RALCO CORPORATION BERHAD – (7498)

Notes To Unaudited Financial Statements Of The Group For The 4th Quarter Ended 31st December 2000

(1) 	Accounting Policies
The accounts of the Group are prepared using the same accounting policies, method of computation and basis of consolidation applied in the preparation of this quarterly financial statements are consistent with those used in the preparation of the most recent annual financial statements.

(2) 	Significant Events
There were no significant events occurring within the Group during the quarterly financial period under review.

(3) 	Exceptional Items
There were no exceptional items for the Group during the quarterly financial period under review.

(4) 	Extraordinary Items
There were no extraordinary items for the Group during the quarterly financial period under review.

(5) 	Taxation 
Taxation charged for the financial quarter under review comprise of:-

Current quarter	Year to date
RM’000		RM ‘000

       Current taxation		  	   -		     - 
					====		  ====

(6) 	Pre-Acquisition Profits
There were no pre-acquisition profits included in the operating profit for the quarterly financial period under review.

(7) 	Quoted Shares
There were no purchase or disposal of quoted shares for the quarterly financial period under review.

(8) 	Profit On Sale of Investments and/or Properties
There were no disposal of investments in the quarterly financial period under review. There were no sales of properties for the quarterly financial period under review.

(9) 	Changes in Composition of the Group
There were no changes in the composition of the Group during the quarterly financial period under review.

(10) 	Status of Corporate Proposals
There were no Corporate proposals announced or pending completion as at the date of this announcement.

(11) 	Seasonal or Cyclical Factors
The business operations of the Group were not materially affected by any seasonal or cyclical factors during the quarterly financial period under review.

(12) 	Equity Structure
There were no other issuance and repayments of debt and equity securities, share buy back, shares held as treasury stocks and resale of treasury shares for the quarterly financial period under review.

(13) 	Group Borrowings

RM (‘000)

Long Term Loan - Unsecured 	       5,477			 
Short Term Loan - Unsecured 	     15,362				------------------ 
       Total	20,839	
	------------------  

											
(14) 	Contingent Liabilities
The Company has issued corporate guarantee to financial institutions for banking facilities granted to certain subsidiary companies up to a limit of RM52.3 million.

(15) 	Off Balance Sheet Financial Instruments
The Group does not have any financial instrument with off balance sheet risk as at the date of this announcement.

(16) 	Material Litigation
The Group does not have any material litigation as at the date of this announcement.

(17) 	Segmental Reporting
No segmental analysis is prepared as the Group is primarily engaged in the manufacturing of plastic products.

(18) 	Material Changes In The Quarterly Results Compared to the Results of the Preceding Quarter 
For the current quarter, the Group registered a pre-tax loss of RM1.4 million as compared to RM1.08 million in the preceding quarter. The loss was mainly due to erosion of profit margin by high resin prices and adverse competition. 

(19) 	Review of Performance of the Company and its Principal Subsidiaries
For the year ended 31st December 2000, the Group faced a very difficult year due to sharp increase in petroleum prices and resulted in an increase in resin prices, resins being the raw material used in the manufacture of plastic containers and other products of the Group.

As such, we incurred a pre-tax loss of RM2.3 million as compared to a pre-tax profit of RM2.4 million for the corresponding period in the previous year.
	
(20) 	Prospects for the Current Financial Year
Barring any unforeseen circumstances and taking into consideration the increasing competition & lower demand which the Group is facing, the Board is of the view that the Group will at best be able to perform satisfactorily for the current financial year ended 31st December 2001.

(21) 	Variance on Forecast Profit
No profit forecast or profit guarantee is made in the quarterly financial period under review.

(22) 	Dividend
No decision is made regarding whether any dividend is to be declared as at a date of this announcement.

By Order of The Board,

Sui Diong Hoe (MIA 3663)
Secretary

Date: February 27, 2001
KUALA LUMPUR/MJ