On behalf of the Board of Directors, I am pleased to present the Annual Report and Financial Statements for the year ended 30 June 2010 of Lion Teck Chiang Limited. The property market has improved due to higher sales in Singapore and Malaysia with renewed interest in the second quarter of 2010. Turnover for the steel business remained weak due to the slowdown in construction demand and falling steel prices.

Financial Highlights

In FY2010, operating profit for the Group improved by $10.5m to $17.3m from $6.8m for FY2009. However, the Group turnover for FY2010 decreased by $81m to $126m from $207m for FY2009 mainly due to lower turnover for the steel business. The Group also registered a fair value gain on investment properties of $3.8.

Prospects

Steel Trading

With the completion of most of the reinforcement concrete works pertaining to the two (2) Integrated Resort Projects towards the end of 2009, the steel business experienced a sharp drop in sales volume in the second half of FY2010. Nevertheless, the Group managed to secure a few major civil work projects namely: Marina Coastal Expressway 482; Marina Coastal Expressway 486 and Downtown Line Stage 2. The demand for steel in Singapore has remained stable. It is expected that growth in other major economic sectors may create a spill over that may benefit the construction sector. The local construction sector may also be bolstered by the release of new MRT lines and strong demand for HDB and private residential housings. Steel prices are also expected to remain stable. However, certain factors like foreign exchange rate, global economy changes and international steel price changes may result in a more challenging environment that may affect future earnings.

Property Development

Singapore

Based on URA statistics, the residential property index increased by 5.3% quarter-on-quarter in the second quarter of 2010, compared with the 5.6% increase in the first quarter of 2010. The index for landed homes indicated price increase of 6.2% in the second quarter of 2010 compared to 8.3% in the first quarter. However, with the implementation of new measures aimed to cool property speculation especially in the mass market segment, the residential property market in Singapore is expected to be affected by the announcement on the new measures. It is encouraging that the mid-to-high-end market may not be affected by the new measures. However, it is not certain if buying interest is sustainable. For FY2011, the Group will focus on and launch its new housing project at Crescent Road with cluster bungalows. Piling work commenced in the third quarter of 2010.

Malaysia

The Group’s Malaysia projects performed moderately for the year. The residential development at Bandar Mahkota Banting, which has completed its earlier launched phases, would see the Group continuing with its efforts to reduce the stock level of its terrace houses. In Melaka, the demand for our shops and strata offices stocks at Plaza Mahkota received encouraging response with sales mainly contributed from the budget hotel sector. Further south in Johor, Taman Impian, the Group achieved commendable results, primarily from the sale of its last phase of terrace houses and medium cost flats. For FY2011, the Group shall continue to be sensitive to the market and would be designing effective campaigns to clear all completed stocks for all the projects. The Group also plans to market its industrial park development in Banting.

Property Rental

The Group’s rental income of the investment properties at Arumugam Road, Singapore is expected to improve with the operation of the MRT Circle Line.

Proposed Dividend

The Board is pleased to propose a first and final (one-tier) tax exempt dividend of 0.75 cents per ordinary share for the year ended 30 June 2010. The proposed first and final dividend, if approved at the Company’s Annual General Meeting to be held on 22 October 2010, will be paid on 22 November 2010.

Acknowledgement

On behalf of the Board, I wish to thank all our management and staff for their achievements and contributions to our performance. I would also like to express my sincere appreciation to our customers, suppliers, shareholders and business associates for their continuing support. I am grateful to members of the Audit Committee and my fellow Directors for their counsel and commitment.

CHENG THENG KEE Chairman