GDP of our country is forecasted at 6.1% in 2008, marginally lower than the 6.3% attained during the year. Reduction in corporate tax rate, proposed implementation of the Ninth Malaysia Plan projects and the introduction of various economic corridors are some of the measures taken to woo local and foreign investors to boost the economy.

In 2008 the Group will concentrate in the core businesses whilst at the same time to be on the lookout for other viable ventures with strong fundamentals. Pursuant to this, the Group has acquired strategic land bank with residential and commercial property development potential. The property development will be both earnings accretive and value enhancing to the Group as demand from foreigners is expected to increase following the relaxation of foreign ownership rules, waiver of real property gain tax, and reduction in stamp duty for certain categories of property.

Dividend

For the first time in 10 years, the Board of Directors is proposing a final dividend consisting of 5 sen gross dividend per share less tax and 1 sen tax exempt per share for the financial year ended 31 December 2007. Together with the interim dividend of 5 sen gross dividend per share less tax paid on 11 July 2007, the total dividends for the year would be RM 79.7 million.

Appreciation

On behalf of the Board of Directors, I wish to express my sincere appreciation to the Management and staff of the Group for their dedication and commitment.

I would also like to thank my fellow Directors for their invaluable support and advice. Last but not least, thanks and appreciation must go to our shareholders, business associates, customers, and financiers for their continued confidence, loyalty and support for the Group.