saluting the extraordinairetm tfp precision industries sdn. bhd. before it adopted its current...

Annual Report 2016Saluting the Extraordinaire

3 Jalan Zarib 6, Kawasan Perindustrian Zarib,31500 Lahat, Ipoh, Perak, MalaysiaE [email protected] +(605) 320 6800

www.salutica.com

SALUTICA BERHAD (1024781-T)


TM

ANNUAL REPORT 2016Saluting the ExtraordinaireTM 1

2 Corporate Information

3 Group Structure

4 Board of Directors

5 Profile of Directors

11 Key Senior Management

14 Chairman’s Statement

16 CEO’s Message

A Stradivarius can be played as part of a harmonious philharmonic in a concert of grandeur or to be fiddled by a maestro in solo to enchant his audience. One amazing instrument achieving two incredible results depending on the objective and purpose. Every value that Salutica provides to our customers is a class of its own but at the same time we bring these amazing values together to turn ideas into incredible products. Salutica is where, in everything that is done, we salute the extraordinaires.

Saluting the ExtraordinaireTM

CONTENTS

Saluting the Extraordinaire™. To build a business where our efforts and results in whatever we do are saluted by our colleagues, partners, customers, stakeholders and even ourselves.

Mission & Vision

18 Financial Highlights

19 Corporate Social Responsibility Statement

20 Company Highlights 2016

25 Corporate Governance Statement

35 Nomination Committee Statement

37 Audit Committee Report

40Statement on Risk Management and Internal Control

43 Directors’ Responsibilitiy Statement

44 Additional Compliance Information

45 Reports and Statutory Financial Statements

102 List of Properties

103 Analysis of Shareholdings

106 Notice of Annual General Meeting

111 Form of Proxy

SALUTICA BERHAD (1024781-T)2

CORPORATE INFORMATION

AUDIT COMMITTEE

ChairmanLeow Chan Khiang

MemberChia Chee HoongJoshua Lim Phan YihLow Teng Lum

REMUNERATION COMMITTEE

ChairmanChia Chee Hoong

MemberLim Chong ShyhJoshua Lim Phan YihLow Teng LumLeow Chan Khiang

NOMINATION COMMITTEE

ChairmanLow Teng Lum

MemberChia Chee HoongJoshua Lim Phan Yih

COMPANY SECRETARIES

Chan Chee Kheong (MAICSA 0810287)

Chan Shook Ling (MIA 17167)

REGISTERED OFFICE

41, Jalan Medan Ipoh 6Bandar Baru Medan Ipoh31400 Ipoh, PerakTel : (05) 548 0888Fax : (05) 545 9222

HEAD/MANAGEMENT OFFICE

3 Jalan Zarib 6Kawasan Perindustrian Zarib31500 Lahat, Ipoh, PerakTel : (05) 320 6800Fax : (05) 322 2029Website : www.salutica.comE-mail : [email protected]

PRINCIPAL BANKERS

OCBC Bank (Malaysia) Berhad2, Jalan Dato’ Maharaja Lela30000, Ipoh, Perak Tel : (05) 241 2200

OCBC Al-Amin Bank Berhad 2, Jalan Dato’ Maharaja Lela30000, Ipoh, Perak Tel : (05) 241 2200

AUDITORS

PricewaterhouseCoopers (AF: 1146)Chartered Accountants1st Floor, Standard Chartered Bank Chambers21-27, Jalan Dato’ Maharaja Lela30000 Ipoh, PerakTel : (05) 254 9545Fax : (05) 253 2366

SPONSOR

RHB Investment Bank Berhad Level 10, Tower One,RHB Centre, Jalan Tun Razak50400 Kuala LumpurTel : (03) 9287 3888Fax : (03) 9287 4770

SHARE REGISTRAR AND ISSUING HOUSE

Tricor Investor & Issuing House Services Sdn. Bhd.Unit 32-01, Level 32, Tower AVertical Business SuiteAvenue 3, Bangsar SouthNo. 8, Jalan Kerinchi59200 Kuala LumpurTel : (03) 2783 9299Fax : (03) 2783 9222

STOCK ExCHANGE LISTING

ACE Market of Bursa Malaysia Securities BerhadStock name : SALUTEStock code : 0183

DIRECTORS

CHIA CHEE HOONGChairman/Independent Non-Executive Director

LIM CHONG SHYH Managing Director/Chief Executive Officer

JOSHUA LIM PHAN YIHNon-Independent Non-Executive Director

LOw TENG LUMSenior Independent Non-Executive Director

LEOw CHAN KHIANGIndependent Non-Executive Director


GROUPSTRUCTURE


OVERVIEWOur company, Salutica Berhad was incorporated in Malaysia under the Companies Act, 1965 on 19 November 2012 as a private limited company under the name of Blue Ocean Genius Sdn. Bhd.. On 29 June 2015, we changed our name to Salutica Sdn. Bhd. and subsequently on 4 November 2015, we became a public limited company.

We are principally an investment holding company and commenced business as an investment holding company immediately following the completion of the acquisition of Salutica Alllied Solutions Sdn. Bhd. (“Salutica Allied”) on 4 September 2013.

Our Group structure as at 30 June 2016 is as follows:-

Salutica Allied was incorporated on 15 October 1990 under the name of TFP Precision Industries Sdn. Bhd. before it adopted its current corporate name in 2013.

Salutica Allied Solutions Sdn. Bhd.206341-H

100%


BOARD OFDIRECTORS

FROM LEFT TO RIGHT (Standing) FROM LEFT TO RIGHT (Seated)

Low Teng LumSenior Independent Non-Executive Director

Lim Chong ShyhManaging Director/ Chief Executive Officer

Leow Chan KhiangIndependent Non-Executive Director

Joshua Lim Phan YihNon-Independent Non-Executive Director

Chia Chee HoongChairman/Independent Non-Executive Director


PROFILE OFDIRECTORS

He obtained his undergraduate degree in law (LL.B) from the University of London in 1999 and his postgraduate degree in law (LL.M) specialising in corporate & securities law from University College London, United Kingdom in 2004 under the auspices of the British Chevening Scholarship awarded by the Foreign and Commonwealth Office, United Kingdom. He obtained the Certificate in Legal Practice in 2000 and was called to the Malaysian Bar in 2001.

He started his career in 2001 as a legal assistant with Zain & Co. In 2008, he left Zain & Co and joined Zaid Ibrahim & Co as a senior associate. After leaving Zaid Ibrahim & Co at the end of 2009, he joined Rahmat Lim & Partners and has been a partner of Rahmat Lim & Partners since then.

He does not hold any directorship in any other public companies and public listed companies.

He does not have any family relationship with any Director or major shareholder of the Company and does not have any conflict of interest with the Group.

ChIA ChEE hOOnGAged 39, Male, MalaysianChairman/Independent non-Executive Director

Mr. Chia was appointed to our Board on 15

October 2015. He is also the Chairman of our

Remuneration Committee and a member of

our Audit and Nomination Committee.


LIM ChOnG Shyh (“JAMES LIM”)Aged 58, Male, Malaysian

Managing Director/Chief Executive Officer

PROFILE OFDIRECTORS (continued)

James Lim was appointed to our Board on

26 November 2012. He is also a member of

our Remuneration Committee.

He is responsible for our business growth direction, major corporate development plans and activities, monitoring of daily on-site operations, overseeing business strategies and product design. He is a trained electrical and electronics engineer with a degree (Hons) in Electrical Engineering from the University of Malaya where he graduated in 1982.

He began his career as a design engineer with ASEA AB (presently known as ASEA Brown Boveri) of Sweden in 1982 where his role involved the standardisation of power transmission systems in Malaysia. Subsequently, in 1983, he left ASEA AB and joined General Electric Malaysia Appliance Components Sdn. Bhd. as an application engineer where his duties involved quality assurance, process engineering and customer application liaison. He was then promoted to assistant managing director in 1990, where he was given the additional responsibility of overseeing operations of the company until 1991.



In 1991, he entered the computer peripherals industry and joined Maxtor Corporation (Penang) as an operations director, where his role involved overseeing operations in productions, which included industrial/process engineering and quality assurance. In 1992, he joined Applied Magnetics (M) Sdn. Bhd. as an operations director where his duties involved managing the firm’s mass production of computer peripherals due to the growth in volume and demand in the early 1990s. In 1993, he joined Crest Ultrasonics (M) Sdn. Bhd. as managing director, where he was responsible for overseeing the growth of the company in the manufacture of automated precision cleaning systems until 1995.

In 1995, he joined the Malaysian operations of Seagate Technology LLC as an executive director, where he was in charge of the commencement, development and growth of the company’s Ipoh facility. After the closure of the Ipoh facility, he was subsequently transferred to head the Seagate removable storage solutions division in Penang as the managing director in 2000 until 2003. Thereafter, he joined Knowles Electronics (M) Sdn. Bhd. as a managing director, playing a key role in the development and growth of the company’s Penang operations until 2004.

In 2004, he was headhunted as the chief executive officer of Salutica Allied (then known as TFP) and he set up the research and development (“R&D”) division to focus on R&D of Bluetooth technology and other wireless, touchscreen and light guide technologies. At the end of 2010, James Lim retired from Salutica Allied and in February 2011 became a consultant to the chief operating officer of TPK Touch Solutions (Xiamen) Inc, in China (“TPK”). He subsequently left TPK following his appointment as the chief operating officer and a director of Balda AG in December 2011, with additional focus on the Malaysian operations. In January 2012, he was also appointed as the Chief Executive Officer of Salutica Allied (then known as Balda Solutions). He left the board of directors of Balda AG in December 2012.

In 2013, he led a management buyout of Salutica Allied from Balda AG Group when the latter intended to focus on its core business in medical precision plastic parts and solutions. He remained as the Chief Executive Officer of Salutica Allied upon the completion of the management buyout.

James Lim is the director and substantial shareholder of Blue Ocean Enlightenment Sdn. Bhd. (“BOE”). BOE, a company incorporated in Malaysia, is regarded as the Company’s ultimate holding company.

James Lim is the father of Joshua Lim Phan Yih, our Non-Independent Non-Executive Director who is also a substantial shareholder and director of BOE. He is also the father of Joel Lim Phan Hong, a substantial shareholder of BOE.

Other than as disclosed above, James Lim does not have any family relationship with any Director or major shareholder and does not have any conflict of interest with the Group.


Joshua Lim was appointed to our Board on 11 September 2013. He is also a member of our Audit, Remuneration and Nomination Committee.

He graduated with an external LL.B (Hons) degree from the University of London in 2007 and subsequently obtained the Certificate in Legal Practice in 2008. He completed his pupillage with Shearn Delamore & Co where he was confirmed as a legal assistant in 2009. In 2010, he left Shearn Delamore & Co and joined Rahmat Lim & Partners as an associate until 2013. In 2013, he became the founding partner of the law firm Joshua Lim & Lee, and is currently the managing partner of the firm.

He does not hold any directorship in any other public companies and public listed companies.

Joshua Lim is the son of James Lim, the Managing Director and Chief Executive Officer of the Company. He is also the director and substantial shareholder of BOE. BOE, a company incorporated in Malaysia, is regarded as the Company’s ultimate holding company. He is also the brother of Joel Lim Phan Hong, a substantial shareholder of BOE.

Other than as disclosed above, Joshua Lim does not have any family relationship with any Director or major shareholder of the Company and does not have any conflict of interest with the Group.


JOShUA LIM PhAn yIhAged 32, Male, Malaysian

non-Independent non-Executive Director


He obtained his qualifications from the Association of Chartered Certified Accountants (“ACCA”) and Institute of Chartered Secretaries and Administrators, both of the United Kingdom, in 1979. He attended the Applied Management Program of the Swedish Institute of Management in 1990. In 1996, he obtained a Masters in Public Administration from the John Fitzgerald Kennedy School of Government, Harvard University.

He started his career as an audit junior in Arthur Young & Company (presently known as Ernst & Young) in 1977 and was subsequently promoted to audit senior in 1978. He then left Arthur Young & Company in 1980 and joined Guthrie Malaysia Holdings Berhad as an internal audit manager until 1981, and subsequently joined Palmco Holdings Berhad in the same year as an internal audit manager. In 1985, he left Palmco Holdings Berhad and joined General Corporation Berhad as a group internal auditor until 1987. Then, he joined Southern Steel Berhad as a finance manager and became the chief operating officer of the steel business unit in 2000 until he

Mr. Low was appointed to our Board on 15 October 2015. He is also the Chairman of our Nomination Committee and a member of our Audit and Remuneration Committee.

left the company in 2001. Subsequently, he joined Guinness Anchor Berhad in 2001 as the finance director and a member of the board of directors (appointed on 19 August 2001) and retired in 2011.

He is a Chartered Accountant of the Malaysian Institute of Accountants (“MIA”), a Fellow member of the ACCA and an Associate member of the Institute of Chartered Secretaries and Administrators, and a member of the Association of Corporate Treasurers, United Kingdom. He has also served as a member of both the Taxation and Trade committees of the Malaysian International Chamber of Commerce and Industry, from 2002 and 2005 respectively until his resignation in 2011.

Presently, he is an independent non-executive director of Boilermech Holdings Berhad and Permaju Industries Berhad.

Mr. Low does not have any family relationship with any Director or major shareholder of the Company and does not have any conflict of interest with the Group.


LOw TEnG LUMAged 62, Male, MalaysianSenior Independent non-Executive Director


Mr.Leow was appointed to our Board on 20 October 2015. He is also the Chairman of our Audit Committee and a member of our Remuneration Committee.

He is a Chartered Accountant of the MIA and a Fellow member of the ACCA. He obtained a Bachelor degree in Economics from the University of Malaya in 1990 and a Master’s degree in Business Administration from Universiti Utara Malaysia in 1999. He is also an approved Goods and Services Tax (“GST”) Agent by the Royal Malaysian Customs.

He began his career in 1991 in Hong Leong Bank Berhad and left Hong Leong Bank Berhad in 1996 to join Malaysian International Merchant Bankers Berhad as an assistant manager where he was responsible for various corporate fund raising exercises as well as general advisory work until 2001. In 2002, he joined CAB Cakaran Corporation Berhad (“CAB”) as a director of corporate finance, and subsequently, was appointed as an executive director in 2003 where he was

responsible for corporate planning, accounting and tax as well as joint-venture matters. Subsequently, he resigned from his position as an executive director of CAB in 2007.

Presently, he is a non-independent non-executive director in SLP Resources Berhad and an independent non-executive director of Ni Hsin Resources Berhad. He is also a major shareholder and executive director of Trinity Avenue Sdn. Bhd., a company specialising in GST consulting and its related services.

Mr. Leow does not have any family relationship with any Director or major shareholder of the Company and does not have any conflict of interest with the Group.

LEOw ChAn KhIAnGAged 50, Male, MalaysianIndependent non-Executive Director


Notes:Conviction of OffencesNone of the Directors has been convicted of any offences within the past 5 years other than possible traffic offences.There were no public sanction or penalty imposed by the relevant regulatory bodies during the financial year ended 30 June 2016.Directors’ ShareholdingThe details of the Directors’ interest in securities of the Company are set out in the Analysis of Shareholding on page 103 of the Annual Report.


KEy SEnIORMANAGEMENT

FROM LEFT TO RIGHT

Goh Bee Chin @ Ooi Bee ChinChief Administrative Officer

James Lim Chong ShyhManaging Director/ Chief Executive Officer

Chin Seen ChoonChief Operating Officer

Chan Shook LingChief Financial Officer

Ho Keat SoongChief Supply Chain Officer


Mr. Ho graduated with a Bachelor of Science in Business Administration from Colorado State University, US, in 1989. He then obtained a Master of Business Administration from the University of South Alabama, US, in 1992. He brings with him approximately twenty three (23) years of experience in supply chain management.

He began his career as a production planner in Penang Seagate Industries (M) Sdn. Bhd. in 1993. He was then promoted to senior materials manager in 1999 where he was responsible for plant-wide materials and production planning functions until 2000. In 2000, he joined Synerflex Consulting as a senior consultant specialising in the supply chain management improvement projects and consultancy services.

Subsequently, in 2003, he was headhunted to join Salutica Allied (then known as TFP) as a general manager of supply chain management. He assumed his current position as our Chief Supply Chain Officer in 2015, where he is responsible for the plant-wide sourcing, purchasing, planning, logistics, quality and key account functions.

Presently, Mr. Ho is an executive director of Salutica Allied, which is the subsidiary of our Group. He does not hold any directorship in any public companies or listed corporations.

Mr. Ho does not have any family relationship with any Director or major shareholder of the Company and does not have any conflict of interest with the Group.

hO KEAT SOOnGAged 50, Male, MalaysianChief Supply Chain Officer

Mr. Chin graduated with a Bachelor of Engineering in Electronic Engineering from Oxford Brookes University, UK, in 1994. He has more than twenty (20) years of experience in the electrical and electronics industry, and plays a key role in managing the overall operations of our Company.

He began his career as an automation engineer with Sony Electronics (Malaysia) Sdn. Bhd. in 1994. He then left Sony Electronics (Malaysia) Sdn. Bhd. and joined Seagate Industry (Malaysia) Sdn. Bhd. in 1995 as an automation engineer, and was subsequently promoted to a photolithography process engineer in 1996. He was then promoted to senior manufacturing engineer in 1997. In 1999, he left Seagate Industry (Malaysia) Sdn. Bhd. and joined Certance (Malaysia) Sdn. Bhd. as a staff engineer until 2003. In 2003, he joined Knowles Electronics (Malaysia) Sdn. Bhd. as a product engineering manager until 2005.

In 2005, he joined Salutica Allied (then known as Balda Thong Fook) as an engineering manager. He assumed his current position as our Chief Operating Officer in 2015, where he is responsible for overseeing factory operations.

Presently, Mr. Chin does not hold any directorship in any public companies or listed corporations.

Mr. Chin does not have any family relationship with any Director or major shareholder of the Company and does not have any conflict of interest with the Group.

ChIn SEEn ChOOnAged 48, Male, Malaysian

Chief Operating Officer

KEy SEnIORMANAGEMENT (continued)


Ms. Chan graduated with a Diploma in Commerce (Financial Accounting) from Tunku Abdul Rahman College in 1995. She obtained her qualifications from the ACCA where she became a Fellow member in 2005. She is also a chartered accountant of the MIA.

She began her career as a settlement clerk for Overseas Union Bank Ltd in Singapore in 1990. In 1992, she left Overseas Union Bank Ltd to further her studies in Tunku Abdul Rahman College, where she graduated in 1995. Then, she joined SSL Heavy Machinery Sdn. Bhd. in 1995 as an accounts supervisor until 1999.

In 1999, she joined Salutica Allied (then known as TFP) as an accountant. In 2013, she assumed her current position as our Chief Financial Officer, where she is responsible for overseeing the overall financial, accounting, compliance and internal control functions of our Group.

Presently, Ms. Chan does not hold any directorship in any public companies or listed corporations.

Ms. Chan does not have any family relationship with any Director or major shareholder of the Company and does not have any conflict of interest with the Group.

ChAn ShOOK LInGAged 46, Female, Malaysian

Chief Financial Officer

Ms. Goh graduated with a Bachelor of Business Administration from Universiti Utara Malaysia in 1990. In 2000, she obtained a certified Diploma in Accounting and Finance from the ACCA. She then obtained a Master of Business Administration from the Universiti Utara Malaysia in 2011. She holds approximately twenty five (25) years of experience in human resource and administrative management.

She began her career in 1990 as an administration officer with DNP Holdings Berhad until 1992. In 1992, she joined Salutica Allied (then known as TFP) as an administrative executive, where her role involved human resource and administrative functions.

Subsequently, in 2015, she assumed her current position as our Chief Administrative Officer, where she is responsible for manpower planning, human resource management, administration, IT, insurance and the security and safety aspects of the assets and properties of our Group.

Presently, Ms. Goh is an executive director of Salutica Allied, which is the subsidiary of our Group. She does not hold any directorship in any public companies or listed corporations.

Ms. Goh does not have any family relationship with any Director or major shareholder of the Company and does not have any conflict of interest with the Group.

GOh BEE ChIn @ OOI BEE ChInAged 51, Female, MalaysianChief Administrative Officer

KEy SEnIORMANAGEMENT (continued)

Note:Conviction of OffencesNone of the Key Senior Management has been convicted of any offences within the past 5 years other than possible traffic offences.There were no public sanction or penalty imposed by the relevant regulatory bodies during the financial year ended 30 June 2016.


ChAIRMAn’SSTATEMENT

Dear Shareholders,

On behalf of the Board of Directors, I am pleased to present the Annual Report and the Audited Financial Statements of Salutica Berhad (the “Company”) for the financial year ended (“FYE”) 30 June 2016. Salutica and its subsidiary, Salutica Allied (“Salutica Group” or “Group”) continue to sustain its growth despite the current challenging global economic condition.

FYE2016 is my inaugural year as the Chairman/Independent Non-Executive Director of Salutica. I am proud to be part of Salutica’s journey as a public listed company on the ACE Market of Bursa Malaysia Securities Berhad (“Bursa Securities”). The Board of Directors and I have confidence that our Managing Director/CEO, James Lim together with his team have what it takes to continue to grow the business and take the Group and bring it to the next level.


ChAIRMAn’SSTATEMENT (continued)

BUSINESS OvERvIEw

FYE2016 was an eventful year for the Group, not only having recorded its highest revenue of RM241.8 million in recent years, the Company had also successfully completed its listing on the ACE Market of Bursa Securities on 18 May 2016. Our share price closed 27.5% higher at RM1.02 on 30 June 2016 as compared to initial public offering (“IPO”) price of RM0.80. I believe that the growth of the Company will continue to give shareholders value in the long term. I would like to take this opportunity to also thank Bursa Securities and the Securities Commission Malaysia for giving us the opportunity to be part of this wider business community, which serves as a platform for our next level of growth.

Salutica Allied is a vertically integrated manufacturer with design, development and manufacturing capabilities that provides value to its multi-national customers (“MNC”) on a global scale.

With its strategic strength in R&D, Salutica continues to leverage on its skill set and talents to develop new processes and products to maintain its competitiveness internationally. To have not only one, but several MNCs as customers putting their trust and confidence with Salutica is not a coincidence for this company. Instead, it is a testament of our people’s capabilities in delivering the quality and standards expected at an international level.

FINANCIAL OvERvIEw

The Group’s revenue grew 25.6% from RM192.5 million in FYE2015 to RM241.8 million in FYE2016. This was mainly attributable to the increased demand for Bluetooth headsets, contributing approximately RM223.2 million, representing around 92.3% of total revenue for the FYE2016. The Group’s PBT increased from RM20.3 million in FYE2015 to RM32.9 million in FYE2016, representing an increase of approximately 62.2%. The increase is mainly due to product mix and better absorption of fixed production overheads. However, the increase in the PBT was partially offset by the one-time listing related expenses of RM2.9 million incurred in FYE 30 June 2016.

As at FYE2016, the Group has RM154.9 million of equity attributable to the owners of the company (also known as shareholders’ fund). This is a 103.3% increase from RM76.2 million for FYE2015. The Group continues to be in a net cash position with a gearing ratio of less than 0.1 after the partial repayment of bank borrowing with the IPO proceeds. I believe that the Group’s healthy financial growth over the year will help to bolster its expansion for FYE2017 as it continues to develop new products and engage new customers.

I am also happy to say that as a public listed company since 18 May 2016, the Company had on 30 June 2016 (in respect to FYE2015) and 30 September 2016 (in respect to FYE2016), paid an interim single-tier dividend of 0.6 sen per share on both occasions. In aggregate, approximately RM4.7million dividends were declared and paid.

The dividend is part of a progressive dividend policy to reward our shareholders. This underscores the Company’s commitment to its dividend policy of 30% of its annual net profit attributable to shareholders as outlined in our prospectus.

MOvING FORwARD

Being a player in the international arena, we continuously face local and international economic challenges. But as the saying goes, tough times do not last but tough men do. This is where I believe that James Lim and his senior management team, having been with the company for over 12 years, have the necessary skills and experience to meet and overcome these challenges.

We believe that consumer electronics, one of it being the Bluetooth devices segment, is a growing market and Salutica Allied is well-positioned to seize the opportunity with its design, development and manufacturing capabilities for further OEM/ODM businesses coupled by its own FOBO branded products that is beginning to garner market recognition.

We have in place the strategies, the people, the technology and the resources to continue our growth and deliver value to our customers and shareholders and we strive to do just that.

ACKNOwLEDGMENT

I would also like to take this opportunity to thank our customers, shareholders, partners and regulatory authorities for their continuing support to the Group. The Board would also like to thank James Lim and his team at Salutica Allied for their hard work, dedication and loyalty to the Group.

Chia Chee HoongChairman/Independent Non-Executive Director28 October 2016


CEO’SMESSAGEGENERAL OvERvIEw

The fiscal year end of 2016 was the beginning of a new journey for Salutica Berhad as a public listed company on 18 May 2016. So I would like to take this opportunity to thank everyone from our senior management to even our most junior employees for their contribution that has made this transformation a success. I also cannot express any lesser gratitude to our customers, investors and partners who believed in us and supported us over the past years so that we could embark on this journey. Even more so, I would also like to thank the families of our employees who have supported and tolerated the sacrifices that their loved ones have made for this company. Salutica has come a long way from a simple contract manufacturer to the start of our own R&D team and we have now established ourselves as an international player in the OEM and ODM industry for consumer electronics. More importantly, as a Malaysian company, we have leveraged on our own R&D capabilities and produced our own in-house FOBO branded line of products that is already competing internationally in the automotive industry with its tyre pressure monitoring system (“TPMS”), known as FOBO Tire, FOBO Bike and FOBO Ultra. I am proud of our people at Salutica having the courage and passion to constantly brave new challenges and explore new products to maintain our competiveness internationally. Salutica Berhad’s IPO and listing on the ACE Market of Bursa Securities on 18 May 2016 successfully raised RM62.4 million for the Group. This additional funding will be utilised to spur growth and continue to create a sustainable business model for the coming future. A major portion from the funds raised from the IPO will be used for capital expenditure to acquire technology machinery and R&D expenses which are key drivers in our business expansion that maintains our competitiveness. In addition to a successful IPO, FYE2016 provided a rewarding experience for our people’s effort and dedication. The Group’s revenue grew 25.6% from RM192.5 million in FYE2015 to RM241.8 million. On top of that, the profit before tax of the group in FYE2016 grew from RM20.3 million in FYE2015 to RM32.9 million. All this was achieved in our sole 30,000 square metre design, development and manufacturing facility in Ipoh, Perak with a workforce of 1,038 employees including the management team (as at 30 June 2016). In the same period we saw 2 new model launches from our existing customers which we believe would contribute to the group’s financial growth. On top of that, Salutica has launched a new product on 16 August 2016 under our own FOBO brand name that is marketed as FOBO Ultra, a TPMS for heavy vehicles that incorporates both Bluetooth and Near Field Communication (“NFC”) technology in its sensors. With new model launches from our OEM/ODM customers as well as from our own FOBO brand, I believe that the company’s healthy growth will continue into 2017. At the same time, new models and projects are in the pipeline for FYE2017 which should add additional contribution to the Group’s financial growth.

OPERATIONAL OvERvIEw

For FYE2016, Plantronics and Jaybird continue to remain as our key customers for our revenue with these customers’ sales consisting of more than 80% of our revenue. We find that this provides a diversified revenue stream for our business and we believe that the strong synergy that we have with these customers will continue on into FYE2017. Furthermore, our own FOBO branded products continues to be one of our key focuses in addition to the OEM/ODM business which has been bolstered by the recently launched FOBO Ultra that has taken more than 12 months of R&D resources. I truly salute our people who have managed to develop a versatile Bluetooth and NFC enabled TPMS sensor that is capable of measuring up to 1296kpa (188psi) of pressure and yet complies with the international quality standards for manufacturing TPMS. This is a proud symbol of our R&D and engineering expertise but most of all, as a Malaysian company.


CEO’SMESSAGE (continued)

OPERATIONAL OvERvIEw (continued)

Our products, both the OEM/ODM and FOBO products, continue to be shipped and delivered internationally and our supply-chain capabilities continue to provide value to our customers to improve the distribution of their products all over the globe. At the same time, in order to produce the best quality products for our customers, we continuously source globally for the best possible materials and components with our international network of suppliers. We will begin the production of a USB-powered device that adds touchscreen functionalities to a non-touch laptop screen in FYE2017. This will be another part our business that we look forward to and that will add another revenue stream to our business, and at the same time we are proud to be involved in this technology that has such a transformative impact for even normal everyday users. At the same time, our own R&D has initiated its feasibility studies into healthcare related products so that we can determine the types of products that best suit our R&D, development, and manufacturing capabilities. This is certainly another brave step taken by our people, not only to challenge ourselves but also to create new life changing products For Our Better wOrld. With the current resources that we have, we will put our efforts to good use to give fruit of this new endeavour in the future.

HR DEvELOPMENT

Salutica has always prided itself in not only being just an employer for our local and foreign workforce but also as a place where everyone has the opportunity to be the best at what they do. Being a vertically integrated manufacturer with R&D, development and manufacturing capabilities that produces products for an international array of customers, we provide a growth-centric platform for our people to continuously gain valuable experience in doing business internationally and to develop their own skill sets and talents that are on par with international standards expected from our global customers. Our customers expect nothing less from our people compared to any other multinational company, from product quality to even customer care services. Furthermore, Salutica is a strong believer in the economic and social welfare of our people and we continuously implement practices that stand for our beliefs. We are compliant with the Code of Conduct set by the Electronic Industry Citizenship Coalition (“EICC”) and also SA8000 which is set by Social Accountability International. These are international standards set for social, environmental and ethical issues. Salutica is not just a ‘rice bowl’ for our people but a melting pot of talents and culture that creates unique set pieces of capabilities that is valuable to our technology orientated business model. I believe that from the group’s practices in maintaining a high standard for the social and economic welfare of our people as well as the environment, we are able to maintain a positive working environment for everyone at Salutica. I believe that this will continue to benefit Salutica in the long term as we continue to preserve a very low attrition rate in our workforce.

Empowering people is a core philosophy of Salutica where everyone is encouraged to set their own goals and achievements. This is done through our Management by Objective (“MBO”) strategy meeting that is held annually where the management and key employees set mutual goals that create a motivational impact for each and every one to achieve it. This further creates a clear communication line for the company’s strategy and philosophy throughout the entire organisation. Our group has in place risk management procedures developed together with our internal audit that is performed by NGL Tricor Governance Sdn. Bhd.. These risk management procedures will assist the management in monitoring the company’s risks in various departments so that there will be appropriate risk control as we continue to conduct and expand our business. The group will periodically work with our internal audit to ensure that the risks within our control are dealt with sufficiently and effectively. At this moment in time, I do not see any material risks within our control that will materially impact the group’s business strategy.

IPO OvERvIEw

Salutica’s listing on the ACE Market of Bursa Securities began with an IPO price of RM0.80 per share. As of today, the shares on the stock market have exceeded its IPO price. I am happy that we have managed to create value not only for the company but also for our shareholders and investors alike. The utilisation of the funds raised from the IPO will be in accordance with the prospectus that was issued and as at the end of FYE2016 we have already utilised RM21.47 of the RM62.4 million. We will continue to utilise the balance proceeds accordingly over the next 24 months from the date of the IPO. The management will continue to utilise the funds raised from the IPO in the best possible manner for the continuing growth and expansion of our business through capital expenditure for new equipment and machineries, additional working capital, and R&D expenses. Furthermore, the Board of Directors have approved for the management to undertake the proposed transfer of the listing of and quotation for our entire issued and paid-up share capital from the ACE Market to the Main Market of Bursa Securities. I hope that this step will put another milestone on Salutica’s exciting journey ahead.

CONCLUSION

I am proud that our people were able to deliver an impressive result for FYE2016 in light of the local and global economic conditions. My team and I will continue to put our hearts and efforts to continue our positive growth in FYE2017. At the same time, I call on everyone, be it our customers, employees, shareholders, investors, suppliers and stakeholders alike to continue giving us support as we bring Salutica to the next level and as we continue our journey as a public listed company. I believe that a positive growth of Salutica will continue to bring value to all of us.

Lim Chong ShyhManaging Director/Chief Executive Officer28 October 2016


90,000

FInAnCIAL HIGHLIGHTS

Revenue (RM’000)

Profit Before Tax(RM’000)

Net assets per share (Sen)

Earnings per share (“EPS”)(Sen)

0 0

0 0

300,000 10.00

40,000 50.00

150,000 5.00

20,000 25.00

2015 2015

2015 2015

2016 2016

2016 2016

Financial Year Ended 30 June 2015 2016

Revenue (RM’000) 192,518 241,827

Profit Before Tax (RM’000) 20,284 32,899

Profit After Tax (RM’000) 27,412* 24,325

Weighted no. of ordinary shares in issue (’000) 309,930 319,830

Earnings per share (“EPS”) (sen) 8.84 7.61

Net assets per share (sen) 24.58 48.46

(*) During the financial year ended 30 June 2015, the Group reported a net tax credit of RM7.1 million mainly due to recognition of unused tax losses as deferred tax assets.

241,827

192,518

7.61

8.84

32,899 48.46

20,284 24.58

18


CORPORATE SOCIALRESPONSIBILITY STATEMENTThe Group firmly believes in being a socially responsible corporate citizen. Hence the Board acknowledges the importance of sustainability within the Group and the environment it operates in and the community it serves.

OCCUPATIONAL SAFETY, HEALTH AND ENvIRONMENT

Our Group places strong emphasis on the health and safety of our employees, and the protection of the environment. In line with this, the Group is committed to comply with the relevant occupational health, safety and environment requirements such as follows:

ISO14001:2004 which specifies requirements for an organisation to develop and implement an environmental management system; and

OHSAS 18001:2007 which specifies requirements for an organisation to develop and implement a health and safety management system.

During the year, various activities were carried out by the Environmental, Occupational Health & Safety (“EHS”) committee such as safety awareness program, first aid training, fire drills, schedule waste and chemical handling training.

Furthermore, there were health screening program, blood donation program and sports activities such as badminton, bowling and jogging to continuously improve the well-being of the employees. For example, the “Go Green” environment initiative launched in February 2015 encouraged employees not to use Styrofoam/Polystyrene to pack their food as a way to improve their health and also save the environment.

LABOUR AND ETHICS MANAGEMENT SYSTEM

Our Group complies with all applicable legal and other requirements and strives to maintain and improve our Labour and Ethics management system.

The Directors are committed to provide a working environment where our employees are treated with dignity and respect.

Our Group complies with the Electronic Industry Code of Conduct (“the EICC code”) that was established by the Electronic Industry Citizenship Coalition and released in 2004. The EICC Code provides guidelines on social, environmental, and ethical aspects to the global electronics supply chain in order to:

• Enhance efficiency and productivity of procurement process;

• Acknowledge the necessity of ensuring basic working condition for individuals;

• Encourage greater economic development and a healthier environment for local communities; and

• Develop better communication and business continuity throughout the electronics industry.

Our Group also complies with SA8000 that is set by Social Accountability International.

HUMAN CAPITAL DEvELOPMENT

The Directors believe that the Group’s greatest asset is its human talents. In this aspect, the Group recognises our employees’ contribution with quarterly Employee Excellence Award and also the annual CEO Award to top achievers.

The training section of the Human Resources department prepares Training Needs Analysis (“TNA”) yearly to assess and identify the needs of the employees to ensure continuous competency and skills development. The Group contributes monthly to the Human Resources Development Fund (“HRDF”) and utilises it for employees’ training.

The Group’s selection and recruitment processes take into account the required mix of skills, knowledge, expertise, experience, competencies and other qualities best suited for the job. There is no discrimination with regards to age, ethnicity, gender, race, religion or belief.

COMMUNITY DEvELOPMENT

The Group recognises the importance to contribute to the community in which it operates. During the financial year, the Group had extended monetary donations to various welfare and charity associations such as the Tabung Thalassaemia Malaysia.


COMPAnyHIGHLIGHTS 2016

MANAGEMENT BY OBJECTIvE (“MBO”) MEETINGS

Our Group employs MBO strategy as its key performance drivers. It creates clear communication line for the Group to align its strategy and philosophy to achieve goal congruent across all levels of employees.

On 3 – 5 July 2015, MBO in Pangkor Laut Resort, Pulau PangkorOn 5 – 7 December 2015, MBO in Parkroyal Hotel, Penang On 15 – 17 July 2016, MBO in Copthorne Hotel, Cameron Highlands

MALAYSIA PRODUCTIvITY CORPORATION (“MPC”) AwARD 2016

Salutica was proud to have 2 teams who participated in the Regional MPC competition who won the GOLD award.

This is no small feat as the team competed against 80 over companies. Congratulations to all who participated – for their great team effort and team spirit!

The key factor which tipped the point towards Salutica’s team winning the award was because of the application of multiple advance tools and innovative strategy in their improvement projects.

PROSPECTUS LAUNCH 28 APRIL 2016

ONE OF MALAYSIA’S vERTICALLY INTEGRATED MANUFACTURER OF CONSUMER ELECTRONICS, SALUTICA LAUNCHES ITS PROSPECTUS

KUALA LUMPUR, 28 APRIL 2016 – Salutica Berhad (“Salutica” or the “Company”), a vertically integrated manufacturer of consumer electronic products in Malaysia, successfully launched its prospectus today in conjunction with the Company’s listing and quotation of its entire issued and paid-up ordinary share capital on the ACE Market of Bursa Securities.

Salutica, through its wholly-owned subsidiary, Salutica Allied is principally involved in the design, development and manufacture of consumer electronic products such as Bluetooth related devices, as well as other electronic products and precision parts and components for multinational corporations and brands. In addition, Salutica launched its own in-house product line of Bluetooth 4.0 technology products, under the brand name of FOBO in 2013.


COMPAnyHIGHLIGHTS 2016 (continued)

BALLOTING DAY 10 MAY 2016

Tricor Investor & Issuing House Services Sdn Bhd (“TIIH”) announced on 10 May 2016 that the IPO of Salutica available for public subscription has been oversubscribed.

The IPO exercise comprises the following:-

(l) Public Issue of 78,000,000 new Shares (“Issue Shares”) in the following manner:

• 19,400,000 Issue Shares made available for application by the Malaysian public;

• 9,700,000 Issue Shares made available for application by the eligible directors and employees as well as persons who have contributed to the success of Salutica and its subsidiary;

• 10,100,000 Issue Shares made available for application by way of private placement to institutional and identified investors; and

• 38,800,000 Issue Shares made available for application by way of private placement to identified Bumiputera investors approved by the Ministry of International Trade and Industry (“MITI”)

(ll) Offer for Sale of 23,000,000 existing Shares (“Offer Shares”) made available for application by way of private placement to institutional and identified investors.

A total of 9,647 applications for 212,985,000 Issue Shares were received from the Malaysian public for 19,400,000 Issue Shares made available for Public subscription, which represents an overall oversubscription rate of 9.98 times. For the Bumiputera portion, a total of 5,211 applications for 93,365,000 Issue Shares were received which represents an oversubscription rate of 8.63 times. For the Public portion a total of 4,436 applications for 119,620,000 Issue Shares were received which represents an oversubscription rate of 11.33 times.

The 9,700,000 Issue Shares made available for application by the eligible directors and employees as well as persons who have contributed to the success of Salutica and its subsidiary has been fully subscribed.

The 10,100,000 Issue Shares made available for application by way of private placement to institutional and identified investors, 38,800,000 Issue Shares made available for application by way of private placement to identified Bumiputera investors approved by MITI and 23,000,000 Offer Shares made available for application by way of placement to institutional and identified investors have been fully placed out.

PROSPECTUS LAUNCH 28 APRIL 2016 (continued)

ONE OF MALAYSIA’S vERTICALLY INTEGRATED MANUFACTURER OF CONSUMER ELECTRONICS, SALUTICA LAUNCHES ITS PROSPECTUS (continued)

Speaking at the event, James Lim shared, “It has taken months of steady preparation to reach this day, which marks a significant advance in our listing exercise as well as a huge milestone in Salutica’s corporate history. The successful launch of our prospectus today is a testament to the hard work and efforts of everyone at the Company as well as our advisers, so I applaud their diligence. We have enjoyed steady growth over the years from the development of Salutica’s manufacturing business as well as its FOBO product line. The deeply rooted innovative culture of our R&D team has enabled the development of the FOBO brand product line, which has experienced a Compound Annual Growth Rate (“CAGR”) in revenue of 226.1% over the past 3 years, which is just one of many of the Company’s notable achievements.”


FOBO ULTRA LAUNCH 16 AUGUST 2016

16 August 2016, marked yet another milestone for Salutica with the launch of its tire pressure monitoring system for heavy vehicles known as FOBO Ultra.

FOBO Ultra - Sensing with Sense

FOBO Ultra, an expansion of the technologies behind FOBO Tire and FOBO Bike, is designed specifically for commercial and heavy vehicles.

FOBO Ultra is the World’s first wireless TPMS for heavy vehicles using Bluetooth 4.1. With its intelligent In-Car monitoring unit, FOBO Ultra works either directly with a qualified Android or iOS smartphones and tablets or on its own. It can monitor up to 1296 kPa (188 psi) and give an alert via the In-Car unit or a qualified smart device.

FOBO Ultra provides 24 by 7 continuous monitoring even when the vehicle’s ignition is switched off. As soon as a user with FOBO App installed in a qualified smart device is within Bluetooth range, the user will get an update of the tire pressure information or an alert if the pre-set tire threshold is breached.

With its patent pending CrossPairTM technology, FOBO Ultra can monitor multiple vehicles in each App installed in a qualified smart device. With FOBOShareTM, multiple authorised users can receive data from the cloud and also data directly from the FOBO Ultra sensors while transmitting live data back to the main user.

FOBOClusterTM is a core feature that monitors multiple trailer configurations through its patent pending FITTM Technology. A key benefit of FOBOClusterTM facilitates a seamless Drop and Hook procedure for trailers. It allows trailers equipped with FOBO Ultra to seamlessly connect and disconnect from different in-car units to form a new chain of clusters with the FITTM Technology.

FOBO Ultra also comes with an optional Fleet Management module which allows enterprise users to remotely monitor their fleet. This gives fleet management an easy way to monitor and ensure optimal tire pressure maintenance that would save time and costs in the long run.


LISTING DAY 18 MAY 2016

Salutica’s IPO involves a total offering of 101 million ordinary shares of RM0.10 each (“IPO Shares”), at an issue price of RM0.80 per share payable in full upon application comprising a public issue of 78 million Issue Shares and an offer for sale of 23 million Offer Shares.

Through this Public Issue, Salutica had raised gross proceeds of RM62.4 million based on the IPO price of RM0.80 per share, of which approximately RM25 million will be utilised for the purchase of new machineries and equipment, and RM16.7 million will be utilised as working capital. A further RM8.2 million will be allocated for the expansion of the Company’s R&D department, which includes the expansion of facilities, equipment as well as workforce. The balance of RM8.5 million will be allocated for the repayment of bank borrowings, and a further RM4 million will be allocated to defray listing expenses.

“Looking ahead, Salutica will continue to focus on high value added Bluetooth products as we believe it remains a compelling market as well as being a technology that is entrenched in our daily lives. New applications of Bluetooth technology are being developed and introduced every now and then for use in wearables, home applications and even the healthcare industry just to name a few. Approximately 3.0 billion Bluetooth products were shipped worldwide in 2013, and this number is expected to reach 4.9 billion in 2018. Furthermore, with the advent of the Internet of Things (“IoT”), we will see an increased connectivity in our daily lives, and IoT is a concept which is already embodied in our FOBO products. These favourable conditions will hopefully continue to create new possibilities for Salutica to explore further growth and expansion,” James Lim said in closing.

RHB Investment Bank Berhad acted as the Principal Adviser, Sponsor, Underwriter and Placement Agent for the IPO.



SALUTICA ANNUAL DINNER 2015

LUCKY DRAw wINNERS

MISS RETRO

MR RETRO



BOwLING 16 AUG 2015 AMPANG BOwL IPOH PARADE

PING PONG 18 OCT 2015 KOMPLEKS SUKAN DBI

NETBALL 22 NOv 2015 SMK PINJI MEwAH

BADMINTON 20 SEPT 2015 DBI BADMINTON COURT

FOOTBALL 22 NOv 2015 SMK PINJI MEwAH


CORPORATE GOVERNANCE STATEMENT

The Board of Directors (“the Board”) of the Company is committed to ensure high standards of corporate governance are in place and practised within the Group. Since its IPO on 18 May 2016, the Group has progressively applied the principles as set out in the Malaysian Code on Corporate Governance 2012 (“the Code”).

1. ESTABLISH CLEAR ROLES AND RESPONSIBILITIES OF THE BOARD AND MANAGEMENT

1.1 Clear functions of the Board and Management

The Board has full control of and is responsible for, the Group’s overall strategy, acquisition and divestment policies, capital expenditure, annual budget, review of financial and operational performance, and internal controls as well as investment and risk management processes. The Group’s overall strategic direction, development, implementation and control remain as the primary focus of the Board.

The Board is charged with leading and managing the Group in an effective and responsible manner. Each Director has a duty to act in the best interests of the Group. The Directors, both individually and collectively, are aware of their responsibilities to the shareholders and other stakeholders for the manner in which the affairs of the Group are managed.

1.2 Board’s Roles and Responsibilities

Following the guidelines as stated in the Code and the Board Charter, the Board recognises the key role it plays in charting the strategic direction of the Group and has assumed the following principal responsibilities in discharging its fiduciary and leadership functions:

• Review and approve strategies, business plans and significant policies and ensure that the Group’s goals are clearly established, and to monitor implementation and performance of the strategy, policies, plans, legal and fiduciary obligations that affect the business by adopting performance appraisal measures;

• Ensure a competent management by establishing policies for strengthening the performance of the Group with a view to proactively build the business through innovation, initiative, technology, new products and the development of its business capital;

• Evaluate whether the business is being properly managed and to ensure that the solvency of the Group and the ability of the Group to meet its contractual obligations and to safeguard the Group’s assets;

• Ensure that the Group has appropriate business risk management processes, including internal control systems and management information systems, systems for compliance with applicable laws, regulations, rules, directives and guidelines and controls in areas of significant financial and business risks;

• Establish various Board Committees and ensure their effectiveness to address specific issues, by considering recommendations of the various board committees and acting on their reports;

• Ensure that the financial statements of the Group and the Company are fairly stated and conform with the relevant regulations including acceptable accounting policies that result in balanced and understandable financial statements;

• Ensure that there is in place an appropriate succession plan for members of the Board and senior management;• Ensure that the Group adheres to high standards of ethics and corporate behaviour including transparency in

the conduct of business. In this regard, our Directors are required to comply with the Directors’ Code of Best Practice which amongst others includes the declaration of any personal, professional or business interests, direct or indirect which may conflict with directors responsibilities as a Board Member and to refrain from voting on such transaction with the Group; and

• Ensure that there is in place an appropriate investor relations and communications policy.

1.3 Code of Ethics

The Group is committed to create a corporate culture to operate in an ethical manner and to uphold the highest standards of behaviour.

Having established policies and procedures for the Group, the Board extends its roles further with a view to promote ethical values and standards amongst employees.

The Code of Ethics is intended to focus on the Board and each Director based on principles of integrity, responsibility, sincerity and corporate social responsibility. This Code is designed to enhance the standard of corporate governance and corporate behaviour with the intention of achieving the following objectives:

• to establish a standard of ethical behaviour for Directors based on acceptable beliefs and values; and• to uphold the spirit of professionalism, objectivity, transparency, and accountability in line with the legislation,

regulations and environmental and social responsibility guidelines governing the Group.


CORPORATE GOVERNANCE STATEMENT (continued)

1. ESTABLISH CLEAR ROLES AND RESPONSIBILITIES OF THE BOARD AND MANAGEMENT (continued)

1.3 Code of Ethics (continued)

The Code of Conduct is applicable to all Directors and employees of the Group. This Code provides guidance for proper standards of conduct and sound and prudent business practices as well as standard of ethical behaviour for Directors and employees based on principles of integrity, responsibility, trust, discipline and diligence.

1.4 Board Charter

As part of our governance process, the Board has formalised and adopted a Board Charter. This Board Charter sets out the composition and balance, roles and responsibilities, operation and processes of the Board, and is to ensure that all Board members acting on behalf of the Company are aware of their duties and responsibilities as Board members. This Board Charter will be reviewed periodically and updated in accordance with the needs of the Company to ensure its effectiveness.

A copy of the Board Charter is available at the Company’s website, www.salutica.com.

1.5 Strategies Promoting Sustainability

The Board recognizes the importance of the role of environmental sustainability as a corporate citizen in its business approach, and always endeavours to adopt the most environmental friendly, ecological and cost effective production processes.

The Board also endeavours to develop the Company’s objectives and strategies with regard to the Company’s responsibilities to its shareholders, employees, customers and other stakeholders and ensuring the long term stability of the business, succession planning and sustainability of the environment. A Corporate Social Responsibility statement is also presented in this Annual Report.

1.6 Company Secretary and Access to Information and Advice

The Company Secretary is always on hand to provide the Directors with appropriate advice and services and also to ensure that the relevant procedures are followed and rules and regulations are complied with. The Board is, from time to time, updated on changes in the law, governance and other regulatory requirements. The Company Secretary also provides the Board with information pertaining to the Company’s business affairs to enable the Board to discharge its responsibilities effectively.

The agenda, Board collaterals and minutes of previous meetings of the Board are circulated in advance to the Board, before meetings. The agenda for every meeting permits Board members to review the contents of meetings and enable the Chairman to better and more efficiently conduct proceedings during Board meetings.

Amongst others, Board collaterals include the following: -

a) Quarterly financial report and analytical review on the Company’s quarterly results;b) Minutes of meetings of all Committees of the Board;c) Current reviews of the operations and future prospects of the Company;d) Reports on Related Party Transactions and Recurrent Related Party Transactions;e) Directors’ share-dealings, including public shareholding spread;f) Reports from Internal and External Auditors, if any; andg) Annual operational and capital budgets.

Senior Management and key personnel as well as professional and external advisors are from time to time invited to attend Board meetings to brief the Board and clarify issues on the subject matter that may be of concern to the Directors. They are also responsible for providing the Board with the required information in an appropriate and timely manner.

2 STRENGTHEN COMPOSITION OF THE BOARD

2.1 Board Committees

The Board has delegated some of its responsibilities to various Committees within the Board. The Board has established 3 Committees, namely the Audit Committee, Nomination Committee and Remuneration Committee, the primary functions of which are to assist the Board in overseeing the affairs of the Company and these Committees have been entrusted with specific responsibilities and authority.



2 STRENGTHEN COMPOSITION OF THE BOARD (continued)

2.1 Board Committees (continued)

The authorities and functions of these Board committees are properly set out in their respective Terms of Reference. The abovementioned Committees are authorised to examine specific issues and report to the Board with their recommendations. The responsibility of decisions on all matters ultimately lies with the Board as a whole. The Board receives regular reports on the respective Committees proceedings and deliberations. On matters reserved for the Board and where Committees have no authority to make decisions, recommendations are highlighted in their respective reports for the Board’s deliberation and endorsement.

Details of the composition of the various Committees and a summary of the respective Committees terms of reference are as follows:

(i) Audit Committee

The terms of the Company’s Audit Committee (“AC”) and its activities during the financial year are outlined under the Audit Committee Report in this Annual Report.

(ii) Nomination Committee

The terms of the Company's Nomination Committee (“NC”) and its activities during the financial year are outlined under the Nomination Committee Statement in this Annual Report.

(iii) Remuneration Committee

The Remuneration Committee (“RC”) was established by the Board on 5 April 2016.

The RC is responsible for developing the Company’s remuneration policy framework and determining the remuneration package of the Company’s Directors and ensure that compensation is competitive and consistent with the Company’s business strategy and long-term objectives.

The RC meets at least once a year or at such other times as the Chairman of the committee decides. The quorum for each meeting shall be a majority of independent Directors.

The RC consists of 5 members who are as follows:

Mr. Chia Chee HoongChairmanChairman/Independent Non-Executive Director

Mr.James Lim Chong ShyhMemberManaging Director/Chief Executive Officer

Mr. Joshua Lim Phan YihMemberNon-Independent Non-Executive Director

Mr. Low Teng LumMemberSenior Independent Non-Executive Director

Mr. Leow Chan KhiangMemberIndependent Non-Executive Director

The remuneration packages are structured according to the skills, experience and performance of the Executive Directors to ensure the Company attracts and retains the Directors needed to run the Company successfully. The remuneration package of the Non-Executive Directors depends on their contribution to the Company in terms of their knowledge and experience. The committee recommends to the Board the policy framework of executive remuneration and its cost, and the remuneration package for each executive Director. It is, nevertheless, the ultimate responsibility of the entire Board to approve the remuneration of these Directors.




2.1 Board Committees (continued)

(iii) Remuneration Committee (continued)

The RC held one meeting since its listing on the ACE Market of Bursa Securities on 18 May 2016, in the presence of the Company Secretary to review the following:

• remuneration package of the Managing Director/Chief Executive Officer, Mr. James Lim Chong Shyh; and• recommend to the Board the proposed directors’ fees for the financial year ended 30 June 2016.

The details of the attendance are as follows:

Member No of meetings held Attendance

Mr. Chia Chee Hoong 1 1/1Mr. James Lim Chong Shyh 1 1/1Mr. Joshua Lim Phan Yih 1 1/1Mr. Low Teng Lum 1 1/1Mr. Leow Chan Khiang 1 1/1

2.2 Directors’ Remuneration

Details of Directors’ remuneration are set out below and in notes to the financial statements.

(a) Aggregate remuneration of Director categorised into appropriate components as follows:

FeesSalaries & *Other

emolumentsBenefits-in

-kind TotalRM RM RM RM

Executive Directors 52,500 1,490,357 39,559 1,582,416Non-Executive Directors 240,208 - - 240,208

* Other emoluments, include allowances, bonuses and the Company’s contribution to the Employer Provident Fund.

(b) The remuneration paid to Directors during the year analysed into bands of RM50,000, which complies with the disclosure requirements under the AMLR of Bursa Securities as follows:

Number of DirectorsRange of Remuneration -Executive Directors -Non-Executive Directors Total

RM1 to RM50,000 - 4 4RM1,600,001 to RM1,650,000 1 - 1

Details of the Director’s remuneration are not disclosed in this report as the Board is of the view that the above remuneration disclosures by band and analysis between Executive and Non-Executive Directors satisfies the accountability and transparency aspects of the Code.

2.3 Supply of Information

The Board members were presented with comprehensive information concerning the performance and financial status of the Company at the Board Meetings. Each Director was provided with the agenda and a full set of the Board Papers prior to each Board Meeting with the aim of enabling the Directors to make fully informed decision at the Board Meetings.




2.3 Supply of Information (continued)

All directors have access to all information within the Company as well as the advices and services of the Company Secretary who is responsible for ensuring the Board’s meeting procedures are adhered to and that applicable rules and regulations are complied with. The Board recognises that the Company Secretary is suitably qualified and capable of carrying out the duties required. The Board is satisfied with the service and support rendered by the Company Secretary in discharge of their functions. Where necessary, the Directors may engage independent professionals at the Company’s expense on specialised issues to enable the directors to discharge their duties with adequate knowledge on the matters deliberated.

The proceedings and resolutions reach at each Board Meeting are recorded in the minutes of the meetings, which are kept in the Minutes Book at the registered office. Besides Board Meetings, the Board also exercises control on matters that require Board approval through the circulation of Director’s Resolutions.

2.4 Appointment to the Board

The NC is responsible for identifying, evaluating and recommending to the Board, suitable candidates to fill Board vacancies at any given time. The NC makes the recommendations following a careful consideration of the required mix of skills, experience and diversity, as well as gender where appropriate.

Apart from assisting the Board in carrying out annual reviews on the mix of skills and experience, contributions and other qualities, including core competencies, which the Non-Executive Directors bring to the Board, the NC also carries out the process of evaluating the effectiveness of the Board as a whole, the performance and contribution of the Chairman and other Directors, including Independent Non-Executive Directors, as well as the Managing Director / Chief Executive Officer of the Company and identifies areas for improvement and change. The Company Secretary has the responsibility of ensuring that relevant procedures relating to the appointment of new Directors are properly executed. New Directors are required to undergo familiarisation programmes and briefings to get a better understanding of the Group’s operations and the overall industry.

2.5 Re-election of Directors and re-appointment of Directors who are over the age of 70

The procedure on re-election of directors by rotation is set out in the Company’s Articles of Association (“the Articles”). Pursuant to the Articles, all Directors who are appointed by the Board during the year are subject to re-election by shareholders at the first meeting after their appointment. The Articles also provide at least one third (1/3) of the remaining Directors are subject to re-election by rotation at each Annual General Meeting and retiring directors can offer themselves for re-election. All Directors shall retire from office at least once in every three (3) years, but shall be eligible for re-election.

Pursuant to Section 129 of the Companies Act, 1965, the office of a Director of or over the age of 70 years becomes vacant at every Annual General Meeting (“AGM”) unless he is reappointed by a resolution passed at such an AGM of which no shorter notice than that required for the AGM has been given and the majority by which such resolution is passed is not less than three-fourths of all members present and voting at such AGM.

2.6 Gender Diversity

The Board has not set gender diversity targets as of the reporting period as it is of the view that Board membership should be determined based on a candidate’s skills, experience and other qualities regardless of gender but will nevertheless consider appointing more directors of the female gender where suitable.

The Board believes that candidature to the Board should be based on a candidate’s merits but in line with the Code, the Board will consider integrating more females onto the Board in due course to bring about a more diverse perspective.

3 REINFORCE INDEPENDENCE OF THE BOARD

3.1 Annual Assessment of Independent Directors

The Board, through the NC, shall assess the independence of Independent Directors annually. The criteria for assessing the independence of an Independent Director include the relationship between the Independent Director and the Group and his involvement in any significant transaction with the Group.

Among the criteria considered for independency includes: ability to exercise independent comments, judgment, and

contribution constructively at all times for an effective Board. The relationship between the Independent Directors with substantial shareholders, Executive Directors, persons related to the Executive Director/Major Shareholder, business transactions with the Group and their tenure of office will also be reviewed.



3 REINFORCE INDEPENDENCE OF THE BOARD (continued)

3.1 Annual Assessment of Independent Directors (continued)

The NC had reviewed the independence of the Independent Directors for financial year ended 30 June 2016 and is satisfied with the independency demonstrated.

3.2 Tenure of Independent Directors

The Board has adopted a nine-year policy for Independent Non-Executive Directors. An Independent Director may continue to serve on the Board subject to the director’s re-designation as a Non-Independent Director. Otherwise, the Board will justify and seek shareholders’ approval at the AGM in the event it retains the director as an Independent Director.

None of the current independent Board members had served the Company for more than nine (9) years as per the recommendations of the Code. Should the tenure of an Independent Director exceed nine (9) years, shareholders’ approval will be sought at an AGM or if the services of the Director concerned are still required, the Director concerned will be re-designated as a Non-Independent Director.

3.4 Roles of Independent Non-Executive Chairman, Chief Executive Officer and Executive Directors

There is a clear segregation of duties between the Chairman of the Board and the Managing Director/Chief Executive Officer so as to ensure that there is always a balance of power and authority. Essentially, the Chairman has the obligation to preside at various meetings, namely the general meetings of shareholders and Board meetings in order to address issues to be highlighted by and to members independently, whilst the Managing Director have the responsibility to manage the day-to-day business operations of the Group by ensuring that strategies, policies and matters approved by the Board and other Committees are implemented diligently.

There is also a balance in the Board with the presence of the Independent Non-Executive Directors of the necessary caliber and experience to carry sufficient weight in Board decisions. Although all the Directors have equal responsibility for the Company’s operations, the role of the Independent Non-Executive Directors is particularly important in providing an independent view, advice and judgment to take into account the interests of the Company, shareholders, employees and communities in which the Company conducts its business.

3.5 Board Balance

The Board comprises a mix of qualified and experienced Directors with diverse experience, background and expertise. Currently, the Board consists of 5 members, as designated below:

Mr. Chia Chee Hoong, Chairman/Independent Non-Executive DirectorMr. James Lim Chong Shyh, Managing Director/Chief Executive OfficerMr. Joshua Lim Phan Yih, Non-Independent Non-Executive Director Mr. Low Teng Lum, Senior Independent Non-Executive DirectorMr.Leow Chan Khiang, Independent Non-Executive Director

The Independent Directors provide independent judgement, experience and objectivity without being subordinated to operational considerations, as well as help to ensure that the interests of all shareholders, and not only the interests of a particular fraction or group, are taken into consideration by the Board and that the relevant issues are subjected to objective and impartial consideration by the Board.

While the Managing Director/Chief Executive Officer is responsible for representing the views of the management of the Company, senior executives may be present to further represent these interests.

The Company had complied with the requirement of the Rules 15.02 of the AMLR of Bursa Securities to have one third (1/3) of its members make up of Independent Non-Executive Directors. The combination of diverse professionals with varied background, experience and expertise in finance and corporate affairs have also enables the Board to discharge its responsibilities effectively and efficiently. The Board through the NC and RC regularly reviews the composition of the Board and Board Committees.

A brief profile of each director is presented in this Annual Report.



4 FOSTER COMMITMENT OF DIRECTORS

4.1 Board Meeting and Attendance

During the financial year ended 30 June 2016, the Board held two meetings since its listing on the ACE Market of Bursa Securities on 18 May 2016.


Names of Directors No of meetings held Attendance

Mr. Chia Chee Hoong 2 2/2Mr. James Lim Chong Shyh 2 2/2Mr. Joshua Lim Phan Yih 2 2/2Mr. Low Teng Lum 2 2/2Mr. Leow Chan Khiang 2 2/2

The Board is satisfied with the level of time commitment given by the Directors of the Company towards fulfilling their duties and responsibilities.

4.2 Supply of Information for Meeting

In order for the Board to discharge its responsibilities efficiently, all quantitative and qualitative information on the Company’s performance is provided for the Board’s review on a regular basis. Updates on operational, financial, corporate issues and strategic matters as well as current development of the Company which require the Board members’ attention are disseminated promptly. Prior to a Board meeting, agenda and comprehensive Board papers containing relevant reports and material information will be distributed to Directors timely for their perusal to enable them to participate effectively in meeting for an effective Board discussion and decision process. The Directors may seek further explanation or clarification on issues before or during the proceedings of the meeting.

4.3 Directors’ Training

All Directors have successfully completed their Mandatory Accreditation Programme (“MAP”) as required by Bursa Securities. In addition to the MAP, the Directors are also encouraged to attend training programmes conducted by highly competent professionals and which are relevant to the Company’s operations and business. The Company in general and the Directors specifically are mindful that they should continue to identify and attend appropriate seminars and courses to keep abreast of changes in market trends, technological advancements and legislation and regulations affecting the Company.

Save as disclosed above for the MAP training, all Directors have attended the following training programmes during the financial year ended 30 June 2016:

Directors Seminar/Training Programmes attended

Mr. Chia Chee Hoong - Risk Management Workshop by NGL Tricor Governance Sdn. Bhd.

Mr. James Lim Chong Shyh - Service Leadership by Dr. Allen Teh- Risk Management Workshop by NGL Tricor Governance Sdn. Bhd.

Mr. Joshua Lim Phan Yih - Service Leadership by Dr. Allen Teh - Risk Management Workshop by NGL Tricor Governance Sdn. Bhd.

Mr. Low Teng Lum - Risk Management Workshop by NGL Tricor Governance Sdn. Bhd.- Nominating Committee Programme 2: Effective Board Evaluations- Sustainability Symposium: Responsible Business.Responsible Investing- Future of Auditor Reporting - The Game Changer for Boardroom.- Stewardship Matters - For Long Term Sustainability- The Interplay between Corporate Governance, Non-financial information and

Investment Decision- Financials hidden in plain sight - “Why Directors and management need to ask hard

questions?”



4 FOSTER COMMITMENT OF DIRECTORS (continued)

4.3 Directors’ Training (continued)

Directors Seminar/Training Programmes attended

Mr. Leow Chan Khiang - KPMG Tax Summit 2015 by KPMG- MFRS/FRS Update 2015/2016 seminar by KPMG- GST Conference 2016 by MIA- Risk Management and Internal Control Workshop for Audit Committee by Bursa

Malaysia

In the future, the Board will continue to undertake the assessment of training needs of the Directors and enrol them in seminars and training programmes as and when required.

5 UPHOLD INTEGRITY IN FINANCIAL REPORTING BY THE COMPANY

It is the Board’s commitment to present a balanced and meaningful assessment of the Company’s financial performance and prospects at the end of each reporting period and financial year, primarily through the quarterly announcement of the Company’s results to Bursa Securities, the annual financial statements of the Company as well as the Chairman’s statement and review of the Company’s operations in the Annual Report, where relevant.

The Board is responsible for ensuring that the financial statements give a true and fair view of the state of affairs of the Company and the Group as at the end of the reporting period and of their results and cash flows for the period then ended.

In assisting the Board in discharging its duties with regards to financial reporting, the Board had established an AC. One of the key responsibilities of the AC in its specific terms of reference is to ensure that the financial statements of the Company comply with applicable financial reporting standards in Malaysia and provisions of the Companies Act, 1965. Such financial statements comprise the quarterly financial report announced to Bursa Securities and the annual statutory financial statements.

The Board understands its role in upholding the integrity of financial reporting by the Company. Accordingly, the AC, which assists the Board in overseeing the financial reporting process of the Company, including the need for the AC’s approval before non-audit services can be provided by the external auditors.

5.1 Compliance with Applicable Financial Reporting Standards

In presenting the annual audited financial statements to shareholders and the quarterly announcements of results to Bursa Securities, the Board takes the responsibility to present a balanced and meaningful assessment of the Company’s position and prospects, and to ensure that the financial statements are drawn up in accordance with the provision of Companies Act, 1965 and applicable accounting standards in Malaysia. The AC assists the Board in scrutinising information for disclosure to ensure accuracy, adequacy and completeness. The Responsibility Statement by the Directors pursuant to the AMLR of Bursa Securities is set out in this Annual Report.

In addition to the above, the Company also undertook an independent assessment of the internal control system and the AC has been assured that no material issues or major deficiencies have been detected which pose a high risk to the overall internal controls under review.

5.2 Assessment of Suitability and Independence of External Auditors

The Board has maintained an appropriate and transparent relationship with the External Auditors through the AC. The AC has been explicitly accorded the power to communicate directly with both the External Auditors and Internal Auditors. Both the External Auditors and Internal Auditors are invited to attend the AC meetings to facilitate the exchange of view on issues requiring attention.



6 RECOGNISE AND MANAGE RISKS OF THE COMPANY

The Board regards risk management and internal controls as an integral part of the overall risk management processes. The following represent the key elements of the Company’s risk management and internal control structure:

a. an organisational structure in the Group with formally defined lines of responsibility and delegation of authority;b. review and approve annual budget for the Group. The budget sets out key business objectives of the respective

business units, the major risks and opportunities in the operations and ensuing action plans;c. review of the Group’s business performance by the Board quarterly, which also covers the assessment of the impact

of changes in business and competitive environment; andd. active participation and involvement by the Managing Director/Chief Executive Officer and senior management in

major business decisions.

Recognising the importance of having risk management processes and practices, the Board has formalised a clear strategy to identify and manage the major or significant operational, financial and market risks associated with the Group’s business which is presented in the Statement on Risk Management and Internal Control in this annual report.

7 ENSURE TIMELY AND HIGH QUALITY DISCLOSURE

7.1 Corporate Disclosure Policies

The Board is aware of the need to establish corporate disclosure policies and procedures to enable comprehensive, accurate and timely disclosures relating to the Company and its subsidiary to be made to the regulators, shareholders and stakeholders. Accordingly, the Board has formalised pertinent corporate disclosure policies not only to comply with the disclosure requirements as stipulated in the AMLR, but also setting out the persons authorised and responsible to approve and disclose material information to regulators, shareholders and stakeholders.

To augment the process of disclosure, the Board has earmarked a dedicated section on the Company’s website, where information on corporate governance of the Company may be accessed.

Sufficient information are provided to the Company Secretary for drafting of necessary announcements. The Board is mindful that information which is expected to be material must be announced immediately, and that the confidential information should be handled properly to avoid leakage and improper use of such information.

7.2 Leverage on Information Technology for Effective Dissemination of Information

The Company’s website, www.salutica.com, incorporates an Investor Relations section which provides all relevant information on the Company and is accessible by the public. This Investor Relations section enhances the Investor Relations function by including all announcements made by the Company. The announcements of the quarterly financial results are also made via BursaLink immediately after the Board’s approval. This is important in ensuring equal and fair access to information by the investing public.

8 STRENGTHEN RELATIONSHIP BETWEEN COMPANY AND SHAREHOLDERS

8.1 Encourage Shareholder Participation at General Meeting

The AGM which is the principal forum for shareholders’ dialogue, allows shareholders to review the Company’s performance via the Company’s Annual Report and pose questions to the Board for clarification. At the AGM, shareholders participate in deliberating resolutions being proposed or on the Company’s operations in general.

The Notice of AGM is circulated to shareholders at least twenty-one (21) days before the date of the meeting to enable them to go through the Annual Report and papers supporting the resolutions proposed. The outcome of the AGM is then announced to Bursa on the same meeting day.

8.2 Voting by Poll

Pursuant to paragraph 8.31A(1) of the AMLR of Bursa Securities, any resolution set out in the notice of any general meeting, or in any notice of resolution which may properly be moved and its intended to be moved at the general meeting, is voted by poll.

Hence, all resolutions as set out in the notice of the Company’s forthcoming AGM will be voted by poll.



8 STRENGTHEN RELATIONSHIP BETWEEN COMPANY AND SHAREHOLDERS (continued)

8.3 Investor Relations and Shareholder Engagement

The Board recognises the importance of maintaining transparency and accountability to its shareholders and investors and to disseminate information on the Company’s performance and any significant developments to ensure that they are informed of all material business matters on a timely manner.

Different channels of communication are optimised to ensure that clear, relevant and effective communication is facilitated. Presently, the Board and management of Company communicate regularly with its shareholders and other stakeholders through the following mediums:

1. Bursa Malaysia Securities Berhad Announcements The Board ensures timely announcements of financial results on a quarterly basis as well as significant corporate

developments are made to Bursa Securities.

2. Analyst Briefings and Press Conferences Press conferences and analyst briefings are held from time to time as a means of effective communication that

enables the Board and Management to convey information relating to the Company’s corporate strategy and other matters affecting shareholders’ interests, as well as provide clearer understanding of the Company’s financial and operational performance.

3. Press Releases Press releases are made to the media on all material and significant corporate developments and business

initiatives.

4. One-to-One Meetings The Company aims to communicate fully with fund managers, investors and analysts upon request and availability.

Regular, one-to-one meetings with analysts and fund managers are held to provide updates on the Company’s strategy and financial performance.

5. Official Company Website The Company has a website, www.salutica.com, which provides information on the Company and its business for

both shareholders and the general public.

COMPLIANCE STATEMENT

The Board has deliberated, reviewed and approved this Statement on Corporate Governance. The Board considered that the Statement on Corporate Governance provides the information necessary to enable shareholders of the Company to evaluate how the principles and best practices as set out in the Code have been complied with since its listing on the ACE Market on 18 May 2016. The Board shall remain committed in attaining the highest possible standards through the continuous adoption of the principles and best practices of the Code and all other applicable laws and regulations.

This Statement is made in accordance with a resolution of the Board of Directors dated 30 September 2016.


NOMINATION COMMITTEE STATEMENT

INTRODUCTION

Pursuant to Paragraph 15.08A(3) of the ACE Market Listing Requirements (“AMLR”) of Bursa Securities, the Board is pleased to present the Nomination Committee Statement which lays out the activities held for the financial year ended 30 June 2016.

The Nomination Committee (“NC”) was established by the Board on 5 April 2016.

Composition

The members of the committee comprise as the following:

Mr. Low Teng LumChairmanSenior Independent Non-Executive Director

Mr. Chia Chee HoongMemberChairman/Independent Non-Executive Director


1. TERMS OF REFERENCE

NC is responsible to assist the Board of the Company along with all its subsidiaries under the Group the following:

a. to identify and recommend to the Board, candidates for Board directorships;b. to evaluate and make recommendations to the Board, pertaining to the following:

• Directors to fill seats on Committees;• review of the re-appointment of Non-Executive and Executive Directors retiring by rotation pursuant to the

provisions of the Board Charter of the Company and in respective compliance with the regulations of the AMLR of Bursa Securities;

• review re-appointment of Non-Executive Directors at the conclusion of a specified term of office as recommended under the Board Charter;

c. to evaluate the effectiveness of the Board and the Board’s committees (including its size and composition) and contributions of each individual director; and

d. to ensure an appropriate framework and plan for Board succession for the Company and the Group.

2. COMPOSITION

The members of the NC are appointed by the Board from amongst the Non-Executive Directors and consist of at least three members, the majority of whom are Independent Directors to fully comply with Paragraph 15.08A(1) of the AMLR.

No alternate Director shall be appointed as a member of the NC.

In the event of any vacancy in the NC resulting in non-compliance in respect of composition of the NC, the Company must fill the vacancy within three months.

3 GENDER DIVERSITY

The Board has not set gender diversity targets as of the reporting period as it is of the view that Board membership should be determined based on a candidate’s skills, experience and other qualities regardless of gender but will nevertheless consider appointing more directors of the female gender where suitable. The Board will consider integrating more females onto the Board in due course to bring about a more diverse perspective.

4. CHAIRMAN

The Chairman of the NC shall be an Independent Non-Executive Director. In the absence of the Chairman, the members shall elect any one of the members present at the meeting to be the Chairman of the meeting.


NOMINATION COMMITTEE STATEMENT (continued)

5. SECRETARY

The Company Secretary shall be the Secretary of the NC.

6. QUORUM AND MEETING PROCEDURES

The quorum of the meeting of the NC shall be at least two members, a majority of whom must be Independent Directors.

At least one meeting shall be convened by the NC during the financial period and at such other times, as the Chairman of the NC shall require.

7. AUTHORITY

The NC shall have the authority to seek any information it requires from any employees of the Group in order to perform its duties.

The NC is not authorized to make any decisions but is obliged to report its recommendations to the Board for decision.

8. ATTENDANCE AT MEETINGS

During the financial year ended 30 June 2016, the NC held one meeting since its listing on the ACE Market of Bursa Securities on 18 May 2016, in the presence of the Company Secretary.



Mr. Low Teng Lum 1 1/1Mr. Chia Chee Hoong 1 1/1Mr. Joshua Lim Phan Yih 1 1/1

9. ACTIVITIES OF THE NC During the financial year ended 30 June 2016, the NC has conducted a review on the performance of the members of the

Board. In reviewing the performance of the Board as a whole and the contribution of the Chairman and individual Directors, performance was assessed and measured against, amongst others, the Company’s strategic plan, principal duties expected of the Board, the Chairman and individual Directors, obligations to support management, available expertise, governance factors, commitment, knowledge of the industry and team contribution. Self-assessment enables the Board to effectively and collectively identify opportunities to improve processes.

The evaluation process takes into account whether:• adequate time has been allocated by Non-Executive Directors on matters pertaining to the Group’s operations;• appropriate consideration to succession planning has been given, taking into account challenges and opportunities

facing the Company and the Group, and the skills and expertise needed on the Board in the future;• review of the structure, size and composition (including mix of skills, knowledge and experience) of the Board has been

undertaken and changes recommended, where necessary;• appropriate recommendations have been made to the Board for the re-election/reappointment of Non-Executive

Directors; and• review of the leadership needs of the Company, executive and non-executive, has been undertaken to ensure

continued ability to compete effectively in the market place.

The NC had reviewed James Lim Chong Shyh and Joshua Lim Phan Yih who would be retiring by rotation in accordance with Article 95 of the Company’s Articles of Association at the forthcoming Annual General Meeting. Both the directors have offered themselves for re-election. Their contributions to the Board were discussed during the meeting and it was noted that they have the required skills, knowledge, expertise, responsibilities, character, integrity, professionalism and time commitment to effectively discharge their duties and responsibilities as directors of the Company.

It was also further noted that their extensive experiences and management skills have enable them to carry out sound business judgments and strategies to the future direction of the Group.


AUDIT COMMITTEE REPORT

INTRODUCTION

Pursuant to Paragraph 15.15 of the AMLR of Bursa Securities, the Board is pleased to present the Audit Committee Report which lays out the activities held for the financial year ended 30 June 2016.

The Audit Committee (“AC”) was established by the Board on 5 April 2016.

COMPOSITION

The members of the AC comprises the following:

Mr. Leow Chan KhiangChairmanIndependent Non-Executive Director

Mr. Low Teng LumMemberSenior Independent Non-Executive Director

Mr. Chia Chee HoongMemberChairman/Independent Non-Executive Director


TERMS OF REFERENCE

1. Objectives

The principal objective of the AC is to assist the Board in its responsibilities relating to the accounting and reporting practices of Company along with all its subsidiaries under the Group.

In addition, the AC shall:

a. evaluate the quality of the audits performed by the internal and external auditors; b. ensure financial statements comply with applicable financial reporting standards; c. oversee compliance with the laws and regulations and ensure observance of a proper code of conduct; and d. have policies and procedures to assess the suitability and independence of external auditors.

2. Composition The members of the AC are appointed by the Board from amongst the Non-Executive Directors and consist of at least three

members, the majority of whom are Independent Directors to fully comply with Paragraph 15.09 of the AMLR.

The Board shall at all the times ensure that at least one (1) member of the AC: i) must be a member of the Malaysian Institute of Accountants (“MIA”); or ii) if he is not a member of the MIA, he must have at least three (3) years’ working experience and:

a) passed the examinations specified in Part I of the First Schedule of the Accountants Act 1967; b) must be a member of one of the associations of accountants specified in Part II of the First Schedule of the

Accountants Act 1967; orc) fulfils such other requirements as prescribed or approved by Bursa Malaysia Securities Berhad.

No alternate Director shall be appointed as a member of the AC.

In the event of any vacancy in the AC resulting in non-compliance in respect of composition of AC, the Company must fill the vacancy within three months.

3. Chairman The Chairman of the AC shall be an Independent Non-Executive Director. In the absence of the Chairman, the members

shall elect any one of the members present at the meeting to be the Chairman of the meeting.


AUDIT COMMITTEE REPORT (continued)

TERMS OF REFERENCE (continued)

4. Secretary The Company Secretary shall be the Secretary of the AC.

5. Quorum and Meeting Procedures

The quorum of the meeting of the AC shall be at least two members, a majority of whom must be Independent Directors.

At least four meetings shall be convened during a year. The meetings shall be scheduled regularly by the Secretary and due notice shall be distributed to the members before the meeting together with the agenda and supporting papers. The minutes of the meeting shall be recorded for reference and inspection purposes. The Executive Directors, Accountants, or the representatives of the internal and external auditors may be present in any meeting upon the invitation of the AC.

6. Attendance at meetings

During the financial year ended 30 June 2016, the AC held two meetings since its listing on the ACE Market of Bursa Securities on 18 May 2016, in the presence of the Company Secretary. The Executive Directors, External Auditors and Internal Auditors were invited to the meeting to respond to queries during the meeting.



Mr. Leow Chan Khiang 2 2/2Mr. Low Teng Lum 2 2/2Mr. Chia Chee Hoong 2 2/2Mr. Joshua Lim Phan Yih 2 2/2

7. Authority

The AC shall have the authority to do the following:a. to carry out its function within its terms of reference. All employees of the Group shall be directed to co-operate as

requested by the AC;b. have full and unlimited/unrestricted access to all information, documents and resources which are required to perform

its duties;c. be able to obtain, at the expense of the Company, any other independent professional advice, if required;d. be able to convene meetings with external auditors, internal auditors or both, excluding the attendance of the Executive

Directors and employees of the Company, whenever deemed necessary;e. be able to make relevant reports when necessary to the relevant authorities if any breach of the rules, regulations and/

or Listing Requirements of the Bursa Malaysia Securities Berhad has occurred; andf. have direct communication channels with the external auditors and person(s) carrying out the internal audit function.

8. Functions

The AC shall discharge the following duties and responsibilities and report the same to the Board:

a. to review with the external auditors:i. the audit plans;ii. its evaluation of the system of internal controls;iii. the audit report;iv. the assistance given by the employees and the management of the Company and the Group to the external

auditors; andv. the management letter of the external auditors and the management’s response.

b. to review with the internal auditors : i. the adequacy of the scope, functions, competency and resources of the internal audit function and that it has the

necessary authority to carry out its work; andii. the internal audit programs, processes, the results of the internal audit programs, processes or investigation

undertaken and whether or not appropriate action is taken on the recommendations of the internal audit function.


AUDIT COMMITTEE REPORT (continued)

TERMS OF REFERENCE (continued)

8. Functions (continued)

c. to review the quarterly unaudited financial results and audited financial statements, prior to the approval of the Board, particularly focusing on:i. changes in or implementation of major accounting policies;ii. significant and unusual events; andiii. compliance with approved accounting standards and other legal requirements.

d. to monitor any related party transaction and conflict of interest situation that may arise within the Group including any transaction, procedure or course of conduct that raises questions of management integrity;

e. to consider the appointment, resignation or dismissal of the external auditors of the Company;

f. to review and monitor the suitability and independence and evaluate the performance of the external auditors for re-appointment;

g. to obtain written assurance from the external auditors confirming that they are, and have been, independent throughout the conduct of the audit engagement in accordance with the terms of all relevant professional and regulatory requirements ; and

h. to review and report such other matters as may be delegated by the Board from time to time.

9. Reporting

The AC shall report to the Board either formally in writing or verbally, as it considers appropriate, on its terms of reference at least once a year, but more frequently as it wishes.

The AC shall report to the Board any specific matters, as requested by the Board, for investigation.

10. Activities of the AC

The main activities carried out by the AC during the financial year ended 2016 in discharging their duties and responsibilities were as follows:

i. reviewed and approved the Audit Planning Memorandum on the statutory audit of the Group for the year ended 30 June 2016 prepared by external auditors;

ii. reviewed with the external auditors the result of the audit work performed, the Audit Summary Memorandum and the management letter or representation, including management response;

iii. reviewed and recommended to the Board the re-appointment of external auditors and audit fees;iv. reviewed and approved the terms of reference of the Audit Committee, the Board Charter, Code of Conduct and

Ethics, Corporate Disclosure and Whistle Blowing Policies;v. reviewed and approved the internal audit plan for the Group which covered internal control system, establishment of

Risk Management Framework and follow-up of observations reported during the internal audit performed;vi. reviewed related party transactions and conflict of interest situation that may arise within the Company or the Group;vii. reviewed and recommended improvements to the existing internal controls, risk management as reported by internal

auditor, NGL Tricor Governance Sdn. Bhd.; andviii. reviewed the third and fourth quarters financial results ended (“FPE”) 31 March 2016 and 30 June 2016 respectively of

the Group and the Company including the announcements pertaining thereto, before recommending to the Board for their approval and release of the same to Bursa Securities.

11. Internal Audit Function

During the financial year ended 30 June 2016, the Group had engaged an independent professional service provider, NGL Tricor Governance Sdn. Bhd. to provide independent assurance on the effectiveness of the Group’s system of internal controls and to advise the Group in areas that requires further improvement. It was noted during the financial year under review that a number of internal control weaknesses have been identified in certain section of the operation. All these weaknesses have been addressed and resolved by the management and none of them resulted in any material losses to the Group.

The cost incurred for the internal audit performed for the financial year ended 30 June 2016 was RM12,000.

This Statement is made in accordance with a resolution of the Board of Directors dated 30 September 2016.


STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL

INTRODUCTION

The Board of the Company is committed to maintain and ensure that a sound system of internal control exists and operates effectively within the Group and is pleased to provide this Statement on Risk Management and Internal Control (“SORMIC”), outlining the nature and scope of risk management and internal control of the Group during the financial year under review pursuant to Rule 15.26(b) of the AMLR of Bursa Securities and compliance with Section 167A of the Companies Act, 1965 (“the Act”).

BOARD’S RESPONSIBILITY

The Board acknowledges its responsibility and reaffirms its commitment in recognising the importance of effective and appropriate system of internal control and risk management practices to enhance good corporate governance. In this respect, the Board is responsible for identifying principal risks, ensuring the implementation of appropriate systems to manage these risks and reviewing the adequacy and integrity of the Group’s system of internal controls.

The system of internal control covers inter alia, governance, risk management, financial, organisation, operational and compliance control. However, the Board recognises that this system is designed to manage risk appropriately rather than eliminate the risks of failure to achieve business objectives. Accordingly, these systems can only provide reasonable, but not absolute assurance against material misstatement of financial information and records or against financial losses or fraud.

The Board is of the view that the system of internal controls in place for the financial year under review and up to the date of issuance of the financial statements is sound and sufficient to safeguard the shareholders’ investment, the interests of customers, regulators and employees, and the Group’s assets. The Management assists the Board in the implementation of the Board’s policies and procedures on risk management and internal control by identifying and assessing the risks faced, and in the design, operation and monitoring of suitable internal controls to manage these risks.

SYSTEM OF INTERNAL CONTROLS

The Board considers risk assessment and internal control to be fundamental to the Group in achieving its corporate objectives within reasonable risk profile and is committed to ensure effective and efficient internal control system is implemented across the Group.

The key elements of the Group’s internal control system are described below:

− Control Environment The importance of a proper control environment is emphasised throughout the organisation. Focus is directed towards the

quality and abilities of the Group’s employees. They are provided with continuing education and training to enhance their skills and to reinforce qualities of professionalism and integrity.

− Control Structure The Board has established an organisation structure with clearly defined lines of accountability and delegated authority.

This includes well-defined responsibilities of Board committees and various management levels, including authorisation levels for all aspects of the business.

• Risk Management Framework

The Board has established an ongoing process to identify, evaluate and manage the significant risks to which the Group is exposed by establishing a risk management framework for the Group. The Board recognises the importance of continuous review and improvement to its risk management process to keep abreast with the industry requirements and adapt to changes in its business environment.

Risk assessment is integrated into strategic planning and all other activities of the Group. Risk assessments are conducted on new ventures and activities, including projects, processes, systems and commercial activities to ensure that these are aligned with the Group’s objectives and goals. Any risks or opportunities arising from these assessments will be identified, analysed and reported to the Risk Management Committee (“the RMC”). All employees are encouraged to contribute towards the identification and implementation of new risk.

The Group maintains a strategic risk register whilst all departments within the Group maintain their respective operational risk registers. The Group is committed to ensuring that all staff, particularly Heads of Department (“HOD”) are provided with adequate guidance and training on the principles of risk management and their responsibilities in order to be in compliant with the risk management framework setup.


STATEMENT ON RISK MANAGEMENT ANDINTERNAL CONTROL (continued)

SYSTEM OF INTERNAL CONTROLS (continued)

• Risk Management Framework (continued)

The Board regularly reviews the design and monitors the operating effectiveness of the internal controls, including the development of an appropriate risk management culture across the Group.

The Board is supported by the RMC headed by its Managing Director. The role of the RMC includes periodic reporting of the status of risk mitigation actions, new risks identified and risks that have changed characteristics together with the corresponding key controls. The RMC, which comprises key persons from all departments, submits its reports to the Audit Committee and the Board on a quarterly basis.

• Management

Areas covered by management:

– Policies and Procedures: Management has implemented series of Policies and Procedures to govern the Group’s various business processes. The procedures are subject to regular review to ensure its relevancy.

– Human Capital: There are guidelines within the Group for hiring and termination of staff, training programmes for staff and annual performance appraisals to enhance the level of staff competency in carrying out their duties and responsibilities.

– Limits of Authority: The Board approves transactions exceeding certain threshold limits, while delegating authority for transactions within those limits to authorised personnel in order to facilitate operational efficiency.

– Related Party Transactions: The Board ensures that related party transactions are undertaken in compliance with Group’s policy – that are carried out on terms agreed between both parties, which are in the best interest of the Group.

– Whistle Blowing Policy: The Board acknowledges the importance of Whistle Blowing Policy and had implemented it in 2015. The policy provides an avenue for staff or any other persons including general public to raise concerns on any wrongdoing committed by staff of the Group relating to mismanagement or abuse of authority, corruption or any breach of laws and regulations. Additionally, it also provides for any complaint to be reported directly to the Chairman of the Audit Committee.

– Communication: Information is communicated through circulars, emails, meetings and internal memos.

• Internal Audit

The Group has outsourced the internal audit function to NGL Tricor Governance Sdn. Bhd., an independent professional service provider (“Internal Auditors”) which carries out its functions independently with risk-based approach and provides the Audit Committee and the Board with the assurance on the areas to be tested during the financial year, the adequacy and effectiveness of the system of internal controls.

For any significant control deficiencies noted from the reviews will be documented and communicated to management for review and corrective actions. The Internal Auditors report to the Audit Committee all significant non-compliance, internal control weaknesses and actions taken by management to resolve the audit issues identified.

• Audit Committee

The Audit Committee reviews, monitors and evaluates the effectiveness and adequacy of the Group’s internal controls and financial and risk management issues raised by the External and Internal Auditors, regulatory authorities and management. The review includes reviewing written reports from the Internal and External Auditors, to ensure that where deficiencies in internal controls have been identified, appropriate and prompt remedial action is taken by management.

The Audit Committee also convenes meetings with External Auditors, Internal Auditors, or both without the presence of management. In addition, the Audit Committee reviews the adequacy of the scope, functions and competency of the Internal and External Auditors. The Audit Committee also reviews and evaluates the procedures established to ensure compliance with applicable legislation, the Listing Requirements and the Group’s system of internal controls.

The Audit Committee report included in this Annual Report contains further details on the activities undertaken by the Audit Committee in 2016.

• The Board

The Board holds regularly discussions with the Audit Committee and management and considers their reports on matters relating to internal controls and deliberates on their recommendations for implementation.


STATEMENT ON RISK MANAGEMENT ANDINTERNAL CONTROL (continued)

REVIEW OF THE STATEMENT BY ExTERNAL AUDITORS

As required by Paragraph 15.23 of the Bursa Malaysia Listing Requirements, the external auditors have reviewed this Statement on Risk Management and Internal Control. Their limited assurance review was performed in accordance with Recommended Practice Guide (“RPG”) 5 (Revised 2015) issued by the Malaysian Institute of Accountants. RPG 5 (Revised 2015) does not require the external auditors to form an opinion on the adequacy and effectiveness of the risk management and internal control systems of the Group.

CONCLUSION

The Managing Director/Chief Executive Officer and Chief Financial Officer have provided assurance to the Board that the Group’s risk management and internal control systems, in all material aspects, have operated adequately and effectively.

There were no major weaknesses in internal controls which resulted in material losses during the financial year under review until the date of approval of this Statement.

The Board is of the view that the risk management and internal control systems are operating satisfactory and have not resulted in any material losses, contingencies or uncertainties that would require disclosure in the Group’s annual report. The Board continues to take pertinent measures to sustain and where required, to improve the Group’s risk management and internal control systems in meeting the Group’s strategic objectives.

This statement was made in accordance with a resolution approved by the Board on 30 September 2016.


DIRECTORS’ RESPONSIBILITY STATEMENT

Directors’ Responsibility Statement in respect of the preparation of the Annual Audited Financial Statements

The Board is responsible to ensure that the audited financial statements give a true and fair view of the state of affairs of the Group and the Company as at 30 June 2016 and the results and cash flows of the Group and the Company for the financial year ended on that date in accordance with the Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia.

During the preparation of the audited financial statements of the Group and the Company, the Directors have considered the following:-

• appropriate accounting policies have been used and are consistently applied;• reasonable judgments and estimates were made; • all applicable approved accounting standards in Malaysia have been adopted; and• the financial statements have been prepared on a going concern basis.

The Directors are responsible for ensuring that the Group and the Company maintains proper accounting records which disclose with reasonable accuracy the financial positions of the Group and the Company.

The Directors acknowledge its overall responsibility for maintaining a system of internal controls that provides assurance of effective and efficient operations and compliance with laws and regulations and also its internal procedures and guidelines. The size and complexity of the operations may give rise to risks of unanticipated or unavoidable losses. The system of internal controls is designed to provide reasonable but not absolute assurance against the risk of material errors, frauds or losses occurring. Audit Committee reviews and reports to the Board the effectiveness of the system of internal controls, which not only covers financial, but also operational, compliance controls and risk management.

The Directors also have a general responsibility for taking such steps that are reasonably available to them to safeguard the assets of the Group and the Company and to prevent fraud and other irregularities.


ADDITIONAL COMPLIANCE INFORMATION

1. UTILISATION OF PROCEEDS

Salutica’s IPO on 18 May 2016 at an issue price of RM0.80 per share had raised gross proceeds of RM62.4 million. The utilisation of proceeds for the financial year ended 30 June 2016 was as follows:

Intended utilisation

Actual utilisation

to-date Deviation Balance

Intended timeframe for

utilisation Details of utilisation (RM’000) (RM’000) (RM’000) (RM’000) (from date of listing)

Repayment of bank borrowing 8,500 8,500 - - Within 6 monthsCapital expenditure 25,000 657 - 24,343 Within 24 monthsR&D expenditure 8,200 719 - 7,481 Within 24 monthsWorking capital 16,700 7,589 - 9,111 Within 24 monthsEstimated listing expenses 4,000 4,000 - - Within 3 monthsTotal 62,400 21,465 - 40,935

The utilisation of the proceeds as disclosed above should be read in conjunction with the Prospectus of the Company dated 28 April 2016.

2. AUDIT AND NON-AUDIT FEES

The audit and non-audit fees incurred for services rendered by external auditors, Messrs. PricewaterhouseCoopers to the Company and the Group for the financial year ended 30 June 2016 are as follows:

FYE2016 Company(RM’000) Group(RM’000)

Audit 48 128Non-Audit 817.1 1,008.5

The non-audit fees included assurance services comprises, amongst others, fees related to the Company’s IPO.

3. MATERIAL CONTRACTS

There were no material contracts entered into by the Company or its subsidiaries involving the interests of the Directors or major shareholders, either subsisting at the end of the financial year 30 June 2016 or, it not then subsisting, entered into since the end of previous financial year.

REPORTS AND STATUTORY

FINANCIAL STATEMENTS

for the financial year ended 30 June 2016


46 Directors’ report

50 Statement by directors

50 Statutory declaration

51 Independent auditors’ report

53 Statements of comprehensive income

54 Statements of financial position

55 Consolidated statement of changes in equity

56 Company statement ofchanges in equity

57 Statement of cash flows

59 Notes to the financial statements

CONTENTS

REPORTS AND STATUTORY

FINANCIAL STATEMENTS

for the financial year ended 30 June 2016

45ANNUAL REPORT 2016Saluting the ExtraordinaireTM


DIRECTORS’ REPORTfor the financial year ended 30 June 2016

The directors are pleased to submit their report together with the audited financial statements of the Group and of the Company for the financial year ended 30 June 2016.

PRINCIPAL ACTIVITIES

The principal activity of the Company is that of investment holding. The principal activities of the subsidiary are shown in Note 12 to the financial statements. There have been no significant changes in the nature of these activities during the financial year.

FINANCIAL RESULTS

Group CompanyRM RM

Net profit for the financial year 24,324,815 6,475,362

DIVIDENDS

Dividends declared and paid by the Company since the end of the Company’s previous financial year are as follows:

RM

In respect of the financial year ended 30 June 2016:- First interim single-tier tax exempt dividend of 0.645 sen (rounded to 3 decimal places) per share on

310,000,000 ordinary shares of RM0.10 each, paid on 23 October 2015 2,000,000- Second interim single-tier tax exempt dividend of 0.645 sen (rounded to 3 decimal places) per share on

310,000,000 ordinary shares of RM0.10 each, paid on 18 April 2016 2,000,000- Third interim single-tier tax exempt dividend of 0.6 sen per share on 388,000,000 ordinary shares of

RM0.10 each, paid on 30 June 2016 2,328,0006,328,000

The directors do not recommend the payment of a final dividend for the financial year ended 30 June 2016.

On 15 August 2016, the directors declared a first interim single-tier tax exempt dividend in respect of the financial year ending 30 June 2017 of 0.6 sen per share on 388,000,000 ordinary shares amounting to RM2,328,000, payable on 30 September 2016.

RESERVES AND PROVISIONS

All material transfers to or from reserves or provisions during the financial year are shown in the financial statements.

DIRECTORS

The directors who have held office since the date of the last report are as follows:

Lim Chong Shyh Joshua Lim Phan YihChia Chee Hoong (Appointed on 15 October 2015)Low Teng Lum (Appointed on 15 October 2015)Leow Chan Khiang (Appointed on 20 October 2015)

In accordance with Article 95 of the Articles of Association, Lim Chong Shyh and Joshua Lim Phan Yih retire at the forthcoming Annual General Meeting and, being eligible, offer themselves for re-election.


DIRECTORS’ REPORTfor the financial year ended 30 June 2016 (continued)

ISSUE OF SHARES

On 16 May 2016, the issued and fully paid-up ordinary share capital of the Company was increased from RM31,000,000 to RM38,800,000 by way of issuance of 78,000,000 ordinary shares of RM0.10 each at par at the issue price of RM0.80 per share pursuant to the initial public offering exercise. The Company raised a total gross cash proceeds of RM62,400,000. In connection with the initial public offering exercise, the Company was listed with its entire enlarged issued and paid-up ordinary share capital were quoted on Bursa Malaysia on 18 May 2016.

The newly issued ordinary shares rank pari passu in all respects with the existing ordinary shares of the Company.

DIRECTORS’ INTERESTS

According to the Register of Directors’ Shareholdings, particulars of interests of the directors who held office at the end of the financial year in shares in the Company and its subsidiary are as follows:

Number of ordinary shares of RM0.10 eachBalance at

1.7.2015 Bought SoldBalance at30.6.2016

Salutica Berhad (the Company)Direct interestLim Chong Shyh 6,027,780 0 6,027,780* 0Joshua Lim Phan Yih 861,110 0 861,110* 0Chia Chee Hoong 0 700,000 0 700,000Low Teng Lum 0 700,000 0 700,000Leow Chan Khiang 0 700,000 0 700,000

Indirect interestLim Chong Shyh 272,972,220 0 9,972,220* 263,000,000Joshua Lim Phan Yih 278,138,890 0 15,138,890* 263,000,000

* Sold pursuant to Offer for Sale in conjunction with the initial public offering exercise

Number of ordinary shares of RM1 eachBalance at

1.7.2015 Bought SoldBalance at30.6.2016

Blue Ocean Enlightenment Sdn. Bhd. (the ultimate holding company)Direct interestLim Chong Shyh 54 0 0 54Joshua Lim Phan Yih 23 0 0 23

By virtue of their substantial interest in shares in Salutica Berhad as at 30 June 2016, Lim Chong Shyh and Joshua Lim Phan Yih are deemed to have interest in the shares in Salutica Allied Solutions Sdn. Bhd., the wholly owned subsidiary of the Company.

Other than as disclosed above, according to the Register of the Directors’ Shareholdings, the directors who held office at the end of the financial year did not hold any other interests in shares in, or debentures of, the Company or its related corporations during the financial year.


DIRECTORS’ BENEFITS

During and at the end of the financial year, no arrangements subsisted to which the Company is a party, being arrangements with the object or objects of enabling directors of the Company to acquire benefits by means of the acquisition of shares in, or debentures of, the Company or any other body corporate.

Since the end of the previous financial year, no director has received or become entitled to receive a benefit (other than those disclosed in Note 6 to the financial statements) by reason of a contract made by the Company with the director or a related corporation with the director or with a firm of which the director is a member, or with a company in which the director has a substantial financial interest except that certain directors received remuneration from a related company in their capabilities as directors of the related company.

STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS

Before the statements of comprehensive income and statements of financial position of the Group and of the Company were made out, the directors took reasonable steps:

(a) to ascertain that action had been taken in relation to the writing off of bad debts and the making of allowance for doubtful debts and have satisfied themselves that all known bad debts had been written off and that adequate allowance had been made for doubtful debts; and

(b) to ensure that any current assets, other than debts, which were unlikely to realise in the ordinary course of business, their values as shown in the accounting records of the Group and of the Company had been written down to an amount which they might be expected so to realise.

At the date of this report, the directors are not aware of any circumstances:

(a) which would render the amounts written off for bad debts or the amount of the allowance for doubtful debts in the financial statements of the Group and of the Company inadequate to any substantial extent; or

(b) which would render the values attributed to current assets in the financial statements of the Group and of the Company misleading; or

(c) which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate.

No contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve months after the end of the financial year which, in the opinion of the directors, will or may affect the ability of the Group and of the Company to meet their obligations when they fall due.

At the date of this report, there does not exist:

(a) any charge on the assets of the Group and of the Company which has arisen since the end of the financial year which secures the liability of any other person; or

(b) any contingent liability of the Group and of the Company which has arisen since the end of the financial year.

At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this report or the financial statements which would render any amount stated in the financial statements misleading.

In the opinion of the directors:

(a) the results of the operations of the Group and of the Company during the financial year were not substantially affected by any item, transaction or event of a material and unusual nature other than the significant event disclosed below and Note 21 to the financial statements; and

(b) there has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature likely to affect substantially the results of the operations of the Group and of the Company for the financial year in which this report is made.



ULTIMATE HOLDING COMPANY

The directors regard Blue Ocean Enlightenment Sdn. Bhd., a company incorporated in Malaysia, as the Company’s ultimate holding company.

SIGNIFICANT EVENT

On 18 May 2016, the Company was listed with its entire enlarged issued and fully paid-up ordinary share capital quoted on Bursa Malaysia.

AUDITORS

The auditors, PricewaterhouseCoopers, have expressed their willingness to continue in office.

Signed on behalf of the Board of Directors in accordance with a resolution dated 30 September 2016.

Lim Chong Shyh Joshua Lim Phan YihDirector Director



STATEMENT BY DIRECTORSPursuant to Section 169(15) of the Companies Act, 1965

We, Lim Chong Shyh and Joshua Lim Phan Yih, being two of the directors of Salutica Berhad, state that, in the opinion of the directors, the financial statements set out on pages 53 to 100 are drawn up so as to give a true and fair view of the state of affairs of the Group and of the Company as at 30 June 2016 and of the results and cash flows of the Group and the Company for the financial year ended on that date in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act,1965 in Malaysia.

The information set out in Note 35 on page 101 to the financial statements have been prepared in accordance with the Guidance on Special Matter No. 1 Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants and the directive of Bursa Malaysia Securities Berhad.

Signed on behalf of the Board of Directors in accordance with a resolution dated 30 September 2016.

Lim Chong Shyh Joshua Lim Phan YihDirector Director

STATUTORY DECLARATIONPursuant to Section 169(16) of the Companies Act, 1965

I, Chan Shook Ling, being the officer primarily responsible for the financial management of Salutica Berhad, do solemnly and sincerely declare that the financial statements set out on pages 53 to 100 and information set out in Note 35 to the financial statements are, in my opinion, correct, and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1960 in Malaysia.

Chan Shook Ling

Subscribed and solemnly declared by the abovenamed Chan Shook Ling before me at Ipoh, in the state of Perak Darul Ridzuan, Malaysia on 30 September 2016.

Lam Ying Woh [No.A209]Commissioner for Oaths

23 Jalan Tranchell31450 Menglembu, Ipoh Perak Darul Ridzuan


REPORT ON THE FINANCIAL STATEMENTS

We have audited the financial statements of Salutica Berhad on pages 53 to 100, which comprise the statements of financial position as at 30 June 2016 of the Group and of the Company, and the statements of comprehensive income, statements of changes in equity and statements of cash flows of the Group and of the Company for the financial year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on Notes 1 to 34.

Directors’ Responsibility for the Financial Statements

The directors of the Company are responsible for the preparation of financial statements so as to give a true and fair view in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia. The directors are also responsible for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgement, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s preparation of financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements give a true and fair view of the financial position of the Group and of the Company as at 30 June 2016 and of their financial performance and cash flows for the financial year then ended in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following:

(a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and its subsidiary of which we have acted as auditors have been properly kept in accordance with the provisions of the Act.

(b) We are satisfied that the financial statements of the subsidiary that have been consolidated with the Company’s financial statements are in form and content appropriate and proper for the purposes of the preparation of the financial statements of the Group and we have received satisfactory information and explanations required by us for those purposes.

(c) The audit report on the financial statements of the subsidiary did not contain any qualification or any adverse comment made under Section 174(3) of the Act.

INDEPENDENT AUDITORS’ REPORTto thE MEMbErS of SALUtICA bErhAD (Company No: 1024781 t) (Incorporated in Malaysia)


INDEPENDENT AUDITORS’ REPORTto thE MEMbErS of SALUtICA bErhAD (continued)(Company No: 1024781 t) (Incorporated in Malaysia)

OTHER REPORTING RESPONSIBILITIES

The supplementary information set out in Note 35 is disclosed to meet the requirement of Bursa Malaysia Securities Berhad and is not part of the financial statements. The directors are responsible for the preparation of the supplementary information in accordance with the Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants (“MIA Guidance”) and the directive of Bursa Malaysia Securities Berhad. In our opinion, the supplementary information is prepared, in all material respects, in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities Berhad.

OTHER MATTERS

This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.

PRICEWATERHOUSECOOPERS LIM HUCK KHIAM[No. AF: 1146] [No. 3192/06/17 (J)] Chartered Accountants Chartered Accountant

1st Floor, Standard Chartered Bank Chambers21-27 Jalan Dato’ Maharaja Lela30000 IpohPerak Darul Ridzuan

30 September 2016


STATEMENTS OF COMPREHENSIVE INCOMEfor the financial year ended 30 June 2016

Group CompanyNote 2016 2015 2016 2015

RM RM RM RM

Revenue 5 241,826,911 192,517,682 9,700,000 40,429,738Raw materials and consumables used (171,617,125) (135,745,466) 0 0Changes in inventories of work in

progress and finished goods 9,046,072 175,485 0 0Employee benefit costs (20,628,048) (19,506,206) (202,708) 0Contract workers (11,367,029) (10,116,200) 0 0Depreciation of property, plant and

equipment (6,290,393) (5,644,215) 0 0Utilities (2,929,131) (3,086,021) 0 0Maintenance and upkeep (2,713,159) (2,302,279) 0 0Interest income 1,165,344 1,058,483 20,799 0Other operating income 3,225,127 7,015,487 19,274 0Other operating expenses (6,057,463) (3,995,054) (3,057,011) (65,577)Profit from operations 6 33,661,106 20,371,696 6,480,354 40,364,161Finance cost 7 (762,262) (87,963) 0 0Profit before taxation 32,898,844 20,283,733 6,480,354 40,364,161Taxation 8 (8,574,029) 7,128,101 (4,992) 0Net profit for the financial year 24,324,815 27,411,834 6,475,362 40,364,161Other comprehensive incomeItem that may be subsequently

reclassified to profit or loss: - change in fair value of available- for-

sale financial asset 0 16,000 0 0Total comprehensive income for the

financial year, attributable to the owners of the Company 24,324,815 27,427,834 6,475,362 40,364,161

Earnings per share (RM) Basic/diluted 9 0.08 0.09

The accompanying notes form an integral part of these financial statements.


STATEMENTS OF FINANCIAL POSITIONas at 30 June 2016

Group CompanyNote 2016 2015 2016 2015

RM RM RM RM

ASSETSNon current assetsProperty, plant and equipment 10 40,095,745 38,944,241 0 0Intangible asset 11 2,191,399 0 0 0Investment in a subsidiary 12 0 0 50,000,005 5Available-for-sale financial asset 13 118,900 55,000 0 0Deferred tax assets 14 171,953 8,484,291 0 0

42,577,997 47,483,532 50,000,005 5Current assetsInventories 15 34,288,613 15,593,481 0 0Receivables, deposits and prepayments 16 28,402,136 18,616,493 3,681 234,684Amount due from a subsidiary 17 0 0 33,809,738 30,809,738Derivative financial instruments 18 113,445 0 0 0Tax recoverable 20,869 0 208 0Short term investments 19 57,732,947 0 7,916,229 0Deposits, cash and bank balances 20 40,163,086 41,217,644 550,936 297,067

160,721,096 75,427,618 42,280,792 31,341,489Total Assets 203,299,093 122,911,150 92,280,797 31,341,494

EQUITYEquity attributable to owners of the

CompanyShare capital 21 38,800,000 31,000,000 38,800,000 31,000,000Share premium 22 53,002,368 0 53,002,368 0Fair value reserve 23 16,000 16,000 0 0Retained profits 24 63,162,762 45,165,947 180,590 33,228

154,981,130 76,181,947 91,982,958 31,033,228LIABILITIESNon current liabilitiesFinance lease liability 25 0 9,365,706 0 0Hire-purchase creditors 26 1,309,525 0 0 0Term loans 27 2,072,507 0 0 0

3,382,032 9,365,706 0 0Current liabilitiesPayable and accruals 28 40,415,926 30,675,554 297,839 308,266Derivative financial instruments 18 45,831 147,352 0 0Finance lease liability 25 0 6,483,155 0 0Hire-purchase creditors 26 947,315 0 0 0Term loans 27 3,442,412 0 0 0Provision for warranties 29 84,447 54,796 0 0Tax payable 0 2,640 0 0

44,935,931 37,363,497 297,839 308,266Total liabilities 48,317,963 46,729,203 297,839 308,266Total equity and liabilities 203,299,093 122,911,150 92,280,797 31,341,494



Issued and

fully paid share capital

RM

Share premium

RM

Fair valuereserve

RM

Retained profits

RMTotal

RM

GroupAt 1 July 2014 200 0 0 58,275,113 58,275,313Total comprehensive incomeNet profit for the financial year 0 0 0 27,411,834 27,411,834Other comprehensive income for the

financial year- fair value gain of available-for-sale

financial asset 0 0 16,000 0 16,000Total comprehensive income for the

financial year 0 0 16,000 27,411,834 27,427,834

Total transactions with owners, recognised directly in equity

Issue of share capital (Note 21) 7,000 0 0 0 7,000Bonus issue (Note 21) 30,992,800 0 0 (30,992,800) 0Dividends (Note 30) 0 0 0 (9,528,200) (9,528,200)

30,999,800 0 0 (40,521,000) (9,521,200)At 30 June 2015 31,000,000 0 16,000 45,165,947 76,181,947

At 1 July 2015 31,000,000 0 16,000 45,165,947 76,181,947

Net profit/Total comprehensive income for the financial year 0 0 0 24,324,815 24,324,815


Issue of share capital (Note 21 and 22) 7,800,000 54,600,000 0 0 62,400,000

Transaction costs arising from issue of share capital (Note 22) 0 (1,597,632) 0 0 (1,597,632)

Dividends (Note 30) 0 0 0 (6,328,000) (6,328,000)7,800,000 53,002,368 0 (6,328,000) 54,474,368

At 30 June 2016 38,800,000 53,002,368 16,000 63,162,762 154,981,130


CONSOLIDATED STATEMENT OF CHANGES IN EQUITYfor the financial year ended 30 June 2016


Issued and

fully paid share capital

RM

Share premium

RM

Retained profits

RMTotal

RM

CompanyAt 1 July 2014 200 0 190,067 190,267

Net profit/Total comprehensive income for the financial year 0 0 40,364,161 40,364,161


Issue of share capital (Note 21) 7,000 0 0 7,000Bonus issue (Note 21) 30,992,800 0 (30,992,800) 0Dividends (Note 30) 0 0 (9,528,200) (9,528,200)

30,999,800 0 (40,521,000) (9,521,200)At 30 June 2015 31,000,000 0 33,228 31,033,228

At 1 July 2015 31,000,000 0 33,228 31,033,228

Net profit/Total comprehensive income for the financial year 0 0 6,475,362 6,475,362


Issue of share capital (Note 21 and 22) 7,800,000 54,600,000 0 62,400,000Transaction costs arising from issue of share

capital (Note 22) 0 (1,597,632) 0 (1,597,632)Dividends (Note 30) 0 0 (6,328,000) (6,328,000)

7,800,000 53,002,368 (6,328,000) 54,474,368At 30 June 2016 38,800,000 53,002,368 (180,590) 91,982,958


COMPANY STATEMENT OF CHANGES IN EQUITYfor the financial year ended 30 June 2016


Group Company2016

RM2015

RM2016

RM2015

RM

Operating activitiesNet profit for the financial year 24,324,815 27,411,834 6,475,362 40,364,161Adjustments for:

Property, plant and equipment- depreciation 6,290,393 5,644,215 0 0- gains on disposal (29,109) (111,868) 0 0- write off 17,346 125 0 0Capitalisation of development cost (2,191,399) 0 0 0Short term investments- gain on disposal (12,001) 0 (3,045) 0- fair value gain (182,947) 0 (16,229) 0Gain from early settlement of finance lease

liability (1,148,861) 0 0 0Interest expense 762,262 87,963 0 0Interest income (1,165,344) (1,058,483) (20,799) 0Dividend income 0 0 (9,700,000) (40,429,738)(Reversal)/Allowance for slow moving

inventories (69,115) 615,808 0 0Provision for warranties 47,789 54,762 0 0Unrealised losses/(gains) on foreign currency

exchange 91,906 (43,368) 0 0Fair value (gains)/losses on derivative

financial instruments (214,966) 172,947 0 0Taxation 8,574,029 (7,128,101) 4,992 0

35,094,798 25,645,834 (3,259,719) (65,577)Changes in working capital:Inventories (18,626,017) 2,180,176 0 0Receivables (9,461,813) 11,008,697 231,003 (234,684)Payables 9,915,408 (12,567,717) (10,427) 262,665

16,922,376 26,266,990 (3,039,143) (37,596)Tax paid (285,200) (280,000) (5,200) 0Tax refunded 0 11,308 0 0Net operating cash flows 16,637,176 25,998,298 (3,044,343) (37,596)

Investing activitiesPurchase of property, plant and equipment (4,280,160) (2,912,409) 0 0Proceeds from disposal of property, plant and

equipment 355,340 111,936 0 0Interest income received 1,165,344 1,058,483 20,799 0Uplift/(Placements) of deposit with a licensed

bank (with maturity period of more than three months) 8,800,000 (3,800,000) 0 0

Dividend income received 0 0 6,700,000 9,620,000Purchase of additional shares issued by a

subsidiary 0 0 (50,000,000) 0Purchase of short term investments (72,450,000) 0 (10,300,000) 0Proceeds from sales of short term investments 14,912,001 0 2,403,045 0Purchase of golf club membership (63,900) 0 0 0Net investing cash flows (51,561,375) (5,541,990) (51,176,156) 9,620,000

STATEMENT OF CASH FLOWSfor the financial year ended 30 June 2016


Group Company2016

RM2015

RM2016

RM2015

RM

Financing activitiesProceed from issuance of shares 62,400,000 7,000 62,400,000 7,000Share issue expenses (1,597,632) 0 (1,597,632) 0Dividends paid (Note 30) (6,328,000) (9,528,200) (6,328,000) (9,528,200)Repayment of finance lease liability 0 (5,635,787) 0 0Repayment of hire-purchase creditor (641,892) 0 0 0Repayment of term loans (10,385,330) 0 0 0Uplift of deposits placed with bank as security 1,500,000 0 0 0Interest paid (762,262) (87,963) 0 0Net financing cash flows 44,184,884 (15,244,950) 54,474,368 (9,521,200)Net change in cash and cash equivalents 9,260,685 5,211,358 253,869 61,204Effects of exchange rate changes on cash and

cash equivalents (15,243) 0 0 0Cash and cash equivalents at beginning of the

financial year 25,917,644 20,706,286 297,067 235,863Cash and cash equivalents at end of the financial year (Note 20) 35,163,086 25,917,644 550,936 297,067


STATEMENT OF CASH FLOWSfor the financial year ended 30 June 2016 (continued)


1. GENERAL INFORMATION

The principal activity of the Company is that of investment holding. The principal activities of the subsidiary are shown in Note 12 to the financial statements. There have been no significant changes in the nature of these activities during the financial year.

The Company is a public limited liability company, incorporated and domiciled in Malaysia, and is listed on Bursa Malaysia on 18 May 2016.

The addresses of the registered office and principal place of business of the Group and the Company are as follows:

Registered office Principal place of business 41 Jalan Medan Ipoh 6 3 Jalan Zarib 6 Bandar Baru Medan Ipoh Kawasan Perindustrian Zarib 31400 Ipoh 31500 Lahat, Ipoh Perak Darul Ridzuan Perak Darul Ridzuan

The financial statements have been approved for issue in accordance with a resolution of the Board of Directors on 30 September 2016.

2. BASIS OF PREPARATION

The financial statements of the Group and of the Company have been prepared in accordance with Malaysian Financial Reporting Standards (“MFRS”), International Financial Reporting Standards (“IFRS”) and the requirements of the Companies Act, 1965 in Malaysia.

The financial statements of the Group and of the Company have been prepared under the historical cost convention unless stated otherwise in the individual policy statement set out in Note 3 to the financial statements and are presented in Ringgit Malaysia.

The preparation of financial statements in conformity with MFRS requires the use of certain critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the reporting date, and the reported amounts of revenues and expenses during the reporting period. It also requires directors to exercise their judgement in the process of applying the Group’s and the Company’s accounting policies. Although these estimates and judgements are based on the directors’ best knowledge of current events and actions, actual results may differ. The areas involving higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 4 to the financial statements.

(a) New standards, amendments to published standards and Issue Committee (“IC”) interpretations to existing standards that are applicable to the Group and the Company and are effective

There are no new standards, amendments to published standards and IC interpretation to existing standards that are applicable to the Group and the Company and effective for the first time for the financial year beginning on 1 July 2015.

(b) New standards early adopted by the Group and the Company

There are no standards early adopted by the Group and the Company.

NOTES TO THE FINANCIAL STATEMENTSfor the financial year ended 30 June 2016


2. BASIS OF PREPARATION (continued)

(c) New standards, amendments to published standards and IC interpretations to existing standards that are applicable to the Group and the Company but not yet effective

The Group and the Company will apply the new standards, amendments to published standards and IC interpretations in the following financial period:

(i) Effective for the financial year beginning on/after 1 July 2016• Amendments to MFRS 116 and MFRS 138 “Clarification of Acceptable Methods of Depreciation and

Amortisation” (effective from 1 January 2016)• Amendments to MFRS 127 “Separate Financial Statements - Equity Accounting in Separate Financial

Statements” (effective from 1 January 2016)• Amendments to MFRS 101 “Presentation of Financial Statements - Disclosure Initiative” (effective from

1 January 2016)• Amendments to MFRS 10, 12 & 128 “Investment entities - Applying the Consolidation Exception”

(effective from 1 January 2016)• Annual Improvements to MFRSs 2012 - 2014 Cycle (Amendments to MFRS 5 “Non-current Assets Held

for Sale and Discontinued Operations”, MFRS 7 “Financial Instruments: Disclosures” and MFRS 134 “Interim Financial Reporting”) (effective from 1 January 2016)

(ii) Effective for the financial year beginning on/after 1 July 2017• Amendments to MFRS 107 “Statement of Cash Flows - Disclosure Initiative” (effective from 1 January

2017) • Amendments to MFRS 112 “Income Taxes - Recognition of Deferred Tax Assets for Unrealised Losses”

(effective from 1 January 2017)

(iii) Effective for the financial year beginning on/after 1 July 2018• MFRS 9 “Financial Instruments”• MFRS 15 “Revenue from Contracts with Customers”

(iv) Effective for the financial year beginning on/after 1 July 2019• MFRS 16 “Leases”

None of the standards listed above are expected to have a significant effect on the financial statements of the Group and of the Company upon initial application, except for the following:

• Amendments to MFRS 107 “Statement of Cash Flows - Disclosure Initiative” (effective from 1 January 2017) introduce an additional disclosure on changes in liabilities arising from financing activities.

• Amendments to MFRS 112 “Income Taxes - Recognition of Deferred Tax Assets for Unrealised Losses” (effective from 1 January 2017) clarify the requirements for recognising deferred tax assets on unrealised losses arising from deductible temporary difference on asset carried at fair value.

In addition, in evaluating whether an entity will have sufficient taxable profits in future periods against which deductible temporary differences can be utilised, the amendments require an entity to compare the deductible temporary differences with future taxable profits that excludes tax deductions resulting from the reversal of those temporary differences.

The amendments shall be applied retrospectively.

NOTES TO THE FINANCIAL STATEMENTSfor the financial year ended 30 June 2016 (continued)


2. BASIS OF PREPARATION (continued)

(c) New standards, amendments to published standards and IC interpretations to existing standards that are applicable to the Group and the Company but not yet effective (continued)

• MFRS 9 “Financial Instruments” (effective 1 January 2018) will replace MFRS 139 “Financial Instruments: Recognition and Measurement”.

MFRS 9 retains but simplifies the mixed measurement model in MFRS 139 and establishes three primary measurement categories for financial assets: amortised cost, fair value through profit or loss and fair value through other comprehensive income (“OCI”). The basis of classification depends on the entity’s business model and the contractual cash flow characteristics of the financial asset. Investments in equity instruments are always measured at fair value through profit or loss with a irrevocable option at inception to present changes in fair value in OCI (provided the instrument is not held for trading). A debt instrument is measured at amortised cost only if the entity is holding it to collect contractual cash flows and the cash flows represent principal and interest.

For liabilities, the standard retains most of the MFRS 139 requirements. These include amortised cost accounting for most financial liabilities, with bifurcation of embedded derivatives. The main change is that, in cases where the fair value option is taken for financial liabilities, the part of a fair value change due to an entity’s own credit risk is recorded in OCI rather than the profit or loss, unless this creates an accounting mismatch.

MFRS 9 introduces an expected credit losses model on impairment that replaces the incurred loss impairment model used in MFRS 139. The expected credit losses model is forward-looking and eliminates the need for a trigger event to have occurred before credit losses are recognised.

• MFRS 15 “Revenue from contracts with customers” (effective from 1 January 2018) replaces MFRS 118 ‘Revenue’ and MFRS 111 “Construction contracts” and related interpretations. The core principle in MFRS 15 is that an entity recognises revenue to depict the transfer of promised goods or services to the customer in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

Revenue is recognised when a customer obtains control of goods or services, i.e. when the customer has the ability to direct the use of and obtain the benefits from the goods or services.

• MFRS 16 “Leases” (effective from 1 January 2019) supersedes MFRS 117 “Leases” and the related interpretations.

Under MFRS 16, a lease is a contract (or part of a contract) that conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

MFRS 16 eliminates the classification of leases by the lessee as either finance leases (on balance sheet) or operating leases (off balance sheet). MFRS 16 requires a lessee to recognise a “right-of-use” of the underlying asset and a lease liability reflecting future lease payments for most leases.

The right-of-use asset is depreciated in accordance with the principle in MFRS 116 “Property, Plant and Equipment” and the lease liability is accreted over time with interest expense recognised in the income statement.

For lessors, MFRS 16 retains most of the requirements in MFRS 117. Lessors continue to classify all leases as either operating leases or finance leases and account for them differently.

The Group and the Company are currently in the process of assessing the impact of the new standards upon initial application of these standards.



3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of the financial statements are set out below. Unless otherwise stated, the following accounting policies have been used consistently in dealing with items which are considered material in relation to the financial statements.

(a) Consolidation

i) Subsidiary

Subsidiary is an entity over which the Group has control. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the relevant activities of the entity. Subsidiary is fully consolidated from the date on which control is transferred to the Group. It is deconsolidated from the date that control ceases.

The Group applies the acquisition method to account for business combination.

The consideration transferred for acquisition of a subsidiary is the fair value of the assets transferred, the liabilities incurred to the former owners of the acquiree and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement and fair value of any pre-existing equity interest in the subsidiary. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. Acquisition-related costs are expensed as incurred.

The Group recognises any non-controlling interest in the acquiree on an acquisition-by-acquisition basis, either at fair value or at the non-controlling interest’s proportionate share of the recognised amounts of acquiree’s identifiable net assets.

The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the identifiable net assets acquired is recognised as goodwill. If the total of consideration transferred, non-controlling interest recognised and previously held interest measured is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase, the difference is recognised directly in the profit or loss.

Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset.

Accounting policies of subsidiary have been changed where necessary, to ensure consistency with the policies adopted by the Group.

(ii) Changes in ownership interests in subsidiary without change of control

Transactions with non-controlling interests that do not result in loss of control are accounted for as transactions with equity owners of the Group. A change in ownership interest results in an adjustment between the carrying amounts of the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the amount of the adjustment to non-controlling interests and any consideration paid or received is recognised in equity attributable to owners of the Group.

(iii) Disposal of subsidiary

When the Group ceases to consolidate because of a loss of control, any retained interest in the entity is remeasured to its fair value with the change in carrying amount recognised in profit or loss. This fair value becomes the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.

Gains or losses on the disposal of subsidiaries include the carrying amount of goodwill relating to the subsidiaries sold.



3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

(b) Investment in subsidiary

In the Company’s separate financial statements, investment in subsidiary is carried at cost less accumulated impairment losses. On disposal of investment in subsidiary, the differences between disposal proceeds and the carrying amounts of the investment is recognised in profit or loss.

(c) Property, plant and equipment

Property, plant and equipment are initially stated at cost, net of the amount of goods and services tax (“GST”), except where the amount of GST incurred is not recoverable from the government. When the amount of GST incurred is not recoverable from the government, the GST is recognised as part of the cost of acquisition of the property, plant and equipment. Property, plant and equipment are subsequently stated at historical cost less accumulated depreciation and impairment losses. The cost of an item of property, plant and equipment initially recognised includes its purchase price and any cost that is directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Cost also includes borrowing costs (if applicable) that are directly attributable to the acquisition, construction or production of a qualifying asset (refer to Note 3(q) to the financial statements for the accounting policy on borrowings and borrowing costs).

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are recognised as expenses in profit or loss during the financial period in which they are incurred.

Leasehold land is amortised in equal instalments over the lease periods of 78 years which expires in the year 2092.

Other property, plant and equipment are depreciated on a straight line basis to allocate the costs of the assets, to their residual values over their expected useful lives. The annual depreciation rates are as follows:

%

Buildings on long term leasehold land 2 - 5Factory extension 23Plant and machinery, moulds and motor vehicles 10 - 20Furniture, fittings, equipment and electrical installation 10 - 50

Residual values and useful lives of assets are reviewed, and adjusted if appropriate, at the end of the reporting period.

Assets under construction are carried as capital work in progress and depreciation only commences when the assets are ready for their intended use.

Gains and losses on disposals of property, plant and equipment are determined by comparing proceeds with carrying amounts and are included in profit or loss.

At the end of the reporting period, the Group assesses whether there is any indication of impairment. If such indication exists, an analysis is performed to assess whether the carrying amount of the asset is fully recoverable. A write down is made if the carrying amount exceeds the recoverable amount. See Note 3(e) to the financial statements on accounting policy for impairment of non-financial assets.




(d) Research and development

Research expenditure incurred for the Group’s own products, is recognised as an expense when incurred. Costs incurred on development projects (relating to the design and testing of new or improved products) are recognised as intangible assets when the following criteria are fulfilled:

• it is technically feasible to complete the intangible asset so that it will be available for use or sale;• management intends to complete the intangible asset and use or sell it;• there is an ability to use or sell the intangible asset;• it can be demonstrated how the intangible asset will generate probable future economic benefits;• adequate technical, financial and other resources to complete the development and to use or sell the intangible

asset are available; and• the expenditure attributable to the intangible asset during its development can be reliably measured.

Directly attributable costs capitalised as part of the intangible asset include employee costs involved in development and an appropriate portion of relevant overheads.

Other development expenditures that do not meet these criteria are recognised as an expense when incurred. Development costs previously recognised as an expense are not recognised as an asset in subsequent period.

Capitalised development costs recognised as intangible assets are amortised from the point at which the asset is ready for use on a straight line basis over its useful life of two years.

(e) Impairment of non-financial assets

Non current and non-financial assets that have an indefinite useful life, for example goodwill or intangible assets not ready to use, are not subject to amortisation and are tested annually for impairment. Property, plant and equipment and other non current and non-financial assets that are subject to amortisation are reviewed for impairment losses whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Impairment loss is recognised for the amount by which the carrying amount of the asset exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest level for which there are separately identifiable cash flows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non current and non-financial assets subject to amortisation, other than goodwill that suffered impairment are reviewed for possible reversal of impairment at each reporting date.

The impairment loss is charged to profit or loss. Impairment losses on goodwill are not reversed. In respect of other non current and non-financial assets that are subject to amortisation, any subsequent increase in recoverable amount is recognised in profit or loss. The reversal is recognised to the extent of the carrying amount of the asset that would have been determined (net of amortisation and depreciation) had no impairment loss been recognised.

(f) Non current assets held for sale

Non current assets (or disposal groups) are classified as assets held for sale when their carrying amount is to be recovered principally through a sale transaction and sales is considered highly probable. They are stated at the lower of carrying amount and fair value less costs to sell.

(g) Accounting by lessee

(i) Finance leases

Leases of property, plant and equipment where the Group assumes substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lease’s commencement at the lower of the fair value of the leased asset and the present value of the minimum lease payments.




(g) Accounting by lessee (continued)

(i) Finance leases (continued)

Each lease payment is allocated between the liability and finance charges so as to achieve a constant rate of interest on the remaining balance of the liability. The corresponding rental obligations, net of finance charges, are included in the statements of financial position as current and non current liabilities. The interest element of the finance cost is charged to profit or loss over the lease period so as to produce a constant rate of interest on the remaining balance of the liability for each financial period. The property, plant and equipment acquired under finance leases are depreciated over the expected useful life of the asset if there is reasonable certainty that the lessee will obtain ownership by the end of the lease term. Otherwise, the leased assets are depreciated over the shorter of their expected useful lives and the lease period, if there is no reasonable certainty that the Group will obtain ownership at the end of the lease period.

Initial direct costs incurred by the Group in negotiating and arranging finance leases are added to the carrying amount of the leased assets and recognised as an expense in profit or loss over the lease period on the same basis as the lease expense.

(ii) Operating leases

Leases of assets where a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to profit or loss on the straight line basis over the lease period.

Initial direct costs incurred by the Group in negotiating and arranging operating leases are capitalised as prepayments and recognised in profit or loss on a straight line basis over the lease period.

When an operating lease is terminated before the lease period has expired, any payment required to be made to the lessor by way of penalty is recognised as an expense in the financial period in which termination takes place.

(h) Financial instruments

Financial instruments recognised on the statements of financial position

The particular recognition method adopted for financial instruments recognised on the statements of financial position is disclosed in the individual accounting policy statements associated with each item.

(i) Financial assets

(i) Classification

The Group and the Company classify its financial assets where applicable, in the following categories: at fair value through profit or loss, loans and receivables and available-for-sale. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification at initial recognition.




(i) Financial assets (continued)

(i) Classification (continued)

Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss are financial assets held for trading. A financial asset is classified in this category if it is acquired or incurred principally for the purpose of selling or repurchasing it in the near term. Derivatives are also categorised as held for trading unless they are designated as hedges. Assets in this category are classified as current assets if expected to be settled within 12 months; otherwise, they are classified as non current assets.

• In addition, certain financial assets are designated at initial recognition at fair value through profit or loss when one of the designation criteria is met:

• Designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise;

• Its performance is evaluated on a fair value basis, in accordance with a documented risk management or investment strategy; or

• The item is a hybrid contract that contains one or more embedded derivatives.

The Group’s financial asset at fair value through profit or loss comprises “short term investment” in the statements of financial position.

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the end of the reporting period. These are classified as non current assets. The Group’s and the Company’s loans and receivables comprise “receivables and deposits” (excluding prepayments), “amount due from a subsidiary” (company level only) and “cash and bank balances” in the statements of financial position.

Available-for-sale financial assets

Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non current assets unless the investment matures or management intends to dispose of it within 12 months from the end of the reporting period.

(ii) Recognition and initial measurement

Regular purchases and sales of financial assets are recognised on the trade-date, the date on which the Group commits to purchase or sell the asset.

Financial assets are initially recognised at fair value plus transaction costs that are directly attributable to the acquisition of the financial assets for all financial assets not carried at fair value through profit or loss (e.g. loans and receivables). Financial assets carried at fair value through profit or loss are initially recognised at fair value, and transaction costs are expensed in profit or loss.

(iii) Subsequent measurement - gains and losses

Financial assets at fair value through profit or loss and available-for-sale financial assets are subsequently carried at fair value. Loans and receivables financial assets are subsequently carried at amortised cost using the effective interest method.

Changes in the fair values of financial assets at fair value through profit or loss, including the effects of foreign currency translation, interest and dividend income are recognised in profit or loss in the financial period in which the changes arise.

Changes in the fair value of available-for-sale financial assets are recognised in other comprehensive income, except for impairment losses (see Note 3(i)(iv) to the financial statements) and foreign currency exchange gains and losses on monetary assets. The foreign currency exchange differences on monetary assets are recognised in profit or loss.




(i) Financial assets (continued)

(iii) Subsequent measurement - gains and losses (continued)

Interest and dividend income on available-for-sale financial assets are recognised in profit or loss, except for impairment losses (see Note 3(i)(iv) to the financial statements). Interest on available-for-sale debt securities calculated using the effective interest method is recognised in profit or loss. Dividends income on available-for-sale equity instruments are recognised in profit or loss when the Group’s right to receive payments is established.

(iv) Subsequent measurement - impairment of financial assets

Assets carried at amortised cost

The Group and the Company assess at the end of the reporting period whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated.

Evidence of impairment may include indications that the debtors or a group of debtors is experiencing significant financial difficulty, default on delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganisation, and where observable data indicate that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

The amount of the loss is measured as the difference between the asset’s carrying amount and the present

value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate. The asset’s carrying amount of the asset is reduced and the amount of the loss is recognised in profit or loss.

If ‘loans and receivables’ has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. As a practical expedient, the Group may measure impairment on the basis of an instrument’s fair value using an observable market price.

The carrying amount of the financial assets is reduced by the impairment loss directly for all financial assets with the exception of trade receivables, where the carrying amount is reduced through the use of an allowance account. When a trade receivable becomes uncollectible, it is written off against the allowance account.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor’s financial position), the reversal of the previously recognised impairment loss is recognised in profit or loss.

When an asset is uncollectible, it is written off against the related allowance account. Such assets are written off after all the necessary procedures have been completed and the amount of the loss has been determined.

(v) De-recognition

Financial assets are de-recognised when the rights to receive cash flows from the investments have expired or have been transferred and the Group and the Company have transferred substantially all risks and rewards of ownership.

When available-for-sale financial assets are sold, the accumulated fair value adjustments recognised in other comprehensive income are reclassified to profit or loss.




(j) Financial liabilities

(i) Classification

The Group and the Company classify the financial liabilities where applicable, in the following categories: at fair value through profit or loss, showing separately (i) those designated as such upon initial recognition, and (ii) those classified as held-for-trading; and financial liabilities measured at amortised cost as other financial liabilities. Management determines the classification of its financial liabilities at initial recognition.

Financial liabilities at fair value through profit or loss

The Group and the Company have not designated any financial liabilities as financial liabilities at fair value through profit or loss. Financial liabilities held- for-trading are derivatives entered into by the Group that do not meet the hedge accounting criteria. Liabilities in this category are classified within current liabilities if they are either held-for-trading or are expected to be settled within 12 months after the reporting date. Otherwise, they are classified as non current liabilities.

Other financial liabilities

Other financial liabilities are non-derivative financial liabilities with fixed or determinable payments that are not quoted in an active market. Other financial liabilities are recognised as current liabilities unless the Group or the Company have an unconditional right to defer repayment of the liabilities for at least 12 months after the reporting date. Other financial liabilities of the Group and of the Company comprise “payables and accruals”, “term loans”, “hire-purchase creditors” and “finance lease liability” in the statements of financial position.

(ii) Recognition and initial measurement

Financial liabilities within the scope of MFRS 139 are recognised in the statements of financial position when, and only when, the Group and the Company become a party to the contractual provisions of the financial instrument.

Financial liabilities are initially recognised at fair value, plus, in the case of financial liabilities other than derivatives, directly attributable transactions costs.

(iii) Subsequent measurement

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss are subsequently carried at fair value. Changes in the fair value of financial liabilities at fair value through profit or loss, including the effect of foreign currency translation are recognised in profit or loss in the financial period in which the changes arise.

Other financial liabilities

Subsequent to initial recognition, other financial liabilities are measured at amortised cost using the effective interest method. Gains and losses are recognised in profit or loss when the other financial liabilities are derecognised, and through the amortisation process.

Financial liabilities are derecognised when the obligation specified in the contract is discharged or cancelled or expired.

(k) Offsetting financial instruments

Financial assets and liabilities are offset and the net amount presented in the statements of financial position when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle the liability simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal course of business and in the event of default, insolvency or bankruptcy.




(l) Inventories

Inventories comprising raw materials, work in progress and finished goods are stated at the lower of cost and net realisable value after adequate allowance has been made for all deteriorated, damaged, obsolete or slow moving inventories. Cost is determined on the first in, first out basis. Cost of raw materials includes purchase price and any cost that is directly attributable to bringing the inventories to their present condition and location. Costs of purchased inventory are determined after deducting rebates, discounts and the amount of GST, except where the amount of GST incurred is not recoverable from the government. When the amount of GST incurred is not recoverable from the government, the GST is recognised as part of the cost of purchased inventory.

Cost of work in progress and finished goods includes cost of direct materials, direct labour, other direct costs and an appropriate proportion of production overheads (based on normal operating capacity). It excludes borrowing costs.

Net realisable value is the estimated selling price in the ordinary course of business, less the costs of completion and the estimated costs necessary to make the sale.

(m) Trade and other receivables

Trade receivables are amounts due from customers for merchandise sold or services performed in the ordinary course of business. Other receivables generally arise from transactions outside the usual operating activities of the Group and of the Company. If collection is expected in one year or less (or in the normal operating cycle of the business if longer), they are classified as current assets. If not, they are presented as non current assets.

Trade and other receivables are recognised initially at fair value, with the amount of GST included. The net amount of GST recoverable from the government is included in “other receivables” in the statements of financial position.

Cash flows are included in the statements of cash flows on a gross basis. The GST components of cash flows which are recoverable from, or payable to, the government are classified as operating cash flows.

Trade and other receivables are subsequently measured at amortised cost using the effective interest method, less allowance for impairment. See Note 3(i)(iv) to the financial statements on the accounting policy for subsequent measurement - impairment of financial assets.

(n) Cash and cash equivalents

For the purpose of the statements of cash flows, cash equivalents are held for the purpose of meeting short term cash commitments rather than for investment or other purposes. Cash and cash equivalents comprise cash on hand, deposits held at call with banks and short term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, net of bank overdrafts (if any).

(o) Trade and other payables

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non current liabilities.

Trade payables are recognised initially at fair value, with the amount of GST included. The net amount of GST payable to the government, wherever applicable, is presented as “other payables” in the statements of financial position. Cash flows are included in the statements of cash flows on a gross basis. The GST components of cash flows which are recoverable from, or payable to, the government are classified as operating cash flows.

Trade payables are subsequently measured at amortised cost using the effective interest method.

(p) Provision

Provision for warranty and claims are recognised when, the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount can be made.




(p) Provision (continued)

Where the Group expects a provision to be reimbursed by another party (for example, under an insurance contract), the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. Provisions are not recognised for future operating losses.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

Provision for warranties covers estimated liability to repair or replace products resulting from customers’ complaints and returns. Provision for warranties is recognised when the underlying products are sold. This provision is measured at a percentage rate of historical replacements and a review of possible outcomes against the associated probabilities of returns.

(q) Borrowings and borrowing costs

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost; any difference between the initial recognised amount and the redemption amount is recognised in the profit or loss over the period of the borrowings using the effective interest method.

Borrowings are classified as current liabilities unless the Group or the Company have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facilities will be drawn down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facilities will be drawn down, the fee is capitalised as a pre-payment for liquidity services and amortised over the period of the facility to which it relates.

General and specific borrowing costs directly attributable to the acquisition, construction or production of qualifying

assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.

All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

(r) Share capital

(i) Classifications

Ordinary shares are recorded at nominal value as share capital and proceeds received in excess of the nominal value of shares issued, if any, are accounted for as share premium. Both ordinary shares and share premium are classified as equity.

(ii) Share issue costs

Incremental costs directly attributable to the issue of new shares are deducted against share premium account, if any, otherwise it is charged to profit or loss.

(iii) Dividend distribution

Liability is recognised for the amount of any dividend declared, being appropriately authorised and no longer at the discretion of the Group and the Company, on or before the end of the reporting period but not distributed at the end of the reporting period.

Distributions to holders of an equity instrument is recognised directly in equity.




(r) Share capital (continued)

(iv) Earnings per share

Basic earnings per shareBasic earnings per share is calculated by dividing:• the profit attributable to owners of the Company, excluding any costs of servicing equity other than

ordinary shares• by the weighted average number of ordinary shares outstanding during the financial period, adjusted for

bonus elements in ordinary shares issued during the period and excluding treasury shares, if any.

Diluted earnings per share Diluted earnings per share adjusts the figures in the determination of basic earnings per share to take into

account:• the after income tax effect of interest and other financing costs associated with dilutive potential ordinary

shares; and• the weighted average number of additional ordinary shares that would have been outstanding assuming

the conversion of all dilutive potential ordinary shares.

(s) Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable for the sale of goods and services in the ordinary course of the Group’s and the Company’s activities. Revenue is shown net of GST, returns, rebates and discounts and after eliminating sales within the Group.

The Group and the Company recognise revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the Group’s and the Company’s activities as described below. The Group and the Company base their estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.

(i) Sales of goods are recognised upon delivery of goods to customers, when significant risks and rewards of ownership of the goods are transferred to the buyer.

(ii) Service charges on contract works are recognised upon rendering of services.(iii) Revenue on fabrication of tools is recognised upon acceptance by customers.(iv) Rental income is recognised on accrual basis unless collection is in doubt.(v) Interest income is recognised using the effective interest method.(vi) Dividend income is recognised when the Group’s or the Company’s right to receive payment is established.(vii) Other income is recognised on an accrued basis unless collectability is uncertain.

(t) Employee benefits

(i) Short term employee benefits

Wages, salaries, social security contributions, paid annual leave and sick leave, bonuses, and non-monetary benefits are accrued in the financial period in which the associated services are rendered by employees of the Group and of the Company. The Group and the Company recognise a liability and an expense for bonuses based on a formula that takes into consideration the profit attributable to the shareholders of the Company after certain adjustments. The Group and the Company recognise a provision when contractually obliged or where there is a past practice that has created a constructive obligation.

(ii) Post-employment benefits

The Group and the Company contribute to the Employees Provident Fund (EPF), the national defined contribution plan. The contributions are charged to the profit or loss in the financial period to which they relate. Once the contributions have been paid, the Group and the Company have no further payment obligations.




(u) Current and deferred taxes

The tax expense for the period comprises current and deferred tax. The income tax expense or credit for the financial period is the tax payable on the current financial period’s taxable income based on the applicable income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case the tax is also recognised in other comprehensive income or directly in equity, respectively.

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the country where the Company and the subsidiary operate and generate taxable income.

Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities. This liability is measured using the single best estimate of the most likely outcome.

Deferred tax is recognised in full, using the liability method, on temporary differences arising between the amounts attributed to assets and liabilities for tax purposes (i.e. tax bases) and their carrying amounts in the financial statements. However, deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred tax is determined using tax rates (and tax laws) enacted or substantively enacted at the end of the reporting period and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.

Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences or unused tax losses or unused tax credits can be utilised.

Deferred tax liability is recognised for all taxable temporary differences associated with investments in subsidiary, except where the timing of the reversal of the temporary difference is controlled by the parent and it is probable that the temporary difference will not reverse in the foreseeable future.

Deferred tax assets are recognised on deductible temporary differences arising from investments in subsidiary only to the extent that it is probable the temporary difference will reverse in the future and there is sufficient taxable profit available against which the deductible temporary difference can be utilised.

Current and deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred tax assets and liabilities relate to taxes levied by the same taxation authority on the taxable entity where there is an intention to settle the balances on a net basis.

(v) Foreign currencies

(i) Functional and presentation currency

Items included in the financial statements of the Group and of the Company are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The financial statements are presented in Ringgit Malaysia, which is the Company’s and the subsidiary’s functional and presentation currency.

(ii) Transactions and balances

Foreign currency transactions are translated into Ringgit Malaysia using the foreign currency exchange rates approximating those prevailing at the dates of transactions. Foreign currency exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at the end of the reporting period using the foreign currency exchange rates approximating those prevailing at the reporting date, are recognised in profit or loss.




(v) Foreign currencies (continued)

(ii) Transactions and balances (continued)

The principal closing rates used in the translation of major foreign currency assets and liabilities are as follows:

Group and Company

Foreign currencies2016

RM2015

RM

Assets:1 Euro 4.46 4.221 US Dollar 4.01 3.76Liabilities:1 Euro 4.47 4.241 US Dollar 4.02 3.78

(w) Government grants

Government grant comprises compensation receivable from the government for applicable past expenses relating to qualifying training, research related activities and modernisation of production processes incurred, which comply with conditions imposed on qualifying activities under the Domestic Investment Strategic Fund Grant obtained by the subsidiary for period from June 2013 to June 2016. The grant is recognised as income in profit or loss in the period the claim is approved by the relevant authorities and becomes receivable when there is no further unfulfilled condition that needs to be met subsequent to the approval by the relevant authorities.

(x) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Group’s Managing Director, who makes strategic decisions.

(y) Contingent liabilities

The Group and the Company do not recognise contingent liabilities but discloses its existence in the financial statements. A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Group and of the Company, or a present obligation that is not recognised because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in the extremely rare case where there is a liability that cannot be recognised because it cannot be measured reliably. However, contingent liabilities do not include financial guarantee contracts.



4. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated by the directors based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The Group makes estimates and assumptions concerning the future. The resulting accounting estimates may differ from the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are outlined follows:

(a) Current and deferred taxes

Income tax is estimated based on the rules governed under the Income Tax Act, 1967. Significant judgement is required in determining the capital allowances and deductibility of certain expenses during the estimation of the current and deferred taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. Where the final tax outcome of these matters is different from the amounts that were initially recognised, such differences will impact the income tax provisions in the period in which such determination is made.

Deferred tax assets are recognised for all unused tax losses and other deductible temporary differences to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences can be utilised. Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and level of future taxable profits together with future tax planning strategies.

Assumptions about generation of future taxable profits depend on management’s estimate of future cash flows. These depend on estimates of future production and sales volume, operating costs, capital expenditure, dividends and the other capital management transactions. Judgement is also required about applicable income tax incentives. These judgements and assumptions are subject to risks and uncertainty, hence there is a possibility that changes in circumstances will alter expectations, which may impact the amount of deferred tax assets recognised in the statements of financial position and the amount of unrecognised tax losses and unrecognised temporary differences.

(b) Inventory write down

Allowance for inventory write down for slow moving items is made based on an analysis of the ageing profile and taking into account the expected product life cycle and sales patterns of individual item held in inventory. Changes in the inventory ageing, the expected product life cycle and sales profiles can have an impact on the allowance recorded.

5. REVENUE

Group Company2016

RM2015

RM2016

RM2015

RM

Dividend income 0 0 9,700,000 40,429,738Sales of goods at invoiced value less

returns

233,484,887 191,244,631 0 0Service charges on contract works 392,214 1,273,051 0 0Services rendered in respect of product

development 7,949,810 0 0 0241,826,911 192,517,682 9,700,000 40,429,738



6. PROFIT FROM OPERATIONS

Group Company2016

RM2015

RM2016

RM2015

RM

Profit from operations is stated after charging/(crediting):

Auditors’ remuneration paid/payable:- statutory audit 128,000 90,000 48,000 17,000- other assurance services* 895,000 0 804,000 0- other services 113,555 81,700 13,100 10,000Employee benefit costs 20,628,048 19,506,206 202,708 0Research expenses 126,802 1,343,372 0 0(Reversal)/Allowance for slow moving

inventories (69,115) 615,808 0 0Property, plant and equipment:- depreciation 6,290,393 5,644,215 0 0- write off 17,346 125 0 0Provision for warranties (Note 29) 47,789 54,762 0 0Rental expenses:- hostel 22,403 17,664 0 0- machinery 44,879 4,919 0 0Interest income (1,165,344) (1,058,483) (20,799) 0Listing expenses (inclusive for fees paid to

reporting accountants) 2,890,311 0 2,890,311 0

Included in other operating income are:- Government grants income (928,440) (3,900,236) 0 0- Net foreign currency exchange losses/

(gains): - realised 1,067,828 (1,776,892) 0 0 - unrealised 91,906 (43,368) 0 0- Rental income of premise (74,150) (61,379) 0 0- Fair value (gains)/losses on derivative

financial instruments (214,966) 172,947 0 0- Gains on disposal of property, plant and

equipment (29,109) (111,868) 0 0- Gains from early settlement of finance

lease liability (Note 25) (1,148,861) 0 0 0- Short term investments: - gains on disposal (12,001) 0 (3,045) 0 - fair value gain (182,947) 0 (16,229) 0

* Included in other assurance services are fees relating to work performed as reporting accountants in connection with the initial public offering of the Company.



6. PROFIT FROM OPERATIONS (continued)

Group Company2016

RM2015

RM2016

RM2015

RM

Employee benefit costs (including directors’ remuneration)

Directors of the Company:- fee 292,708 0 202,708 0- allowances 84,000 84,000 0 0- salaries and bonus 1,169,038 1,033,371 0 0- defined contribution plan 237,319 212,306 0 0

1,783,065 1,329,677 202,708 0

Directors of the subsidiary:- allowances 1,750 36,000 0 0- salaries and bonus 577,074 487,042 0 0- defined contribution plan 108,461 99,378 0 0

687,285 622,420 0 0

Other staff costs:- salaries, wages and bonus 14,597,879 14,491,986 0 0- defined contribution plan 1,820,564 1,797,123 0 0- other short term employee benefits 1,739,255 1,265,000 0 0Total other staff costs 18,157,698 17,554,109 0 0Total employee benefit expense 20,628,048 19,506,206 202,708 0

Monetary value of benefits in-kind other than cash given to directors 73,107 39,093 0 0

7. FINANCE COST

Group2016

RM2015

RM

Interest on:Term loans 609,835 0Hire-purchase 129,548 0Finance lease liability 22,879 87,963

762,262 87,963



8. TAxATION

Group Company2016

RM2015

RM2016

RM2015

RM

Current financial year:Income tax charge 279,710 282,640 4,992 0Deferred tax assets (Note 14)- origination and reversal of temporary

differences 8,312,338 (7,410,751) 0 08,592,048 (7,128,111) 4,992 0

Previous financial years:(Over)/Under accrual of income tax (18,019) 10 0 0Tax expense/(credit) 8,574,029 (7,128,101) 4,992 0

The explanation of the relationship between taxation and profit before taxation is as follows:

Group Company2016

RM2015

RM2016

RM2015

RM

Profit before taxation 32,898,844 20,283,733 6,480,354 40,364,161

Tax calculated at the Malaysian income tax rate of 24% (2015: 25%) 7,895,723 5,070,933 1,555,285 10,091,040

Tax effects of:- expenses not deductible for tax purposes 1,491,159 646,618 782,333 16,394- income not subject to tax (545,313) 0 (2,332,626) (10,107,434)- previously unrecognised deductible

temporary differences now recognised 0 (10,502,279) 0 0- utilisation of deductible temporary

differences previously not recognised 0 (2,343,383) 0 0- (over)/under accrual of income tax in

respect of previous financial years (18,019) 10 0 0- under provision of deferred tax assets in

respect of previous financial year (249,521) 0 0 0Tax expenses/(credit) 8,574,029 (7,128,101) 4,992 0

As at 30 June 2016, the subsidiary has unused tax losses amounting to approximately RM8,684,000 (2015: RM42,508,000) which can be carried forward and utilised to set off against its future taxable profits.

9. EARNINGS PER SHARE

Basic/diluted earnings per share of the Group is calculated by dividing the net profit for the financial year by the weighted average number of ordinary shares in issue during the financial year.

Group2016 2015

Net profit for the financial year attributable to owners of the Company (RM) 24,324,815 27,411,834Weighted average number of ordinary shares in issue during the financial year 319,830,137 309,930,384

Basic/diluted earnings per share (RM) 0.08 0.09



10. PROPERTY, PLANT AND EQUIPMENT

Group

Long termleasehold

landRM

Buildingon long

termleasehold

landRM

Factoryextension

RM

Plant andmachinery,

mouldsand motor

vehiclesRM

Furniture,fittings,

equipmentand

electricalinstallation

RMTotal

RM

Cost At 1 July 2015 4,905,000 21,559,238 550,762 13,513,192 4,293,867 44,822,059Additions 775,569 0 0 5,618,932 1,390,973 7,785,474Disposals 0 0 0 (335,925) (3,786) (339,711)Write off 0 0 0 (121) (17,225) (17,346)At 30 June 2016 5,680,569 21,559,238 550,762 18,796,078 5,663,829 52,250,476

Accumulated depreciation

At 1 July 2015 113,753 1,854,624 228,272 1,091,339 1,159,746 4,447,734Charge for the

financial year 65,478 1,011,613 124,511 3,924,423 1,164,368 6,290,393Disposals 0 0 0 (11,189) (2,291) (13,480)At 30 June 2016 179,231 2,866,237 352,783 5,004,573 2,321,823 10,724,647

Accumulated impairment loss

At 1 July 2015/ 30 June 2016 0 0 0 832,224 597,860 1,430,084

Carrying amountAt 30 June 2016 5,501,338 18,693,001 197,979 12,959,281 2,744,146 40,095,745

GroupCostAt 1 July 2014 4,905,000 21,559,238 550,762 16,972,788 3,965,211 47,952,999Additions 0 0 0 2,032,299 880,110 2,912,409Disposals 0 0 0 (5,309,879) (203,489) (5,513,368)Write off 0 0 0 (182,016) (347,965) (529,981)At 30 June 2015 4,905,000 21,559,238 550,762 13,513,192 4,293,867 44,822,059

Accumulated depreciation

At 1 July 2014 51,706 843,011 103,760 3,174,713 671,669 4,844,859Charge for the

financial year 62,047 1,011,613 124,512 3,408,493 1,037,550 5,644,215Disposals 0 0 0 (5,309,859) (201,625) (5,511,484)Write off 0 0 0 (182,008) (347,848) (529,856)At 30 June 2015 113,753 1,854,624 228,272 1,091,339 1,159,746 4,447,734



10. PROPERTY, PLANT AND EQUIPMENT (continued)

Long termleasehold

landRM

Buildingon long

termleasehold

landRM

Factoryextension

RM

Plant andmachinery,

mouldsand motor

vehiclesRM

Furniture,fittings,

equipmentand

electricalinstallation

RMTotal

RM

Accumulated impairment loss

At 1 July 2014 0 0 0 832,224 599,676 1,431,900Disposal 0 0 0 0 (1,816) (1,816)At 30 June 2015 0 0 0 832,224 597,860 1,430,084

Carrying amountAt 30 June 2015 4,791,247 19,704,614 322,490 11,589,629 2,536,261 38,944,241

The carrying amount of land and buildings as at 30 June 2016 pledged as securities for the borrowings of the Group as disclosed in Note 27 to the financial statements in RM24,392,318 (2015: N/A).

Assets under finance lease and hire-purchase

Included in property, plant and equipment of the Group are assets acquired under finance lease and hire-purchase arrangement as follows:

Group2016

RM2015

RM

Finance LeaseLand and building- carrying amount at financial year end 0 24,818,351

Hire-purchasePlant and machinery- additions during the financial year 3,684,054 0- carrying amount at financial year end 3,372,759 0

On 19 June 2015, the subsidiary signed a Sale and Purchase Agreement with the lessor to exercise its purchase option to acquire the land and buildings under finance lease arrangement earlier than the agreed option exercise date due on 28 February 2017 at a revised purchase consideration of RM26,052,250. The transaction was completed on 12 October 2015. Stamp duty relating to the acquisition of the land and buildings amounting to RM775,569 had been capitalised as property, plant and equipment accordingly. Other transaction costs totalling RM105,110 are taken to profit or loss as expenses during the current financial year.



11. INTANGIBLE ASSET

Group2016

RM2015

RM

Development costsAt 1 July 0 0Additions 2,191,399 0At 30 June 2,191,399 0

Intangible asset of the Group comprises development costs incurred on in-house developed products that meet the capitalisation criteria. All expenditure relating to research activities of RM126,802 (2015: RM1,343,372) are recognised as an expense in the profit or loss as incurred.

No amortisation was charged to profit or loss during the financial year as the intangible asset is not ready for use.

12. INVESTMENT IN A SUBSIDIARY

Company2016

RM2015

RM

Investment in a subsidiary, at cost 50,000,005 5

On 27 May 2016, the Company injected RM50,000,000 cash and acquired additional 50,000,000 shares of RM1 each in Salutica Allied Solutions Sdn. Bhd.

Detail of the subsidiary which is incorporated in Malaysia, is as follows:

Effective interestheld by the Company

2016 2015Name of Company % % Principal activities

Salutica Allied Solutions Sdn. Bhd. 100 100 Comprises vertical integration processes covering product design and development, and manufacturing of mobile communication products, wireless electronics and lifestyle devices.

13. AvAILABLE-FOR-SALE FINANCIAL ASSET

Group2016

RM2015

RM

Available-for-sale financial asset 118,900 55,000

The available-for-sale financial asset of the Group comprises a transferable golf club membership stated at fair value that is held for long term purposes as the Group has no intention to dispose it.



14. DEFERRED TAx ASSETS

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when the deferred taxation relates to the same tax authority. The following amounts, determined after appropriate offsetting, are shown in the statements of financial position:

Group2016

RM2015

RM

Deferred tax assets - subject to income tax 171,953 8,484,291

The movements in deferred tax assets during the financial year comprise the following:

2016RM

2015RM

GroupAt 1 July 8,484,291 1,073,540Credited/(Charged) to profit or loss (Note 8)- property, plant and equipment 108,053 (3,027,661)- provisions and allowances (302,361) 236,342- unused tax losses (8,118,030) 10,202,070

(8,312,338) 7,410,751At 30 June 171,953 8,484,291

Subject to income taxDeferred tax assets- provisions and allowances 93,876 396,237- unused tax losses 2,084,040 10,202,070Deferred tax assets (before offsetting) 2,177,916 10,598,307Offsetting (2,005,963) (2,114,016)Deferred tax assets (after offsetting) 171,953 8,484,291

Deferred tax liabilities- property, plant and equipment (2,005,963) (2,114,016)Offsetting 2,005,963 2,114,016Deferred tax liabilities (after offsetting) 0 0

Deferred tax assets- to be realised within 12 months 171,953 5,674,000- to be realised after 12 months 0 2,810,291

171,953 8,484,291

Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences or unused tax losses can be utilised.



15. INVENTORIES

Group2016

RM2015

RM

Raw materials 17,627,486 7,978,426Work in progress 7,078,815 4,099,010Finished goods 9,582,312 3,516,045

34,288,613 15,593,481

16. RECEIVABLES, DEPOSITS AND PREPAYMENTS

Group Company2016

RM2015

RM2016

RM2015

RM

Trade receivables 24,429,280 16,051,173 0 0Other receivables 833,910 1,268,969 0 0

25,263,190 17,320,142 0 0Amounts recoverable from customers for

product development 0 9,323 0 0Deposits 42,325 34,325 1,000 0Prepayments 3,096,621 1,252,703 2,681 234,684

28,402,136 18,616,493 3,681 234,684

Credit terms of trade receivables of the Group range from 10 to 75 days (2015: 15 to 90 days).

Included in other receivables of the Group are input tax receivable of RM456,547 (2015: RM488,793) in respect of GST paid for the purchases and sales of goods and services.

Included in prepayments of the Group are downpayments of RM1,273,156 (2015: RM606,582) for the purpose of acquisition of property, plant and equipment.

The currency profile of receivables and deposits of the Group is as follows:

Group Company2016

RM2015

RM2016

RM2015

RM

- US Dollar 24,239,282 16,148,381 0 0- Ringgit Malaysia 1,066,233 1,205,344 1,000 0- Euro 0 742 0 0

25,305,515 17,354,467 1,000 0

17. RELATED PARTY DISCLOSURES

(a) Related parties and relationship

The directors regard Blue Ocean Enlightenment Sdn. Bhd., a company incorporated in Malaysia, as the Company’s ultimate holding company.

The wholly-owned subsidiary of the Company is Salutica Allied Solutions Sdn. Bhd., a company incorporated in Malaysia.

All directors of the Company and the senior management team of the subsidiary are regarded as key management personnel of the Group.



17. RELATED PARTY DISCLOSURES (continued)

(b) Related party balance

Amount due from a subsidiary is denominated in Ringgit Malaysia, interest free and is receivable on demand.

(c) Significant related party transactions

Group Company2016

RM2015

RM2016

RM2015

RM

Consultation fee paid/payable- with a person connected with certain

directors of the Company 14,729 11,077 0 0- with firms in which certain directors

of the Company are members 330,000 103,500 300,000 0

The above transactions were established based on terms and prices agreed between the related parties.

(d) Key management compensation

Group Company2016

RM2015

RM2016

RM2015

RM

Salaries and other short term employee benefits 2,745,652 2,117,148 202,708 0

Post employment benefits 442,561 404,836 0 03,188,213 2,521,984 202,708 0

Key management compensation includes directors’ remuneration as disclosed in Note 6 to the financial statements.

18. DERIVATIVE FINANCIAL INSTRUMENTS

Group2016

RM2015

RM

Derivative financial instrumentsAssets 113,445 0

Liabilities 45,831 147,352

The subsidiary does not apply hedge accounting. It has entered into foreign currency forward exchange contracts which are economic hedges to mitigate its risk of foreign currency exposure.



18. DERIVATIVE FINANCIAL INSTRUMENTS (continued)

The notional principal amounts of the outstanding derivative financial instruments are as follows:

GroupCurrency

boughtCurrency

sold2016

RM2015

RM

- foreign currency forward exchange contracts RM USD 8,967,200 6,307,800

19. SHORT TERM INVESTMENTS

Group Company2016

RM2015

RM2016

RM2015

RM

Investments in unit trust quoted in Malaysia at fair value 57,732,947 N/A 7,916,229 N/A

Quoted market price per unit 1.00 N/A 1.00 N/A

The short term investments are in respect of investments in an Islamic money market fund.

20. CASH AND CASH EQUIvALENTS

Cash and cash equivalents included in the statements of cash flows comprise the following:

Group Company2016

RM2015

RM2016

RM2015

RM

Deposits with licensed banks 37,300,000 36,350,000 0 0Cash and bank balances 2,863,086 4,867,644 550,936 297,067

40,163,086 41,217,644 550,936 297,067

Deposits with licensed banks 37,300,000 36,350,000 0 0Deposits pledged with a licensed bank (5,000,000) (6,500,000) 0 0Deposits with maturity period more than

three months (unencumbered) 0 (8,800,000) 0 0(5,000,000) (15,300,000) 0 0

Deposits with maturity period less than three months (unencumbered) 32,300,000 21,050,000 0 0

Cash and bank balances 2,863,086 4,867,644 550,936 297,067Cash and cash equivalents 35,163,086 25,917,644 550,936 297,067



20. CASH AND CASH EQUIvALENTS (continued)

The currency profile of deposits, cash and bank balances of the Group and of the Company is as follows:

Group Company2016

RM2015

RM2016

RM2015

RM

Ringgit Malaysia 39,281,939 38,088,265 550,936 297,067US Dollar 868,204 3,126,684 0 0Euro 12,172 1,651 0 0Others 771 1,044 0 0

40,163,086 41,217,644 550,936 297,067

Group2016

%2015

%

Weighted average effective interest rate of the deposits of the Group at the reporting date is as follows:

Deposits with licensed banks 3.74 3.64

Days DaysThe range of maturity periods of the deposits with licensed banks are as follows:- encumbered 183 183- unencumbered 3 - 92 8 - 365

The cash and bank balances of the Group and of the Company are deposits placed in current accounts of various licensed banks in Malaysia and cash in hand which do not earn any interest.



21. SHARE CAPITAL

Group and Company2016 2015 2016 2015

Number of shares

Number of shares RM RM

AuthorisedAt 1 July 500,000,000 (1) 100,000 (2) 50,000,000 100,000Creation of new ordinary shares

during the financial year 0 49,900,000 (2) 0 49,900,000500,000,000 50,000,000 50,000,000 50,000,000

Sub-division of shares of RM0.10 each during the financial year 0 450,000,000 (1) 0 0

At 30 June 500,000,000 (1) 500,000,000 (1) 50,000,000 50,000,000

Issued and fully paidAt 1 July 310,000,000 (1) 200 (2) 31,000,000 200Issuance of new ordinary shares

during the financial year 78,000,000 (1) 7,000 (2) 7,800,000 7,000Bonus issue 0 30,992,800 (2) 0 30,992,800

388,000,000 (1) 31,000,000 38,800,000 31,000,000Sub-division of shares of RM0.10

each during the financial year 0 279,000,000 (1) 0 0At 30 June 388,000,000 (1) 310,000,000 (1) 38,800,000 31,000,000

(1) The nominal value of these shares is RM0.10 each following the subdivision of the Company’s shares from the nominal value of RM1.00 each to RM0.10 each on 30 June 2015.

(2) The nominal value of these shares were RM1.00 each.

(i) During the current financial year, the Company completed the following transaction:

On 16 May 2016, the issued and fully paid-up ordinary share capital of the Company was increased from RM31,000,000 to RM38,800,000 by way of issuance of 78,000,000 ordinary shares of RM0.10 each at par at the issue price of RM0.80 per share for total gross cash proceeds of RM62,400,000, pursuant to the initial public offering exercise, where the Company was listed with its entire enlarged issued and paid-up ordinary share capital quoted on Bursa Malaysia on 18 May 2016.

The newly issued ordinary shares rank pari passu in all respects with the existing ordinary shares of the Company.

(ii) In preceeding financial year, the Company completed the following transactions:

On 29 June 2015, issued and fully paid share capital of the Company was increased from RM200 to RM7,200 by way of issuance of 7,000 ordinary shares of RM1.00 each at par for cash. The newly issued ordinary shares ranked pari passu in all respects with the existing ordinary shares of the Company.

On 30 June 2015, the Company completed the following transactions:

(a) The authorised share capital of the Company was increased from RM100,000 to RM50,000,000 by the creation of 49,900,000 new ordinary shares of RM1.00 each at par. The increased authorised share capital was subsequently subdivided to 500,000,000 ordinary shares of RM0.10 each;

(b) A bonus issue of 30,992,800 new ordinary shares of RM1.00 each on the basis of 4,304.56 (rounded to 2 decimal places) new ordinary shares for every one existing ordinary share held in the Company; and

(c) Sub-division of issued share capital of RM31,000,000 comprising 31,000,000 ordinary shares of RM1.00 each to 310,000,000 ordinary shares of RM0.10 each. Each of the new shares of RM0.10 each had the same rights as the previous shares of RM1.00 nominal value.



22. SHARE PREMIUM

Group and Company2016

RM2015

RM

At 1 July 0 0Issuance of new ordinary shares (Note 21) 54,600,000 0

54,600,000 0Transaction costs arising from issue of shares (1,597,632) 0At 30 June 53,002,368 0

23. FAIR VALUE RESERVE

Group2016

RM2015

RM

Fair value reserve 16,000 16,000

Fair value reserve is in respect of accumulated fair value gains on available-for-sale financial asset.

24. RETAINED PROFITS

Dividends paid out of retained profits of the Company are single-tier dividends which are tax exempt in the hands of shareholders.

25. FINANCE LEASE LIABILITY

Group2016

RM2015

RM

Present value of minimum lease payments:Current - payable within one year 0 6,483,155Non current - payable later than one year but not later than five years 0 9,365,706

0 15,848,861

Fair value of finance lease liability 0 15,848,861

The subsidiary leased the land and buildings under a finance lease arrangement with lease term expiring in 2018 and a purchase option exercisable in January to February 2017.

On 19 June 2015, the subsidiary signed a Sale and Purchase Agreement with the lessor to exercise its purchase option to acquire the land and buildings under finance lease arrangement earlier than the agreed option exercise date due on 28 February 2017 at a revised purchase consideration of RM26,052,250. The final settlement amount of RM14,700,000 was derived based on revised purchase consideration plus transaction costs relating to acquisition less accumulated lease payments. The transaction was completed on 12 October 2015 with the drawdown a term loan of RM14,700,000 to re-finance the finance lease liability. The early settlement of the finance lease liability resulted in a gain of RM1,148,861, being the difference between final settlement amount of RM14,700,000 and outstanding finance lease liability of RM15,848,861, recognised in profit or loss of the Group during the current financial year.

As at 30 June 2015, finance lease liability was effectively secured as the rights to the leased assets revert to the lessor in the event of default.



26. HIRE-PURCHASE CREDITORS

Group2016

RM2015

RM

Future minimum hire-purchase payments:- Payable within one year 1,071,610 0- Payable later than one year but not later than five years 1,371,782 0

2,443,392 0Less: Finance charges (186,552) 0

2,256,840 0Present value of hire-purchase liabilities:Current- Payable within one year 947,315 0Non current- Payable later than one year but not later than five years 1,309,525 0

2,256,840 0

Hire-purchase creditors are denominated in Ringgit Malaysia. The effective interest rates ranged from 6.60% - 7.42% (2015: N/A) per annum. Hire-purchase creditors are effectively secured as the rights to the leased assets revert to the lessor in the event of default and they are guaranteed by a director.

The carrying amount is approximates the fair value as at the reporting date.

27. TERM LOANS

Group2016

RM2015

RM

SecuredTerm loan 1 4,489,411 0UnsecuredTerm loan 2 1,025,508 0

5,514,919 0

Current- Repayable within one year 3,442,412 0Non current- Repayable later than one year but not later than five years 2,072,507 0

5,514,919 0

Term loans 1 and 2 are repayable by 60 instalments commencing November 2015 and September 2015 respectively.

Term loan 1 is secured by way of first legal charge on the leasehold land and buildings of the Group and certain fixed deposits pledged.

Term loan 1 and 2 are guaranteed by a director.



27. TERM LOANS (continued)

These term loans have effective interest rates per annum as follows:

Group2016

RM2015

RM

Term loan 1 5.90 0Term loan 2 5.65 0

The interest expenses on these term loans are calculated based on floating interest rates which may be varied from time to time at the bank’s discretion. All of the term loans are denominated in Ringgit Malaysia.

28. PAYABLES AND ACCRUALS

Group Company2016

RM2015

RM2016

RM2015

RM

Trade payables 33,470,717 18,735,684 0 0Other payables and accruals 5,724,347 4,332,678 297,839 308,266

39,195,064 23,068,362 297,839 308,266Advances from customers for product

development 84,481 1,835,782 0 0Advances from customers for sales of goods 1,136,381 5,771,410 0 0

40,415,926 30,675,554 297,839 308,266

Credit terms of trade payables granted to the Group vary from 14 to 90 days (2015: 14 to 90 days) from invoice date.

The currency profile of payables and accruals is as follows:

Group Company2016

RM2015

RM2016

RM2015

RM

US Dollar 31,198,334 16,417,901 0 0Ringgit Malaysia 7,800,199 6,357,924 297,839 308,266Euro 184,132 290,837 0 0Others 12,399 1,700 0 0

39,195,064 23,068,362 297,839 308,266



29. PROVISION FOR WARRANTIES

Group2016

RM2015

RM

At 1 July 54,796 34Charge during the financial year 47,789 54,762Utilised during the financial year (18,138) 0At 30 June 84,447 54,796

Provision for warranties is in respect of finished products manufactured and sold by the Group directly to the end users. The provision is measured at a percentage rate of historical replacement and a review of possible outcomes against the associated probabilities of returns.

30. DIVIDENDS

Company2016

RM2015

RM

PaidFirst interim single-tier tax exempt dividend of 0.645 sen (rounded to 3 decimal

places) per share on 310,000,000 ordinary shares of RM0.10 each, paid on 23 October 2015 (2015: First interim single-tier tax exempt dividend of RM5,665 per share on 200 ordinary shares of RM1.00 each, paid on 15 December 2014) 2,000,000 1,133,000

Second interim single-tier tax exempt dividend of 0.645 sen (rounded to 3 decimal places per share on 310,000,000 ordinary shares of RM0.10 each, paid on 18 April 2016 (2015: Second interim single-tier tax exempt dividend of RM10,000 per share on 200 ordinary shares of RM1.00 each, paid on 23 March 2015) 2,000,000 2,000,000

Third interim single-tier tax exempt dividend of 0.6 sen per share on 388,000,000 ordinary shares of RM0.10 each, paid on 30 June 2016 (2015: Third interim single-tier tax exempt dividend of RM31,976 per share on 200 ordinary shares of RM1.00 each, paid on 22 June 2015) 2,328,000 6,395,200

6,328,000 9,528,200Dividends per share - gross 0.02 47,641.00

The directors do not recommend the payment of a final dividend for the financial year ended 30 June 2016.

On 15 August 2016, the directors declared a first interim single-tier tax exempt dividend in respect of the financial year ending 30 June 2017 of 0.6 sen per share on 388,000,000 ordinary shares amounting to RM2,328,000, payable on 30 September 2016.



31. NON CASH TRANSACTIONS

The principal non cash transactions of the Group and the Company during the financial year is as follows:

Group Company2016

RM2015

RM2016

RM2015

RM

- Purchase of plant and machinery by means of hire-purchase arrangement (2,898,732) 0 0 0

- Payment of insurance premium of key management by means of a term loan disbursed directly to the insurer (1,200,249) 0 0 0

- Early settlement of finance lease liability by means of a term loan disbursed directly to the lessor (14,700,000) 0 0 0

32. CAPITAL COMMITMENTS

Capital commitments in respect of property, plant and equipment not provided for in the financial statements are as follows:

Group Company2016

RM2015

RM2016

RM2015

RM

Approved and contracted 3,047,000 4,094,854 21,000 0Approved but not contracted 18,039,000 496,564 0 0

33. FINANCIAL INSTRUMENTS

(a) Classification of financial instruments

Group Company2016

RM2015

RM2016

RM2015

RM

Financial assetsFinancial asset measured at fair

value through profit or loss:- Short term investments 57,732,947 0 7,916,229 0- Derivative financial instruments 113,445 0 0 0

Available-for-sale financial asset 118,900 55,000 0 0

Loans and receivables at amortised cost:

- Trade, other receivables and deposits 24,848,968 16,865,674 1,000 0- Deposits with a licensed bank 37,300,000 36,350,000 0 0- Cash and bank balances 2,863,086 4,867,644 550,936 297,067- Amount due from a subsidiary 0 0 33,809,738 30,809,738Total 122,977,346 58,138,318 42,277,903 31,106,805



33. FINANCIAL INSTRUMENTS (continued)

(a) Classification of financial instruments (continued)

Group Company2016

RM2015

RM2016

RM2015

RM

Financial liabilitiesFinancial liability measured at fair

value through profit or loss:- Derivative financial instrument 45,831 147,352 0 0

Other financial liabilities at amortised cost:

- Payables and accruals 39,195,064 23,068,362 297,839 308,266- Finance lease liability 0 15,848,861 0 0- Hire-purchase creditors 2,256,840 0 0 0- Term loans 5,514,919 0 0 0Total 47,012,654 39,064,575 297,839 308,266

The Group and the Company have no financial assets classified as “held-to-maturity”.

(b) Financial risk management

The Group’s overall financial risk management objectives and policies are to ensure that the Group creates value and maximises returns for its shareholders. Financial risk management is carried out through risk review, internal control systems, benchmarking to the industry’s best practices and adherence to the Group’s financial risk management policies. The main risks arising from the financial instruments of the Group are market risk, price risk, credit risk and liquidity risk. Management monitors the Group’s financial position closely with the objective to minimise potential adverse effects on the financial performance of the Group. The nature of these risks and the Group’s approaches in managing these risks are listed below:

(i) Market risk

(a) Foreign currency exchange risk

Foreign currency exchange risk is the risk that the fair value or future cash flows of financial instruments will fluctuate because of the changes in foreign exchange rates.

The Group’s sales are mostly denominated in US Dollar and Ringgit Malaysia whilst purchases of goods are denominated in US Dollar, Ringgit Malaysia and Euro.

The Group mitigates its foreign currency exchange risk through the natural hedge of operating foreign currency accounts using the deposits from its export proceeds to pay imported purchases where both are denominated in the same foreign currency. The Group also enters into foreign currency forward exchange contracts to hedge its receivables for export proceeds, whenever considered necessary.

Sensitivity analysis for foreign currency exchange risk

Based on the currency profile of receivables and deposits, cash and bank balances and payables and accruals as disclosed in the respective Note 16, Note 20 and Note 28 to the financial statements respectively, the sensitivity analysis of foreign currency exchange risk is calculated based on reasonably possible change in exchange rates for the major currencies transacted by the Group against Ringgit Malaysia at the end of the financial year. This analysis assumes that all other variables are held constant.




(b) Financial risk management (continued)

(i) Market risk (continued)

(a) Foreign currency exchange risk (continued)

Estimated % increase Impact on profit or loss2016 2015 2016 2015

% % RM RM

GroupForeign currency strengthens against

RM- US Dollar 7 17 -402,000 +494,000- Euro 6 4 -10,000 +10,000

Conversely, weakening of major currencies against Ringgit Malaysia by the above percentages would have had equal but opposite effects on the results of the Group shown above on the basis that all other variables remain constant.

(b) Interest rate risk

Interest rate risk is the risk that fair value or future cash flows of the Group’s financial instruments will fluctuate because of changes in market interest rates.

The Group’s exposure to changes in interest rates relates mainly to term loans and deposits placed with licensed banks in Malaysia. Majority of the borrowings are contracted on variable terms.

Sensitivity analysis for interest rate risk

Assuming all variables remain constant, an increase in interest rate by 0.5% (2015: 0.5%) on financial assets and liabilities of the Group which have variable interest rates would have an impact on the Group’s profit or loss as shown below:

Impact on profit or loss(Unfavourable)/Favourable

2016 2015RM RM

GroupIncrease in interest rate:- term loans (53,000) 0- deposits with licensed banks 184,000 145,000

Conversely, a decrease in interest rate by 0.5% on financial assets and liabilities of the Group would have had equal but opposite effect on the amounts shown above on the basis that all other variables remain constant.

The impact of fluctuation in interest risk on the results of the Company is not significant.





(ii) Price risk

Price risk is the risk that the fair value or future cash flows of the Group’s and of the Company’s financial instruments will fluctuate because of changes in market prices (other than interest or exchange rates).

The Group and the Company are exposed to price risk arising from its short term investments in money market fund. The short term investments are classified as fair value through profit or loss.

At the end of the reporting period, if the money market fund had been 2% (2015: N/A) higher/lower, with all other variables held constant, the Group’s and the Company’s net profit would have been approximately RM1,154,659 (2015: N/A) and RM158,325 (2015: N/A) respectively higher/lower, as a result of an increase/decrease in the fair value of the quoted money market fund.

(iii) Credit risk

Credit risk is the risk of loss that may arise on outstanding financial assets should a counterparty default on its obligations. The Group’s exposure to credit risk arises primarily from derivative financial instruments, trade, other receivables and deposits, deposits with licensed banks and bank balances.

Trade receivables are monitored on an ongoing basis via the Group’s management reporting procedures. The Group has significant concentration of credit risk in the form of outstanding balance due from 3 customers representing 89% of the total trade receivables (2015: 3 customers, 86%).

The credit quality of trade receivables that are neither past due nor impaired are substantially amounts due from these major customers with good collection track record with the Group. Management will continuously monitor closely the trade receivables which are past due.

Credit risk arising from derivative financial instruments and deposits with licensed banks

Credit risk also arises from derivative financial instruments and deposits with licensed banks. The derivative and deposits are placed with creditworthy licensed banks in Malaysia. The Group considers the risk of material loss in the event of non-performance by a financial counterparty to be low.

Exposure to credit risk

At the end of the reporting period, the Group’s maximum exposure to credit risk is represented by the carrying amount of each class of financial assets recognised in the statement of financial position.





(iii) Credit risk (continued)

Ageing analysis

The ageing analysis of the Group’s and the Company’s financial assets is as follows:

Group Company2016

RM2015

RM2016

RM2015

RM

Neither past due nor impairedDerivative financial assets 113,445 0 0 0Trade receivables 23,859,630 12,342,601 0 0Amount due from a subsidiary 0 0 33,809,738 30,809,738Other receivables and deposits 419,688 814,501 1,000 0Deposits with licensed banks 37,300,000 36,350,000 0 0Cash and bank balances 2,863,086 4,867,644 550,936 297,067

64,555,849 54,374,746 34,361,674 31,106,805Trade receivables: Past due but

not impaired1 to 30 days past due 567,935 3,629,512 0 031 to 60 days past due 0 79,060 0 061 to 90 days past due 1,715 0 0 0Sub-total 569,650 3,708,572 0 0Total 65,125,499 58,083,318 34,361,674 31,106,805

Receivables that are neither past due nor impaired

Deposits and bank balances are mainly deposits placed with reputable licensed banks in Malaysia. Amount due from a subsidiary is receivable on demand and is within the treasury arrangements controlled within the Group. Trade and other receivables that are neither past due nor impaired are due from creditworthy debtors with good historical payment records with the Group. Majority of the Group’s trade receivables arise from regular customers with the Group and with insignificant losses noted.

None of the Group’s trade receivables that are neither past due nor impaired have been renegotiated during the financial year.

Receivables that are past due but not impaired

As at 30 June 2016, trade receivables of the Group of RM569,650 (2015: RM3,708,572) were past due but not impaired. These debts relate to a number of independent customers for whom there is no recent history of default. All of these debts have been repaid subsequent to the financial year end.

Trade receivables that are impaired

There are no trade receivables that are impaired at the reporting date.

(iv) Liquidity risk

Liquidity risk is the risk that the Group will encounter difficulty in meeting financial obligations due to shortage of funds. The Group’s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. The Group maintains sufficient cash and ensures availability of funding through an adequate but flexible amount of credit facilities obtained from financial institutions in Malaysia. Certain facilities are maintained with varying maturities to ensure sufficient cash inflow from operations is available to meet all repayment requirements, if required.





(iv) Liquidity risk (continued)

The table below summarises the maturity profile of the Group’s and the Company’s liabilities at the end of the reporting period based on contractual undiscounted repayment obligations.

2016Within

one yearTwo to

five years TotalRM RM RM

GroupFinancial liabilities:Payables and accruals 39,195,064 0 39,195,064Term loans 3,673,800 2,166,742 5,840,542Hire-purchase creditors 1,071,610 1,371,782 2,443,392Total undiscounted financial obligations 43,940,474 3,538,524 47,478,998

Derivative financial liabilities:Gross settled currency forward- receipts 3,192,300 0 3,192,300- payments (3,238,131) 0 (3,238,131)

(45,831) 0 (45,831)

2015Within

one yearTwo to


GroupFinancial liabilities:Payables and accruals 23,068,362 0 23,068,362Term loans 0 0 0Hire-purchase creditors 0 0 0Finance lease liability 6,542,250 9,306,611 15,848,861Total undiscounted financial obligations 29,610,612 9,306,611 38,917,223

Derivative financial liabilities:Gross settled currency forward- receipts 6,307,800 0 6,307,800- payments (6,455,152) 0 (6,455,152)

(147,352) 0 (147,352)





(iv) Liquidity risk (continued)

2016Within

one yearTwo to


CompanyOther payables and accruals 297,839 0 297,839

2015Within

one yearTwo to


Company

Other payables and accruals 308,266 0 308,266

(v) Capital management

The Group’s objective when managing capital is to safeguard the Group’s ability to continue as a going concern and to maintain an optimal capital structure so as to maximise shareholder value.

Management monitors capital based on shareholders’ equity attributable to the owners of the Group.

(c) Fair value of financial instruments

The carrying amounts of the following financial assets and liabilities approximate their fair values due to the relatively short term maturity of these financial instruments: deposits, cash and bank balances, receivables and payables.

The fair value of the floating interest rate borrowings approximates the carrying value as at the reporting date.

The disclosure of fair value measurements by level of the following fair value measurement hierarchy:

• Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);

• Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (Level 2);

• Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3).




(c) Fair value of financial instruments (continued)

The following table presents the Group’s and the Company’s assets that are measured at fair value:

Level 1 Level 2 Level 3 TotalRM RM RM RM

At 30 June 2016GroupAssetsAvailable-for-sale financial asset 0 118,900 0 118,900Short term investments 57,732,947 0 0 57,732,947Derivative financial instruments 0 113,445 0 113,445LiabilitiesDerivative financial instruments 0 45,831 0 45,831

CompanyAssetShort term investments 7,916,229 0 0 7,916,229

At 30 June 2015GroupAssetsAvailable-for-sale financial asset 0 55,000 0 55,000LiabilitiesDerivative financial instruments 0 147,352 0 147,352

There were no short term investment and derivative financial instrument of the Group and the Company as at 30 June 2015.

The fair value of the short term investments of the Group and the Company are based on quoted market price in active market and is therefore classified in Level 1.

The fair value of the derivative financial instruments and available-for-sale financial asset is based on certain inputs which are not directly obtainable from quoted prices and is therefore classified in Level 2.

There were no transfers between Levels 1, 2 and 3 during the financial year.

34. SEGMENT REPORTING

The Group operates in Malaysia under one business segment: • Consumer electronics - is an operating segment which comprises vertical integration processes covering product

design and development, and manufacturing of mobile communication products, wireless electronics and lifestyle devices.



34. SEGMENT REPORTING (continued)

(a) Analysis of results and financial position

Consumer electronics2016

RM2015

RM

GroupRevenue 241,826,911 192,517,682

ResultsProfit from operations 33,661,106 20,371,696Finance cost (762,262) (87,963)Profit before taxation 32,898,844 20,283,733Taxation (8,574,029) 7,128,101Net profit for the financial year 24,324,815 27,411,834

Other informationSegment assets 203,106,271 114,426,859Unallocated assets 192,822 8,484,291Total assets 203,299,093 122,911,150

Segment liabilities 48,317,963 46,726,563Unallocated liabilities 0 2,640Total liabilities 48,317,963 46,729,203

Interest income 1,165,344 1,058,483

Depreciation of property, plant and equipment 6,290,393 5,644,215

Capital expenditure 7,785,474 2,912,409

Unallocated assets consist of income tax recoverable and deferred tax assets. Unallocated liabilities include income tax payable.

(b) Analysis of revenue by region

Although the Company and its subsidiary are located in Malaysia, the Group exports the goods to Asia, Europe, North America, Australia and Africa. The revenue of the Group is analysed as follows:

Group2016

RM2015

RM

North America 216,492,168 137,428,331Europe 8,671,189 31,377,593Australia (including New Zealand, Oceania) 133,048 1,086,363Asia (excluding Malaysia) 14,675,799 19,059,886Africa (including Middle East) 32,524 223,887Malaysia 1,822,183 3,341,622

241,826,911 192,517,682

For the financial year, the revenue of 2 (2015: 3) customers which contributed more than 10% of the total revenue of the Group amounting to RM212,386,939 (2015: RM160,716,575).



34. SEGMENT REPORTING (continued)

(b) Analysis of revenue by region (continued)

All non current assets of the Group are located in Malaysia.

The basis of measurement of reported segment profit or loss, segment assets and segment liabilities is consistent with the basis used for the statements of comprehensive income of the Group for the financial year ended 30 June 2016 and the statements of financial position as at 30 June 2016. The components of the segment assets and liabilities include classes of assets and liabilities disclosed in the statements of financial position.



35. REALISED AND UNREALISED PROFITS/LOSSES

The following analysis of realised and unrealised profits/losses at the legal entity level is prepared in accordance with Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants whilst the disclosure at the group level is based on the prescribed format by Bursa Malaysia Securities Berhad.

The retained profits as at the reporting date are analysed as follows:

Group Company2016

RM2015

RM2016

RM2015

RM

Retained profits:- realised 44,756,254 18,680,089 164,361 33,228- unrealised 393,513 8,472,863 16,229 0

45,149,767 27,152,952 180,590 33,228Add: Consolidation adjustments 18,012,995 18,012,995 0 0Total retained profits as at 30 June 63,162,762 45,165,947 180,590 33,228

The disclosure of realised and unrealised profits/losses above is solely for compliance with the directive issued by Bursa

Malaysia Securities Berhad and should not be used for any other purpose.



LIST OF PROPERTIES

Registered owner

Title details/ address

Tenure/ Expiry of

leaseDescription and

existing use

Approximate age of

building

Total built up area and land

area(square meter)

Carrying Amount as at 30

June 2016

(RM’000)

Date of Acquisition/

Valuation

Salutica Allied

Lot 202124, PN 94442, Mukim Hulu Kinta, Daerah Kinta, Negeri Perak

3 Jalan Zarib 6 Kawasan Perindustrian Zarib, 31500 Lahat, Ipoh, Perak

99 years, expiring

on 11 February

2092

Allocated parking space for employees

N/A Land area: 4,551

Built-up area: N/A

626.8 12 October 2015

(Date of Acquisition)

Salutica Allied

Lot 202125, PN94443, Mukim Hulu Kinta, Daerah Kinta, Negeri Perak


99 years, expiring

on 11 February

2092

Allocated parking space for employees

N/A Land area: 4,314

Built-up area: N/A

660.6 12 October 2015


Salutica Allied

Lot 381631, PN314266, Mukim Hulu Kinta, Daerah Kinta, Negeri Perak


99 years, expiring

on 11 February

2092

Our manufacturing

plant comprising a two (2)-storey office annexed

to a two (2) storey

warehouse (“Phase Three”)

and factory (“Phase One

and Two”) (“Buildings”)

Phase One: 17 years

Phase Two: 16 years

Phase Three: 8 years

Land area: 30,130

Built-up area: Approximately

30,318

23,105 12 October 2015


The above properties are charged as security for a loan facility with OCBC Bank (Malaysia) Berhad.


ANALYSIS OF SHAREHOLDINGSas at 19 September 2016

Authorised Share Capital : RM50,000,000Issued and Fully Paid Up Share Capital : RM38,800,000Class of Shares : Ordinary shares of RM0.10 each Voting Rights : One vote per ordinary share

LIST OF SUBSTANTIAL SHAREHOLDERS

Direct Interest Indirect InterestName Size of Holdings % Size of Holdings %

Blue Ocean Enlightenment Sdn. Bhd. (“BOE”) 216,500,000 55.80 - -Genius Thinkers Sdn. Bhd. (“GT”) 46,500,000 11.98 - -Lim Chong Shyh - - 263,000,0001 67.78Joshua Lim Phan Yih - - 263,000,0001 67.78Joel Lim Phan Hong - - 216,500,0002 55.80

Notes:

1. Deemed interested by virtue of shareholdings in BOE and GT pursuant to Section 6A of the Act.

2. Deemed interested by virtue of shareholdings in BOE pursuant to Section 6A of the Act.

DIRECTORS’ SHAREHOLDINGS

Direct Interest Indirect InterestName Size of Holdings % Size of Holdings %

Chia Chee Hoong 700,000 0.18 - -Low Teng Lum 700,000 0.18 - -Leow Chan Khiang 700,000 0.18 - -Lim Chong Shyh - - 263,000,000¹ 67.78Joshua Lim Phan Yih - - 263,000,000¹ 67.78

Note:

1. Deemed interested by virtue of shareholdings in BOE and GT pursuant to Section 6A of the Act.

ANALYSIS BY SIZE OF HOLDINGS

No. of Holders Size of Holdings Total Holdings %

6 1 - 99 100 0.00127 100 - 1,000 90,000 0.02582 1,001 - 10,000 3,316,300 0.86418 10,001 - 100,000 14,972,700 3.86128 100,001 to less than 5% of issued shares 106,620,900 27.482 5% and above of issued shares 263,000,000 67.781,263 TOTAL 388,000,000 100.00


ANALYSIS OF SHAREHOLDINGSas at 19 September 2016 (continued)

LIST OF THIRTY LARGEST SHAREHOLDERS

No. NameNo. of

shares held %

1. BLUE OCEAN ENLIGHTENMENT SDN. BHD. 216,500,000 55.80

2. GENIUS THINKERS SDN. BHD. 46,500,000 11.98

3. CIMB GROUP NOMINEES (TEMPATAN) SDN. BHD.CIMB COMMERCE TRUSTEE BERHAD – KENANGA GROWTH FUND

8,744,700 2.25

4. DB (MALAYSIA) NOMINEE (TEMPATAN) SENDIRIAN BERHADDEUTSCHE TRUSTEES MALAYSIA BERHAD – EASTSPRING INVESTMENTS SMALL-CAP FUND

7,235,600 1.86

5. GOH BEE CHIN @ OOI BEE CHIN 6,215,000 1.60

6. CHAN SHOOK LING 6,100,000 1.57

7. CHIN SEEN CHOON 5,600,000 1.44

8. HO KEAT SOONG 5,470,800 1.41

9. CITIGROUP NOMINEES (TEMPATAN) SDN. BHD.UNIVERSAL TRUSTEE (MALAYSIA) BERHAD – CIMB ISLAMIC SMALL CAP FUND

4,368,800 1.13

10. CARTABAN NOMINEES (TEMPATAN) SDN. BHD.RHB TRUSTEES BERHAD – MANULIFE INVESTMENT SHARIAH PROGRESS FUND

4,265,000 1.10

11. DB (MALAYSIA) NOMINEE (TEMPATAN) SENDIRIAN BERHADDEUTSCHE TRUSTEES MALAYSIA BERHAD – EASTSPRING INVESTMENTS MY FOCUS FUND

2,988,600 0.77

12. MAYBANK NOMINEES (TEMPATAN) SDN. BHD.MAYBANK TRUSTEES BERHAD – CIMB-PRINCIPAL SMALL CAP FUND (240218)

2,350,400 0.61

13. RHB NOMINEES (TEMPATAN) SDN. BHD.OSK TECHNOLOGY VENTURES SDN. BHD.

2,184,600 0.56

14. HSBC NOMINEES (TEMPATAN) SDN. BHD.HSBC (M) TRUSTEE BHD – MANULIFE INVESTMENT PROGRESS FUND (4082)

2,153,200 0.55

15. TAN AH LOY @ TAN MAY LING 1,700,000 0.44

16. DB (MALAYSIA) NOMINEE (TEMPATAN) SENDIRIAN BERHADDEUTSCHE TRUSTEES MALAYSIA BERHAD – EASTSPRING INVESTMENTS GROWTH FUND

1,696,600 0.44

17. TAN BOOI CHARN 1,600,500 0.41

18. DB (MALAYSIA) NOMINEE (TEMPATAN) SENDIRIAN BERHADDEUTSCHE TRUSTEES MALAYSIA BERHAD – EASTSPRING INVESTMENTS EQUITY INCOME FUND

1,564,100 0.40

19. CITIGROUP NOMINEES (ASING) SDN. BHD.CEP FOR PHEIM SICAV-SIF

1,558,600 0.40

20. TOKIO MARINE LIFE INSURANCE MALAYSIA BHD. AS BENEFICIAL OWNER (TMEF) 1,479,100 0.38

21. DB (MALAYSIA) NOMINEE (TEMPATAN) SENDIRIAN BERHADDEUTSCHE TRUSTEES MALAYSIA BERHAD – EASTSPRING INVESTMENTS DANA AL-ILHAM

1,475,900 0.38

22. ALLIANCEGROUP NOMINEES (TEMPATAN) SDN. BHD. PLEDGED SECURITIES ACCOUNT FOR TING SIEW PIN

1,426,700 0.37

23. HSBC NOMINEES (TEMPATAN) SDN. BHD.HSBC (M) TRUSTEE BHD. – MANULIFE INVESTMENT AL-FAID (4389)

1,374,200 0.36

24. TAN TAI MING 1,158,500 0.30


ANALYSIS OF SHAREHOLDINGSas at 19 September 2016 (continued)

LIST OF THIRTY LARGEST SHAREHOLDERS (continued)

No. NameNo. of

shares held %

25. TOKIO MARINE LIFE INSURANCE MALAYSIA BHD AS BENEFICIAL OWNER (NPF) 1,153,500 0.30

26. DB (MALAYSIA) NOMINEE (TEMPATAN) SENDIRIAN BERHADDEUTSCHE TRUSTEES MALAYSIA BERHAD – EASTSPRING INVESTMENTS BALANCED FUND

1,080,500 0.28

27. AMANAHRAYA TRUSTEES BERHAD – PUBLIC STRATEGIC GROWTH FUND 1,039,800 0.27

28. HSBC NOMINEES (TEMPATAN) SDN. BHD.HSBC (M) TRUSTEE BHD – MANULIFE INSURANCE BERHAD (MANAGED FUND)

969,500 0.25

29. AMANAHRAYA TRUSTEES BERHAD – PB MIXED ASSET GROWTH FUND 918,600 0.24

30. CARTABAN NOMINEES (TEMPATAN) SDN. BHD.RHB TRUSTEES BERHAD – MANULIFE INVESTMENT-HW SHARIAH FLEXI FUND

775,000 0.20

TOTAL 341,647,800 88.05


NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN THAT the Fourth Annual General Meeting (“AGM”) of Salutica Berhad will be held at The Jubilee Ballroom, Level 1, Royal Perak Golf Club, Jalan Sultan Azlan Shah, 31400 Ipoh, Perak Darul Ridzuan, Malaysia on Thursday, 24 November 2016 at 10:00 a.m. for the following purposes:-

ORDINARY BUSINESS

1. To receive the Audited Financial Statements for the financial year ended 30 June 2016 together with the Directors’ and Auditors’ Reports thereon.

Please refer to Note A.

2. To approve the payment of Directors’ Fees amounting to RM202,708.00 for the financial year ended 30 June 2016.

Resolution 1

3. To re-elect the following Directors retiring in accordance with the Company’s Articles of Association and being eligible, have offered themselves for re-election:-

(i) Mr. Lim Chong Shyh (Article 95) Resolution 2

(ii) Mr. Joshua Lim Phan Yih (Article 95) Resolution 3

4. To re-appoint Messrs PricewaterhouseCoopers as Auditors for the financial year ending 30 June 2017 and to authorise the Directors to fix their remuneration.

Resolution 4

SPECIAL BUSINESS

To consider and, if thought fit, to pass the following resolutions, as Ordinary/Special Resolutions:-

5. ORDINARY RESOLUTION

Proposed Authority to Allot and Issue Shares Pursuant to Section 132D of the Companies Act, 1965

Resolution 5

“THAT pursuant to Section 132D of the Companies Act, 1965 and subject to the approvals from the relevant governmental and/or regulatory authorities, the Directors be and are hereby empowered to issue shares in the Company from time to time and upon such terms and conditions and for such purposes as the Directors may in their absolute discretion deem fit, provided that the aggregate number of shares issued pursuant to this resolution does not exceed ten (10) percent of the issued share capital of the Company for the time being, AND THAT the Directors be and are also hereby empowered to obtain the approval from Bursa Malaysia Securities Berhad (“Bursa Securities”) for the listing of and quotation for the additional shares so issued AND THAT such authority shall continue in force until the conclusion of the next AGM of the Company.”

6. SPECIAL RESOLUTION

Proposed amendments to the Articles of Association of the Company to facilitate the proposed transfer the listing of and quotation for the entire issued and paid-up share capital of Salutica from the ACE Market to the Main Market of Bursa Securities (“Proposed Transfer”) (“Proposed Amendments”)

Resolution 6

“THAT the proposed amendments to the Articles of Association of the Company to facilitate the Proposed Transfer be and is hereby approved as follow:-

Existing ProposedArticle No. 2 Article No. 2“Listing Requirements”

The ACE Market Listing Requirements of the Exchange as may be amended from time to time including any re-enactment thereof and such guidance notes or circulars as may be amended by the Exchange from time to time.

“Listing Requirements”

The ACE Market or Main Market Listing Requirements (as the case may be) of the Exchange as may be amended from time to time including any re-enactment thereof and such guidance or practice notes (as the case may be) or circulars as may be amended by the Exchange from time to time.


NOTICE OF ANNUAL GENERAL MEETING (continued)

SPECIAL BUSINESS (continued)

6. SPECIAL RESOLUTION (continued)

AND THAT the Directors of the Company be and are hereby authorised to assent to any modifications, variations and/or amendments as may be required by the relevant authorities and to do all acts and things and take all steps as may be considered necessary to give full effect to the Proposed Amendments.”

7. To transact any other business of which due notice shall have been given in accordance with the Companies Act, 1965 and the Company’s Articles of Association.

By Order of the Board

CHAN CHEE KHEONG (MAICSA 0810287)CHAN SHOOK LING (MIA 17167)Company Secretaries

Ipoh28 October 2016

NOTES:

A. Audited Statement of Accounts

This agenda item is intended for discussion only as under Section 169(1) of the Companies Act, 1965, the Audited Financial Statements do not require formal approval of shareholders. As such, this agenda item will not be put forward for voting.

B. Appointment of Proxy

(i) A member entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy or attorney or in the case of a corporation, to appoint a duly authorised representative to attend and vote in his place. A proxy may but need not be a member of the Company and the provisions of Sections 149(1)(a) and (b) of the Companies Act 1965 shall not apply.

(ii) A member of the Company who is entitled to attend and vote at a meeting of the Company may not appoint more than one (1) proxy to attend, speak and vote instead of the member at the meeting.

(iii) A member of the Company, who is an authorised nominee as defined under Securities Industry (Central Depositories) Act 1991, may appoint one (1) proxy in respect of each securities account it holds with ordinary shares of the Company standing to the credit of the said securities account.

(iv) Where a member of the Company is an exempt authorised nominee which holds ordinary shares in the Company for multiple beneficial owners in one (1) securities account (“omnibus account”), there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds.

(v) Where an exempt authorised nominee appoints two (2) or more proxies, the proportion of shareholdings to be represented by each proxy must be specified in the instrument appointing the proxies.

(vi) The instrument appointing a proxy shall be executed by the appointor or any person duly authorised by the appointor or, if the appointor is a corporation, executed by a duly authorised person or under its common seal or in any other manner authorised by its constitution, shall be deposited at the Share Registrar’s Office, Tricor Investor & Issuing House Services Sdn. Bhd., Unit 32-01, Level 32, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No. 8 Jalan Kerinchi, 59200 Kuala Lumpur, not less than forty eight (48) hours before the time appointed for holding the meeting or adjourned meeting at which the person named in the appointment proposes to vote.

(vii) For the purpose of determining who shall be entitled to attend this meeting, the Company shall be requesting the Bursa Malaysia Depository Sdn. Bhd. to make available to the Company, a Record of Depositors as at 16 November 2016. Only a Member whose name appears on such Record of Depositors shall be entitled to attend this meeting or appoint a proxy to attend, speak and vote on his/her behalf.


NOTICE OF ANNUAL GENERAL MEETING (continued)

ExPLANATORY NOTES ON SPECIAL BUSINESS

1. (i) Ordinary Resolution Proposed Authority to Allot and Issue New SharesThe proposed Resolution 5 is a new mandate and, if passed, will give the flexibility and authority to the Directors of the Company to issue new shares up to maximum of 10% of the issued share capital of the Company at any point of time, for such purposes as they consider would be in the interest of the Company. This authority shall commence immediately upon the passing of this ordinary resolution until the conclusion of the next AGM, unless otherwise revoked or varied by ordinary resolution passed by the shareholders of the Company at a general meeting. The Company continues to consider opportunities to broaden its earnings potential. If any of the expansion/diversification proposal involves the issue of new shares, the Directors, under certain circumstances when the opportunity arises, would have to convene a general meeting to approve the issue of new shares even though the number involved may be less than 10% of the issue capital.

In order to avoid any delay and costs involved in convening a general meeting to approve such issue of shares, it is thus considered appropriate that the Directors be empowered to issue and allot shares at any time to such persons/corporations in their absolute discretion for the purpose of funding current and/or future investment(s), working capital and/or acquisitions.

(ii) Special ResolutionProposed Amendments to the Articles of Association of the Company to Facilitate the Proposed TransferThe proposed Resolution 6, if passed, will facilitate the proposed transfer listing from the ACE Market to the Main Market of Bursa Securities which is subject to the approval of Bursa Securities, the Securities Commission Malaysia and other relevant government and/or regulatory authorities.

POLL VOTING

Pursuant to Paragraph 8.31A(1) of the ACE Market Listing Requirements of Bursa Securities, all the Resolutions set out in this Notice will be put to vote by poll.

PERSONAL DATA PRIVACY

By submitting an instrument appointing a proxy(ies) and/or representative(s) to attend, vote and speak at the AGM and/or any adjournment thereof, a member of the Company (i) consents to the collection, use and disclosure of the member’s personal data by the Company (or its agents) for the purpose of the processing and administration by the Company (or its agents) of proxies and representatives appointed for the AGM (including any adjournment thereof) and the preparation and compilation of the attendance lists, minutes and other documents relating to the AGM (including any adjournment thereof), and in order for the Company (or its agents) to comply with any applicable laws, listing rules, regulations and/or guidelines (collectively, the “Purposes”), (ii) warrants that where the member discloses the personal data of the member’s proxy(ies) and/or representative(s) to the Company (or its agents), the member has obtained the prior consent of such proxy(ies) and/or representative(s) for the collection, use and disclosure by the Company (or its agents) of the personal data of such proxy(ies) and/or representative(s) for the Purposes, and (iii) agrees that the member will indemnify the Company in respect of any penalties, liabilities, claims, demands, losses and damages as a result of the member’s breach of warranty.

STATEMENT ACCOMPANYING NOTICE OF FOURTH ANNUAL GENERAL MEETING

(Pursuant to paragraph 8.29(2) of the ACE Market Listing Requirements of Bursa Securities)

Details of individuals who are standing for election as Directors (excluding directors standing for re-election)

No individual is seeking new election as a Director at the forthcoming Fourth AGM of the Company.

1. The profile of the Directors who are standing for re-election (as per Ordinary Resolution 2 to 3 as stated above) at the Fourth Annual General Meeting of the company are as follows:-

Article 95 of the Company’s Articles of Association• Mr. Lim Chong Shyh• Mr. Joshua Lim Phan Yih

2. The profiles of the above Directors are set out in the Profile of Directors appearing on pages 6 to 8 of this Annual Report.

3. The details of the above Directors’ shareholdings in the Company are set out in the Analysis of Shareholdings appearing on page 103 of this Annual Report.


THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK


FORM OF PROXY

FOURTH ANNUAL GENERAL MEETING

I/We, Tel: (Full name, NRIC No./Company No. and Telephone No.)

of (Address)

being a Member of SALUTICA BERHAD, hereby appoint

(Full name, NRIC No./Company No.)

of (Address)

or failing him/her, the Chairman of the Meeting as my/our proxy, to attend and vote for me/us on my/our behalf at the Fourth Annual General Meeting of SALUTICA BERHAD, to be held at The Jubilee Ballroom, Level 1, Royal Perak Golf Club, Jalan Sultan Azlan Shah, 31400 Ipoh, Perak Darul Ridzuan, Malaysia on Thursday, 24 November 2016 at 10.00 a.m. and at any adjournment thereof.

Please indicate with an “X” in the spaces provided below how you wish your vote to be cast. If no specific direction as to the voting is given, the proxy will vote or abstain from voting at his/her discretion.

ORDINARY BUSINESS FOR AGAINSTResolution 1 To approve the payment of Directors’ feesResolution 2 To re-elect Mr. Lim Chong Shyh as DirectorResolution 3 To re-elect Mr. Joshua Lim Phan Yih as DirectorResolution 4 To re-appoint Messrs PricewaterhouseCoopers as Auditors and to authorise

the Directors to fix their remunerationSPECIAL BUSINESSResolution 5 To authorise the Directors to allot and issue shares pursuant to Section 132D

of the Companies Act, 1965Resolution 6 To approve the Proposed Amendments

Dated this day of 2016.

Signature(s)/Common Seal of Member

Notes:-

(i) A member entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy or attorney or in the case of a corporation, to appoint a duly authorised representative to attend and vote in his place. A proxy may but need not be a member of the Company and the provisions of Sections 149(1)(a) and (b) of the Companies Act 1965 shall not apply.

(ii) A member of the Company who is entitled to attend and vote at a meeting of the Company may not appoint more than one (1) proxy to attend, speak and vote instead of the member at the meeting.

(iii) A member of the Company, who is an authorised nominee as defined under Securities Industry (Central Depositories) Act 1991, may appoint one (1) proxy in respect of each securities account it holds with ordinary shares of the Company standing to the credit of the said securities account.

(iv) Where a member of the Company is an exempt authorised nominee which holds ordinary shares in the Company for multiple beneficial owners in one (1) securities account (“omnibus account”), there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds.

(v) Where an exempt authorised nominee appoints two (2) or more proxies, the proportion of shareholdings to be represented by each proxy must be specified in the instrument appointing the proxies.

(vi) The instrument appointing a proxy shall be executed by the appointor or any person duly authorised by the appointor or, if the appointor is a corporation, executed by a duly authorised person or under its common seal or in any other manner authorised by its constitution, shall be deposited at the Share Registrar’s Office, Tricor Investor & Issuing House Services Sdn. Bhd., Unit 32-01, Level 32, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No. 8 Jalan Kerinchi, 59200 Kuala Lumpur, not less than forty eight (48) hours before the time appointed for holding the meeting or adjourned meeting at which the person named in the appointment proposes to vote.

(vii) For the purpose of determining who shall be entitled to attend this meeting, the Company shall be requesting the Bursa Malaysia Depository Sdn. Bhd. to make available to the Company, a Record of Depositors as at 16 November 2016. Only a Member whose name appears on such Record of Depositors shall be entitled to attend this meeting or appoint a proxy to attend, speak and vote on his/her behalf.

(viii) Pursuant to Paragraph 8.31A(1) of the ACE Market Listing Requirements of Bursa Malaysia Securities Berhad, all the Resolutions set out in this Notice will be put to vote by poll.

Number of Shares HeldCDS Account Number


Please fold across the line and close

stamp

Please fold across the line and close

Share RegistrarTricor Investor & Issuing House Services Sdn Bhd

Unit 32-01, Level 32, Tower AVertical Business SuiteAvenue 3, Bangsar SouthNo. 8, Jalan Kerinchi59200 Kuala Lumpur

Annual Report 2016Saluting the Extraordinaire

3 Jalan Zarib 6, Kawasan Perindustrian Zarib,31500 Lahat, Ipoh, Perak, MalaysiaE [email protected] +(605) 320 6800

www.salutica.com



TM

saluting the extraordinairetm tfp precision industries sdn. bhd. before it adopted its current...

Documents