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Letter to Shareholders

Dear Fellow Shareholders,

In 2023 the Indonesian economy was one of the strongest in ASEAN region, and our portfolio of Indonesian based businesses has benefited. Indonesia continues its long-term economic transformation into major economy. It is the largest in SEA and 16th largest in the world with a GDP of US$1.4 trillion. GDP growth was around 5% in 2023, and unemployment fell to 5.3% from 5.8%. Indonesia's fiscal deficit was reduced from 2.4% to 2.1% of GDP partially as a result of 2.7% increase in tax revenues and 4% lower amount spent on subsidies (such as 2022's reduced fuel and electricity subsidies). Lower energy price volatility allowed businesses to better forecast, and FDI increased almost 14% to US$47 billion. The previous years supply shock inflation effects moderated, and the GDP growth returned Indonesia to an upper middle-income economy.

The government is targeting stable 5% GDP growth for 2024 - 2026. As a young country (median age 29.2 years) the workforce increases by around 1 million people per year. Properly fed, educated, and employed, this young and growing workforce can help to continue to transform the country from an upper middle-income economy to a high-income economy. Some of the building blocks have been put in place. For example, the social security system, BPJS, supported by employer and worker contributions, is slowly gaining momentum, as its savings reached US$45 billion last year (increasing annually by US$5-6 billion). This system is slowly rolling out a universal healthcare benefit which should significantly increase the average life expectancy.

We also hope that the generally good condition of the economy should lead to a smooth February 2024 election and generally stable business conditions as happy voters generally prefer continuity rather than change. A smooth continuation of an inclusive, compromising style of government is good for business, and good for the economy. Potential headwinds include the weak European economy, slower than expected China economic recovery, and sustained higher global interest rate environment keeping FDI away from emerging markets.

As mentioned last year, our industrial parks benefit from the continuing global supply chain diversification away from China, and in 2023 we added around 22,200 m2 of newly built factories to our customers, with another 116,400 m2 under construction and due to be handed over in FY2024. Our future pipeline is robust, and we expect that our parks will continue to be in high demand due to our natural competitive advantages of land, labor, and our Singapore standard infrastructure, combined with our linkage to Singapore's logistic, financial and other competitive advantages.

Our utilities business has shown a nice recovery on the back of an increase in visitors to hotels in Bintan Resorts and less volatile energy prices. We expect to see additional contributions from the increasing occupancy figures in our industrial parks and continuing increases in visitors to existing and new hotel openings in the resorts. We are also adding significant PV energy production to both Bintan and Batam, and the results should start to flow through in FY2025.

Our property development business did not have any results in 2023. However, we are looking forward to a good pipeline in 2024. This pipeline includes new hotels, a convention center, an equestrian center, and a new 800 hectare data center project in addition to our numerous existing projects.

Our resorts business had a good recovery in 2023, though still short of pre-pandemic numbers. In anticipation of the continued recovery, and on the back of new hotel additions, we are in the process of adding new vessels to our ferry fleet. We also expect to see other new attractions in Bintan including a major equestrian center and polo club, renovated professional tour level golf courses, and marathon and triathlon events.

Overall, in 2023 our EBITDA from these operational segments increased from S$38.4 million to S$60.8 million. With regards to our associate companies Indomobil, BOMC, and PMSE, we also had some success. Indomobil booked record revenues, on the back of strong heavy duty equipment sales and servicing. Looking forward to 2024, those sales for at least the first half of 2024 are already pre-sold, and we expect better contributions from our logistics business (now the largest in Indonesia with around 5,000 trucks) and our fuel distribution business (additional revenues from fleet buyers). In addition, our portfolio of passenger car brands is increasing as we diversify to a multi-brand portfolio. Our BOMC business is also looking forward to significantly increased business from new projects, and we continue to pursue our PMSE solar energy project JV. When completed, together with our other solar PV production sites in Bintan and Batam, this will transform our utilities business to a majority green energy electricity production business.

With regards to the TCFD, we are happy to report we are also taking steps such as replacing old ICE vehicles with EVs, adding additional stand-alone as well as the previously mentioned centralized solar PV production sites, replacing fluorescent lamps with LEDs, continuing our tree and mangrove planting program, as well as major corporate education among all management staff, etc.

We believe the Indonesian economy, will grow strongly in 2024 and 2025. We believe that all our businesses are well positioned to capture the rewards of this growth and we look forward to sharing the benefits from our investments in the near future. Thank you for your continuing support and we look forward to welcoming you soon in Bintan and Batam.

Sincerely,