The directors are pleased to submit their report to the members together with the audited financial statements for the year ended 31st December 2006 which disclose the state of affairs of the company.

INCORPORATION AND ADDRESS

GM Nigeria Limited is incorporated in Nigeria under the Companies & Allied Matters Act 1990 as a private limited liability company, and is domiciled in Nigeria . The address of its registered office is:
31, Mobolaji Johnson Street,
Oregun Ikeja, Lagos.

PRINCIPAL ACTIVITIES

The principal activities of the company are the assembly of CKD (Completely Knocked Down) motor components to produce pick-ups and trucks, the manufacture of bodies for various applications like buses, tankers and ambulances, etc. with up to 30% local value added the marketing and distribution of vehicles through its network of branches and dealers nationwide. The company provides product support for parts and service at its Oregun plant and through its numerous Parts and Service dealers. The company is also involved in provision of technical training for our employees, dealers and fleet customers' personnel.

The company's product range includes Isuzu light, medium and heavy commercial vehicles and Chevrolet heavy commercial vehicles, (all with various body applications).

During the year, we structured the business by discontinuing assembly of CKDs, disposal of Apapa premises and movement to a smaller location at 31 Mobolaji Johnson Way , Oregun, Ikeja.

RESULTS AND DIVIDEND

The Company's results for the year are set out on page 15. The profit after tax for the year is N1,190,228 part of which will be used to pay dividend of 417 kobo per share as recommended by the directors. The company's performance for the year must be viewed against the background of the disposal of Apapa premises which yielded a profit of N1billion.

DIRECTORS

The directors who held office during the year and to the date of this report are shown on page 8. None of the directors has interest in the equity of the company.

APPOINTMENT AND RETIREMENT OF DIRECTORS

Since the conclusion of the previous Annual General Meeting, Mr. L.E Ettah was appointed a Director and Chairman with effect from 1st November, 2006. While Mr. L.A Ajayi retired as a Director and Chairman of the Board.

DIRECTORS INTERESTS IN CONTRACTS

None of the directors has notified the company for the purpose of section 277 of the Companies and Allied Matters Act 1990 of their direct or indirect interest in contracts or proposed contracts with the company during the year.

SHAREHOLDING

According to the register of members at 31st December, 2006, the following shareholders of the company held more than 10% of the issued share capital of the company:

DEALERS

The following were the company's dealers spread across the length and breadth of the country at the year end:

EMPLOYMENT OF DISABLED PERSONS

The company has a policy of fair consideration of job applications by disabled persons having regard to their abilities and aptitude. The company's policy prohibits discrimination of disabled persons in the recruitment, training and career development of its employees.

EMPLOYEE HEALTH, SAFETY AND WELFARE

The company enforces strict health and safety rules and practices at the work environment, which are reviewed and tested regularly. The company provides free medical care for its employees and their families through designated hospitals and clinics.

EMPLOYEE TRAINING AND INVOLVEMENT

We retain and motivate employees through training and development in order to achieve excellence in perfonnance. We .also encourage employees to improve themselves academically or professionally through self development schemes. Communication is a major industrial relation activity in GM Nigeria Limited, as such, all employees are kept informed not only on matters relating to them as employees but also on the challenges in the environment where they function and the state of the business. Regular team briefing, knowledge sharing, suggestion boxes and Joint Consultative Committee (JCC) meetings and management & staff conference, are medium of exchange of ideas between staff and management, to improve the communication channel.

AUDITORS

The company's auditors, PricewaterhouseCoopers, will continue in office in accordance with Section 357{2) of the Companies and Allied Matters Act, 1990 without any resolution being passed. A resolution will however be proposed at the Annual General Meeting authorizing the directors to fix their remuneration.

Dated the 2nd day of July, 2007 By order of the Board.

Godwin A. Samuel, Esq.
Company Secretary.