Dear Shareholders,

For and on behalf of the Board of Directors, we are pleased to present to you the Annual Report and Financial  Statements of Brothers Holdings for the financial year ended 31 March 2011 (“FY2011”).

Financial Highlights for FY2011

FY2011 was a challenging year which saw the PRC central government implementing various control measures to curb speculative activities in the property market. Despite the challenges posed, the Group achieved significant improvement in its financial results in FY2011 over FP2010 (financial period for 15 months ended 31 March 2010).

Turnover increased by 9% from S$48.0 million in FP2010 to S$52.3 million in FY2011 with gross profit increasing by 90% from S$9.1 million to S$17.4 million. At the net profit attributable to equity holders of the Company level, the Group reported a 149% increase in net profit from S$5.6 million in FP2010 to S$13.9 million in FY2011. Similarly, the Group achieved a healthy balance sheet position with its cash position rising from S$28.1 million to S$39.6 million, whilst bank borrowings reduced from S$19.0 million to S$2.9 million.

Developments during FY2011

The healthy financial performance achieved for FY2011 was mainly contributed by Phase 1B and Phase 2 of the Singapore City@Shenyang Project, and Phase 2 of the Singapore City@Yalu River Project. Phase 2 of the Singapore City@Shenyang Project was newly launched in August 2010 whilst Phase 2 of the Singapore City@Yalu River Project was newly launched in October 2010.

Our sales performance in FY2011 continued to be robust, with average selling prices for Phases 1 and 2 of Singapore City@Shenyang Project increasing by 29% over FP2010 and the Singapore City@Yalu River Project increasing by 13% over FP2010. We observe that demand in the property markets for Shenyang and Dandong are mainly generated by owner-occupiers comprising first-time home buyers and home up-graders, rather than speculative buyers. This has contributed positively to

maintaining relatively stable market growth amidst the governmental controls aimed at curbing speculation.

In FY2011, we successfully completed the construction of Phase 1 of our Singapore City@Yalu River Project, comprising 228 residential units. The hand-over of units to our residents started in the second half of December 2010. To-date 41% of the units sold for Phase 1 of the Singapore City@Yalu River Project have been handed-over to residents. We are pleased with this commendable performance as we are the first developer in the Wenan International Business Zone to achieve hand-over stage.

During FY2011, the Group disposed its stake of 114.6 million shares in Oakwell Engineering Limited (“OEL”) resulting in a disposal gain of S$3.4 million.

Plans for FY2012

We plan to commence construction and sales launch of Phase 3 of the Singapore City@Shenyang Project in FY2012. For Phase 2 of the Singapore City@Yalu River Project, less than half the number of the blocks have been launched so far, and we plan to roll out sales launches of the remaining blocks progressively during FY2012.

The Group has successfully acquired the land-use right of a new land parcel in Dandong, with land area of 89,000 square meters and GFA of approximately 262,000 square meters. We expect to commence construction of the new project, to be named “Singapore City@Dandong Project” in FY2012.

We are confident of the long-term potential of the PRC real estate sector, particularly in the second and third-tier cities. We will continue to seek new opportunities to expand our land bank in prime locations in Shenyang, Dandong and other growing cities in northeast PRC through careful study and evaluation to ensure that such acquisitions would generate economic yields that contribute to the Group’s long-term growth.

Although we are confident of the long-term economic prospects of the PRC market, we expect that the year ahead will continue to be challenging in view of the global economic uncertainties and market

control measures in the PRC. We will continue to adopt a cautious approach in managing our business and continue to improve our competitiveness and efficiencies.

Proposed Dividend

The Board of Directors is pleased to recommend a first and final exempt dividend of 0.4 cents per ordinary share, for approval at the forthcoming annual general meeting.

Thank You

The success of Brothers over the years would not have been possible without the contribution and support of various parties. Therefore I would like to take this opportunity to express my sincere appreciation to our shareholders, customers, financial advisors, professionals and bankers.

I would like to thank the management team and staff for their hard work and the Board of Directors for their wise counsel and guidance.

Koh Teak Huat, Brothers Holdings Limited Chairman