Chairman's Statement

Extracted from Annual Report 2008

Financial Performance

	Year 2007 RM'000	Year 2008 RM'000	Growth %

Revenue	36,169	26,413	-27%
Profit Before Tax ("PBT")	14,867	8,599	-42%
Profit After Tax ("PAT")	14,427	8,324	-42%

Vitrox Group recorded revenue of RM26.41 million in 2008, a decrease of 27% over the RM36.17 million in previous financial year.

The decrease in revenue was due to lower demand for the machine inspection system ("MVS") and electronic communication system ("ECS").

AS a result, the PAT achieved RM8.32 million, a decrease of 42% over RM14.43 million recorded in previous year.

Dividend

A special interim dividend, tax exempt of 0.7 sen per ordinary share each for financial year ended December 31, 2008 was paid to shareholders on 10 February 2009.

The Board of Directors has recommended a final dividend, tax exempt of 0.4 sen per ordinary share each for the year ended 31 December 2008. If approved at he forthcoming annual General Meeting, the total distribution is 1.1 sen per ordinary share for financial year 2008.

Corporate Development

The shareholders of the Company, by a resolution passed at the Extraordinary General Meeting held on 21 November 2008, approved Company's plan to purchase its own shares.

The directors are committed to enhancing the value of the Company to its shareholders and believe that the purcjase plan can be applied in the best interest of the Company and its shareholders.

Achievements in 2008

On 16 August 2008, the Vitrox Corporation Berhad was ranked no. 6th in the top 100 KPMG Shareholder Value Awards 2007.

On 31 October 2008, the Group's wholly owned subsidairy, Vitrox Technologies Sdn Bhd has won the Golden Bull Hall of Fame 2008 Awards.

Future Outlook and Focus

The Group will continue to focus and expand on its core business in the development & production of MVS, automated optical inspection (AOI) system and ECS.

The Group is also positioning itself towards a higher level of integration in the application of vision technologies to diversify its business.

Along this business strategy, we will focus more heavily in the development of vision equipment with expanded technologies and platform. This is crucial to our future while maintaining and achieving higher values for our shareholders.

During the uncertain economic situation, the Group will implement even more stringent and prudent internal cost control measures through lean initialtives. We believe strongly that our success depends heavily on containing costs and eliminating waste in order to ensure sufficient resources are available for product innovation and market expansion not only for the immediate future but to build ourselves into a more robust company in the global markets.

The Group appointed a new Hong Kong based sales representatives for the AOI business and took part in the International Printed Circuit Assembly Exhibition (HKPCA) in Shenzhen, China in December 2008.

The Group will continue to expand its presence in the Philippines through sales representatives expansion in MVS and AOI business.

We will capitalize and expand our presence in USA, with continuous growth and technology advancement.

We foresee FY2009 would be a very challenging and break-through year. We are well positioned to address the situation through innovations and business excellence.

Dato' Seri Kelvin Kiew
Chairman
28 April 2009