News

PADICO Press Release
August 14, 2007

Mr. Munib R. Masri, Chairman of the Board of Directors of PADICO Group, announced that PADICO’s profits for the first half of 2007 were good, citing that PADICO’s audited financial reports for the period showed the company’s revenues at US$ 25.8 million and net profit at US$ 20.2 million. Masri explained that these profits are from both direct and indirect investments in local, Arab, and regional markets. He further commented that these profits are the result of the great effort of PADICO Group’s subsidiaries and affiliates to overcome serious political, economic, and financial challenges.

PADICO’s financial reports indicate the following as of June 30, 2007:

• Total Assets US$ 438.7 million

• Total Liabilities US$ 122.5 million

• Total Shareholders’ Equity US$ 316.2 million

The first half of 2007 witnessed important political events that negatively impacted the local and regional economy, especially in Palestine. There were obvious setbacks in various Arab stock exchanges, including the Palestine Securities Exchange. Palestine also witnessed difficult political events between Palestinian brothers, which negatively affected the Palestinian cause overall and caused further damage to the economic situation.

The Palestinian economy continues to suffer from closures and violence, and public servants have not been paid for the past 15 months. The private sector is unable to carry on normal business activities and to reach local and regional markets due to the strict closures between major areas of Palestine.

All of these factors have contributed to the poor performance of most Palestinian private sector companies, as well as the drop in the indicators of the Palestinian economy. Palestine Securities Exchange trading index (Al-Quds Index) which reached 605 points by the end of 2006, further dropped to 509 points, a decrease of 15.87%.

PADICO Group is hopeful that the political and economic conditions in Palestine will improve, resulting in a calmer environment that is conducive to investments and attracts foreign investors, and eases the path to investments in the surrounding region. Better conditions will also provide an opportunity for the Palestinian private sector to continue its efforts to develop and further invest in the various sectors of the country.

PADICO Group’s strategic plan is to maintain its positive results through diversified direct and indirect investments, to achieve regular and sustainable profits from local and regional markets. PADICO invests part of its cash assets in Arab markets, including Saudi Arabia, UAE, Kuwait, Qatar, Egypt, Morocco, and Jordan, as well as other promising markets. PADICO’s vision is to invest globally.

The Group’s subsidiaries and affiliates have taken on an active role in investing both locally and in outside markets, with a strategy of investing in the development of various sectors, including agriculture and industry among others. These companies will also continue in the patriotic duty of building a strong foundation for Palestine

It should be note that, based on a decision taken by its General Assembly on April 29, 2007to PADICO has distributed cash dividends in the amount of US$ 25 million to its shareholders, which amounts to 10% of its subscribed capital.