HONG FOK CORPORATION LIMITED

(Co. Reg. No. 196700468N)

Full Year Financial Statement And Dividend Announcement for the Year Ended 31 December 2005

PART I INFORMATION REQUIRED FOR ANNOUNCEMENTS OF QUARTERLY (Q1, Q2 & Q3), HALF-YEAR AND FULL YEAR
RESULTS

1(a) An income statement (for the group), together with a comparati ve statement for the corresponding period of the
immediately preceding financial year.

Full year financial statement on consolidated results for the year ended 31 December 2005.
These figures have not been audited.

%
Increase/
2005 2004 (Decrease)
Revenue (Note 1) 38,729 39,979 (3)
Other income (Note 2) 327 419 (22)
39,056 40,398 (3)
Allowance for diminution in value and foreseeable losses on - (400) NM
development properties
Impairment losses on other investments and remeasurement of (926) (865) 7
trading securities, net
Allowance for doubtful receivables and bad debts written off, net (333) (122) 173
Amortisation of negative goodwill - 93 NM
Cost of sales of development property - (434) NM
Depreciation of fixed assets (428) (346) 24
Exchange gain/(loss), net 399 (734) NM
Other operating expenses (23,679) (23,981) (1)
Total expenses (24,967) (26,789) (7)
Profi t from operations (Note 3) 14,089 13,609 4
Finance costs (18,782) (14,796) 27
Loss before share of resul ts of associ ated compani es (4,693) (1,187) 295

Share of results of associated companies (4,383) 2,087 NM
(Loss)/Profit from ordinary acti viti es before taxation (9,076) 900 NM
Income tax - current year (96) (206) (53)
Income tax - overprovision in prior years 305 1,440 (79)
Deferred taxation (171) (818) (79)
Net (Loss)/Profit for the year (9,038) 1,316 NM
$'000
The Group

Notes :
(1) Included in Revenue is investment income of approximately $312,000 (2004 : $89,000).
(2) Included in Other income is gain on disposals of fixed assets, net of approximately $97,000 (2004 : $64,000).
(3) Included in Profit from operations is profit on sale of development property of approximately $Nil (2004 : $716,000).
(4) NM Not Meaningful.
(5) NA Not Applicable.








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1 (b)(i) A balance sheet (for the issuer and group), together with a comparative statement as at the end of the immediately
preceding financial year.


2005 2004 2005 2004
Non-current Assets
Fixed assets 732 832 - -
Subsidiaries - - 186,746 187,207
Associates 176,412 157,281 4,456 4,403
Investment properties 867,453 829,720 - -
Other investments 375 918 - -
Deferred tax assets 51 221 - -
1,045,023 988,972 191,202 191,610
Current Assets
Trading securities 1,084 2,192 - -
Development properties 50,038 40,357 - -
Trade and other receivables 2,785 4,729 3 3
Derivative assets 241 - - -
Cash and cash equivalents 967 392 51 40
55,115 47,670 54 43
Total Assets 1,100,138 1,036,642 191,256 191,653
Equity Attributable to Equity Holders of the Parent
Share capital 149,899 149,899 149,899 149,899
Reserves 438,347 387,896 40,901 41,305
Total Equity 588,246 537,795 190,800 191,204
Non-current Liabilities
Obligations under finance leases 215 303 - -
Interest-bearing loans and borrowings 367,357 481,280 - -
Deferred tax liability 498 498 - -
368,070 482,081 - -
Current Liabilities
Bank overdraft (secured) 123 709 - -
Trade and other payables 15,091 14,433 456 449
Obligations under finance leases 145 134 - -
Interest-bearing loans and borrowings 128,231 1,000 - -
Tax payable 232 490 - -
143,822 16,766 456 449
Total Liabilities 511,892 498,847 456 449
Total Equity and Liabilities 1,100,138 1,036,642 191,256 191,653
The Group The Company
$'000 $'000


1(b)(ii) Aggregate amount of groups borrowings and debt securities.

Amount repayable in one year or less, or on demand
Secured Unsecured Secured Unsecured
$128,499,000 - $1,843,000 -
As at 31.12.2004 As at 31.12.2005

Amount repayable after one year
Secured Unsecured Secured Unsecured
$367,572,000 - $481,583,000 -
As at 31.12.2004 As at 31.12.2005


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Details of any collateral

Included in the amount repayable in one year or less, or on demand (secured) of $128,499,000 is a principal amount of
$110,000,000 bonds due J uly 2006 but was repaid in J anuary 2006 through refinancing of $70,000,000 Fixed Rate Notes
due 2011 and $40,000,000 Floating Rate Notes due 2011. Included in the carrying value of the interest-bearing loans and
borrowings is an amount of approximately $241,000 relating to the change in fair value of these bonds in line with the
adoption of FRS 39.

The borrowings by the subsidiaries are generally secured by the Groups investment and development properties and are
guaranteed by the Company.


1(c) A cash flow statement (for the group), together with a comparati ve statement for the corresponding period of the
immediately preceding financial year.
2005 2004
Operating Acti viti es :
(Loss)/Profit from ordinary activities before taxation (9,076) 900
Adjustments for :
Share of results of associated companies 4,383 (2,087)
Depreciation of fixed assets 428 346
Amortisation of negative goodwill - (93)
Gain on disposal of development property - (716)
Gain on disposals of fixed assets, net (97) (64)
Gain on disposals of trading securities (225) (20)
Impairment losses on other investments and remeasurement of 926 865
trading securities, net
Interest income (252) (89)
Interest expenses 18,782 14,796
Operating profit before working capital changes 14,869 13,838
Changes in working capital :
Development properties (8,738) (353)
Trade and other receivables 547 (1,864)
Trade and other payables 516 (283)
Cash generated from operations 7,194 11,338
Income tax paid (107) (502)
Interest received 72 89
Income tax refund 58 77
Cash Flows from Operati ng Activi ti es 7,217 11,002
Investing Activiti es :
Decrease in investment properties 50 152
Increase in trading securities (426) (2,288)
Purchase of fixed assets (270) (105)
Proceeds from disposal of development property - 1,150
Proceeds from disposals of fixed assets 97 67
Proceeds from disposals of trading securities 1,381 931
(Increase)/Decrease in interests in associated companies (400) 729
Cash Flows from Investi ng Activi ti es 432 636
Fi nancing Activiti es :
Interest paid (19,583) (14,679)
Dividend paid (1,199) (1,199)
Repayment of interest bearing loans and borrowings (1,000) -
Payment of finance lease rentals (136) (126)
Proceeds from interest bearing loans and borrowings 15,429 4,500
Cash Flows from Fi nanci ng Activi ties (6,489) (11,504)
Net Increase i n Cash and Cash Equi val ents 1,160 134
Cash and cash equivalents at 1 J anuary (317) (445)
Effect of exchange rate changes on balances held in foreign currencies 1 (6)
Cash and Cash Equi val ents at 31 December 844 (317)
Cash and Cash Equi val ents at 31 December is represented by :
Cash at banks and in hand 967 392
Bank overdraft (secured) (123) (709)
844 (317)
The Group
$'000
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1(d)(i) A statement (for the issuer and group) showing either (i) all changes in equity or (ii) changes in equity other than
those arising from capitalisation issues and distributions to shareholders, together with a comparati ve statement for
the corresponding period of the immediately preceding financial year.

Capital
Share Share and Other Translation Revaluation
Capital Premium Reserves Reserves Reserves Total
The Group
At 1 J anuary 2004 149,899 814 10,297 (19,916) 277,370 75,807 494,271
Exchange differences on translation - - - (1,259) - - (1,259)
of financial statements of foreign
subsidiaries and associated companies
Exchange differences on translation - - (326) - (2,093) - (2,419)
of balances at beginning of the year
Net surplus on revaluation - - - - 932 - 932
Share of reserves of associated companies - - - - 46,153 - 46,153
Net profit for the year - - - - - 1,316 1,316
Dividend - - - - - (1,199) (1,199)
At 31 December 2004 149,899 814 9,971 (21,175) 322,362 75,924 537,795
At 31 December 2004, as previously reported 149,899 814 9,971 (21,175) 322,362 75,924 537,795
Effects of adopting :
FRS 21 - - - 70 - (79) (9)
FRS 103 - - (7,600) (317) - 13,983 6,066
At 1 J anuary 2005, as restated 149,899 814 2,371 (21,422) 322,362 89,828 543,852
Exchange differences on translation - - - 903 - - 903
of financial statements of foreign
subsidiaries and associated companies
Exchange differences on translation - - - - 2,035 - 2,035
of balances at beginning of the year
Net surplus on revaluation - - - - 37,783 - 37,783
Share of reserves of associated companies - - 772 - 13,324 (186) 13,910
Net loss for the year - - - - - (9,038) (9,038)
Dividend - - - - - (1,199) (1,199)
At 31 December 2005 149,899 814 3,143 (20,519) 375,504 79,405 588,246
The Company
At 1 J anuary 2004 149,899 814 - - - 41,682 192,395
Net profit for the year - - - - - 8 8
Dividend - - - - - (1,199) (1,199)
At 31 December 2004 149,899 814 - - - 40,491 191,204
Net profit for the year - - - - - 795 795
Dividend - - - - - (1,199) (1,199)
At 31 December 2005 149,899 814 - - - 40,087 190,800
$'000
Retained
Profit

1(d)(ii) Details of any changes in the companys share capital arising from rights issue, bonus issue, share buy-backs,
exercise of share options or warrants, conversion of other issues of equity securities, issue of shares for cash or as
consideration for acquisition or for any other purpose since the end of the previous period reported on. State also
the number of shares that may be issued on conversion of all the outstanding convertibles as at the end of the
current financial period reported on and as at the end of the corresponding period of the immediately preceding
financial year.

Nil.







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2. Whether the figures have been audited or reviewed, and in accordance with which auditing standard or practice.

The figures have not been audited nor reviewed by the Companys auditors.


3. Where the figures have been audited or reviewed, the auditors report (including any qualifications or emphasis of a
matter).

NA.


4. Whether the same accounting policies and methods of computation as in the issuers most recently audited annual
financial statements have been applied.

Except as disclosed in paragraph 5 below, the Group has applied the same accounting policies and methods of computation
in the financial statements for the current reporting year compared with the Groups audited financial statements for the year
ended 31 December 2004.


5. If there are any changes in the accounting policies and methods of computation, including any required by an
accounting standard, what has changed, as well as the reasons for, and the effect of, the change.

The Group adopted various new or revised Financial Reporting Standards (FRS) which became effective for the financial
year beginning 1 J anuary 2005. The FRS that have a material financial impact on the Group are disclosed below :

FRS 21 The Effects of Changes in Foreign Exchange Rates

With the adoption of the revised FRS 21, the measurement currency of one of the subsidiaries was changed from S$ to US$.
Consequently, comparatives were restated and opening retained profit was adjusted.

FRS 39 Financial Instruments : Recognition and Measurement

The adoption of FRS 39 resulted in the Group classifying certain of its financial assets as trading securities. It also requires
derivatives to be recognised at fair value and sets out certain conditions in which hedge accounting can be applied. The
Group has entered into an interest rate swap to manage the impact of interest rate risk of fixed rate bonds and the changes in
the fair value of the fixed rate bonds and interest rate swap are dealt with in the profit and loss account.

FRS 102 Share-based Payment

In compliance with FRS 102, share options granted by an associated company to certain of its directors and employees are
measured at fair value at the date of grant and recognised as an expense in the profit and loss account at the vesting date
which is the same as the grant date.

FRS 103 Business Combinations

The adoption of FRS 103 resulted in the Group derecognising negative goodwill at 1 J anuary 2005 with a corresponding
adjustment to the opening retained profit.


6. Earnings per ordinary share of the group for the current financial period reported on and the corresponding period
of the immediately preceding financial year, after deducting any provision for preference dividends.
2005 2004
(Loss)/Profit per ordinary share of the Group after deducting any provision for
preference dividends :
(a) Based on the average number of ordinary shares on issue; and (1.51) cts 0.22 cts
(b) On a fully diluted basis (detailing any adjustments made to the earnings) (1.51) cts NA
The Group

The (loss)/profit per ordinary share was calculated based on the loss for the year of approximately $9,038,000
(2004 : profit of $1,316,000) and the number of ordinary shares in issue of 599,595,180 (2004 : 599,595,180).

There is no dilutive potential ordinary shares in existence as at 31 December 2005.


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7. Net asset value (for the issuer and group) per ordinary share based on issued share capital of the issuer at the end
of the :

(a) current financial period reported on; and
(b) immediately preceding financial year.
2005 2004 2005 2004
Net asset value per ordinary share based on 98 cts 90 cts 32 cts 32 cts
issued share capital
The Group The Company


8. A review of the performance of the group, to the extent necessary for a reasonable understanding of the groups
business. It must include a discussion of the following :

(a) any significant factors that affected the turnover, costs, and earnings of the group for the current financial
period reported on, including (where applicable) seasonal or cyclical factors; and
(b) any material factors that affected the cash flow, working capital, assets or liabilities of the group during the
current financial period reported on.

The Groups revenue for 2005 decreased from approximately $40.0 million to $38.7 million. This was principally due to
an absence in sale of development property in Singapore and the lower contribution of rental income from its investment
properties although there was an increase in investment income from its trading securities.

The Groups other income for 2005 decreased mainly due to lower compensation income from the tenants of its
investment properties.

The Groups expenses for 2005 decreased from approximately $26.8 million to $25.0 million due mainly to the absence
of allowance for diminution in value and foreseeable losses on development properties, the absence of cost of sales of
the development property and the recording of an exchange gain in 2005 as against an exchange loss in 2004.

However, in spite of a slight increase in profit from operations, the Groups loss before share of results of associated
companies increased from approximately $1.2 million for 2004 to $4.7 million for 2005. This was attributed to increase
in finance costs from higher interest rates and increase in bank borrowings.

In addition, the Groups share of loss from associated companies was approximately $4.4 million for 2005. This was
principally due to the Groups share of impairment loss on property held for future development being higher than the
Groups share of the profit from the completion of the sale of a property in Hong Kong.

Hence, the Group made a loss of approximately $9.0 million for 2005 as compared to a profit of approximately $1.3
million for 2004.

The increase in net tangible assets was principally due to an increase in reserves resulting from the net surplus arising
from the revaluation of the Groups investment properties as of December 2005.


9. Where a forecast, or a prospect statement, has been previously disclosed to shareholders, any variance between it
and the actual results.

NA.


10. A commentary at the date of the announcement of the significant trends and competitive conditions of the industry
in which the group operates and any known factors or events that may affect the group in the next reporting period
and the next 12 months.

The Group expects its operating environment to remain challenging and competitive, especially in light of the rising interest
rates.









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11. Dividend

(a) Current Financial Period Reported On

Any dividend declared for the current financial period reported on ? None

(b) Corresponding Period of the Immediately Preceding Financial Year

Any dividend declared for the corresponding period of the immediately preceding financial year ? Yes


Name of Dividend
Dividend Type
Dividend Amount per Share (in cents)
Optional : Dividend Rate (in %)
Par value of shares
Tax Rate
$0.25
20%
First & Final
Cash
1% per ordinary share
0.25 cents per ordinary share (less tax)


(c) Date payable

NA.

(d) Books closure date

NA.


12. If no dividend has been declared/recommended, a statement to that effect.

No dividend has been declared nor recommended for the full year ended 31 December 2005.




PART II ADDITIONAL INFORMATION REQUIRED FOR FULL YEAR ANNOUNCEMENT
(This part is not applicable to Q1, Q2, Q3 or Half Year Results)

13. Segmented revenue and results for business or geographical segments (of the group) in the form presented in the
issuers most recently audited annual financial statements, with comparati ve information for the immediatel y
preceding year.

Property Property Property Other
Business Segments Investment Development Management Operations Total
2005
Total revenue 37,122 399 896 312 38,729
Segment results 14,250 286 65 (512) 14,089
Finance costs (17,689) (629) - (464) (18,782)
(4,693)
Share of results of associated companies (4,383)
Taxation 38
Net loss for the year (9,038)
2004
Total revenue 37,470 1,532 888 89 39,979
Segment results 14,789 393 86 (1,659) 13,609
Finance costs (14,194) (405) - (197) (14,796)
(1,187)
Share of results of associated companies 2,087
Taxation 416
Net profit for the year 1,316
$'000
The Group

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14. In the review of performance, the factors leading to any material changes in contributions to turnover and earnings
by the business or geographical segments.

Please refer to paragraph 8 above.


15. A breakdown of sales.

%
Increase/
2005 2004 (Decrease)
(a) Sales reported for first half year 19,616 19,191 2
(b) Operating profit/(loss) after tax before deducting minority 175 (817) NM
interests reported for first half year
(c) Sales reported for second half year 19,113 20,788 (8)
(d) Operating (loss)/profit after tax before deducting minority (9,213) 2,133 NM
interests reported for second half year
The Group
$'000


16. A breakdown of the total annual dividend (in dollar value) for the issuers latest full year and its previous full year.

Total Annual Dividend (Refer to Para 16 of Appendix 7.2 for the required details)
Latest Full Year ('000) Previous Full Year ('000)
Ordinary - 1,199
Preference - -
Total : - 1,199












BY ORDER OF THE BOARD

Koh Chay Tiang
Quek Sok Cher
Company Secretaries
28 February 2006

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