Dato' Capt. Ahmad Sufian @ Qurnain bin Abdul Rashid,Chairman

I am pleased to present my seventh annual report to our fellow stake-holders for the financial year ended 30 June 2011. It had been a challenging year, with economic uncertainties in the West, social unrest in the Middle East and natural calamities elsewhere. Commodity prices spiked and inflation soared. At home, we are relatively stable. Against this backdrop, I am pleased to report that our Group continued to achieve reasonable progress.

Our Performance in 2011

The substantial rise in the cost of living called for reasonable adjustments in our workers pay. This inevitably affected our bottom line but is necessary to maintain a stable workforce and quality service.

Meanwhile, the Group continued to invest in its facilities and infrastructure as the demand for our service is still strong.

I am pleased to report that the Group achieved an increase in sales and profitability for the year reviewed. Group's turnover increased 13.7% to RM93.07 million from RM81.84 million a year ago, while Group's pre-tax profit increased 19.4% to RM9.86 million from RM8.26 million previously. Net profit after tax increased 17.3% to RM6.98 million from RM5.95 million. Net earnings per share amounted to 2.71 sen per every 10 sen share against 2.31 sen previously and diluted earnings per share amounted to 2.51 sen.

Earnings before interest, tax, depreciation and amortization (EBITDA) increased by 5.3% from RM14.09 million to RM14.84 million.

In aspiring to become a significant player in the regional logistics sector, the Group must maintain balanced and sustainable growth. To support this, it is necessary to build up its capacities - in manpower, equipment and infrastructure.

It is this need to allocate its cash for reinvestment that we need to balance against the ability to pay dividend. I am pleased to announce that the Board of Directors has declared a first and final dividend of 12.5% for every 10 sen share resulting in a payout of RM3.21 million to our shareholders.

Our Group continued to expand its operations in line with higher demand for our service. Adopting a prudent approach, the Group constantly worked towards improving its operating efficiency and service quality, mindful that we need to meet the expectations of our customers while keeping our costs under control. For the year under review, our Group has undertaken the following:

• Leased a piece of property measuring 59,886 sq ft to house its logistics operations
• Established Courier Operation Command Centre to improve service quality
• Finalised plans to double the handling capacity of parcel sorting at HQ Hub
• Completed the installation of tail-gate for all its long haul vehicles
• Completed the issuance and listing ofWarrants

The rapid advance in information technology has transformed social order and business model. This in turn has far reaching implications for our industry. Physical access has to catch up with information flow. Timely movement of packages becomes a necessity for business success and a way of life. As an express carrier group, the need to be ever vigilant and be prepared to respond to such developments is imperative.

The expansion of domestic giants from various regions into Malaysia and Singapore demonstrates the tremendous business potential in the industry. This increases the level of competition and it also forces the upgrade of service quality. On one hand, this will make survival harder for the existing players. On the other hand, it brings about new business opportunities for collaborating with them as they seek local business partners here. The entry of SingPost as a substantial shareholder of GDEX demonstrates the materialization of such opportunities. Meanwhile, most of these newcomers to Malaysia have chosen GDEX as their local partner. It also reflects the confidence of major foreign players in us.

To enhance our long term survival amongst the stiffer competition and to reap the benefits of collaboration in the fast changing industry, we need to strengthen our facilities by bigger capacity and achieving greater operational efficiency. That is why we need to raise our level of capital expenditure to build the capacity for economies of scale and to acquire better tools and equipment to achieve better service quality.

The Group continues to be cautious in cost control while maintaining a high standard in service quality to be ahead of competition. The increase in demand for our services necessitates our plan for capacity building, which in turn will bring about better economy of scale. In the long run, this will bring down costs to benefit our customers.

I would like to thank the management and staff for their continued dedication and untiring efforts to expand the Group.

My sincere thanks and appreciation also goes to our customers, vendors, business associates and the various statutory and government bodies, which have facilitated the Group in its operations.

I would also like to thank our shareholders for their patience and confidence in us. I believe the declaration of yet another dividend reflects our Board's determined efforts to consistently reward our loyal stakeholders.

Last but not least, I would like to commend my fellow board members who have continued to fulfill their commitments and obligations with distinction to the Board. I would also like to thank Mr Lau Wing Tat and Mr Kong Hwai Ming who have resigned from the Board for their contributions to the Group during their terms of office. At the same time, I take this opportunity to welcome Mr Ng Hin Lee to the Board.

Thank you for all your valuable contributions. I look forward to a better year ahead.

Dato' Capt. Ahmad Sufian @ Qurnain bin Abdul Rashid
Chairman