Good afternoon, fellow shareholders.

At last year's annual stockholder meeting, we anticipated that 2008 was going to be a challenging year. What we did not expect was that is was going to be the most difficult year for world financial markets in over 50 years. The U.S. economy is in recession, and it appears that the recovery will be a slow and long process.

In this regard, the main concern for the Philippines is the plight of the eight million overseas workers and the remittances they send home to support their families' basic needs.

The "million dollar" question is whether these remittances, the country's most important source of foreign currency and the main driver of domestic consumption, will dry up. Remittances from overseas Filipinos reached a record high of US$16 billion in 2008. This represented a growth rate of 15% against the previous year, despite the U.S. being in recession for the whole of 2008.

Inflation was the Philippine economy's main nemesis last year. World prices for oil and food products skyrocketed to new highs. Lower production in our corn and rice fields exacerbated the problem. Consumer inflation rose quickly to peak by mid-year at 12%. However, by December, world oil prices normalized and consumer inflation slowed to 8%. This trend of easing inflation has carried over into 2009, ending at 6.9% for the first quarter. We feel that consumer inflation will continue to abate, and may average around 5% for 2009.

Last year, interest rates remained stable. The banking system operated under fairly normal circumstances. Despite the major pullback in the prices of bank stocks, most Philippine banks are healthier than their stock prices reflect.

During 2008, the yield on the 3-month Philippine Treasury bill fluctuated between 6.5% and 4.5%. It has now settled at the bottom part of that range. We expect interest rates to fall further, possibly ending the year in the neighborhood of 4.2%.

Philippine GDP grew by a modest 4.6% in 2008. Although this was lower than 2007's record growth rate of 7.2%, it was a fair performance in our view, considering the more severe impact the world financial crisis has had on many other countries.

The Philippine stock market and the Philippine Peso were not spared from the global financial meltdown. Our stock market lost almost half of its value as foreign funds dumped Philippine stocks as part of their worldwide selling spree. Meanwhile, the Peso depreciated by 15% against the U.S. Dollar.

Due to our long-term view and commitment to the equities market, we did not sell out of equities completely. In 2008, we repositioned the equities portfolio of the Fund to take advantage of much higher cash dividends, primarily in the communications sector, and we reduced our exposure to the financial and property sectors. We maintained a neutral weighting in equities, averaging approximately 70% exposure throughout 2008. Although we reduced our overall equities weighting throughout 2008, we could not wholly avoid the negative impact of the major selloff in the Philippines stock market. In 2008, the PSE Index contracted by 48%, while our Fund's Net Asset Value per share contracted by 41% to end the year at P 1.28. We continue to believe that the Philippines would weather the current financial storm and come out stronger from it. It now appears that investors also increasingly see the longstanding value of listed Filipino companies. For the period ended June 30, 2009, the Philippine Stock Exchange Index has risen 30%, while the NAV per share of your Fund has risen to P 1.58, or 23.5% higher than at the beginning of this year.

For 2009, we anticipate that we will maintain a neutral weighting for the portfolio: on average, 70% of the Fund will be invested in stocks and the 30% remainder will be invested in cash or cash equivalents.

For equities, we have reduced our holdings to 16 companies. Due to uncertain market conditions, we will favor investments which are stable and liquid, and which offer a cash yield over growth and value. At the end of the first quarter of 2009, 55% of our equity position was invested in the power and telecom sectors. Property and holding companies made up another 25%, and the 20% balance was divided among the banking, consumer and transport sectors.

PLDT and Globe Telecom make up our holdings in the communications sector. With combined earnings of over PHP 50 billion, these companies are the clear earnings winners. They are expected to continue paying healthy cash dividends in the coming years.

In the power and utilities sector we favor Aboitiz Power (AP). AP is the country's leader in renewable energy production and owner of the second largest power distribution network in the country. Other utilities stocks we hold in the portfolio include First Philippine Holdings, Manila Water, Energy Development Corp. and First Generation.

In the property sector our top stock is mall developer SM Prime Holdings, owner of all the SM malls in the country.

As for holding firms, our largest position is in Ayala Corporation, one of the most respected conglomerates in Asia today. Our bank holdings are limited to industry leader Bank of the Philippine Islands and Security Bank. Our exposure to the transport sector is through port operator ICTSI and our only consumer play in the portfolio is Jollibee Foods Corporation.

As for our fixed income positions, we participated in the recent corporate bond offerings of Globe Telecom, San Miguel and Aboitiz Power. Corporate bonds now make up about 30% of our fixed income portfolio. The balance of the portfolio is invested in government notes, bonds and cash. Our fixed income portfolio has an average life of less than three years and an average yield to maturity of 6.2%.

I would like to take this opportunity to inform all the shareholders that your Board of Directors is considering the implementation of a regular dividend policy. I am hopeful that this policy will be put in place before the end of this year.

Because 2008 was a difficult year, we would like to thank each and every one of you for standing by your Fund. In 2008, the ATR Kim Eng Equity Opportunity Fund was one of the mutual funds in the Philippines that grew in terms of number of shareholders. This continued growth our Fund's investor base is a remarkable testament to Filipinos' long-term confidence in the country, especially in light of the circumstances of the past 23 months. Most of our shareholders live in the Philippines, but we also have a sizeable number who reside in Hong Kong, the Middle East, and other parts of the world.

My fellow shareholders, thank you very much for your loyalty. I hope you will tell your friends, colleagues and relatives about the Fund, so they can also be given the chance to demonstrate their optimism about the Philippines � to invest their money where their hearts are. Mabuhay ang Pilipinas, at mabuhay po kayong lahat.