PART A: EXPLANATORY NOTES AS PURSUANT TO FRS 134

A1.	Basis of preparation 

The interim financial report is unaudited and has been prepared in accordance with the Financial Reporting Standard (“FRS”) 134: “Interim Financial Reporting” and Paragraph 9.22 Appendix 9B of  Bursa Malaysia Securities Berhad ("Bursa Securities") Listing Requirements. 

The interim financial report should be read in conjunction with the audited financial statements of the Group for the financial year ended 30 April 2007. The explanatory notes attached to the interim financial report provide an explanation of events and transactions that are significant to an understanding of the changes in the financial position and performance of the Group.

A2.	Changes in accounting policies

The accounting policies and method of computation adopted for interim financial statements are consistent with those adopted for the audited financial statements for the financial year ended 30 April 2007 except for the adoption of the following new Financial Reporting Standard (“FRS”) for financial statement commencing  1 May 2007:

FRS 117	Leases
FRS 124	Related Party Disclosures

The adoption of the above standards does not have material impact to the financial position of the Group. The following comparatives amounts have been restated due to the adoption of  FRS 117.

At 30 April 2007	As previously reported
RM’000	Reclassification 

RM’000	Restated 

RM’000	

Properties, plant and equipment 
(net book value)	
87,208	
(1,974)	
85,234	

Prepaid lease payments	
0	
1,974	
1,974	

A3.	Qualification of Annual Financial Statements

There were no audit qualifications on the annual financial statements for the year ended 30 April 2007.

A4.	Seasonal and cyclical factors

The Group’s business operation results were not materially affected by any major seasonal or cyclical factors.
	
A5.	Unusual nature and amounts of items affecting assets, liabilities, equity, net income or cash flows

There were no unusual nature and amounts of items affecting assets, liabilities, equity, net income or cash flows during the current quarter under review.

A6.	Material changes in estimates

There were no material changes in estimates of amounts reported in the current quarter under review. 

A7.	Issuances and repayment of debt and equity securities	

There were no issuance, repayment of debt and equity securities, share buy-backs, share cancellations, shares held as treasury shares or resale of treasury shares during the current quarter under review. 
	                                                                                                                                           
A8.	       Dividend Paid	

There was no dividend paid by the company for the current quarter under review. 

A9.	Segment information

	Segmental information is presented in respect of the Group’s business segments:-

							Current	
							period	
					Other	Consolidation	ended	
			Manufacturing	Trading	Operation	adjustment	31.10.07	
			RM'000	RM'000	RM'000	RM'000	RM'000	
								
Revenue from external customers 	71,212	1,206	-	                  -   	72,418      	
Inter-segment revenue		661                         	120            	-	(781)            	                -   	
Total revenue		71,873	1,326	-	(781)	72,418	
							 	
Segment results		5,112	(56)	(165)	(174)                    781   	4,717	
								
Interest income						144	
Interest expense						(1,329)	
Share of results of associates			
		329	
								
Profit before taxation						3,861	
Tax expense						(30)	
								
Net profit for the period					3,831	

A10.	Valuation of property, plant and equipment

The property, plant and equipment except for freehold land are stated at cost/valuation less accumulated depreciation. There was no revaluation of property, plant and equipment for the current quarter and financial year to date.

A11.	Material events subsequent to the end of the interim period

There were no material events subsequent to the end of the current quarter ended 31 October 2007.

A12.	Changes in the composition of the Group

       There were no material changes in the composition of the Group for the current quarter and financial    
       year-to-date except for the following: 

a)	On 12 September 2007, there was a disposal of 490,000 ordinary shares of RM1.00 each in Hirotako Kein Hing Sdn Bhd (HKH), representing 49% of the issued and fully paid-up capital of HKH.

b)	On 8 November 2007, there was an acquisition of USD25,000 charter capital in Kein Hing Polychrome (Vietnam) Co. Ltd. (KHPV), representing 10% of charter capital of KHPV.

A13.	Changes in contingent liabilities

There were no changes in contingent liabilities and contingent assets of a material nature since the last audited financial statements for the year ended 30 April 2007.
                                             
      A14.     Capital commitments

There were no capital commitments as at date of this report.

PART B: 	ADDITIONAL INFORMATION REQUIRED BY THE BURSA MALAYSIA LISTING REQUIREMENTS

B1.	Review of performance 
	
The Group achieved revenue of RM 40.15 million representing an increase of 41.2% compared to RM 28.44 million in the previous year corresponding quarter. The increase in revenue is mainly due to overall sales increase.

The Group’s profit before tax for the current quarter increased by 11.3% to RM2.37 million from the previous year’s corresponding quarter’s profit before tax of RM2.13 million. This is mainly attributed to the improvement in profit margin and better results recorded by subsidiaries both in Malaysia and Vietnam.

B2.	Variation of results against preceding quarter 

The Group registered a profit before tax RM2.37 million in the current quarter compare to the profit before tax of RM1.50 million for the immediate preceding quarter, which is an increase of RM0.87 million.

The improvement in the profit before tax is attributed to higher sales and better profit margin achieved in the quarter under reviewed compare to that of preceding quarter.
.

B3.	Prospects 

Barring any unforeseen circumstances, the Board expects the Group to continue to achieve satisfactory performance for the next quarter.

B4.	Variance of actual and forecast profit 

The Group has not provided any profit forecast for the current financial year ending 30 April 2007.

B5.	Tax expense 

		Current		Current year	
		Quarter		To date	
		31.10.2007		31.10.2007	
                                                                                                RM' 000		RM' 000	
Current tax expense:					
 - Current	282		530	
 - Prior year	- 		-	
	282		530	
Deferred tax expense:				
- Reversal of temporary differences	(500)		(500)	
	  218   		         (30)	

The effective tax rate for the period under review was lower than the statutory income tax rate of 26% due to the utilization of reinvestment allowances in a wholly-owned subsidiary of the Company.  

B6.	Unquoted investments and/or properties 

The Group has not disposed off any investments in any unquoted investments and/or properties during the financial quarter under review.

B7.	Quoted and marketable investments 

The detail of the investment in quoted shares as at 31 October 2007 are set out below:

	Current quarter
RM’000	
Total investment at cost	434	
Total investment at book value	434	
Total investment at market value	454	

B8.	Status of corporate proposal announced 

There were no corporate proposals announced as at date of this report.

B9.	Group borrowings 

The Group’s borrowings as at the end of the reporting quarter are as follows:

The above is inclusive of borrowing in foreign currency of USD4.99 million.

B10.	Off balance sheet financial instrument 

There are no financial instruments with off balance sheet risk as at the date of this report.

B11.	Changes in material litigation 

Neither the Company nor any of its subsidiaries is engaged in any litigation or arbitration, either as plaintiff or defendant, which has a material effect the financial position of the Company or any of its subsidiaries and the Board is not aware of any proceedings pending or threatened, or of any fact likely to give rise to any proceedings, which might materially and adversely affect the position or business of the Company or any of its subsidiaries. 

B12.	Dividend payable

The first and final tax exempt dividend of 3% for the financial year ended 30 April 2007 has been paid on 21 November 2007.

B13.	Basic earnings per share 

	The basic earning per share for the current quarter and cumulative year to date are computed as follow:-
   
B14.	Authorisation for issue

	The Second Quarterly Report was authorised for issue by the Board of Directors in accordance with the resolution of the directors on 10 December 2007.

	By Order of the Board

	
	Yap Toon Choy
	Group Managing Director
	10 December 2007