6 March 2003

Singapore Exchange Limited
2 Shenton Way #19-00
SGX Centre 1
Singapore 068804

Attention: Ms Siew Wun Mui
Vice President
Issuer Regulation

Dear Madam,

OKP HOLDINGS LIMITED ("the Company")
ADDITIONAL INFORMATION ON FULL YEAR FINANCIAL STATEMENT FOR THE PERIOD ENDED 31 DECEMBER 2002

We refer to your letter of 6 March 2003 and would like to provide the following information in response to your queries:

(A)

Query

The reasons for the decline in net profit after taxation of 28% from $1,292,000 for the first half year of FY2002 to $931,000 for the second half year of FY2002 while the sales increased by 23% from $23,248,000 in the first half year of FY2002 to $28,570,000 in the second half year of FY2002.

Response

The decline in net profit after taxation by 28% from $1,292,000 for the first half of FY2002 to $931,000 for the second half of FY2002 was due mainly to:-

(a) lower aggregate profit margin achieved for major projects undertaken in the second half of FY2002;

(b) the increase in administrative expenses which included higher directors' remuneration as a result of the commencement of the service agreements, as disclosed in the Company's prospectus dated 13 July 2003, in the second half of FY2002; and

(c) the increase in other operating expenses due to fixed assets written off in the second half of FY2002.

(B)

Query

Paragraph 9 of Appendix 7.2 of the Listing Manual requires that where a forecast or a prospect statement has been previously disclosed to shareholders, any variance between it and the actual results must be explained. We note from the Company's half year results announcement for the period ended 30 June 2002 released via Masnet on 24 September 2002 that "the Group expects to at least maintain its performance in the second half of the financial year ending 31 December 2002". However, we note from the Full Year Results announcement that the net profit after taxation for the second half year of FY2002 ($931,000) is lower than that of the first half year of FY2002 ($1,292,000). Please advise us of the following:-

(i) The bases for the Directors' expectations disclosed in the Masnet announcement of 24 September 2002;

(ii) When the Directors were first aware that the bases for their expectations were no longer appropriate, resulting in a lower net profit after taxation for the second half year of FY2002 as compared to the first half year of FY2002, contrary to the Directors' expectations in the half year results announcement; and

(iii) A statement to explain whether it was possible for the Directors to inform investors of the material change in the Group's expected performance for the second half year of FY2002 earlier by way of a profit warning via Masnet.

Response

(i) Based on the contracts secured on hand and work in progress as at September 2002, our Directors expected the turnover and profitability to at least maintain its performance in the second half of the year ended 31 December 2002.

(ii) The management accounts for the year ended 31 December 2002 were completed in early February 2003. At that point of time, at both turnover and profit before tax level, the management accounts was in line with our prospect statement made on 24 September 2002. However, in late February 2003, the management noticed that certain progress payment claims had not yet been certified by the customers for work done and as a result the revenue was overstated in the management accounts. Further, there was also an underestimation of provision for taxation in the management accounts. Accordingly, adjustments were made to our management accounts which resulted in a dip in net profit after taxation for the second half of FY2002.

(iii) As the full year results were scheduled to be announced soon after late February 2003 i.e. 3 March 2003, it was decided that investors could have been informed promptly of the material change in the Group's expected performance for the second half of FY2002 through the full year result announcement.