Kuala Lumpur, February 26 - Esso Malaysia Berhad today announced the Company's fourth quarter and full year results for the year ended December 31, 2006:

Full Year 2006 Financial Results
The Company recorded an after tax profit of RM7 million for 2006, compared to RM20 million in 2005, as strong retail volume growth and improved marketing margins were offset by the impact of the high cost of low sulfur crudes on refining margins and adverse inventory valuation effects.

Revenues in 2006 were RM9.3 billion, an increase of RM1.1 billion or 13% over the previous year, reflecting higher product prices.

Operating performance for the year was strong, with 8% sales growth in the controlled petroleum products sector reflecting the benefits of retail initiatives such as the Smiles driver reward loyalty card and diesel subsidy card programs.  The Company progressed efforts to increase the mix of lower cost refinery feedstocks, and implemented process upgrades to improve product yields.  Our plants and terminals maintained high levels of operating reliability, winning several gold awards from the Malaysian Society for Occupational Safety and Health, and completing 10 years of continuous operations without an employee lost time injury.

Fourth Quarter 2006 Financial Results
The business environment in the fourth quarter was very challenging, with the Company recording an after tax loss of RM47 million, compared to a loss of RM12 million in the same period in 2005.  Improved earnings in the marketing sector were more than offset by the impact of weaker refining margins and adverse inventory valuation effects.  The fourth quarter loss offset most of the gains made earlier in 2006.

Business Outlook
The prospects for the Malaysian economy in 2007 and beyond remain positive, and the demand for petroleum products is expected to remain strong. Nevertheless, the potential for earnings volatility remains and intense competition will continue.  In this environment we will work to further diversify refinery feedstocks to increase operating flexibility and lower crude costs, selectively expand our retail business, and maintain our focus on product and service quality, flawless operations and cost control.

Dividends for Financial Year 2006
Management remains confident in the underlying performance of our business and in the Company’s competitive position in a growing economy.  In recognition of this and of our desire to continue to provide a steady return to shareholders, the Board proposes a dividend for the year ended December 31, 2006 of 12 sen less Malaysian income tax at 27% per ordinary stock unit.  This matches the dividend for the 2005 financial year.