AJIYA BERHAD (377627-W)	
Notes to the Interim Financial Report for the period ended 28 February 2005

Notes

A1	Basis of Preparation
	The Interim financial report is unaudited and has been prepared in compliance with FRS 134, Interim Financial Reporting and Chapter 9 part K of the Listing Requirements of the Bursa Malaysia and should be read in conjunction with the financial statement of the Group for the year ended 30 November 2004.
	
	The accounting policies and methods of computation adopted by the Group in this interim financial report are consistent with those adopted in the financial statements for the year ended 30 November 2004.

A2	Status of Audit Qualifications
	The audited financial statements of the Group for year ended 30 November 2004 were not subject to any audit qualification.

A3	Seasonality or cyclicality
	The Group’s operations were not materially affected by any seasonal or cyclical factors.

A4	Unusual items Affecting Assets, Liabilities, Equity, Net Income or Cash Flows
	There were no items affecting assets, liabilities, equity, net income or cash flows that were unusual because of their nature, size or incidence.

A5	Material Changes in Estimates
	There were no material changes in estimates used in the preparation of the financial statements in the current financial period as compared with the previous financial period or previous year.

A6	Issuance, cancellation, repurchases, resale and repayments of debts and equity securities
	There were no issuance, cancellation, repurchases, resale and repayments of debts and equity securities for the current financial year todate.
	
A7	Dividend paid	
	There were no dividend paid during the current financial period.

A8	Segmental Reporting
	The Group is principally involved in the manufacture and supply of materials used in the construction and building based industries in Malaysia. Hence no segment information is provided.

A9	Valuation of Property, Plant and Equipment
	The valuations of property, plant and equipment have been brought forward without any amendment from the previous annual financial statements.

A10	Material Events Subsequent to the End of Period
	There were no material events subsequent to the period ended 28.02.2005.

A11	Changes in Composition of the Group
	There were no changes in the composition of the Group during the current financial quarter except for the disposal of 4000 ordinary shares of RM1.00 each representing 40% of the total issued and paid up capital in ARI Utara Sdn Bhd for a total cash consideration of RM168,000.00.				

A12	Changes in Contingent Liabilities or Contingent Assets
	There were no contingent liabilities/assets in respect of the Group since the last annual balance sheet date.

ADDITIONAL INFORMATION REQUIRED BY THE BURSA MALAYSIA SECURITIES BERHAD’S LISTING REQUIREMENT	

B1.	Review of Performance
	For the quarter under review, the Group achieved a turnover of RM34.958 million compared to preceding year corresponding quarter of RM39.456 million. The variation in turnover was due to stiff competition and the slowing down in the construction industry.
	
B2	Material changes in profit before taxation for the quarter against the immediate preceding quarter
	The Group recorded a profit before tax of RM3.211 million for the current quarter compared to immediate preceding quarter of RM6.253 million. 
	The lower profit was mainly due to lower turnover, higher raw material price and competitive market resulting in the lower profit margin for the Group’s products.
	
B3	Current Financial Year Prospects
The Group will continue to arm itself well to face the current and future challenges of the industry, despite the continuing competitive domestic market. Apart from this, the commencement of production in the Kedah factory early this financial year is expected to positively enhance the Group’s earning.

The Group expects the financial results for the year to remain profitable.

B4	Profit Forecast
	Not applicable as the Company did not provide any profit forecast in public documents.
		
B5	Taxation
	The Taxation of the Group for the financial period under review is as follows:-
		 
				     Current  	Current Year
	  Quarter Ended	Todate	
			  28-02-2005	 28-02-2005	
			  (RM’000)	 (RM’000)	
	Current Tax		480	480
	Deferred Tax	      	      -	-
	Under/(Over) Provision		   -                          	-                                
				------	--------	
                                                                                      480	                                480
	====	=====	

	Effective tax rate	15%	15%
	Statutory tax rate	20% & 28%         	20% & 28%
	Variance	13%	13%
	
	The Effective Tax Rate is different from Statutory Tax Rate for current year to date due to the claiming of reinvestment allowances and a lower corporate tax rate charged (20% corporate tax rate for small and medium scale companies 1st RM500,000.00 chargeable income). 

B6	Profit/Loss on Sale of Unquoted Investments and/or Properties
	There was no other sale of unquoted investment except for the disposal of 40% of the total issued and paid up capital in ARI Utara Sdn Bhd as stated in notes A11.
	
B7	Quoted Investments	
a)	There was no purchase of quoted securities for the current quarter ended    28-02-2005.
b)	Investment in quoted securities as at the reporting period:-
	at cost	RM456,241
	at carrying value/book value	RM456,241
	at market value	RM754,534
		(based on average of the higher and lower price on 20-04-2005)
		
B8	Status of Corporate Proposals Announced 	
There was no corporate proposals announced but not completed as at to date.

B9	Borrowing and Debt Securities as at quarter ended 28-02-2005:-												
		Secured (RM)	Unsecured (RM)	Total (RM)
	Long term borrowing	:	3,907,000	 0	  3,907,000
	Short term borrowing	:	2,417,000	5,559,000	  7,976,000

B10	Off Balance Sheet Financial Instruments
	The Group does not have any financial instrument with off balance sheet risk as at reporting date.

B11	Changes In Material Litigation
	The Group is not involved in any material litigation as at the date of this report. 

B12	Dividend 	
	No dividend payment is recommended for the quarter ended 28-02-2005.

B13	Earning per share
	The basic earnings per share has been calculated by dividing the Group’s net profit after minority interest of RM2,232,000 for the current quarter by the weighted average number of shares in issue of 69,223,821.

By order of the Board
Chong Wui Koon (secretary)
Date :  22-04-2005