BOARD OF DIRECTORS' REPORT

UIC had another good year in 2007, reflecting our commitment to our customers and shareholders. We are proud that amid various challenges such as unstable and high crude oil price, regional business competition, our profit after tax was up to 182% this year from USD 1.53 million in 2006 to USD 3.53 million in 2007, demonstrating the effectiveness of the Company's strategy in delivering returns to shareholders. We delivered solid financial performance by focusing on effective cost control and the management of risk.

In 2007, the Company recorded 10.91% gross profit margin which mostly contributed by the increase in our selling price due to high crude oil price and that UIC has applied alternative fuel to substitute diesel without reducing product quality. This conversion has lowered our production cost. Improvments are continuously being develop to find a way to reduce cost. UIC has started to use natural gas as its main fuel since the beginning of 2008, a move which is expected to bring more efficiency thus enhancing UIC gross profit margin.

Without a doubt, the unstable high crude oil price has some impacts on our raw material price. In order to minimize the impact, we increase our emphasis on a more efficient raw material procurement and production to suit our customers demand. As we foresee the tightness in Petrochemical Industry in this upcoming 2-3 years, we decided to integrate our business by widening it into up stream, that is Normal Paraffin. Discussions with the concerned party is currently underway.

In the year ahead, we expect stable crude oil price, continuity of good relationship
with all stakeholders as well as increasing domestic customer purchasing power. As
detergent consumption per capita in Indonesia is relatively low compare to other countries, we believed that this industry provides a promising future. We also keep alert on new business opportunity and to explore ways to uplift current export volume. In property sector, we will focus on marketing our product and creating more value to investors and buyers. In 2008, we will launch a luxurious spa facility under Jamu Spa management and an exclusive club house which provides banquet facility, restaurant, fitness centre and three swimming pools.

As a public company, UIC commits to apply and develop the policy and the principle
of Good Corporate Governance. We realize the impor tant of Good Corporate Governance as a means to increase the Company performance and accountability to the public based on the principles of Accountability, Fairness, Transparency, and Independency and fulfills the Responsibility to the stakeholders. In 2006 Annual General Shareholders Meeting, the shareholders have appointed Mr. Andreas Maliwa and Mr. Takashi Nakamura as new members of Board of Directors replacing Mr. Andi Solaiman, Vice President Director and Mr. Handoyo Sutanto, Director, respectively. We thanked them for their leadership and dedication in the success of the Company.

UIC will celebrate its 25-year anniversary i n 2 0 0 8 . Ample challanges and accomplishments have marked UIC journey over the past years. Kindly let us convey our great gratitude to all stakeholders who have always granted us their support in good time and bad time. We also dedicate our sincere appreciation to all our employees for a job well done.