Contents :

The different in announced and audited results can be reconciled as follows:

RM'000
Losses after taxation, but before MI (as announced) 18,339

Adjustments made during the audits:-

Provision for slow moving debt
- related company balance- Southtech Timber (M) Sdn Bhd 16,973
- other trade debtor previously not provided 593
Provision for impairment loss in land 698
Losses in subsidiary previously not consolidated
- Southtech Industries Sdn Bhd 492
Other general adjustment (76)
Losses after taxation, but before MI (as per audited acct) 37,019
Less: MI share of losses ( 539)
Losses after taxation and MI (as per audited accts) 36,480

The above information are provided by the former CEO, Paul Leong Jee Hong (resigned October 2002) and his financial controller, Sean Goh (resigned November 2002).

Query Letter Contents :

We refer to your Company's Annual Audited Accounts 2002 received on 14 November
2002.
We note that the group's loss after taxation and minority interests for the
year ended 30 May 2002 amounts to RM36,479,604.
However, your Company's announcement of unaudited results dated 26 August 2002,
showed a loss after taxation and minority interests of RM18,339,000 for the
abovementioned financial year.
In accordance with the Exchange's Listing Requirements, kindly furnish the
Exchange immediately with your detailed explanation of the above difference for
public release.

Yours faithfully


TAN YEW ENG
Senior Manager, Listing Operations
TYE/NZ