Chairman message

Dear Shareholders,

The year ended 31 December 2016 was our first full year as SUTL Enterprise and it was a very eventful one for the Group.

We started the year by disposing of the last of our legacy IT peripherals distribution business in January 2016. Unencumbered by this loss making business, we were able to fully focus all our energies on our vision to be Asia's leading, premier integrated marina developer.

Our CEO, Mr Arthur Tay, has a dream to adorn a string of pearls along the beautiful coastlines of Asia where the boating community can sail along and stop to explore this amazing region. Each pearl represents an efficiently operated worldclass ONE°15 branded integrated marina with a myriad of lifestyle and retail choices. Each of them a destination within a destination.

Once this network is in place, we believe that it will attract a new segment of farflung visitors to the region – a community of high net worth individuals who own super yachts but have not been able to explore Asia's coastline in the past because of a lack of available and viable berthing space.

Through our interactions with many boating enthusiasts from Europe and the US, we have learnt that they are in fact very keen to sail here but are hampered by the lack of infrastructure.

We envisage that a strong network of marinas will also make it possible for those who love the waterfront and boating lifestyle to visit hard-to-reach coastal destinations and islands on chartered yachts. This in turn will benefit the yacht leasing business of ONE°15 Luxury Yachting.

Both of these are new high value tourism segments which we wish to contribute to Asia's tourism industry.

The opportunities are aplenty because many countries in Asia are not landlocked. In fact, of all the world's regions, we may have the highest network of islands and coastal areas here. Indonesia alone has more than 17,500 islands and the Philippines has more than 7,000 islands. Unlike Europe and the US where the boating lifestyle is already firmly entrenched, these coastal destinations in Asia are waiting to be developed and the possibilities are endless.

While we are keen to develop marina infrastructure in emerging markets, these projects have longer gestation periods because some of these marinas have to be redeveloped while others have to be built from the ground up.

To counterbalance the longer wait from greenfield marinas, we have been actively keeping an eye out for potential assets in more mature markets around the world that we may acquire. Our plan is to introduce Asian hospitality, which is warm and attentive, and breathe new life and vibrancy into these old marinas. We have seen some potential assets for sale but we will do our due diligence and only make the investment if it is the right fit and reasonably priced.

In FY2016, we had added three new pearls to our necklace. The first was through an agreement with UEM Sunrise Berhad to incorporate a joint venture company to develop a public marina, a private marina and a superyacht marina Puteri Harbour of Iskandar Puteri in Iskandar Malaysia, Johor. All will be branded ONE°15. We are still working towards fulfilling all the conditions precedent for this Joint Venture.

The second and third, which were announced at the same time in September 2016 were contracts for the management of a marina in Zhuhai, China and a marina in Jakarta, Indonesia. All three are in different stages of development but we expect all to become operational between 2018 and 2019.

These new marinas together with ONE°15 Marina Club, Sentosa Singapore and ONE°15 Brooklyn New York, USA, which we are also managing, brings the total number of marinas we have to five.

The team is busy looking for more pearls to add to our necklace in FY2017 and we hope to have good news to share very soon. In the meantime, we are pleased to share the fruits of a good year with our shareholders. The Board has proposed a final dividend of 2.0 Singapore cents per share to be approved by shareholders at the upcoming AGM in April 2017.

In closing, I would like to thank our management team for their dedication to the Group's vision and their determination to make it happen. I also want to thank our shareholders for your patience as we build up our new marina business and your faith in our ability to add value to your investment.

Lew Syn Pau
Non-Executive Chairman