CORAL GROWTH INVESTMENTS LIMITED

ANNUAL REPORT AND AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2007 CORAL GROWTH INVESTMENTS LIMITED

Contents

Page

Directors 1-3

Management and Administration 4

Investment Portfolio 5

Report of the Investment Manager 6-7

Directors' Report and Statement of Directors' Responsibilities 8-9

Independent Auditor's Report to the Members of Coral Growth Investments Limited 10

Balance Sheet 11

Income Statement 12

Reconciliation of Movement in Shareholders' Funds 13

Cash Flow Statement 14

Notes to the Financial Statements 15-27 CORAL GROWTH INVESTMENTS LIMITED

Directors

Peter Grant CBE (Chairman) Mr. Grant was Deputy Chairman of London Merchant Securities plc, and is Chairman of Egyptian Direct Investment Fund Limited, The Egypt Investment Company Limited and Coral Growth Investments (Parallel) Limited and is a Director of other companies. He retired as Chairman of Sun Life Corporation PLC in April 1995 and was previously with Lazard Brothers & Co, Limited 1952-88, Vice-Chairman 1983-85 and Deputy Chairman 1985-88. He retired as a Director of BNP UK Holdings Limited in April 2005. He was formerly a member of the council of the Institute of Directors and the Civil Aviation Authority and of the Industrial Development Advisory Board of the Department of Trade and Industry and Chairman of the Finance Committee of the British Red Cross. In 1997 he was named as a commander of the Order of the British Empire.

Fahad Al-Rajaan Mr. Al-Rajaan is the Director General of the Public Institution for Social Security in Kuwait. He is also the Chairman of Ahli United Bank-Bahrain, Ahli United Bank (UK), Delta International Bank (Cairo) and Wafra Investment Advisory Group (New York). He is a director of National Industries Group (Kuwait). Mr. Al-Rajaan is a graduate of the American University in Washington D.C. In 1976 he started his career as manager of the “New Issues Department” of the Kuwait Investment Company. In 1981 he joined Kuwait Real Investment Consortium as Chairman and Managing Director. He held the position of Chairman of the Egyptian Gulf Bank (Cairo) and Deputy Chairman of the Industrial Bank of Kuwait (Kuwait). Mr. Al-Rajaan is a Director of Coral Growth Investments (Parallel) Limited.

Richard Blum Richard C. Blum is Chairman and CEO of Blum Capital Partners, L.P., a private equity firm he founded in 1975. Mr. Blum and his partners invest in middle market, usually publicly traded companies. Blum Capital takes significant interests in publicly owned companies and then works cooperatively with management to pursue financial or business strategies that will enhance shareholder value over the long term. Blum Capital Partners, L.P. is based in San Francisco and has approximately US$4 billion of capital under management with 17 investment professionals. Mr. Blum is also co-Founder and co-Chair of TPG Capital L.P. TPG, established twelve years ago, is a pioneer in private equity in Asia, managing US$3.2 billion of capital. He also currently serves as Chairman of the Board of Directors of CB Richard Ellis Group, Inc., a global market leader real estate services firm. He is a director of Fairmont Raffles Holding International, Current Media, L.L.C., and is on the board of Myer Pty. Ltd. Mr. Blum has long had philanthropic interests, primarily focused on global poverty and education. He is Founder and Chairman of the American Himalayan Foundation (“AHF”), which was established 25 years ago. AHF has 170 projects providing vital healthcare, educational, environmental and cultural preservation throughout the Himalayan region. He is the Honorary Consul of Mongolia and Nepal. In 2006, with a US$15 million grant from Mr. Blum, the Blum Center for Developing Economies at the University of California, Berkeley, was established. The center will foster student interest in the developing world and in working on projects abroad. Four years ago, Mr. Blum founded the Global Economy and Development Center at The Brookings Institution and the Blum-Brookings Conference, to develop policy research strategy and to work on individual projects. Mr. Blum is now serving as the Chairman of the University of California Board of Regents. He is a trustee and a member of the executive committee of The Carter Center, founded by former President Jimmy Carter. In addition, he is currently on the Boards of The Wilderness Society and The California Academy of Sciences. Mr. Blum earned both his B.A. and M.B.A. from the University of California at Berkeley. In 2006 he received an honorary doctoral degree from the University of San Francisco’s McLaren College of Business.

Mr. Blum is a Director of Egyptian Direct Investment Fund Limited and of Coral Growth Investments (Parallel) Limited.

1 CORAL GROWTH INVESTMENTS LIMITED

Directors (continued)

Richard Coons Mr. Coons has extensive and diversified experience in both U.S. and international investment banking, in which field he has held senior positions with three major firms. In recent years, he has been engaged as an independent advisor to several small merchant banks in New York, as well as operating in London as a consultant to a U.S. group engaged in mergers and acquisitions. As Chief Executive Officer, he was responsible for the establishment, in 1986, of a new U.S. brokerage subsidiary of Baring Brothers & Co., which was engaged in international brokerage transactions for U.S. institutional investors. In 1979, Mr. Coons joined J. Henry Schroder Bank & Trust Co. in New York (wholly owned by Schroder, Wagg - London) as Executive Vice President specializing in capital markets in the U.S. and Europe. Clients included small growth companies interested in raising equity capital overseas, as well as major U.S. corporations requiring a full range of international financial services. He was directly involved in the formation of, and was elected founding director of, a US$100 million fund placed with European institutions for investment in U.S. oil and gas properties. He originated the concept and implemented the formation of a broker/dealer subsidiary of J. Henry Schroder Bank & Trust Co., which became a member of the New York Stock Exchange, to execute transactions for institutional customers. During his prior 25 years at Kidder, Peabody & Co. Incorporated, Mr. Coons was engaged in a wide variety of financial transactions, both in the U.S. and overseas, and had principal responsibility for many of the firm’s major accounts.

In 1966 and 1967, he worked virtually full time designing a successful plan to re-float Intra Bank (Beirut), which had gone bankrupt and ceased operations. At Kidder, Peabody, he was a member of the Executive Committee, managed the Corporate Finance Department, and was the Senior Manager of the International Department. Mr. Coons received a BA from Princeton and a MBA from Harvard Business School.

Mr. Coons is a Director of Coral Growth Investments (Parallel) Limited.

Tarek Ben Halim Mr. Ben Halim is a former investment banker with Goldman Sachs, JP Morgan and Credit Suisse First Boston. During his 23 year career he worked in corporate finance, equities and fixed income. He worked at Goldman Sachs from 1991 to 2003 and was named a Managing Director in 1997. During his time at Goldman Sachs he had responsibility for the firm’s investment banking business in the MENA region, South Africa, Eastern Europe and Russia. In 2001 he was appointed Head of Goldman Sachs’ Milan office. Currently Mr Ben Halim is serving as advisor to the Libyan Government on financial sector reform. He is a non-executive director of Majid al Faltaim Group in Dubai. In addition, he is the founder of Alfanar, an organisation set up to support positive social change in the Arab world. He is a Trustee of Common Purpose International, a UK based civil society organisation. Mr. Ben Halim received a BSc from Warwick University in England in 1977 and a MBA from Harvard University in 1980. Mr. Ben Halim is a Director of Coral Growth Investments (Parallel) Limited.

Ove Hoegh Mr. Hoegh is the former senior partner of Hoegh Invest A/S, a family owned company. Mr. Hoegh is a graduate of the Royal Norwegian Naval Academy and has an MBA from Harvard Business School. From 1966 to 1974 he was Managing Director of Leif Hoegh & Co A/S and from 1974 to 1979 was Chairman of the same company. Mr. Hoegh has served on the boards of a number of Norwegian companies and associations. He is a director of Apex Silver Mines Corp, The Egyptian Growth Investment Company Limited and of Coral Growth Investments (Parallel) Limited.

2 CORAL GROWTH INVESTMENTS LIMITED

Directors (continued)

Bertrand Viriot Mr. Viriot has recently retired as the Managing Director of the Saudi French Bank in Riyadh. This bank is a joint venture between the Crédit Agricole Indosuez and leading Saudi businessmen and is one of the most successful joint venture banks in Saudi Arabia. Mr. Viriot started his career in investment banking with Morgan Stanley & Co. in New York and joined the Suez Group in 1967 in Paris. In 1969 he became Director of Suez American Corporation in New York until 1973. He returned to Paris at that time with the Suez Group which had then become Crédit Agricole Indosuez. From 1973 to date, Mr. Viriot took senior assignments for Crédit Agricole Indosuez in Paris, New York and Hong Kong in 1987 when he became Senior Country Officer for the Group in Hong Kong and China. In 1993 Mr. Viriot spent a year as Senior Country Officer in the United Kingdom. From 1994 to 1997 he was Senior Country Officer for Australia and New Zealand based in Australia. Mr. Viriot is a graduate of the University of Paris and a graduate of the Paris Law School and Institute of Political Sciences. Mr. Viriot is a Director of Coral Growth Investments (Parallel) Limited.

Mohamed Younes Mr. Younes is the Chairman of the Concord Group and a Director of Stanhope Overseas Limited. From July 1977 to December 1979 Mr. Younes was President of Industrial Holdings Limited in New York. Prior to that, he was head of International Corporate Finance and a member of the Board of Directors of Kidder, Peabody & Co. Incorporated. From December 1979 to February 1987 he was Chairman and Chief Executive of Kidder, Peabody International Limited. He was appointed Chairman of the Concord Group in 1988 and concurrently served as Chairman of Baring Brothers & Co., Inc., the New York based corporate finance affiliate of Baring Brothers & Co., Limited, until 1992. Mr. Younes is a graduate of Cairo University and has a MBA from the Harvard Business School. He has served on the boards of Directors of Euroclear Clearance System, UBAF Arab American Bank, New York and Baring Brothers & Co. Limited, London. He has served on a number of advisory committees on securities-related issues, including the Advisory Committee on International Capital Markets to the Board of the New York Stock Exchange and the International Capital Committee of the Securities Industry Association, New York.

Mr. Younes served for two consecutive four year terms ending in December 2007 as a member of the Board of Directors of the Central Bank of Egypt. In that capacity he was a member of the Central Bank’s Audit Committee, its Investment Committee as well as the Banking Industry Restructuring Committee. He was a member of the board of directors of Delta International Bank. Mr Younes is presently a member of the Board of Directors IT Investments, The Egyptian Investment Company, The Egypt Investment Company Limited, The Egyptian Growth Investment Company Limited, the Egyptian Direct Investment Fund Limited, The IT-Concord-Misr Technology Venture Capital Fund Limited, Lecico Egypt, Coral Growth Investments (Parallel) Limited, Castle Property Company Limited, Nile Growth Fund Limited and Concord Egypt Fund respectively. Mr. Younes was the Chairman of the International Advisory Board of the Cairo Stock Exchange and a founder and member of the board of directors of the Egyptian Investment Management Association.

3 CORAL GROWTH INVESTMENTS LIMITED

Management and Administration

Registered Office Administrator, Secretary, Registrar and Channel 2nd Floor Islands Stock Exchange Sponsor Regency Court Butterfield Fund Services (Guernsey) Limited Glategny Esplanade P.O. Box 211 St Peter Port Regency Court Guernsey Glategny Esplanade Channel Islands GY1 3NQ St Peter Port Guernsey Legal Advisers Channel Islands GY1 3NQ As to Guernsey Law Ogier Custodian Ogier House HSBC Bank, Egypt St Julian's Avenue 3 Abou El Feda Street St Peter Port Zamalek Guernsey Cairo 11211 Channel Islands GY1 1WA Egypt

Investment Manager Auditors Stanhope Overseas Limited Ernst & Young LLP C/O Concord International Investments 14 New Street 725 Fifth Ave St Peter Port New York Guernsey NY 10022 Channel Islands GY1 4AF USA

Placing Agent Concord (BVI) International Limited Sea Meadow House Blackburne Highway Road Town, Tortola British Virgin Islands

Structuring Agent Concord (BVI) International Limited Sea Meadow House Blackburne Highway Road Town, Tortola British Virgin Islands

4 CORAL GROWTH INVESTMENTS LIMITED

Investment Portfolio (Unaudited) as at 31 December 2007

% of net assets Fair attributable to Nominal Cost Value holders of US$ US$ participating redeemable preference shares Listed investments Bond: Arab Republic Egypt 8.75% 16,000,000 2,854,666 3,018,130 10.32% Floating Rate Notes: Barclays Bank Plc FRN 25 May 2015 300,000 300,418 293,133 1.00% HBOS FRN 06 Feb 2014 1,000,000 1,004,000 993,104 3.40% RBS FRN 24 Jul 2014 1,000,000 1,005,000 986,978 3.38%

Unlisted investments Coral Growth Holdings* 16,886,810 16,798,221 22,851,542 78.13% Coral Growth Holdings Convertible Loan Stock 694,778 694,778 2.38%

Total investments 22,657,083 28,837,665 98.61%

Cash at bank and other net assets attributable to holders of participating redeemable preference shares 405,291 1.39%

Total net assets attributable to holders of participating redeemable preference shares 29,242,956 100.00%

* The Company's holding of 16,886,810 shares in Coral Growth Holdings represents 47.43% of the total issued share capital of that Company as at 31 December 2007 (see note 5 to the financial statements).

5 CORAL GROWTH INVESTMENTS LIMITED Report of the Investment Manager Overview The Company reviewed a number of potential investments during 2007 however, no new investments were made. The Company has increased its investment in Amoun Pharmaceutical Company (Amoun) through subscribing in the capital increase that took place at the special purpose vehicles level. The performance of Amoun was affected by the stock piling of the distributors of its products that took place during 2006, the increase in raw material prices as well as the effect of the financial cost of the syndicated acquisition loan that was assigned to it during 2007. Despite that, Amoun has the highest EBITDA margin in its sector of 46.5%, ranks as the second in Egypt in terms of turnover and maintains its market share of 5.7%.

Hereunder is an update on the Company’s first investment Amoun Pharmaceutical Company as at 31 December 2007: Amoun Pharmaceutical Company Financial and Operational Update At the request of the Consortium, pro forma consolidated financial statements of all the companies established by the Company and its fellow consortium members, Citigroup Venture Capital International, Capital International Private Equity Fund IV and Coral Growth Investments (Parallel) Limited (the"Consortium"), in Egypt for the acquisition of Amoun Pharmaceutical Company (Mercury (Egypt) Pharmaceutical Manufacturing and Mercury (Egypt) Pharmaceutical Distribution) as well as the financial statements of Amoun Pharmaceutical Company and Amoun Distribution L.L.C. are prepared and audited on a quarterly basis. The following analysis is based on these audited pro forma consolidated figures prepared for the years ended 31 December 2007 and 31 December 2006:

2007* 2006* EGP '000s USD '000s EGP '000s USD '000s % Change

Revenues 596,906 105,970 640,085 112,821 -6.7% EBITDA 277,343 49,237 323,647 57,046 -14.3% EBITDA Margin 46.5% 46.5% 50.6% 50.6% -8.1% Net Profit Before Tax 44,310 7,866 200,054 35,262 -77.9% Taxes (6,642) (1,179) (1,426) (251) -365.7% Net Profit After Tax 37,688 6,691 195,900 34,529 -80.8% Earnings per Share (EGP)** 0.6 0.6 3.3 3.3 -80.8%

* Mercury (Egypt) Pharmaceutical Manufacturing audited pro forma consolidated figures and based on the audited statements of Amoun Pharmaceutical Company, Amoun Distribution L.L.C, Mercury (Egypt) Pharmaceutical Manufacturing and Mercury (Egypt) Pharmaceutical Distribution. ** Earnings per share are based on the total number of Amoun Pharmaceutical Company's shares. The drop in revenues by 6.7% in 2007 is due to the drop in both the human and veterinary revenues as detailed below: - Human revenues for the year ended 31 December 2007 were EGP 566.6 million which represents a drop of 2.5% from 2006's level. Human sales for 2007 were negatively affected by the distributors' stockpiling that took place during 2006. This is reflected in the fact that distributors’ purchases from Amoun dropped by 35.9% from 2006 to record EGP 185.7 million in 2007. Notwithstanding this, the IMS1 report figures for the full year 2007 ranks Amoun as second in Egypt in terms of turnover and shows that its turnover grew by 20.4% over 2006, exceeding the overall market growth of 17.6% for the same period. Accordingly, Amoun is maintaining its market share of 5.7%. - Veterinary revenue for 2007 were EGP 20.1 million which is a drop of 65.1% from 2006. This is mainly due to the impact of Asian flu. Amoun Distribution L.L.C decided to distribute Amoun's veterinary products through its own sales force and it is anticipated that an improvement in veterinary sales will take place in 2008. - Exports in 2006 reached a low figure of EGP 1.1 million due to sales returns from previous periods. However, in 2007, it reached an impressive level of EGP 9.8 million due to intensive efforts of the new management during the year. Amoun Pharmaceutical Company has opened a wholly owned subsidiary in Romania 'Amoun Pharmaceutical Romania SRL' in January 2008.

1 IMS is an independent market research firm which publishes data on Egyptian pharmaceutical companies sales in pharmacies at retail prices.

6 CORAL GROWTH INVESTMENTS LIMITED Report of the Investment Manager (continued)

Financial and Operational Update (continued)

The EBITDA margin decreased from 50.6% in 2006 to 46.5% in 2007, driven by increases in both the Cost of Goods Sold ("COGS")/Sales ratio and Selling, General and Administrative costs ("SG&A")/Sales ratio. - The COGS/Sales ratio increased from 32.5% in 2006 to 36.3% in 2007 due to the increase in raw material costs in addition to the rise in wages. It is worth noting that an increase in basic salary of 15% took place in July 2007. - Despite a drop in the SG&A figure by 5.1% in 2007, the SG&A/Sales ratio increased from 16.9% in 2006 to 17.2% in 2007 mainly due to the drop in sales. The net profit margin dropped from 30.6% in 2006 to 6.3% in 2007. The key reason for that drop is the financial charges of EGP 196.1 million that are related to the acquisition debt of EGP 1.4 billion that was obtained by Mercury (Egypt) Pharmaceutical Manufacturing for the purchase of 98.8% of Amoun Pharmaceutical Company . Eliminating the effect of these charges results in a net profit margin of 39.2% which is an increase of 28% over 2006 margin. On 29 November 2007, an assignment of the syndicated bridge-loan agreement was made whereby the loan for EGP 1.4 billion was assigned to Amoun Pharmaceutical Company by Mercury (Egypt) Pharmaceutical Manufacturing with all related obligations. On 6 December 2007, the assigned syndicated bridge-loan was converted to a medium term loan. On 24 December 2007 Mercury (Egypt) Pharmaceutical Manufacturing ("MPM") launched an offer under the Open Purchase System ("OPR") to acquire the remaining 1.2% of Amoun Pharmaceutical Company at the same price per share of EGP 50 that was used for the acquisition of the free float in November 2006. The offer was completed on 23 January 2008 for a total value of EGP 22.1 million, including commissions. As a result, MPM now owns 99.53% of the total shares of Amoun Pharmaceutical Company. In addition, MPM also owns one share quota in Amoun Distribution Company for legal (second shareholder) purposes. Almost 50% of the acquisition price of Amoun Pharmaceutical Company was financed by the syndicated loan facility (referred to above) from Arab African International Bank (AAIB) and the remaining balance was financed by the Consortium's funds in the form of monies advanced from shareholders to be converted to capital at a later date ("Due to shareholders"). The extraordinary general assembly of MPM that took place on 16 May 2007 approved the conversion of all the shareholders' loans into capital. Paid-up in capital was to increase from EGP 500 thousand to EGP 1,410 million. The general assembly also approved an increase in MPM’s authorized capital from EGP 5 million to EGP 10 billion. The Company's commercial register has subsequently been updated. The merger process between MPM and Amoun Pharmaceutical Company with the latter being the surviving entity, has started. Approval has been requested from the General Authority for Investments and it is currently reviewing the case. The founder of Amoun, Dr. Bassily established a limited liability company, Amoun Distribution Company and he transferred Amoun's distribution business to it. Mercury (Egypt) Pharmaceutical Distribution (MPD), the special purpose vehicle established to acquire the distribution business of Amoun acquired 99.8% of Amoun Distribution Company in April 2007 for EGP 1.5 million in accordance with the sale and purchase agreement with Dr. Bassily. On 29 November 2007, MPD sold its 99.8% stake in Amoun Distribution Company to Amoun Pharmaceutical Company. This sale is a pre-requisite for the anticipated merger between MPM and Amoun Pharmaceutical Company. MPD’s capital was increased to EGP 250,000 by June 2007. Moreover, MPD’s extraordinary general assembly that took place on 16 May 2007 approved the conversion of the Due to shareholders account to capital. Hence, MPD’s paid-up capital will therefore be increased from EGP 250,000 to EGP 1,982,700. The general assembly also approved the increase of MPD’s authorised capital from EGP 2,500,000 to EGP 10,000,000. These increases have been registered in the Company's commercial register. Coral Growth Holdings' shareholders' loan of US$843,575 was used to finance the purchase of the minority stake of Amoun Pharmaceutical Company through the OPR system and fund operational expenses at the Mercury (Cayman) Holdings level. This loan was converted to capital of Mercury (Cayman) Holdings in 2008.

Stanhope Overseas Limited November 2008

7 CORAL GROWTH INVESTMENTS LIMITED

Directors' Report and Statement of Directors' Responsibilities

The Directors of Coral Growth Investments Limited (the"Company") present the Annual Report and Audited Financial Statements for the year ended 31 December 2007.

Incorporation The Company was incorporated in Guernsey on 24 March 2005 and is a closed-ended investment company with limited liability. The Company has been authorised by the States of Guernsey Advisory & Finance Committee under the Control of Borrowing (Bailiwick of Guernsey) Ordinances 1959 to 1989. The Company was listed on the Channel Islands Stock Exchange ('CISX') on 31 January 2006.

Term The Company has a fixed initial life of 10 years from the First Closing. This term may be extended once only by two further years by a resolution of the Board of Directors.

Principal Activity The principal activity of the Company is that of a closed-ended investment fund. The investment objective of the Company is to achieve long term capital appreciation by taking advantage of significant opportunities for direct investments in Egypt. The investments will be in equity and equity related securities. The Company will make investments in the modernisation of Egyptian industry and industry related services of the private sector as well as privatised companies in connection with restructurings, recapitalisations and capital injections. The Company may provide capital to entrepreneurs or corporate partners seeking to establish new ventures in Egypt.

Results & Dividends The Directors do not propose a dividend for the year. The results for the year are set out in the Income Statement on Page 12.

Significant Shareholdings The following shareholdings represent interests of 3 per cent. or more of the total number of participating preference shares of the Company as at the date of this report: Number Number Of Units Of Shares Percentage The Public Institution for Social Security (Kuwait) 500 10,000 55.2% The Saudi National Commercial Bank 250 5,000 27.6% JJ Mack 50 5,000 5.5% Export Development Bank of Egypt 40 800 4.4% 840 20,800 92.7%

The following were the Directors of the Company during the period under review and at the date of this report:

Peter Grant, CBE (Chairman)* Fahad Al-Rajaan Richard C. Blum Richard F. Coons* Tarek Ben Halim* Ove Hoegh* Bertrand P. Viriot* Mohamed S. Younes *Independent Director The biographical information relating to the Directors is shown on pages 1 to 3.

8 CORAL GROWTH INVESTMENTS LIMITED

Directors' Report and Statement of Directors' Responsibilities (Continued) The Board acts independently of the Investment Manager and a majority of the Directors are not employees of, or professional advisers to, the Investment Manager or any other company in the Concord International Investments Group, LP. The address of each of the Directors for the purposes of the Company is the registered office of the Company. No Director is interested beneficially or otherwise in any shares of the Company or has had any direct or indirect interest in any assets acquired or disposed of by the Company.

Except for Mr Mohamed Younes, who is Chairman of Concord International Investments Group, LP., the parent company of the Investment Manager, no Director of the Company, was or is materially, interested in any contract of significance relating to the Company subsisting during, or at the end of, the financial year. The Chairman is entitled to an annual fee of US$30,000. Each of the other Directors is entitled to an annual fee of US$20,000. These fees are allocated equally between the Company and the Company's parallel fund, Coral Growth Investments (Parallel) Limited. There has been no change in these interests between 31 December 2007 and the date of this report.

Statement of Directors' Responsibilities

The Directors are responsible for preparing financial statements for each financial period which give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period and which are in accordance with applicable laws. In preparing those financial statements the Directors are id * select suitable accounting policies and apply them consistently; * make judgements and estimates that are reasonable and prudent; * state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and * prepare the Financial Statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business. The Directors confirm that they have complied with the above requirements in preparing the Financial Statements and that the going concern basis for the preparation of the Financial Statements is appropriate. The Directors are responsible for keeping proper accounting records which are sufficient to show and explain the Company's transactions and are such as to disclose with reasonable accuracy at any time the financial position of the Company and which enable them to ensure that the Financial Statements are properly prepared in accordance with The Companies (Guernsey) Law, 2008. They are also responsible for safeguarding the assets of the Company and for taking reasonable steps for the prevention and detection of fraud and other irregularities. So far as the Directors are aware, there is no relevant audit information of which the Company's auditors are unaware, having taken all the steps the Directors ought to have taken to make themselves aware of any relevant audit information and to establish that the Company's auditors are aware of that information.

Corporate Governance The Directors are committed to ensuring that high standards of corporate governance are maintained and have made it Company policy to comply with best practice on corporate governance, insofar as the Directors believe it is relevant and appropriate to the Company, and notwithstanding the fact that as a CISX listed company which is incorporated in Guernsey, the company has no legal obligation to comply with the “Combined Code” (I.e. the Code of Best Practice published by the Committee on the Financial Aspects of Corporate Governance).

However, the Company complies with the corporate governance guidelines issued by the Guernsey Financial Services Commission on 10 December 2004, whose underlying principles are similar to those of the Combined Code.

Auditors

A resolution proposing the re-appointment of Ernst & Young LLP as Auditors of the Company is to be proposed at the forthcoming Annual General Meeting.

By Order of the Board

Peter Grant, CBE - Chairman Mohamed Younes - Director 27 November 2008 9 CORAL GROWTH INVESTMENTS LIMITED

Independent Auditor's Report to the Members of Coral Growth Investments Limited

We have audited the company's financial statements for the year ended 31 December 2007 which comprise the Balance Sheet, Income Statement, Reconciliation of Movement in Shareholders' Funds, Cash Flow Statement and the related notes 1 to 18. These financial statements have been prepared on the basis of the accounting policies set out therein. This report is made solely to the company’s members, as a body, in accordance with Section 262 of the Companies (Guernsey) Law, 2008. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed. Respective responsibilities of Directors and Auditors As disclosed in the Statement of Directors' Responsibilities the Directors of the company are responsible for the preparation of the financial statements in accordance with applicable Guernsey law . Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements and International Standards on Auditing (UK and Ireland). We report to you our opinion as to whether the financial statements give a true and fair view and are properly prepared in accordance with the Companies (Guernsey) Law, 2008. We also report to you if, in our opinion, the Directors' Report is not consistent with the financial statements, if the company has not kept proper accounting records, or if we have not received all the information and explanations we require for our audit. We read other information contained in the Annual Report and consider whether it is consistent with the audited financial statements. The other information comprises only the Directors, Management and Administration, Investment Portfolio, Report of the Investment Manager, Directors' Report and Statement of Directors' Responsibilities. We consider the implications for our report if we become aware of any apparent misstatements or material inconsistencies with the financial statements. Our responsibilities do not extend to any other information. Basis of audit opinion We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgements made by the Directors in the preparation of the financial statements, and of whether the accounting policies are appropriate to the company's circumstances, consistently applied and adequately disclosed. We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements .

Opinion In our opinion the financial statements give a true and fair view, in accordance with United Kingdom Accounting Standards, of the state of the company’s affairs as at 31 December 2007 and of its results for the year then ended, and have been properly prepared in accordance with the Companies (Guernsey) Law, 2008.

Ernst & Young LLP Guernsey, Channel Islands Date: 28 November 2008 10 CORAL GROWTH INVESTMENTS LIMITED

Balance Sheet as at 31 December 2007

31.12.2007 31.12.2006 Notes US$ US$ Assets Investments: financial assets at fair value through profit or loss 5 28,837,665 18,475,325 Debtors, prepayments and accrued income 7 203,808 90,852 Cash at bank 12 (b) 294,636 4,772,873

Total assets 29,336,109 23,339,050

Equity Management share capital 9 1 1

Total equity 11

Liabilities Creditors and accruals 8 93,152 130,032

Net assets attributable to holders of participating redeemable preference shares 11 29,242,956 23,209,017

Total liabilities 29,336,108 23,339,049

Total equity and liabilities 29,336,109 23,339,050

Net asset value per fully paid participating redeemable preference share 16 5,385.42 4,577.69

Fully paid participating redeemable preference shares in issue 16 5,430 5,070

Approved by the Board of Directors on 27 November 2008 and signed on its behalf by:

Peter Grant - Chairman

Mohamed Younes - Director

The notes on pages 15 to 27 form an integral part of these Financial Statements.

11 CORAL GROWTH INVESTMENTS LIMITED

Income Statement For the year ended 31 December 2007

01.01.2007 to 01.01.2007 to 01.01.2007 to 24.03.2005 to 24.03.2005 to 24.03.2005 to 31.12.2007 31.12.2007 31.12.2007 31.12.2006 31.12.2006 31.12.2006 Notes US$ US$ US$ US$ US$ US$ Revenue Capital Total* Revenue Capital Total* Net gains/(losses) on financial assets at fair value through profit or loss Realised loss on investments 5 - - - - (1,110) (1,110) Unrealised gain/(loss) on investments 5,11 - 6,182,896 6,182,896 - (2,314) (2,314) - 6,182,896 6,182,896 - (3,424) (3,424) Income Investment income 6 221,201 - 221,201 301,058 - 301,058 Interest received from financing activities 11 26,819 - 26,819 10,001 - 10,001 Gross Income 248,020 - 248,020 311,059 - 311,059

Expenses Investment Manager's fees 4(a) 1,757,945 - 1,757,945 1,216,288 - 1,216,288 Administration fees 4(d) 110,646 - 110,646 115,811 - 115,811 Directors' fees 4(e) 85,000 - 85,000 81,566 - 81,566 Professional fees 34,284 34,284 45,236 - 45,236 Sundry expenses 54,689 - 54,689 47,872 - 47,872 Audit fees 34,234 - 34,234 31,344 - 31,344 Consultancy fees 29,988 - 29,988 31,244 - 31,244 Directors' & Officers' insurance premium 29,095 - 29,095 31,235 - 31,235 Custodian's fees 4(c) 1,105 - 1,105 3,139 - 3,139 2,136,986 - 2,136,986 1,603,735 - 1,603,735

Total (loss)/earnings for the year/period (1,888,966) 6,182,896 4,293,930 (1,292,676) (3,424) (1,296,100)

Earnings/(loss) per participating redeemable preference share 15 243.48 (110.95)

* The total column of this statement represents the Profit and Loss account of the Company. The Directors consider the activities of the Company to be of a continuing nature. A statement of total recognised gains and losses has not been prepared as all gains or losses are recognised in the Income Statement. The notes on pages 15 to 27 form an integral part of these Financial Statements. 12 CORAL GROWTH INVESTMENTS LIMITED

Reconciliation of Movement in Shareholders' Funds For the year ended 31 December 2007

01.01.2007 to 24.03.2005 to 31.12.2007 31.12.2006 US$ US$

Total (loss)/earnings for the year/period 4,293,930 (1,296,100) Opening shareholders' funds 23,209,018 - Issue of shares 11 1,800,009 25,350,118 Structuring fees 4(b),11 (60,000) (845,000) 29,242,957 23,209,018

Total assets 29,336,109 23,339,050 Creditors and accruals (93,152) (130,032)

Net assets 29,242,957 23,209,018

Net assets attributable to holders of fully paid participating preference shares 29,242,829 23,208,909 Net assets attributable to holders of partly paid participating preference shares 127 108 Net assets attributable to holders of management shares 1 1

29,242,957 23,209,018

The notes on pages 15 to 27 form an integral part of these Financial Statements.

13 CORAL GROWTH INVESTMENTS LIMITED

Cash Flow Statement For the year ended 31 December 2007

01.01.2007 to 24.03.2005 to 31.12.2007 31.12.2006 Operating activities Notes US$ US$

Net cash outflow from operating activities 12(a) (2,065,621) (1,263,497)

Financing activities

Issue of shares 11 1,800,009 25,350,118 Structuring fees 4(b),11 (60,000) (845,000) Interest received on issue of shares 26,819 10,001

Net cash inflow from financing activities 1,766,828 24,515,119

Investing activities

Purchase of listed investments 5 (2,854,666) (14,321,278) Purchase of unlisted investments 5 (1,324,778) (16,168,221) Proceeds from disposal of investments 5 - 12,010,750

Net cash outflow from investment activities (4,179,444) (18,478,749)

(Decrease)/Increase in cash (4,478,237) 4,772,873

Reconciliation of net cash flow movement

Net cash at the start of the year/period 4,772,873 - (Decrease)/Increase in cash during the year/period (4,478,237) 4,772,873

Net cash at the end of the year/period 12(b) 294,636 4,772,873

The notes on pages 15 to 27 form an integral part of these Financial Statements.

14 CORAL GROWTH INVESTMENTS LIMITED

Notes to the Financial Statements

1. Establishment Coral Growth Investments Limited (the "Company") was incorporated in Guernsey on 24 March 2005. The Company received regulatory approval from the Guernsey Financial Services Commission under The Control of Borrowing (Bailiwick of Guernsey) Ordinance, 1959, as amended, on 25 November 2005. The First Closing of the Company was on 21 December 2005. The Company is a closed-ended Investment company with limited liability formed under the Companies (Guernsey) Law, 1994 and was listed on the Channel Islands Stock Exchange ("CISX") on 31 January 2006. 2. Principal Accounting Policies The following accounting policies have been applied consistently in dealing with items which are considered to be material in relation to the Company's financial statements. Basis of Accounting The financial statements have been prepared in accordance with United Kingdom generally accepted accounting principles and under the historical cost convention as adjusted by the revaluation of investments and in accordance with the Statement Of Recommended Practice for Investment Trust Companies issued by the United Kingdom Association of Investment Companies. Investments Investments are classified as fair value through profit or loss since the Company's business is investing in financial assets with a view to profiting from their total return in the form of interest or increases in fair value. Investments are recognised and derecognised on the trade date where a purchase or sale is under a contract whose terms require delivery within the timeframe established by the market concerned, and are initially and subsequently measured at fair value. - Listed investments Listed investments are generally valued at the bid price prevailing at the close of the respective market on the Balance Sheet date, as this is deemed to reflect the fair value of the investments held. - Unlisted investments Unlisted investments are included in the Balance Sheet at fair value as determined by the Directors. In valuing unlisted investments the Directors will take into consideration the following factors: (i) Investments acquired in the reporting period prior to the valuation date are generally valued at cost unless there has been a material deterioration in the financial position of the investment. (ii) Where a significant transaction which establishes an arm's length price for an investment has been effected, the transaction will form the basis of the valuation. (iii) Otherwise, unlisted investments will be valued by reference to their profits and the price/earnings multiples applicable to comparable listed companies less a suitable discount to reflect their lack of marketability. Profits for the purpose of the valuations will be those disclosed in the latest audited financial statements taking into consideration any subsequent financial information. Given the lack of readily ascertainable market values for the unlisted investments, the eventual proceeds of realisation of these investments will inevitably differ from the estimated proceeds and the difference could be significant. Unrealised and realised gains or losses on investments are shown within the Income Statement as capital movements. Accounting for associate companies In accordance with Financial Reporting Standard 9 - Associates and Joint Ventures ("FRS9"), the Company accounts for all investments where significant influence and/or joint control exists at fair value through profit or loss in accordance with the normal accounting policy for investments. The Company holds 47.3% of the issued Share capital of Coral Growth Holdings as at 31 December 2007. This investment is held within the Company's investment portfolio and accounted for in accordance with FRS9, paragraph 49. Share Capital In accordance with Financial Reporting Standard 25 - Financial Instruments: Disclosure and Presentation, participating redeemable preference Shares have been disclosed as a financial liability as the Shares are redeemable at a fixed date. Income Income arising from investments is accounted for on an ex-dividend basis and is shown gross of withholding taxes. Other investment income is accounted for on an accruals basis. Expenses Expenses are accounted for on an accruals basis. Going Concern The Directors consider that the Company has adequate resources to continue in operational existence for the foreseeable future. For this reason the Directors believe that the business is a going concern and it is appropriate to prepare these accounts on the going concern basis.

15 CORAL GROWTH INVESTMENTS LIMITED

Notes to the Financial Statements

2. Principal Accounting Policies (continued) Foreign Currencies Foreign currency assets and liabilities, including investments at fair value, are translated into US dollars ("US$") at the rate of exchange ruling at the Balance Sheet date. Investment transactions and income and expenditure items are translated at the rate of exchange ruling at the date of the relevant transaction. Exchange differences are included in the Income Statement as capital movements if they are of a capital nature and recognised as revenue movements if they are of a revenue nature. Functional and Presentational Currency The financial statements of the Company are presented in the currency of the primary economic environment in which it operates (its functional currency). The Directors have considered the primary economic environment of the Company and considered the currency in which the original finance was raised, distributions made, and ultimately what currency would be returned to investors on a break-up basis. The Directors have also considered the currency to which the underlying investments are primarily exposed. On balance, the Directors believe US dollars best represents the functional currency. The books and records are maintained in US dollars and for the purpose of the financial statements the results and financial position of the Company are presented in US dollars which is also the presentation currency of the Company.

3. Taxation With effect from 1 January 2008, the standard rate of income tax for companies in Guernsey moved from 20% to 0% under the the Income Tax (Zero Ten) (Guernsey) Law, 2007 passed by the States of Guernsey on 26 September 2007. Close- ended investment vehicles such as the Company can continue to apply for exempt status for Guernsey tax purposes. Alternatively they may choose to automatically become tax resident, paying the nil rate. The Company elected for exempt status on incorporation. 4. Material Agreements (a) Investment Management Agreement Under the terms of the Investment Management Agreement dated 19 November 2005, Stanhope Overseas Limited was appointed with effect from 21 December 2005 as Investment Manager (the "Investment Manager"), and is paid a basic management fee at a rate of 2 per cent. per annum of the total Committed Capital of the Company for the duration of the Commitment Period ending 21 December 2009. Thereafter the basic management fee will be calculated at a rate of 2 per cent. per annum of the total Committed Capital drawn down at the date of calculation of the fee less an amount equal to: (a) the acquistion cost of any investments disposed of; and (b) the acquisition cost of any investments which have been written down or written off permanently. The management fee is calculated and paid quarterly in advance. A fee of US$1,757,945 (31 December 2006: US$1,216,288) in respect of the year is included within the Income Statement and nil (31 December 2006: US$1,151) remained unpaid at the year end. A performance fee is payable to the Investment Manager in accordance with the Company's Private Placement Memorandum under Section 3 - "Summary of Terms" - "Distributions and Performance Fee". Disposal proceeds from investments will be applied in making distributions to Shareholders and in payment of a performance fee to the Investment Manager in the following amounts and order of priority: ● a) Return of capital: First, 100 per cent. by way of distribution to Shareholders until cumulative distributions of Current Income and Disposal Proceeds are equal to the aggregate of the Committed Capital attributable to: (i) all Fund Investments that have been realised (“Realised Fund Investments”); (ii) any Fund Investments to the extent that such investments have been written off or written down permanently (to the extent not previously distributed); and (iii) the management fee and all other expenses paid or accrued (as such expenses are described above) allocable to Realised Fund Investments; ● b) 6 per cent. preferred return: Second, 100 per cent. by way of distribution to Shareholders until cumulative distributions of Current Income and Disposal Proceeds from Realised Fund Investments represent a 6 per cent. annual internal rate of return on the Committed Capital attributable to Realised Fund Investments and to any Fund Investments to the extent that such investments have been written off or written down permanently (to the extent not previously distributed) from the date or dates on which any part of such capital was drawn down until the date Shareholders are given notice of the relevant distribution; ● c) Investment Manager catch-up: Third, 100 per cent. by way of a performance fee to the Investment Manager of an amount equal to 20 per cent. of the aggregate of the total amounts distributed to Shareholders pursuant to clause (b) above; and . ● d) 80/20 split: Thereafter, 80 per cent. by way of distribution to Shareholders and 20 per cent. by way of performance fee to the Investment Manager. No performance fee provision is included in the financial statements.

16 CORAL GROWTH INVESTMENTS LIMITED

Notes to the Financial Statements

4. Material agreements (continued) (b) Structuring Agreement Under the terms of the Structuring Agreement dated 19 November 2005, the Company will pay to Concord (BVI) International Limited, as the structuring agent, a structuring fee of 1 per cent. of the aggregate value of the Units issued during the raising of the Committed Capital by the placing (subject to increase) of up to 1,000 units initially comprising 20,000 shares both at the first closing and at any subsequent closings (the"Placing") as consideration for consultation, structuring and advisory services provided to the Company. The aggregate value is determined using the Placing Price ($100,000 per Unit) net of any fees or commissions payable on the units. Under the terms of the Structuring Agreement, Concord (BVI) International Limited will bear the establishment costs of the Company other than listing expenses and selling commissions. Structuring fees are offset, in the financial statements, against the share premium (note 11) . A fee of US$60,000 (31 December 2006: US$845,000) in respect of the year is offset against share premium and nil (31 December 2006: US$5,000) remained unpaid at the year end. (c) Custodian Agreement Under the terms of a Custodian Agreement dated 19 November 2005, the Company appointed HSBC Egypt as Custodian. The Custodian is paid 0.20 per cent. per annum on the month end portfolio value comprised of physical equity and 0.15 per cent. per annum on the month end portfolio value comprised of scripless equity. Custodian's fees are charged at 0.03 per cent. per annum on floating rate notes. Fees are charged monthly and are subject to a monthly minimum of US$250 for equities and US$100 for floating rate notes. In addition transaction costs of US$60 per physical equity transaction, US$40 per scripless equity transaction and US$50 per floating rate note transaction are charged by the Custodian. (d) Administration Agreement (v) Under the terms of an Administration, Secretarial and Registrar Agreement dated 19 November 2005, the Fund appointed Butterfield Fund Services (Guernsey) Limited as Administrator, Secretary, and Registrar. For valuation, administration, accounting, corporate secretarial and compliance services an administration fee is charged, based on the standard hourly charging rates in force from time to time, subject to a minimum fee of GBP7,500 per quarter. In addition, a one-off fee was charged for the take on of the Fund of GBP5,000. Fees are charged for corporate and secretarial services in connection with Board meeting attendance at a rate of GBP2,000 for attendance at meetings in Guernsey and GBP3,000 for attendance at meetings outside Guernsey. These fees are payable quarterly in arrears. (e) Directors' Fees The Chairman is entitled to an annual fee of US$30,000. Each of the other Directors is entitled to an annual fee of US$20,000. These fees are allocated equally between the Company and Coral Growth Investments (Parallel) Limited.

5. Investments - financial assets at fair value through profit or loss 31.12.2007 31.12.2006 US$ US$ Listed Investments Cost of listed investments at the beginning of the year/period 2,309,418 - Acquisitions at cost 2,854,666 14,321,278 Less cost of investments sold: Proceeds from disposal of investments - (12,010,750) Realised loss on disposal of investments - (1,110)

Cost of listed investments as at 31 December 5,164,084 2,309,418 Unrealised gain/(loss) on listed investments 127,261 (2,314)

Fair value of listed investments as at 31 December 5,291,345 2,307,104

Unlisted Investments Unlisted investments comprise the Company's primary investment in a special purpose vehicle "Coral Growth Holdings", a company registered in the Cayman Islands. The Company's principal underlying investment is in the Egyptian * pharmaceutical group "Amoun " which is held through a series of special purpose vehicles which are detailed below (all holdings stated are as at 31 December 2007): *Amoun is defined as the consolidated position of Amoun Pharmaceutical Company and Amoun Distribution Company. The Company held 47.43% (2006:45.80%) of the share capital of Coral Growth Holdings. Coral Growth Holdings held 14.06% (2006:12.86%) of the share capital of Mercury (Cayman) Holdings. Mercury (Cayman) Holdings held 99.99% (2006:99.80%) of the share capital of Mercury (Egypt) Pharmaceutical Manufacturing. Mercury (Cayman) Holdings held 99.96% (2006:99.96%) of the share capital of Mercury (Egypt) Pharmaceutical Distribution. Mercury (Egypt) Pharmaceutical Manufacturing held 98.8% (2006:98.8%) of the share capital of Amoun. Therefore as at 31 December 2007 the Company indirectly held a 6.6% (2006:5.8%) interest in Amoun. During 2007, the Company agreed to provide to Coral Growth Holdings an unsecured and interest free convertible loan for the principal amount of US$694,778. Notice to convert the loan was served on 3 July 2008. The loan was subsequently converted to 694,778 shares in Coral Growth Holdings.

17 CORAL GROWTH INVESTMENTS LIMITED

Notes to the Financial Statements

5. Investments - financial assets at fair value through profit or loss (continued) Unlisted Investments (continued) 31.12.2007 31.12.2006 US$ US$

Cost of unlisted investments at beginning of the year/period 16,168,221 - Acquisitions at cost 1,324,778 16,168,221 Cost of unlisted investments as at 31 December 17,492,999 16,168,221 Unrealised gain on unlisted investments 6,053,321 - Fair value of unlisted investments as at 31 December 23,546,320 16,168,221

Total cost of investments as at 31 December 22,657,083 18,477,639

Total fair value of investments as at 31 December 28,837,665 18,475,325

31.12.2007 31.12.2006 US$ US$

Unrealised gains/(losses) on investments

Unrealised loss on listed investments at beginning of year/period 2,314 - Unrealised gains/(losses) on listed investments at year/period end 127,261 (2,314) Total unrealised gains/(losses) on listed investments during the year/period 129,575 (2,314)

Unrealised gains on unlisted investments at beginning of year/period - - Unrealised gains on unlisted investments at year/period end 6,053,321 - Total unrealised gains on unlisted investments during the year/period 6,053,321 -

Total movement in unrealised gains/(losses) on investments during the year/period 6,182,896 (2,314)

6. Investment income 01.01.2007 to 24.03.2005 to 31.12.2007 31.12.2006 US$ US$

Interest on bonds 113,994 - Interest on floating rate notes 107,207 301,058 221,201 301,058

7. Debtors, prepayments and accrued income 31.12.2007 31.12.2006 US$ US$

Accrued interest 133,558 20,920 Prepayments 70,249 69,931 Management share capital 1 1

203,808 90,852

8. Creditors and accruals 31.12.2007 31.12.2006 US$ US$

Audit fees 41,240 31,344 Administration fees 25,307 64,670 Directors' fees 23,750 23,261 Other creditors and accruals 2,593 4,548 Custodian's fees 262 58 Structuring fees - 5,000 Management fees - 1,151

93,152 130,032

18 CORAL GROWTH INVESTMENTS LIMITED

Notes to the Financial Statements

9. Share capital and share premium Nominal Nominal Value Value 31.12.2007 31.12.2006 Authorised US$ US$

100 Management shares of US$0.01 each 1 1 60,000 Unclassified shares of US$0.01 each 600 600

601 601

Issued share capital Number of Share Number of Share shares capital shares capital 31.12.2007 31.12.2007 31.12.2006 31.12.2006 Equity share capital US$ US$

Management shares of US$0.01 each:

Shares in issue 100 1 100 1

The management shares have been created in order to comply with Guernsey law under which the participating shares must be issued with preference over an alternate class of capital. The management shares have been issued to the Investment Manager and its nominee but have not been paid for. Each management share carries a right to vote at general meetings of the Company but does not carry the right to receive dividends. In a winding-up, management shares rank only for the return of the nominal paid-up capital after the return of the nominal capital paid-up on participating shares and nominal shares (see below). The unclassified shares are termed as such pending issue. They are issued as participating redeemable preference shares or nominal shares. Participating redeemable preference shares ("Shares"), issued in units of twenty Shares ("Units"), are issued at a price, at such times and on such terms and conditions as determined in accordance with the Company's Private Placement Memorandum and Articles of Association. Participating redeemable preference shares carry the right to vote on limited matters at general meetings of the Company and to receive dividends and in a winding-up rank first for the return of nominal paid-up capital. Participating redeemable preference shares may not be redeemed at the option of the holders of such shares. The Company may, at any time after the end of the commitment period ending 21 December 2009, give to each holder of fully paid participating redeemable preference shares notice of its intention to redeem any of such shares then in issue. The aggregate amounts payable on redemption shall be determined by the Board of Directors on such a basis as the Board may from time to time determine in accordance with the terms of the Private Placement Memorandum.

On the redemption or forfeit (for unpaid participating redeemable preference shares) of a participating redeemable preference share by the Company, a nominal share is issued to the Investment Manager for cash at par on the basis of one nominal share for each participating redeemable preference share redeemed. Nominal shares may be converted and reissued as participating redeemable preference shares upon subsequent applications for an equal number of participating redeemable preference shares. Nominal shares carry neither the right to vote at general meetings of the Company nor to receive dividends and in a winding-up rank only for the return of nominal paid-up capital after the return of the nominal capital paid-up on participating redeemable preference shares.

10. Outstanding commitments At the Balance Sheet date the total Committed Capital of the Company amounted to US$90,500,000 (2006: US$ 84,500,000) of which 30% had been called. Total commitments still outstanding at the Balance Sheet date amounted to US$63,349,831 (2006:US$ 59,149,882) representing 70% of the total Committed Capital.

19 CORAL GROWTH INVESTMENTS LIMITED

Notes to the Financial Statements

11. Net assets attributable to holders of participating redeemable preference shares

Non-equity share capital Number of Share Share shares capital premium 31.12.2007 31.12.2007 31.12.2007 US$ US$

Participating redeemable preference shares of US$0.01 each: Total non-equity shares as at 1 January 2007 16,900 169.0 24,504,948 Fully paid participating redeemable preference shares issued during the 360 3.6 1,799,997 year Partly paid participating redeemable preference shares issued during the 840 8.4 - year Structuring fees attributable to the above issues (note 4b) - - (60,000)

Total non-equity shares as at 31 December 2007 18,100 181.0 26,244,945 Total non-equity shares at 31 December 2007 of 18,100 shares comprise 5,430 fully paid participating redeemable preference shares and 12,670 partly paid participating redeemable preference shares.

Non-equity share capital Number of Share Share shares capital premium 31.12.2006 31.12.2006 31.12.2006 US$ US$

Participating redeemable preference shares of US$0.01 each: Fully paid participating redeemable preference shares issued during the 5,070 50.7 25,349,948 period Partly paid participating redeemable preference shares issued during the 11,830 118.3 - period Structuring fees attributable to the above issues (note 4b) - - (845,000)

Total non-equity shares at 31 December 2006 16,900 169.0 24,504,948

Participating redeemable preference share capital has been issued in Units each initially comprising 20 Shares of nominal value US$0.01 each. As at 1 January 2007, there were 845 Units comprising 20 Shares in issue, of which 6 Shares per Unit were fully paid as to US$5,000 each and 14 Shares per Unit were partly paid as to their nominal value of US$0.01 each.

On 14 March 2007, there was a subscription for 10 Units comprising 20 Shares in issue, of which 6 Shares per Unit were fully paid as to US$5,000 each and 14 Shares per Unit were partly paid as to their nominal value of US$0.01 each. Interest of US$26,819 was charged during 2007 at the rate of Libor + 2% from the date of the First Closing on 21 December 2005. On 4 June 2007, there was a subscription for 50 Units comprising 20 Shares in issue, of which 6 Shares per Unit were fully paid as to US$5,000 each and 14 Shares per Unit were partly paid as to their nominal value of US$0.01 each.

Therefore, as at 31 December 2007, there were 905 Units comprising 20 Shares in issue, of which 6 Shares per Unit were fully paid as to US$5,000 each and 14 Shares per Unit were partly paid as to their nominal value of US$0.01 each.

20 CORAL GROWTH INVESTMENTS LIMITED

Notes to the Financial Statements

11. Net assets attributable to holders of participating redeemable preference shares (continued)

31.12.2007 31.12.2006 Revenue reserve US$ US$

Balance at beginning of the year/period (1,292,676) - Net loss for the year/period (1,888,966) (1,292,676)

Balance at 31 December (3,181,642) (1,292,676)

Capital reserve

Balance at beginning of the year/period (3,424) - Unrealised gain/(loss) on investments 6,182,896 (2,314) Realised loss on investments during year/period - (1,110)

Balance at 31 December 6,179,472 (3,424)

Summary of net assets attributable to holders of participating redeemable preference shares 31.12.2007 31.12.2006 US$ US$

Share capital 181 169 Share premium 26,244,945 24,504,948 Revenue reserve (3,181,642) (1,292,676) Capital reserve 6,179,472 (3,424)

Balance at 31 December 29,242,956 23,209,017

12. Cash flow statement 01.01.2007 to 24.03.2005 to (a) Reconciliation of net loss to net cash outflow 31.12.2007 31.12.2006 from operating activities US$ US$

Net loss for the year/period (1,888,966) (1,292,676) Interest received from financing activities (26,819) (10,001) Increase in debtors, prepayments and accrued income during the year/period (112,956) (90,852) (Decrease)/Increase in creditors and accruals during the year/period (36,880) 130,032

Net cash outflow from operating activities (2,065,621) (1,263,497)

(b) Analysis of changes in cash and cash equivalents 31.12.2007 31.12.2006 US$ US$

Cash at bank 294,636 4,772,873

21 CORAL GROWTH INVESTMENTS LIMITED

Notes to the Financial Statements

13. Risks arising from investments in financial assets and liabilities

Strategy in using financial instruments The Company's activities expose it to a variety of financial risks: market risk (including market price risk, currency risk and interest rate risk), credit risk and liquidity risk. Significant accounting policies Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised in respect of each class of financial asset, financial liability and equity instrument are disclosed in note 2 to the financial statements. Categories of financial instruments Carrying Carrying value value 31.12.2007 31.12.2006 US$ US$ Financial assets Fair value through profit or loss (FVTPL) 28,837,665 18,475,325 Loans and receivables 498,444 4,863,725 Total assets 29,336,109 23,339,050

Financial liabilities Amortised cost 93,152 130,032 Total liabilities 93,152 130,032

Financial assets classified as FVTPL as at 31 December 2007 include US$21,245,688 (2006:US$16,168,221) in a special purpose vehicle whose primary underlying asset is a listed Egyptian company 'Amoun Pharmaceutical Company'. Other investments comprise US$3,018,130 (2006:US$nil) in a bond, US$2,273,215 (2006:US$2,307,104) in floating rate notes and a convertible loan note instrument US$694,778 (2006:US$nil). Loans and receivables presented above represents cash and cash equivalents, balances due from brokers and other receivables as detailed in the balance sheet. Financial liabilities measured at amortised cost presented above represent other creditors and accrued expenses as detailed in the balance sheet. Risk strategy The concentration, and therefore lack of diversification, of the Company's investments in a limited number of holdings and sectors may result in the aggregate returns realised by shareholders being materially adversely affected by the unfavourable performance of one or a small number of such investments. The risk due to lack of diversification is mitigated to the extent investments in a single company are restricted to 20 per cent. of the Company's total committed capital. The success of the Company depends in part on the quality, skill and expertise of the individual members of the Investment Manager, the Company's Advisory Board and the Consultants1. The Investment Manager will provide benefit from its strong network developed within the investment and business communities in Egypt and its access to extensive, readily available research on Egyptian companies and the strong analytical resources at its disposal. Since the identification of attractive investment opportunities is difficult and involves a high degree of uncertainty, the expertise available will reduce this risk associated with investment decisions. Market risk Market risk is the risk that future changes in market prices, other than those generated from interest rate or foreign exchange movements, may adversely affect the value or burden of a financial instrument. The market risk is concentrated in the investments. The Company's investments are susceptible to market risk arising from uncertainties about future prices of the instruments.

1 The Company's consultants are the Industrial Modernisation Centre, the implementation agency of the Government of Egypt and the European Union's Industrial Modernisation Programme in Egypt and Concord Corporate Finance and Securities Marketing Company S.A.E.

22 CORAL GROWTH INVESTMENTS LIMITED

Notes to the Financial Statements

13. Risks arising from investments in financial assets and liabilities (continued) Market risk(continued) Egypt is an emerging market. Emerging markets, including Egypt, are subject to particular investment risks and considerations. Furthermore, the likelihood of adverse political and economic developments may be magnified in emerging markets. As the Company will invest mainly in private/unlisted securities, when seeking to sell little or no market may exist for the securities. Additionally, when the Company is seeking to sell, enforcement of legal rights may present additional considerations than in more developed jurisdictions. The Company gives preference to investments in companies producing goods under the 2004 Egyptian QIZ (Qualifying Industrial Zones) Protocol. The benefits of Egypt's QIZ are various; ease of access to US markets being the most important, with open, unlimited quotas as well as exemption from tariff and non-tariff barriers. Other benefits include low factory costs as well as a large supply of labour force. Enhanced by the added benefits of trade agreements with other markets, Egypt is ideally-suited to provide many economic benefits to industries located within these zones. All securities investments present a risk of loss of capital. The Investment Manager moderates this risk through a careful selection of securities and other financial instruments within specified limits. At 31 December 2007, should the market price of investments subject to market price risk have increased or decreased by 5 per cent. with all other variables remaining constant, the increase or decrease in net assets attributable to holders of participating redeemable preference shares for the year would amount to approximately US$1,441,883 (2006:US$923,766). Currency risk The Company's primary investment is in a special purpose vehicle ("SPV") denominated in US dollars. The SPV ultimately holds an asset denominated in Egyptian Pounds (EGP) as its underlying investment. Accordingly, a change in the value of the EGP against the US dollar may adversely impact the performance of the Company in US dollar terms. At 31 December 2007 the Company held cash balances in US dollars of $294,636 (2006:US$4,772,873). The Company does not hedge against adverse currency movements.

The following table sets out the Company's exposure to currency risk:

Currency exposure Net current assets/ Cash (liabilities)Investments Total 31.12.2007 31.12.2007 31.12.2007 31.12.2007 US$ US$ US$ US$ Egyptian Pound - 113,994 26,564,450 26,678,444 Sterling - (86,398) - (86,398) US dollar 294,636 83,060 2,273,215 2,650,911 Total net assets 294,636 110,656 28,837,665 29,242,957

Currency exposure Net current assets/ Cash (liabilities) Investments Total 31.12.2006 31.12.2006 31.12.2006 31.12.2006 US$ US$ US$ US$ Egyptian Pound - - 16,168,221 16,168,221 Sterling - (62,782) - (62,782) US dollar 4,772,873 23,602 2,307,104 7,103,579 Total net assets 4,772,873 (39,180) 18,475,325 23,209,018

As at 31 December 2007, had the exchange rate between the US dollar increased or decreased compared to the Egyptian pound by 10% with all other variables held constant, the increase or decrease respectively in net assets attributable to holders of participating redeemable preference shares would amount to approximately US$2,507,260 (2006:US$1,616,822).

23 CORAL GROWTH INVESTMENTS LIMITED

Notes to the Financial Statements

13. Risks arising from investments in financial assets and liabilities (continued)

Interest rate risk The majority of the Company's financial assets and liabilities are non-interest bearing. As a result, the Company is not subject to significant amounts of risk due to fluctuations in the prevailing levels of market interest rates. The Company's interest-bearing financial assets and liabilities expose it to risks associated with the effects of fluctuations in the prevailing levels of market interest rates on its financial position and cash flows. The table below summarises the Company's exposure to interest rate risks:

Interest rate exposure Net current assets/ Cash (liabilities) Investments Total 31.12.2007 31.12.2007 31.12.2007 31.12.2007 US$ US$ US$ US$ Fixed rate - 113,994 3,018,130 3,132,124 Floating rate - 19,564 2,273,215 2,292,779 Non interest bearing 294,636 (22,902) 23,546,320 23,818,054 Total net assets 294,636 110,656 28,837,665 29,242,957

Net current Cash liabilities Investments Total 31.12.2006 31.12.2006 31.12.2006 31.12.2006 US$ US$ US$ US$ Floating rate - - 2,307,104 2,307,104 Non interest bearing 4,772,873 (39,180) 16,168,221 20,901,914 Total net assets 4,772,873 (39,180) 18,475,325 23,209,018

At 31 December 2007, should interest rates have increased or decreased by 100 basis points with all other variables remaining constant, the increase or decrease in net assets attributable to holders of participating redeemable preference shares for the year would have amounted to approximately US$3,620 (2006:US$3,872). The Investment Manager and the Directors do not regard the interest rate risk as being material. Credit risk Credit risk represents the risk that the counterparties to a financial instrument fail to discharge their obligation, contractual or otherwise, which causes the Company to suffer a financial loss. Credit risk has been generated on the following financial assets: Investments, Debtors and Cash and bank balances. All transactions in listed securities are settled/paid for upon delivery using approved brokers. The risk of default is considered minimal, as delivery of securities is only made once the broker has received payment. Payment is made in turn on a purchase only once the securities have been received by the broker. The trade will fail if either party fails to meet its obligation. Credit risk in the Company's primary underlying investment in Amoun is monitored by the review of the financial statements of the underlying special purpose vehicles, to ensure there is no other debt owed within the structure. The Directors consider that debtors and creditors balances are not material, thus affording negligible credit risk. Cash and bank balances are placed with HSBC Bank, Egypt. HSBC Holdings plc which owns over 90% of HSBC Egypt's issued share capital has a strong credit rating and has an outlook classified by Moody's, Standard & Poor's and Fitch as 'Stable', as of 25 November 2008, which substantially mitigates the credit risk identified. The Investment Manager does not regard the credit risk as being material.

24 CORAL GROWTH INVESTMENTS LIMITED

Notes to the Financial Statements

13. Risks arising from investments in financial assets and liabilities (continued) Liquidity risk The Directors of the Company do not regard the liquidity risk as being material. The closed-ended nature of the Company means preference shareholders cannot redeem on demand. The Fund has a fixed initial life of 10 years from the First Closing. This term may be extended only once by a further two years if a resolution is passed by shareholders. The Investment Manager and Directors ensure that investments have a clear exit strategy to enable proceeds realised by the investments to be distributed by the Company's winding up date. Investors make a Capital Commitment to the Company. Capital is drawn down at various intervals to meet the investment objectives of the Company. Financial liabilities held at the year end were not material therefore it is deemed the Company will be able to meet it obligations to its creditors. The table below analyses the Company's financial assets and liabilities into relevant maturity groups based on the remaining period at the Balance Sheet date to the contractual maturity date. The amounts in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances, as the impact of discounting is not significant.

2007 Less than no stated 1 month 1-12 months > 1 Year maturity total US$ US$ US$ US$ US$

Fair value through profit or loss - - 5,291,345 23,546,320 28,837,665 Other receivables and prepayments 80,436 123,372 - - 203,808 Cash at bank - - - 294,636 294,636 Total financial assets 80,436 123,372 5,291,345 23,840,956 29,336,109

Other creditors 93,152 - - - 93,152 Total financial liabilities 93,152 - - - 93,152

2006 Less than no stated 1 month 1-12 months > 1 Year maturity total US$ US$ US$ US$ US$

Fair value through profit or loss - - 2,307,104 16,168,221 18,475,325 Other receivables and prepayments 69,932 20,920 - - 90,852 Cash at bank - - - 4,772,873 4,772,873 Total financial assets 69,932 20,920 2,307,104 20,941,094 23,339,050

Other creditors 130,032 - - - 130,032 Total financial liabilities 130,032 - - - 130,032

Fair value In accordance with the Company's accounting policies all financial assets and liabilities are carried at historic cost, as adjusted by the revaluation of investments. In the opinion of the Directors this is not materially different from fair value. The participating redeemable preference shares are shown in the financial statements at net asset value. The fair value of these Shares at 31 December 2007 is considered to be their market value.

25 CORAL GROWTH INVESTMENTS LIMITED Notes to the Financial Statements

14. Controlling party and related parties disclosure. In the opinion of the Directors there is no ultimate controlling party of the Company as defined by Financial Reporting Standard No. 8 - Related Party Disclosures. Fahad Al-Rajaan is a Director of the Company and Director General of The Public Institution for Social Security (Kuwait) which holds 55.2% of the participating redeemable preference shares of the Company. Mohamed Younes is a Director of Stanhope Overseas Limited, which is the Investment Manager of the Company and of Concord (BVI) International Limited, which is the Structuring Agent to whom management fees and structuring fees respectively are payable (Note 4). Laura Osman is a Director of Coral Growth Holdings and is also a director of Concord (BVI) International Limited. The Company owns 47.43% (2006:45.8%) of the shares of Coral Growth Holdings. Richard Blum is a director of the Company and also holds 400 participating redeemable preference shares in the Company of which 120 were fully paid as at 31 December 2007. 15. Profit/(loss) per participating redeemable preference shares The profit/(loss) per participating redeemable preference share has been calculated by dividing the profit/(loss) for the year/period of US$4,293,930 ((2006: US$(1,296,100)) by the weighted average number of participating redeemable preference shares in issue during the year/period 17,635 (2006:11,682).

16. Net asset value per participating redeemable preference share The net asset value per participating redeemable preference share calculation has been made by dividing the net assets attributable to holders of participating redeemable preference shares by the total number of these shares in issue at the Balance Sheet date. 31.12.2007 31.12.2006 US$ US$ Net assets attributable to holders of fully paid participating preference shares 29,242,829 23,208,909 Net assets attributable to holders of partly paid participating preference shares 127 108

Total net assets attributable to holders of participating redeemable preference shares 29,242,956 23,209,017

Number of fully paid participating redeemable preference shares 5,430 5,070 Number of partly paid participating redeemable preference shares 12,670 11,830 Total number of participating redeemable preference shares 18,100 16,900

Net asset value per fully paid participating redeemable preference share US$ 5,385.42 US$ 4,577.69

Net asset value per partly paid participating redeemable preference share US$ 0.01 US$ 0.01

The net asset value per Unit in issue as at 31 December 2007 is US$30,538.23 (31 December 2006:US$27,466.29). This is calculated by dividing the total net assets attributable to participating redeemable preference shares by the number of Units in issue at that date 905 (31 December 2006:845).

17. Reconciliation of net asset value per fully paid participating redeemable preference share per the financial statements to published net asset value NAV per Shares NAV In Issue US$ US$ 31.12.2007 31.12.2007 Net asset value reported to Channel Islands Stock Exchange 23,197,635 4,272.12 Revaluation of Coral Growth Holdings 6,053,321 1,114.79 Accrual adjustment (8,127) (1.49) Net assets attributable to holders of fully paid participating preference shares 29,242,829 5,385.42

26 CORAL GROWTH INVESTMENTS LIMITED Notes to the Financial Statements

17. Reconciliation of net asset value per fully paid participating redeemable preference share per the financial statements to published net asset value (continued) NAV per Shares NAV In Issue US$ US$ 31.12.2006 31.12.2006 Net asset value reported to Channel Islands Stock Exchange 23,213,528 4,578.58 Accrual adjustment (4,619) (0.89) Net assets attributable to holders of fully paid participating preference shares 23,208,909 4,577.69

18. Post balance sheet event

On 10 April 2008 a further notice for the drawdown on capital was sent to the Company's shareholders. A further 20% of each shareholder's Capital Commitment was requested which fully paid a further 4 Shares in each Unit. Notice to convert the convertible loan note instrument, between the Company and Coral Growth Holdings, was served on 3 July 2008. On 24 December 2007 Mercury (Egypt) Pharmaceutical Manufacturing ("MPM") launched an offer under the Open Purchase System ("OPR") to acquire the remaining 1.2% of Amoun Pharmaceutical Company at the same price per share of EGP 50 that was used for the acquisition of the free float in November 2006. The offer was completed on 23 January 2008 for a total value of EGP 22.1 million, including commissions. As a result, MPM owned 99.53% of the total shares of Amoun Pharmaceutical Company. In addition, MPM also owns one share quota in Amoun Distribution Company for legal (second shareholder) purposes.

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