Corporation Limited

PRESS RELEASE

JACKSPEED CORPORATION SECURES NEW CONTRACT TO SUPPLY AUTOMOTIVE LEATHER TRIM TO NAZA AUTOMOTIVE MANUFACTURING SDN BHD AND EXPANDS CAPACITY TO MEET ROBUST DEMAND - Invested in additional new equipment to enhance capacity in Kluang factory - Acquired a 19,035 sq m of land in Kedah, to build additional production facility to cater to growing domestic market in Malaysia - Surge in OEM demand and capacity constraint reduced profit margins for FY04

Singapore, March 8, 2004

Jackspeed Corporation Limited ("Jackspeed"), an SGX-Mainboard-listed manufacturer of custom-fitted automotive leather trim for car seats and leather wrapping for automotive interior products, has secured a new contract from Naza Automotive Manufacturing Sdn Bhd (“Naza Automotive”). Naza Automotive is a member of Malaysia’s Naza Group of Companies, which assembles, markets and distributes the range of vehicles, Malaysia’s third national car project. Jackspeed is currently a Tier One supplier of Naza Automotive.

Jackspeed will supply a total of 10,000 sets of leather trim for Naza Automotive’s special edition vehicle – the National MPV for the Malaysian market. Delivery will be done over 3 years starting from this financial year. This is the second contract Jackspeed has secured from Naza Automotive in less than a year. Jackspeed has an existing contract to supply 30,000 sets of leather trim over 3 years from July 2003.

To meet increased market demand, Jackspeed has expanded its production capacity in Malaysia. It has taken delivery of 69 new sewing machines for a total of about RM$600,000 (estimated S$290,000) for its Kluang factory in January 2004 and will recruit and train new employees to run these machines. With the new machines and additional manpower, Jackspeed targets to raise its current

1 production capability in its Kluang factory from about 2,200 sets/month to about 5,000 sets a month by June 2004.

Jackspeed has also, in February 2004, acquired a piece of land of 19,035 sq m in Kedah to build a production facility there to cater to OEM customers, which include Naza Automotive. This production facility will be operated by Jackspeed Industries Malaysia to cater to the expected demand increase in the Malaysian domestic market. This production facility, which is targeted to commence production in 4th quarter 2004, will provide a total maximum capacity of about 3,000 sets a month. Part of the production capacity will be transferred from the Kluang facility.

Aside from Malaysia, Jackspeed will also be increasing its capacity in Batam from about 750 sets/month currently to 1,500 sets/month by June 2004 and in Thailand, from 600 sets/month now to 1,000sets/month by 2nd half of 2004. Further increase in capacity will be done if required.

Jackspeed has accelerated its capacity expansion in anticipation of the growing OEM market in Thailand and Malaysia.

The surge in OEM demand and a capacity constraint in the 2nd half of 2003 had affected the Group’s profit margins. Towards end-2003, OEM demand was exceptionally strong. While Jackspeed had enough equipment to fulfill the orders, an unexpected shortfall in manpower resources resulted in higher costs due to overtime pay for existing employees and additional outsourcing-related costs i.e. freight costs and import duty. Jackspeed supplemented its existing production capacity in Malaysia by outsourcing part of the production process of its leather trim production for delivery between December 2003 and February 2004. The higher costs reduced profit margins. As such, Jackspeed expects its earnings for the financial year ending February 04 to be lower than earlier expected. Given the steps taken to increase capacity, the capacity shortfall is expected to be a one-off issue. With its capacity expansion in place, Jackspeed anticipates this constraint to be rectified by April/May 2004.

“We are delighted with the new contract from Naza Automotive. This demonstrates their trust and confidence in our high standards of quality and delivery. We will continue to grow our OEM business as we expect the uptrend in this sector to be sustained as Asia – especially Malaysia, Thailand and China continue to expand their OEM car manufacturing industries. We have accelerated our capacity expansion plans this year to meet the robust growth in demand for our products and services – in both the OEM as well as the car distribution segments. With new capacity on-stream, we will also be better able to cater to expected new orders from markets such as Australia where we have recently set up a subsidiary,” said Mr Jackson Liew, Jackspeed’s Group Chairman and CEO.

2 About Jackspeed Corporation:

Established in 1993, Jackspeed started as a trader of automobile parts and accessories. Since then, the Group has grown into a manufacturer of automotive leather trim with one production facility each in Singapore, Malaysia, and Indonesia to serve a growing clientele. The Group also has an associated company, which has a production facility in Thailand.

In addition to the manufacture of custom-fitted automotive leather trim for car seats, it also provides leather wrapping for other automotive interior products, such as steering wheels, consoles, gear-shift knobs and hand brakes, as well as leather trim and leather wrapping for non-automotive interior products in the aviation and marine industries.

Its subsidiary, Jackspeed Leather Special Manufacturer (M) Sdn. Bhd., is a tier- one supplier to Naza Automotive Manufacturing Sdn. Bhd. in Malaysia. Its associated company, Jackspeed Leather Manufacture (Thailand) Co., Ltd., is a tier-one supplier to the Ford Group.

Leveraging on its strengths in design and its high product and service quality standards, Jackspeed has established itself as a recognised brandname in the industry. Jackspeed was one of the winners of the “Singapore Promising Brand Award” in 2003 organised by the Association of Small and Medium Enterprises and Lianhe Zaobao, an award given to selected companies in Singapore whose brand is associated with good value and quality products and services.

Jackspeed has achieved several international certifications and awards including the QS-9000 (for the design, manufacturing and installation of automotive leather trim and other related accessories), ISO 9002:1994, ISO 14001:1996 (for the design, manufacturing and installation of automotive leather trim and other accessories) and TUV Kraftfahrt GmbH (for side airbag safety).

Jackspeed has established a profitable track record in the last 3 financial years. Group revenue rose from S$14.6 million in FY2001 to S$23.7 million in FY2003. Profit before tax increased from S$1.6 million in FY2001 to S$3.8 million in FY2003, representing a compounded annual growth rate (CAGR) of 52%.

Jackspeed was listed on the Mainboard of the Singapore Exchange in November 2003.

For more information on Jackspeed, please visit : www.jackspeed.com

3 ABOUT NAZA AUTOMOTIVE

The Naza group, which started in 1976 as an importer of used and reconditioned vehicles, today markets completely-built-up Mercedes Benz, KIA, , Bentley, and Marserati cars apart from its hospitality, public transport and other businesses. The Naza Group of Companies is one Malaysia's largest importer of cars.

The group became a full-fledged auto assembler when it launched the KIA Spectra in 2001. Last year, Naza launched Malaysia's first multi-purpose vehicle, the Naza Ria.

March 8, 2004

For more information, please contact: Tham Moon Yee / Mabel Ong Claudia Yu Stratagem Consultants Pte Ltd Jackspeed Corporation Limited Tel : 6227 0502 Tel : 6788 2088 Fax : 6227 5663 Fax : 6789 0020 Email : [email protected] [email protected]

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