Tax Benefit To Be Recognised In SembCorp's 4Q2006 Financial Statements

Singapore, Nov 06, 2006

Further to its announcement on July 11, 2006 relating to the Inland Revenue Authority of Singapore’s confirmation of Solitaire costs incurred as trade losses of Sembawang Corporation Ltd (Sembawang), SembCorp Industries (SembCorp) announces that the losses available for transfer within the SembCorp Group under the group tax relief system and/or offset against taxable profits of Sembawang, subject to compliance with the respective provisions under the Singapore Income Tax Act, will be fully utilised  in 2006.

From our evaluation undertaken together with tax consultants, the estimated tax benefit of these Solitaire expenses amounts to $155m. Based on the proposed Group Tax Relief Exercise to be completed in December 2006, this tax benefit will be recognised in the financial statements of SembCorp Group for the last quarter of the year ending December 31, 2006.

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By Order of the Board
Kwong Sook May
Company Secretary

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