Chairman's Statement

Efficient's net profit soared 24.8% to RM15.122 million in financial year ended 31 December 2007 from RM12.114 million in the previous year on the back of higher revenue. The Group's revenue rose 31.1% to RM56.410 million from RM43.013 million the year before and its earnings per share improved to 4.61 sen from 4.04 sen.

Efficient attributed the growth to the increase in volume of data printing from existing customers as well as software application development services rendered in relating to data capture and conversion.

A first interim tax exempt dividend of 3.5% per ordinary share of RM0.10 each was declared during the financial year and paid on 16 January 2008.

The Board has recommended a tax exempt final dividend of 3.5% per ordinary share of RM0.10 each for the financial year ended 31 December 2007 for the approval of shareholders at the forthcoming Annual General Meeting.

During the financial year ending 31 December 2008, the Group has announced the following:

1. Proposed bonus issue of up to 329,300,050 new ordinary shares of RM0.10 each in Efficient ("Bonus Shares"), to be credited as fully paid-up, on the basis of one (1) Bonus Share for every one (1) existing ordinary share of RM0.10 each ("Share") held in Efficient ("Proposed Bonus Issue");
2. Proposed increase in the authorised share capital of Efficient from RM50,000,000 comprising 500,000,000 shares to RM200,000,000 comprising 2,000,000,000 shares ("Proposed Increase In Authorised Share Capital");
3. Proposed Amendments to the Memorandum and Articles of Association of Efficient ("Proposed Amendments"); and
4. Proposed transfer of the listing of and quotation for the enlarged issued and paidup capital of the Company of up to RM65,860,010 comprising up to 658,600,100 shares from the MESDAQ Market to the Main Board of Bursa Malaysia Securities Berhad ("Bursa Securities") after the Proposed Bonus Issue ("Proposed Transfer").

The Proposed Bonus Issue will facilitate the Proposed Transfer, as it will enable Efficient to meet the requirements of Paragraph 3.04 of the Listing Requirements of Bursa Securities ("Listing Requirements") for companies listed on the Main Board of Bursa Securities as well as Paragraph 9.01(a) of Chapter 9 of the SC Guidelines as detailed in Section 3(a) above. Paragraph 3.04 of the Listing Requirements states that an applicant seeking listing on the Main Board must have a minimum issued and paid-up capital of RM60 million comprising ordinary shares of at least RM0.10 each.

The Proposed Bonus Issue will also increase the capital base of the Company to a level which will better reflect the current scale of operations of Efficient Group and will provide existing shareholders with greater participation in the Company's equity in terms of number of Shares held.

The Proposed Increase In Authorised Share Capital is undertaken to facilitate the implementation of the Proposed Bonus Issue.

The Proposed Amendments is undertaken to facilitate the implementation of the Proposed Bonus Issue and the Proposed Transfer.

The Proposed Transfer is expected to enhance Efficient Group's standing and attractiveness amongst investors. In addition, the Proposed Transfer is also expected to enhance the confidence of the Group's customers, suppliers, investors and employees as well as further strengthen the Group's profile among its bankers.

The proposals above are pending completion.

For the financial year ended 31 December 2007, the Company had utilised approximately RM18.426 million of the total proceeds raised from its Initial Public Offering. The status of the utilization of proceeds is listed below:

The Securities Commission ("SC") had on 17 January 2008 approved the proposed variation for the Company to utilize the balance of an approximate RM473,459, initially earmarked for branding and promotion, for working capital purposes. The SC had also granted an extension of time to 31 December 2008 for the Group to utilise the above balance.

Efficient Group continues to grow in its Data and Document Processing and Electronic Business Processing businesses, as demonstrated by its increasing revenues and profits over the past financial years. In order to preserve and grow its competitive advantages, the Group expects to continue to expand its operations by continuing to offer competitive cost services for delivery of both paper and electronic presentment, as well as to introduce new value added services such as its scanning and archival services, which is now fully operational, and its Service-Oriented Architecture ("SOA") methodology, which has been rolled-out and is currently being implemented for a customer in the banking sector. SOA is a new methodology for delivering information technology application software using a design approach, which provides for better, more seamless integration of IT systems. With the SOA approach, Efficient's software are created not as standalone products, but as shareable software 'services', which can be integrated with software services of other systems, regardless of underlying technology.

Efficient Group has allocated RM2.0 million from the proceeds raised from its Initial Public Offering ("IPO") towards the continuing R&D efforts of the Group and the continuing development of its software applications, namely e-TALKTM, e-DOCTM and e-FLOWTM. The Group is committed to continually invest in R&D as an integral part of providing and improving innovative services for its customers. To date, the Group has spent RM2.0 million on its R&D from the proceeds of the IPO. Efficient expects to spend RM500,000.00 per annum on its R&D. Efficient expects its R&D effort to yield continuous improvement in its products and services, eventually contributing positively to the future results of the Group.

Efficient Group is committed to play its role as a caring corporate citizen. In line with this philosophy, our Group has taken a proactive step in making contributions toward the local community. The initiatives undertaken included providing free newspapers to the school and colleges, offering graduate placement programs and trying to reduce the amount of wastage generated by the Group by improving the effi ciency of production workflow in order to reduce the global warming.

On behalf of the Board of Directors I wish to record my sincere appreciation to all our valued customers, shareholders, business partners, sponsors, financiers, corporate advisers for their continued support, guidance and confidence.

My appreciation also goes to the management and staff for their hard work, perseverance and unwavering dedication and commitment in leading Efficient to greater heights.

We look forward to the continued support of all stakeholders of the Group in the coming years.