Distinguished Shareholders, Colleagues, Ladies and Gentlemen, I am delighted to welcome you to the 10th Annual General Meeting of our Company, uacn Property Development Company (UPDC) Plc being held today, Tuesday 13th May, 2008 at the Arthur Mbanefo Hall, Novotel Festac Hotel (formerly Durbar
Hotel), Amuwo-Odofin, Lagos.

Before I present to you the 2007 performance of the Company, please permit me to review the operating environment of the business forthe year under review.

Review of Operatinq Environment
The Nigerian economy showed some improvement in 2007 over the previous year. Gross Domestic Product (GDP) stood at N22.91 trillion in December 2007, up from N18.57 trillion in December 2006. Real GDP growth rate in the year was estimated at 7.01 % as against 5.63% recorded in the preceding year. Non-oil GDP recorded a growth rate of 9.8% against 8.59%, while Oil GDP recorded a decline rate of 5.1% against the decline rate of 4.51% in 2006. The Non-oil GDP growth was driven by growth in agriculture, solid minerals, telecoms and manufacturing sectors while the decline in Oil GDP was due to the continuing crisis in the Niger-Delta Area of the country.

The year-on-year inflation figure for 2007 was 6.6% against 8.5% for the preceding year. The economy achieved a single digit inflation figure projected for the year due to the appreciation in the value of the Naira against the USD, the improvement in other macro-economic variables in the economy and the proactive measures the CBN adopted to manage liquidity in the financial sector.

The country's external debt stock stood at USD3.4 billion in December 2007, showing a marginal reduction from the previous USD3.54 billion in December 2006. External reserves however went up from USD45.01 billon in 2006 to USD 52.0 billion in 2007, showing a.15'.5% growth rate. The efforts of the immediate past administration to get Nigeria freed from huge external debt have helped the economy to free additional resources for the domestic economy to promote growth and development.

The Monetary Policy Rate (MPR) was 9.5% while Prime Lending Rate averaged 17.6%. - Inter-bank interest rates were generally lower in 2007 when compared with the preceding year. For Real Estate development, mortgage instruments remained largely un-developed and available mortgage facilities were given at rates ranging between 15% and 20%, which is still not conducive for stimulating real growth in the sector.

The official Naira exchange rate to the USD appreciated by 8.03% during the year as the average exchange rate was N116.80 to a Dollar compared with N 127.00 to a Dollar in 2006. The appreciation in the Naira value was on account of escalating price of crude oil in the international market which resulted into a more favourable balance of payment position for the country and a better co-ordination of fiscal and monetary policies during the year.

On the socio-political front, Nigeria for the first time since independence successfully transited from one democratically elected government to another during the year. The election however fell short of international standard as it was marred by irregularities and outright manipulations, as reported by international observers. The high spate of nullification of election results across board by the Election Petition Tribunals attests to the observation.

Kidnappings in the Niger-Delta Area by militant youths continued unabated in the year and most of the oil companies operating in the area had to relocate their expatriate employees to Lagos. This sad development continues to affect projected oil production and revenue levelsfor the economy.

Financial Performance

Despite the seemingly harsh operating environment, your Company posted a modest turnover performance of N5.68 billion for 2007, showing a slight increase of 4% over the figure of N5.48 billion recorded in 2006. Profit before Tax (PBT) was N 1.42 billion against N 1.37billion in the preceding year, showing a slight improvement of 4%. It is pertinent to state that the challenges encountered by the Company during the year with regard to unjustified title recertificationlplanning approval demands and prolonged closure of project sites by the Lagos State Government had consequential project time and cost overrun and loss of revenue for the business.

In the light of these results, the Board of Directors has recommended for your approval a dividend of 49 kobo per share for the year. This represents an increase of 14 kobo over the 35 kobo dividend per share paid in the previous year.

Review of Operations

•  The Company
Operationally, the company maintained her leadership position in the niche segment of the Real Estate sector of the economy. We achieved full completion of the residential development at 3, Yola Street Port- Harcourt, among other projects, during the year. Some of the major projects at varying stages of completion as at the year end are Imperial Court, Park View Estate, Ikoyi; Trenchard Place, 10 Gerrard Road, Ikoyi; Romay Gardens, Lekki Peninsular and Victoria Mall & Plaza, Aboyade Cole Street, Victoria Island, Lagos.

•  UPDC Hotels Limited
Despite Initial financial and power implementation challenges, we are nearing completion of phase one (1) of the refurbishment work on Novotel Festac Hotel, Amuwo- Odofin, Lagos. That this meeting is being held in the Hotel today is a testimony to the commitment of management to make our dream for the Hotel a reality. Refurbishment work is at an advanced stage as you can see and we are poised to open fully to guests before the end of the year.

•  1004 Estates Limited
Sequel to the re-opening of the project site by Lagos State Government, work has commenced in earnest and the refurbishment work is at an advanced stage. The Project will be completed in 2008 and flats handed over to the buyers.

Looking Forward
We are very hopeful that the business climate will continue to improve. Going by the influx of foreign direct investments and investors into the country in recent times, we are optimistic that the demand for quality accommodation will increase significantly in the coming years. Your company is poised to take advantage of these emerging opportunities.
I wish to assure that your Company's governance structures, operating systems and processes are being progressively strengthened and improved upon to deliver sustained value to you, our esteemed shareholders.

with the investments it has made into land acquisitions as well as strategic alliances being formed with land owners, developers and other interest groups. The successful reforms of the Pension (Pension Act) and the on-going reform and capitalization of the Insurance and Stock Broking sectors of the economy combined with the imminent take off of the Real Estate Investment Trust (REITS) initiative would help mobilise private capital for real estate/mortgage development.

Your Company will continue to leverage on highly skilled and experienced human capital, as a market leader, and improve the quality of its products and project delivery timelines to guarantee profitability.

Board Changes
Fellow Shareholders, I am pleased to inform you of a recent change on the Board of your Company. Since the last Annual General Meeting, Mr. Stephen Mayaki, and Mr. Nsikak Titus Ekure had resigned from the Board, while Mr. Abdul Akhor Bello and Mrs. Nana Dawodu (with Mr. Olumide Abayomi Oduntan as her alternate) joined the board as Managing Director and non-executive Director respectively. Please join me in wishing them successful tenures.

Appreciation
Ladies and Gentlemen, I wish to express my profound appreciation to the management and staff of our Company for their effort in working for the sustained profitability of the company.

I thank you our esteemed Shareholders for your unwavering interest and commitment to the Company.

Finally I thank my fellow directors for providing good leadership and direction to the Company.

I thank you all for your attention.

Lt. General Mohammed Wushishi (rtd.) GCON, CFR, FSS,PSC.
Chairman