UIC Announces 2004 Net Profit of KD 2.85 Million (US$ 9.67 Million)

Board Recommends Cash Dividends of 20 Per cent of Paid-up Capital

Kuwait City, February 6, 2005 – United Industries (UIC), part of the Kuwait Projects Company (KIPCO) Group and a specialised investor in the oil, power, gas and foodstuffs manufacturing sectors of the GCC and neighbouring countries, has announced net profit of KD 2.85 million (US$ 9.67 million), or 19.18 fils (6.5 cents) per share.

UIC chairman Sheikh Khalifa Al Abdullah Al Jaber Al Sabah said the company’s income statement for the previous year (2003) had been restructured on the recommendation of the Board of International Accounting Standards on early implementation of Standard No. 3 of International Financial Reporting Standards, which should have been implemented from the beginning of 2005. This standard provides that there is no need for making provisions in the balance sheet for amortising goodwill. Accordingly, UIC’s net profit for the year ended on December 31, 2003 had been revised to KD 2.99 million
(US$ 10.1 million, instead of KD 2.3 million (US$ 7.8 million).

He said the 5 per cent decline in profit for 2004 compared to 2003 was due to profits generated from the sale of assets during 2003. With most of UIC’s subsidiaries showing better performance and posting good operating results for 2004, the Board has recommended distribution of cash dividends of 20 per cent of paid-up capital, or 20 fils (6.7 cents) per share, subject to approval of the official authorities and the shareholders’ general meeting.

Sheikh Khalifa said UIC continued the implementation of its plan of restructuring its assets and with a view to exiting from lines of business not consistent with its investment purposes and policy. The Company has conducted studies on the feasibility and evaluation of many of its assets, as well as on investment opportunities available in the industrial sector. As a result, UIC sold Kuwait Catering Company, generating a profit of KD 362, 000 (US$ 1.2 million) and established Kuwait United Catering & Restaurants Management Company with a capital of KD 700,000 (US$ 2.4 million), in addition to United Projects Company, both of which are 100 per cent owned by UIC.

During 2004, UIC also established the Danish & Middle East Paints Holding Company in Bahrain. Based on this, formalities are underway to merge the divisions of Hempel companies in Kuwait, Saudi Arabia and Syria with the holding company, which will be the parent company for Hempel branches.

Commenting on the launching of KD 15 million (US$ 50.9 million) bonds issue for public subscription last December, Sheikh Khalifa said that this transaction was aimed at restructuring and rescheduling loans borrowed by UIC. He saud the bonds issue will provide required liquidity for the Company at a lower cost, to assist in developing and preparing infrastructure for financing of several future projects the Company is considering in the industrial sector.

Regarding the listing of SADAFCO on the Saudi Stock Exchange, Sheikh Khalifa said formalities were still underway with no final date fixed for the listing, but expected to be finalised before the end of February 2005 after completion of necessary procedures and obtaining required approvals from the official authorities.

Kuwait Projects Company (KIPCO) is Kuwait’s largest private sector company with more than US$ 10 billion under management or control, and a portfolio of some 70 companies with major activities in financial services, media & telecommunications, real estate, industry, management advisory, medical services and aviation throughout the Middle East and North Africa (MENA) region, as well as substantial ownership interests in the U.S. and Europe. KIPCO employs more than 10,000 people internationally and its shares are among the most actively traded on the Kuwait Stock Exchange.

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