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					TECHNICS GROUP HOLDINGS LIMITED
       ANNUAL REPORT 2004




                    Reaching out to our customers
                   and penetrate emerging markets
                 Contents
Corporate Profile                                1
Chairman’s Statement                             2
Operations Review                                6
Group Structure                                  8
Corporate Information                            9
Board of Directors                              10
Key Executives                                  11
Financial Highlights                            12
Corporate Governance                            13
Report of the Directors                         20
Statement of Directors                          23
Auditors’ Report                                24
Balance Sheets                                  25
Consolidated Income Statement                   26
Statements of Changes in Equity                 27
Consolidated Cash Flow Statement                28
Notes to Financial Statements                   29
Additional Information Required for Discloure   47
Shareholder’s Statistics                        48
Notice of Annual General Meeting                49
Proxy Form
Corporate Profile


From a visionary start-up of only 12 staff in 1990, the Technics        Led by a team of dedicated professionals and experienced
Group is today a leading international specialist engineering service   engineers, our outstanding service standards and impeccable track
provider with over 170 staff, offering a comprehensive range of         records have allowed us to build strong and longstanding customer
engineering services for the oil and gas exploration and production     relationships.
industry.
                                                                        Presently, Technics has over nine countries, including Australia,
As a highly professional one-stop service entity, our services          Brunei, China, Malaysia, Myanmar and Russia, within its business
encompass design, engineering, procurement, fabrication,                coverage and offices in Singapore, Indonesia and Vietnam. Among
installation and commissioning of turnkey projects. These services      our growing portfolio of international customers are several blue-
are categorised broadly under the following three key areas:            chip clients that includes Emerson Process, Halliburton
• Engineering, Procurement, Construction and Commissioning              Multinational, Keppel Fels, MODEC, Petreco International, Shell,
    (EPCC)                                                              Technip, VietsovPetro JV and many more.
• Contract Engineering (CE)
• Procurement and other After-sales Services (PS)                       Our current facilities comprise two wholly-owned manufacturing
                                                                        and fabrication yards in Singapore and Batam, with a land area
Since its incorporation, Technics has participated in several major     of 16,759 sqm and 20,000 sqm respectively. With both facilities
onshore and offshore projects both locally and abroad. Our strength     sited on extensive waterfronts, we are more than suitably geared
lies in our strong and reliable engineering and project management      to undertake any large EPCC projects.
capabilities with a highly proven track record of completing projects
on time and within budget. We are                                                Our continuous effort to excel has brought us constant
thus well-positioned to provide                                                  success and allows us to chalk up a distinguished list
customers with a wide                                                             of certifications since our establishment in 1990.
range of integrated                                                                  Certainly, we are not resting on our laurels, and
services, tailored to                                                                     Technics will continuously strive to make its
their specific needs                                                                      indelible mark in the highly specialized oil and
and requirements.                                                                      gas exploration and production industry.




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     Chairman’s Statement




                                                                            Ting Yew Sue, Executive Chairman and Managing Director




                                                         FINANCIAL PERFORMANCE
     The Group registered revenue of S$24.8million, an increase of              in July 2004. As such, our gross profit margin decreased
     S$13.1million or 112% over that of the previous year. The increase         from 19.2% in FY2003 to 13.2% in the current year.
     in revenue stems largely from an aggressive pursuit of projects
     within the region that has allowed us to secure new businesses         •   Higher distribution expenses incurred in marketing and travel
     in Australia, Brunei, China, Indonesia, Malaysia and Russia, in            to develop and penetrate new markets.
     addition to our traditional markets in Singapore and Vietnam.
     The contribution from these markets accounted for more than            •   Higher administrative expenses, an increase of 54% compared
     40% of total revenue, a 30% increase from FY2003.                          to the previous year, due to:
                                                                                a) Higher depreciation costs from the expansion of
     However, the Group reported an after-tax loss of S$3.7million for              manufacturing facilities.
     the financial year ended 30 September 2004. This was attributed            b) Rental and maintenance-related charges for operating two
     to the following:                                                              Singapore yards simultaneously.
                                                                                c) Higher payroll expenses with the recruitment of additional
     •   Higher production costs due to an increase in raw materials,               engineers to boost up our core team of engineers to meet
         mainly steel, prices. Higher operations costs were also incurred           our growth plan, which is evidenced by increased sales.
         as a result of delays in the relocation of the old yard to our
         new facility in Singapore, which was subsequently completed        •   Higher financing costs from increased business activities and
                                                                                higher costs of borrowings.


                                                                BALANCE SHEET
     Our investment in property, plant and equipment at Loyang Way          placement have been deployed as additional working capital and
     shows an increase of S$1.8million. Secured term loan against           for business developments in both new and existing markets such
     this facility increased by S$800,000 to S$2.4million, a 50%            as China, Indonesian, Malaysia, Myanmar, Singapore, Thailand
     increase over FY2003. Our Company’s share capital also grew            and Vietnam.
     further by S$440,000 to S$5,196,663 with the issuance of 11
     million new shares of $0.04 each through private placement as          Cash and cash equivalent decreased by 51.4% to S$1.7million
     disclosed in the MASNET announcement on 29 January 2004.               compared to S$3.5million in FY2003. This is largely due to losses
                                                                            incurred during the year, delays in payment by customers, and
     The net proceeds of about S$4.6million raised from the private         pending settlement of variation orders.


                                                             INVESTING FOR GROWTH
     Over the last two years, the Group has seen significant investments    customers, encouraged by higher oil prices, to acquire more
     in both manufacturing facilities and manpower in Singapore and         sophisticated production equipment to cater for drilling in deeper
     Batam. These investments have put us in good stead to take             waters and replacing and/or upgrading of ageing facilities.
     advantage of the increased outlays by both existing and new


2 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
                                                  CAPTURING NEW MARKETS
New markets in Australia, Brunei, China, Indonesia and Malaysia        continue to pursue strategic co-operation with leading oil and gas
and others accounted for more than 40% of the Group’s turnover         players to reinforce its standing as a total solution provider for its
in FY2004 compared to about 10% in FY2003. The Group will              customers.


                                                GAS COMPRESSION BUSINESS
After going through a stringent qualification audit by Cooper Energy   We foresee an increasing demand for gas compressors in Asia
Services (a division of Cooper Cameron Corporation, USA),              Pacific as natural gas reserves are abundant in these areas. Natural
Technics was appointed as its gas compressor authorized packager       gas is more environmental friendly, relatively cheap compared to
for the Asia Pacific market in March 2003. We secured our              oil and is increasingly being used as an alternative source of energy.
first EPCC (engineering, procurement, construction and
commissioning) contract worth $1.2 million for the supply of a         The Group is also in the process of setting up a representative
start-up fuel gas compressor for the East Area - Additional Oil        office in Beijing, China to work more closely with our principal,
Recovery Project in Nigeria in September 2003. Since then, we          Cooper Energy Services to pursue new sales for the gas
have jumped leaps and bounds in securing new orders for gas            compression business. According to our principal, Cooper Energy
compressors and till date, we have already delivered four gas          Services, we are now reckoned to be its largest packager of gas
compressor packages and have on hand 12 units of gas                   compression units outside the USA.
compressors undergoing works-in-progress.


                                                  DIVERSIFYING FOR GROWTH
The Group has entered into a joint venture with a medical practice     stake in the joint venture from 10% to 70% towards the end of
to provide hyberbaric oxygen treatment, patient clinical assessment    December 2005 by subscribing new shares at S$1.00 per share.
for HBOT, total wound care, training for hyperbaric-related
programmes, and hyperbaric-related consulting services and             The Group has also entered into a memorandum of understanding
occupational medical treatment. We will build the hyperbaric           with Wah Seong Corporation Berhad (WS) for the issuance of
chamber for the joint venture while the medical practice will market   convertible note and grant of option to WS. Details can be obtained
and perform treatment. The Group has an option to increase its         from the announcement made over the MASNET on 6 October 2004.


                                                       ACKNOWLEDGMENTS
On behalf of the Board of Directors, I would like to express my        and staff for their commendable commitment and contribution to
gratitude to all our customers, business partners and shareholders     the Group. Together, I am sure that we can achieve even more
for their continued support. My thanks too to the management           unprecedented growth and success for the Group.




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4 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
   We foresee an increasing
demand for gas compressors
in Asia Pacific as natural gas
   reserves are abundant in
  these areas. Natural gas is
more environmental friendly,
  relatively cheap compared
   to oil and is increasingly
 being used as an alternative
        source of energy.




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     Operations Review

                                                             INVESTING FOR GROWTH
     Higher oil prices globally have encouraged both our existing and        investment in facilities and manpower in Singapore and Batam
     new customers to upgrade or replace ageing facilities to cater for      over the last two years has allowed us to gain from these market
     drilling in deeper waters for greater oil and gas output. Our           reactions and add to the growth in revenues of the Group.


                                                   REVENUE BY BUSINESS SEGMENTS
     Total revenue registered by all business segments totalled              year with EPCC topping the category with a 390% growth, bringing
     S$24.8million, a 112% increase from FY2003. Of this total, CE           in S$5.6million compared to S$1.1million in FY2003. CE revenue
     accounted for the majority of the Group revenues at 61.9%,              raked in an encouraging 98% increase while PS revenue increased
     followed by EPCC at 22.7% and PS at 15.4%. All business                 by 35% compared to the preceding year’s corresponding results.
     categories showed increases in revenue over the preceding financial


                                               REVENUE BY GEOGRAPHICAL SEGMENTS
     Singapore continues to bring in the bulk of Group sales at              countries brought in a further S$7.7million and other countries
     S$11.9million, accounting for about 48% of total revenue. Asean         accounted for another S$6.2million.


                                                              SHARES PLACEMENT
     The Company’s share capital was further increased by $440,000           The net proceeds of about $4.6 million raised from the private
     to $5,196,663 with the issuance of 11,000,000 new shares of             placement mentioned above have been deployed as additional
     $0.04 each through private placement as disclosed in the MASNET         working capital and for business developments in new and existing
     announcement on 29 January 2004.                                        markets such as China, Indonesia, Malaysia, Myanmar, Singapore,
                                                                             Thailand and Vietnam.


                                                  NEW CONTRACTS AND BUSINESSES
     The Group remained positive in its core businesses in the oil and gas   •   An EPCC contract worth S$3.1million was signed in April in
     sector and is actively pursuing new contracts and businesses in non-        Malaysia for the supply of two Gas Lift Compressors, following
     traditional markets such as Australia, Brunei, China, Indonesia,            earlier contracts secured from India, China and Brunei worth
     Malaysia and Myanmar. The success rate has been encouraging                 another S$3million for the supply of metering system. In total,
     throughout the year as evidenced by the following events:.                  Technics has secured an estimated S$6.1million worth of
                                                                                 contracts within two weeks in April.
     •   In January, Technics secured two contracts worth an estimated
         S$1.8million. The first, worth S$0.5million, involves the supply    •   In May, Technics entered into a joint operation agreement with
         of Bulk Handling Systems to the Keppel Group for installation           Petreco International Limited, a division of Cooper Cameron
         on their supply boats. The second is an EPCC contract worth             Corporation, to pursue oil and gas projects in the Asia Pacific
         S$1.3million to supply a Vapour Recovery Compressor Package             region. This strategic alliance will enable the Group to bid for
         to Sarawak Shell Berhad.                                                and undertake larger projects in the region. Within the same
                                                                                 month, Technics was also awarded a major EPCC contract worth
     •   March saw the Group securing several contracts worth a total            S$15.9million for the supply of a Gas Compression Package in
         of S$3million from China, Vietnam and Singapore. The China              Myanmar and is now pending the signing of the contract. This
         project comprises the engineering, procurement and                      is in addition to another secured EPCC contract worth
         construction (EPC), a first for the Group in this category in           S$1.2million for the supply of a Cementing System in Indonesia.
         China, of a Fuel Gas Booster Compressor, for power generation
         in a power plant. The other projects in Vietnam and Singapore       •   In November, a major S$12million contract was awarded to
         involve the supply of Manifold Module and Supply Vessel                 Technics by Federal JWR Energy Pte Ltd, a joint venture
         Cement Tank Systems.                                                    between Federal International and PT Jaya Wijaya Raya, for
                                                                                 the supply of production facilities for the Semberah Field
                                                                                 Development Project in Indonesia.



6 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Operations Review

To further enhance revenues from other related businesses, the        programmes, and hyperbaric-related consulting services and
Group has also entered into a joint venture with a medical practice   occupational medical treatment. We will build the hyperbaric
to provide hyberbaric oxygen treatment, patient clinical assessment   chamber for the joint venture while the medical practice will market
for HBOT, total wound care, training for hyperbaric-related           and perform treatment.


                                               GAS COMPRESSION BUSINESS
Technics was appointed by Cooper Energy Services as its gas           The market for gas compressors in Asia Pacific is set to grow in
compressor authorized packager for the Asia Pacific market in         view of the abundant gas reserves in the region, and where natural
March 2003. Since securing our first S$1.2million EPCC contract       gas is fast becoming an alternative source of energy usage
in September 2003 for the supply of a start-up fuel gas compressor    worldwide. According to our principal, Cooper Energy Services,
in Nigeria, we have already delivered four gas compressor packages    we are now reckoned to be its largest packager of gas compression
and have on hand 12 units of gas compressors undergoing works-        units outside the USA.
in-progress. The Group is also in the process of setting up a
representative office in Beijing, China to work more closely with
our principal, Cooper Energy Services to pursue new sales for the
gas compression business.




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     Group Structure




8 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Corporate Information

BOARD OF DIRECTORS                        AUDITORS
Ting Yew Sue                              Chio Lim & Associates
Executive Chairman and Managing           A member of Horwath International
Director                                  Certified Public Accountants
                                          18 Cross Street #09-01
Tay Mian Cheo                             Marsh & McLennan Centre
Executive Director                        Singapore 048423
                                          Partner-in-charge : Teo Cheow Tong
Tan Eng Ann
Executive Director

Ong Siew Peng                             PRINCIPAL BANKERS
Independent Director                      The Development Bank of Singapore Ltd
                                          6 Shenton Way
Foo Meng Kee
                                          DBS Building, Tower One
Independent Director
                                          Singapore 068809
AUDIT COMMITTEE                           Malayan Banking Berhad
Ong Siew Peng (Chairman)                  2 Battery Road
Foo Meng Kee                              Maybank Tower
Tan Eng Ann                               Singapore 049907

NOMINATING COMMITTEE                      Overseas-Chinese Banking Corporation
Foo Meng Kee (Chairman)                   Limited
Ong Siew Peng                             65 Chulia Street #29-02/04
Ting Yew Sue                              OCBC Centre
                                          Singapore 049513
REMUNERATION COMMITTEE                    Standard Chartered Bank
Foo Meng Kee (Chairman)                   6 Battery Road
Ong Siew Peng                             Singapore 049909
Tay Mian Cheo

JOINT COMPANY SECRETARIES
Low Mei Mei Maureen, ACIS, LLB
(Hons) (London)
Tan Eng Ann, CPA

REGISTERED OFFICE
18 Cross Street #07-03
Marsh & McLennan Centre
Singapore 048423

REGISTRAR & SHARE
TRANSFER OFFICE
Lim Associates (Pte) Ltd
10 Collyer Quay #19-08
Ocean Building
Singapore 049315




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     Board of Directors




                   STANDING FROM LEFT TO RIGHT   FOO MENG KEE, ONG SIEW PENG, TING YEW SUE, TAY MIAN CHEO, TAN ENG ANN




10 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
                                                                            Profile of Key Executives

TING YEW SUE is our Executive Chairman and Managing Director,               KIANG LONG HOON is our Head of Group Sales and Marketing. He has
and is responsible for the general management, and overall strategic        centralized responsibility for the sales and marketing activities of the Group
planning and direction of our Group. He is also the General Manager         outside Vietnam. He is also in charge of project tender evaluation and
of the subsidiary, Technics Offshore Engineering Pte Ltd (“TOE”),           negotiation for the Group outside Vietnam. Kiang Long Hoon has over 30
overseeing the Singapore operations. Mr Ting has more than 34 years         years of experience in cost estimation, project planning, sales and marketing
of experience in design, engineering and production of process modules      in the oil and gas and shipbuilding industries. Prior to joining Technics in
and integrated system for the oil and gas industry. Prior to the founding   1997, he spent 15 years as a Marketing Manager with Applied Engineering
of TOE in 1990, he was the Operations Manager in charge of the day-         Pte Ltd, an engineering company providing design and fabrication services
to-day management and operations of Hup Seng Offshore Engineering           to chemical and petrochemical industries. His responsibilities then included
Pte Ltd, an engineering company servicing the oil and gas industry          cost estimation, sales and marketing.
from 1968 to 1990.
                                                                            LU MIN is our General Manager for Petro Process System Pte Ltd and he
TAY MIAN CHEO is our Executive Director and is in charge of business        oversees its general management and operations. He has over 20 years
development, sales and marketing in Vietnam. He has more than ten           of experience in project management and process design for chemical,
years of experience in business development and sales in the oil and        petrochemical, oil and gas, and shipbuilding industries. Prior to joining
gas industry of which six years were spent in business development          us in 2002, he was the senior engineer with Baker Hughes Process System
in Vietnam’s oil and gas industry. Prior to joining Technics, he was        Pte Ltd from 1997 to 2002. Prior to that, he spent 14 years as an
sales and marketing manager for Ritz Precision Engineering Pte Ltd,         engineer with companies that include Shanghai Jishan Petrochemical
a precision equipment company.                                              Design Institute, Far East Levingston Shipbuilding Limited and Gas Services
                                                                            International (S) Pte Ltd. He holds a Bachelor of Engineering degree from
TAN ENG ANN (CFA & CPA) is our Finance Director overseeing the              East China College of Chemical Technology, China.
finance and corporate development of the Group and assists the
Managing Director in developing and implementing business strategies        NG LAI WAH is our General Manager for PT Technics Offshore Jaya and
for the Group. He is also responsible for the Group’s financial and         he has overall responsibility for its management and operations in
accounting functions, statutory reporting, corporate and investment         Indonesia. Prior to joining us in May 2004, he was the General Manager
matters. He joined Technics in 2002. Between 2001 and 2002,                 of Kompass International, a listed oil and gas company in Indonesia from
he was a Manager, Corporate Advisory at Standard Chartered Bank             2001 to 2004. Before that, he was Head of Technical Department with
where he advised on merger and acquisition targets and conducted            BP Shipping Limited from 1979 to 1988, Fleet Deputy General Manager
market research and valuations. He was an Investment Marketing              with International Maritime Carrier Ltd, Hong Kong from 1988 to 1991
Manager at AIB Govett (Asia) Ltd from 1999 to 2001 where he                 and General Manager with Shougang Concord International Transport Ltd,
marketed the company’s investment management services on both               Hong Kong from 1992 to 2001. He holds a Bachelor of Science,
equity and fixed income products to fund consultants and clients.           Engineering degree from Newcastle University, UK and Master of Science
Between 1998 and 1999, he was Financial Analyst with Citibank,              (Engineering) from Cranfield Institute of Technology, UK.
N.A., and between 1994 and 1997, he was Assistant Manager at
Yamaichi Merchant Bank providing investment advice on investment            CHRIS CHRISTOU is our Head of Group Quality, Health and Safety.
opportunities in Asia.                                                      He is responsible for the development, implementation and improvement
                                                                            of the Group’s QHS standards and policies. He is a Chartered Engineer
FOO MENG KEE is our Independent Director. He is the Managing                with over 16 years of experience in quality, health and safety. He has
Director of M K Capital Pte Ltd, a consultancy which renders advice         been with the Group since 1997 and prior to that, from 1994 to 1997,
on business development, marketing and management control to                he was Quality Assurance/Quality Control Manager with Eastburn Stork
engineering companies, as well as a broker for Singapore and PRC            Pte Ltd, an engineering company serving the oil and gas industry. From
shipyards in respect of ship repair and shipbuilding. Between 1976          1987 to 1990, he worked in Oman as a welding engineer and supervisor.
and 1998, Mr Foo worked for Hitachi Zosen Singapore Limited
(subsequently renamed Keppel Hitachi Zosen Limited and now known            LAM MAY YIH (CPA) is our Group Finance Manager. She is responsible
as Keppel Shipyard Limited). When the company was listed in 1992,           for the preparation of Group Management reports, accounting department
Mr Foo was the managing director of the company and also sat on the         daily operations and assisting the Finance Director in banking and financial
executive committee and the audit committee until 1998. Mr Foo is           matters. She has been with the Group since 2001 and prior to that,
also an independent director of several listed companies including          she was an Accounts Executive with Kim Hup Hong (Pte) Ltd from
Asia Food & Properties Limited, Golden Agri-Resources Limited,              1995 to 2001.
Lee Metal Group Limited and Liang Huat Aluminium Limited. He has
in the past served on the Committees of the Association of Singapore        LOW JUI KEN is our Head of Group Human Resource and Administration.
Marine Industries and the Singapore Armed Forces Reservists’                She has centralized responsibility for the formulation and implementation
Association.                                                                of human resource and administration policies of the Group. She joined
                                                                            us in 2002 and brought to the Group over ten years of experience in
ONG SIEW PENG is our Independent Director. He is an Executive               human resource. She was the Human Resource Manager of TNT Express
Director and Corporate Mediator and Advisor with Corporate Brokers          Worldwide (S) Pte Ltd from 2001 to 2002, and of Goodrich Wallcoverings
International Pte Ltd, a strategic investment search company focusing       & Carpets Pte Ltd from 1998 to 2001. She has also worked as an Assistant
on small and medium enterprise since 2001 where he is responsible           Human Resource Manager in OCBC Property Services Pte Ltd and SMI
for corporate mediation regarding mergers and acquisitions matters,         Hotels & Resorts Pte Ltd earlier.
providing financial and management advice, strategic business
planning and strategic investor search advice. He is also the Chairman
and Director of PowerSource International Pte Ltd., a local diesel engine
distributor for the Asia Pacific region.




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     Financial Highlights


                           GROUP REVENUE                                                  NET PROFIT / LOSS
                                    ($’000)                                                         ($’000)
                                                            24,819                                                       -3,730
           2004




                                                                         2004
                               11,732                                                            -1,923




                                                                         2003
           2003




                  0    5,000      10,000   15,000 20,000       25,000           0       -1,000       -2,000         -3,000        -4,000




                      PROFIT / LOSS BEFORE TAX                                          EARNINGS PER SHARE
                                    ($’000)                                                         (CENTS)

                                                       -3,777                                                   -2.95
           2004




                                                                         2004




                               -1,882                                                                          -2.78
           2003




                                                                         2003




                  0      -1,000       -2,000       -3,000      -4,000           0        -1.0          -2.0            -3.0        -4.0



                      FINANCIAL INFORMATION BY                                        FINANCIAL INFORMATION BY
                      BUSINESS SEGMENTS 2004                                        GEOGRAPHICAL SEGMENTS 2004


                                            PS
                                           3,817                                                                 Asean
                                                                                                              Ex Singapore
                                                                                                                 7,440
                                                                                        Singapore
                                                   EPCC                                  11,171
                            CE
                                                   5,627
                          15,375

                                                                                                          Others
                                                                                                          6,208




                                  Total Revenue                                                   Total Revenue
                                     24,819                                                          24,819

       EPCC – Engineering, procurement, construction and commissioning    “Others” comprises Australia, People’s Republic of China,
       EC   – Contract engineering                                       Germany, Korea, France, Taiwan, United Kingdom and USA.
       PS   – Procurement services




12 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Corporate Governance

The Board of Directors (the “Board”) of Technics Group Holdings Limited recognizes the importance, and is committed to achieving a
high standard of corporate governance within the Group and to put in place effective self-regulatory corporate practices to ensure
greater transparency, protecting the interests of its shareholders as well as strengthening investors’ confidence in its management and
financial reporting.


BOARD OF DIRECTORS
Principle 1: Board’s Conduct of its Affairs

The Board conducts meetings at least twice yearly in addition to ad-hoc meetings. The principal functions of the Board, apart from its
statutory responsibilities, are to:

•      Review financial performance of the Group;
•      Approve major investment and funding decisions;
•      Oversee the processes for evaluating the adequacy of internal controls, risk management, financial reporting and compliance;
•      Evaluate the performance and determine the compensation of key management personnel; and
•      Assume the responsibility for overall corporate governance of the Group.

Board meetings are convened as required by circumstances.

The Board has established committees to assist it in discharging its responsibilities. These committees operate under clearly defined
terms of reference. The three committees are:

-      Audit Committee (the “AC”)
-      Nominating Committee (the “NC”)
-      Remuneration Committee (the “RC”)

The attendance of the Directors at meetings of the Board and Board committees, as well as the frequency of such meetings during the
financial year is as follows:

Attendance at Meetings

                                                                                                      Board Committees
                                                                      Board               Audit          Nominating       Remuneration

    No. of meetings held                                                 6                  4                 1                  2
    Board Members                                                                         No of meetings attended

    Ting Yew Sue                                                        6*                                    1
    Tay Mian Cheo                                                        6                                                       2
    Tan Eng Ann                                                          6                  4
    Ong Siew Peng                                                        6                  4*                1                  2
    Foo Meng Kee                                                        6                   4                 1*                 2*
    * Chairman

Certain matters specifically reserved for decision by the Board are those related to approval of announcements of financial results,
approval of annual reports and financial statements, convening of shareholders’ meetings, dividend payment, major contracts, material
acquisitions and disposal of assets and corporate restructuring matters.

New directors are briefed on the Group’s business and Corporate Governance policies. Familiarisation visits, including overseas offices,
are organized, if necessary, to facilitate a better understanding of the Group’s operations.



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     Corporate Governance

     Board members are encouraged to attend seminars and receive training to improve themselves in the discharge of their duties as
     directors. The Company works closely with professionals to provide its directors with changes to relevant laws, regulations and
     accounting standards.

     Principle 2: Board Composition and Balance

     The Board’s five Directors comprise three Executive Directors and two Independent Directors. This composition complies with the
     Code’s requirement that at least one-third of the Board should be made up of Independent Directors.

     The independence of each Director is reviewed annually by the NC. The NC is of the view that the current Board has an independent
     element ensuring objectivity in the exercise of judgment on corporate affairs independently from the management. The NC is also of the
     view that no individual or a small group of individuals dominates the Board’s decision making process.

     The Board is of the opinion that its current board size of five Directors is appropriate, taking into account the nature and scope of the
     Company’s operations. The Board composition reflects the broad range of experience, skills and knowledge necessary for the effective
     stewardship of the Group.

     Principle 3: Role of Chairman and Managing Director

     The Chairman and the Managing Director of the Company is Mr Ting Yew Sue. The Board is of the view that, given the scope and
     nature of the operations of the Group and the strong element of independence of the Board, it is not necessary to separate the functions
     of Chairman and Managing Director.

     As Chairman, Mr Ting bears responsibility for the workings of the Board and, together with the AC, ensures the integrity and effectiveness
     of the governance process of the Board.

     As Managing Director, Mr Ting bears overall daily operational responsibility for the Group’s business.


     NOMINATING COMMITTEE
     Principle 4: Board Membership

     The NC comprises three directors, of whom a majority are Independent Directors.

     Chairman:       Mr Foo Meng Kee          (Independent Director)

     Member:         Ong Siew Peng            (Independent Director)
                     Ting Yew Sue             (Managing Director)

     The main role of the Committee is to make the process of Board appointments and re-appointments transparent and to assess the
     effectiveness of the Board as a whole and the contribution of individual Directors to the effectiveness of the Board.

     The terms of reference of the Committee are as follows:

     •       Recommend appointment and re-appointment of Directors;
     •       Review annually the independence of each Director, and ensure that the Board comprises at least one-third Independent
             Directors;
     •       Decide, where a Director has multiple board representation, whether the Director is able to and adequately carries out his duties
             as Director of the Company;
     •       Decide how the Board’s performance may be evaluated and propose objective performance criteria to assess effectiveness of
             the Board; and
     •       Perform assessment of the effectiveness of the Board as a whole and the contribution of individual Directors.



14 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Corporate Governance

Under the Company’s Article of Association, each Director (except the Managing Director) is required to retire at least once in every
three years by rotation and all newly appointed Directors will have to retire at the next Annual General Meeting following their
appointment. The retiring Directors are eligible to offer themselves for re-election.

Key information regarding the directors can be found under the “Board of Directors” section of this annual report.

Information on shareholdings in the Company held by each Director is set out in the “Directors’ Report” section of the Annual Report.

Principle 5: Board Performance

The NC conducted an assessment on the effectiveness of the Board as a whole and the contribution by each individual Director to the
effectiveness of the Board during the year. The NC is of the opinion that the Board and each member of the Board has been effective
due to the active participation of every Board member during each meeting.

Principle 6: Access to Information

The members of the Board in their individual capacity have access to complete information on a timely basis in the form and quality
necessary for the discharge of their duties and responsibilities. Prior to each Board meeting, the members of the Board are each
provided with the relevant documents and information to enable them to obtain a comprehensive understanding of the issues to be
deliberated upon to enable them to arrive at an informed decision.

The Directors have direct access to management and the advice and services of the Company Secretary, who attends all Board
meetings and is responsible for ensuring that Board meeting procedures are followed and that applicable rules, acts and regulations are
complied with.

Should Directors, whether as a group or individually, need independent professional advice, the Company Secretary will, upon direction
by the Board, appoint a professional advisor approved by the Company to render the advice.


REMUNERATION COMMITTEE
Principle 7: Procedures for Developing Remuneration Policies

The RC comprises three Directors, of whom a majority are Independent Directors.

Chairman:      Mr Foo Meng Kee        (Independent Director)

Member:        Ong Siew Peng          (Independent Director)
               Tay Mian Cheo          (Executive Director)

The terms of reference of the Committee are as follows:

•      Recommend to the Board a framework of remuneration for the Executive Directors and other key members of executive
       management;
•      Determine specific remuneration packages for each Executive Director; and
•      Determine targets for any performance-related pay schemes operated by the Company.

The recommendations of the RC should be submitted to the Board for endorsement. All aspects of remuneration, including but not
limited to directors’ fees, salaries, allowances, bonuses, options and benefits in kind are covered by the RC.

The RC has access to expert professional advice on human resource matters whenever there is a need to consult externally. In its
deliberations, the RC will take into consideration industry practices and norms in compensation in addition to the Company’s relative
performance to the industry and the performance of the individual Directors. No individual Director should be involved in deciding his
own remuneration.



                                                                            | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 15
     Corporate Governance

     Principle 8: Level and Mix of Remuneration

     The remuneration package generally comprises two components. One component is fixed in the form of a base salary, car allowance
     and a fixed bonus of one month’s salary per annum. The other component is variable consisting of incentive bonuses. The incentive
     bonuses are dependent on the financial performance of the Company as the RC strongly supports and endorses the flexible wage
     system because it gives the Company more flexibility to ride through economic downturns. The RC has adopted set profitability levels
     to be achieved before incentive bonuses are payable.

     The Independent Directors are paid a directors’ fee for their efforts and time spent, responsibilities and contribution to the Board,
     subject to approval by the shareholders at the Annual General Meeting.

     For the financial year 2004, the Managing Director and two Executive Directors had waived the fixed bonus of one month’s salary
     amounting to a total of $40,000.

     Principle 9: Disclosure on Remuneration

     Breakdown of remuneration of each Director by % (financial year ended 30 September 2004)

         Remuneration Band                      Base/Fixed        Directors’           Variable or Performance
         & Name of Director                       Salary             Fees               Related Income/Bonus                 Total

         Below $250,000
         Ting Yew Sue                             100%                –                           –                         100%
         Tay Mian Cheo                            100%                –                           –                         100%
         Tan Eng Ann                              100%                –                           –                         100%
         Ong Siew Peng                               –             100%                           –                         100%
         Foo Meng Kee                                –             100%                           –                         100%

     No option has been granted to the above Directors.

     Breakdown of remuneration of each Key Executive (who are not Directors) by % (financial year ended 30 September 2004)

         Remuneration Band                                        Base/Fixed           Variable or Performance
         & Name of Key Executive                                    Salary              Related Income/Bonus                 Total

         Below $250,000
         Kiang Long Hoon                                           100%                           –                         100%
         Lu Min                                                    100%                           –                         100%
         Ng Lai Wah                                                100%                           –                         100%
         Chris Christou                                            100%                           –                         100%
         Lam May Yih                                               100%                           –                         100%
         Low Jui Ken                                               100%                           –                         100%

     No option has been granted to the above Key Executives.

     No employees of the Company and its subsidiaries were an immediate family member of any Director and whose remuneration has
     exceeded $150,000 during the financial year ended 30 September 2004. “Immediate family member” means the spouse, child,
     adopted child, stepchild, brother, sister and parent.




16 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Corporate Governance

AUDIT COMMITTEE
Principle 11: Audit Committee

The AC comprises three Directors, of whom a majority are Independent Directors.

Chairman:       Ong Siew Peng           (Independent Director)

Member:         Foo Meng Kee            (Independent Director)
                Tan Eng Ann             (Executive Director)

The profiles of the members of the AC are set out in the “Board of Directors” section. The Board is of the view that the AC has the
requisite financial management expertise and experience to discharge its responsibility properly.

The terms of reference of the Committee are as follows:

•       Review the audit plans, the system of internal accounting controls and the audit report in conjunction with the external
        auditors;
•       Review the assistance given by the Company’s officers to the external auditors;
•       Review the independence and objectivity of the external auditors annually;
•       Nominate external auditors for re-appointment;
•       Review the financial statements of the Company, including the half-year and full-year results and the respective announcements
        before the submission to the Board of Directors;
•       Give due consideration to the requirements of the Stock Exchange Listing Rules; and
•       Review interested person transactions.

The AC has direct access to and full co-operation of the Company’s management. It has full discretion to invite any Director or executive
officer to attend its meetings and has been given reasonable resources to enable it to discharge its functions.

The AC meets at least twice a year to review the announcements of the half-year and full-year results before being approved by the
Board for release to the SGX-ST. The AC also meets with the external auditors and reviews the scope and results of the external audit.
The AC may meet the external auditors at any time, without the presence of the Company’s management.

The AC has conducted an annual review of the volume of non-audit services to satisfy itself that the nature and extent of such services
will not prejudice the independence and objectivity of the external auditors before recommending their re-nomination to the Board.

The AC has recommended to the Board the nomination of Chio Lim & Associates, for re-appointment as auditors of the Company at the
forthcoming Annual General Meeting.

Principle 12: Internal Controls

The Board acknowledges that it is responsible for maintaining a sound system of internal controls to safeguard shareholders’ interests
and maintain accountability of its assets. While no cost-effective internal control system can provide absolute assurance against loss or
misstatement, the Group’s internal controls and systems have been designed to provide reasonable assurance that assets are safeguarded,
operational controls are in place, business risks are suitably protected, proper accounting records are maintained and financial information
used within the business and for publication, are reasonable and accurate.

For the financial year 2004, the AC, on behalf of the Board, has reviewed the effectiveness of the internal control system put in place
by the management and is satisfied that there are adequate internal controls in the Company.




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     Corporate Governance

     Principle 13: Internal Audits

     The Company does not have an internal audit function, as the Group’s current scope of business and structure of the organization
     would not make it cost-effective to have a separate internal audit function. The key element in the Group’s internal control system is the
     control which senior management exercises over expenditures for projects and capital spending, with the various levels of approvals
     documented in the authorization limits approved by the Board. In addition, cheques are only approved by two authorized signatories
     in accordance to the authorization limits granted by the Board.

     The AC has instructed the External Auditors to ascertain the existence and adequacy of material internal controls procedures as part of
     its audit for the financial year under review. The AC is of the view that the work carried out by the External Auditors is adequate.

     The AC will continuously review the cost-effectiveness and adequacy of the Group’s internal system with the external auditors and shall
     assess the need for a separate internal audit function when the Group grows in size and complexity.


     COMMUNICATION WITH SHAREHOLDERS
     Principle 10: Accountability
     Principle 14: Communication with Shareholders
     Principle 15: Greater Shareholder Participation

     The Board believes in timely communication of information to shareholders and the public. It is the Company’s policy that all shareholders
     and the public should be equally and timely informed of all major developments that impact the Company. Communication is made
     through:

     •       Annual reports that are issued to all shareholders and non-shareholders. They may access the SGX-ST website for a soft copy
             of the annual report;
     •       Announcement of half-year and full year results on the Singapore Exchange Securities Trading Limited’s SGXNET;
     •       Disclosure on the SGXNET;
     •       Press releases on major developments of the Company; and
     •       Company’s website at www.technicsgrp.com from which shareholders can access information on the Company.

     The Annual General Meeting is the principal forum for dialogue with shareholders. There is an open question and answer session at
     which shareholders may raise questions or share their views regarding the proposed resolutions and the Company’s businesses and
     affairs. The Chairman of the Board, the Board members and the external auditors are in attendance at the Annual General Meeting.


     INTERESTED PERSON TRANSACTIONS
     The Company has established internal control policies to ensure that transactions with interested persons are properly reviewed and
     approved, and are conducted at an arm’s length basis.

     There are no material contracts of the Company or its subsidiaries involving the interest of the directors or controlling shareholders
     during the financial year.




18 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Corporate Governance

SECURITIES TRANSACTIONS
The Company has issued a policy on dealings in the securities of the Company to its Directors and key employees (including employees
with access to price-sensitive information to the Company’s shares), setting out the implications of insider trading and guidance on
such dealings. It has adopted the Best Practices Guide on Dealings in Securities issued by the Singapore Exchange Securities Trading
Limited.

Its officers are not allowed to deal in the Company’s shares during the period commencing one month before the announcement of the
Group’s half-year and full-year results and ending on the date of the announcement of the results.

Directors and executives are also expected to observe insider trading laws at all times even when dealing with securities within the
permitted trading period.


RISK MANAGEMENT
The Company regularly reviews and improves its business and operational activities to take into account the risk management perspective.
The Company seeks to identify areas of significant business risks as well as appropriate measures to control and mitigate these risks.
The Company reviews all significant control policies and procedures and highlights all significant matters to the AC.




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     Report of the Directors

     The directors of the company are pleased to present their report together with the audited financial statements of the company and of
     the group for the financial year ended 30 September 2004.


     1       DIRECTORS AT DATE OF REPORT
             The directors of the company in office at the date of this report are:

             Executive Directors:
                    Ting Yew Sue
                    Tay Mian Cheo
                    Tan Eng Ann – appointed on 1 January 2004
             Non-executive Independent Directors:
                   Ong Siew Peng
                   Foo Meng Kee


     2       ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE BENEFITS BY MEANS OF THE ACQUISITION
             OF SHARES AND DEBENTURES
             Neither at the end of the financial year nor at any time during the financial year did there subsist any arrangement whose object
             is to enable the directors of the company to acquire benefits by means of the acquisition of shares or debentures in the company
             or any other body corporate.


     3       DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES
             The directors of the company holding office at the end of the financial year had no interests in the share capital and debentures
             of the company and related corporations as recorded in the register of directors’ shareholdings kept by the company under
             section 164 of the Companies Act, Cap. 50, except as follows:

                                                                                                Direct interest
             Name of directors and companies
             in which interests are held                                 At beginning of year                             At end of year
             Technics Group Holdings Limited
             (the company)                                          Ordinary shares of $0.04 each                 Ordinary shares of $0.04 each

             Ting Yew Sue                                                   49,775,775                                    45,775,775
             Tay Mian Cheo                                                  15,026,675                                    12,026,675
             Ong Siew Peng                                                      50,000                                        50,000
             Foo Meng Kee                                                       10,000                                        10,000

             By virtue of section 7 of the Companies Act, Cap. 50, Messrs Ting Yew Sue is deemed to have an interest in all the related
             corporations of the company at the relevant dates.

             The directors’ interests as at 21 October 2004 were the same as those at the end of the year.




20 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Report of the Directors

4   CONTRACTUAL BENEFITS OF DIRECTORS
    Since the beginning of the financial year, no director of the company has received or become entitled to receive a benefit which
    is required to be disclosed under section 201(8) of the Companies Act, Cap. 50, by reason of a contract made by the company
    or a related corporation with the director or with a firm of which he is a member, or with a company in which he has a
    substantial financial interest except as disclosed in the attached financial statements. Certain directors of the company received
    remuneration from related corporations in their capacity as directors and or executives of those related corporations.


5   OPTIONS TO TAKE UP UNISSUED SHARES
    During the financial year, no option to take up unissued shares of the company or any corporation in the group was granted.


6   OPTIONS EXERCISED
    During the financial year, there were no shares of the company or any corporation in the group issued by virtue of the exercise
    of an option to take up unissued shares.


7   UNISSUED SHARES UNDER OPTION
    At the end of the financial year, there were no unissued shares of the company or any corporation in the group under option.


8   AUDIT COMMITTEE
    The members of the audit committee at the date of this report are as follows:-

    Ong Siew Peng       (Chairman of the Audit Committee and Independent Director)
    Foo Meng Kee        (Independent Director)
    Tan Eng Ann         (Executive Director)

    The audit committee performs the functions specified by section 201B of the Companies Act, Cap. 50. It met with the
    company’s external auditors to discuss their audit plan covering the scope of their work and the results of their audit, including
    the external audit report.

    The audit committee also performed the following functions:

    a)     Reviewed with the external auditors their evaluation of the company’s internal accounting controls.

    b)     Reviewed the adequacy of the assistance provided by the company’s officers to the external auditors.

    c)     Reviewed the financial statements of the group and the company prior to their submission to the directors of the
           company for adoption.

    Other functions performed by the audit committee are described in the report on corporate governance included in the annual
    report.

    The audit committee has recommended to the board of directors that the auditors, Chio Lim & Associates be nominated for
    re-appointment as auditors at the next annual general meeting of the company.




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     Report of the Directors

     9       AUDITORS
             The auditors, Chio Lim & Associates, have expressed their willingness to accept re-appointment.


     10      DEVELOPMENT SUBSEQUENT TO THE ANNOUNCEMENT OF RESULTS
             There are no significant developments subsequent to the release of the group’s and company’s preliminary financial statements,
             as announced on 12 November 2004, which would materially affect the group’s and company’s operating and financial
             performance as of the date of this report.

             Subsequent to the release of the group’s and company’s preliminary financial statements, as announced on 12 November
             2004, there were certain developments which resulted in an increase of $146,868 in the group’s loss before tax.




     ON BEHALF OF THE DIRECTORS




     Ting Yew Sue
     Director




     Tay Mian Cheo
     Director

     7 December 2004




22 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Statement of Directors

In the opinion of the directors, the accompanying financial statements are drawn up so as to give a true and fair view of the state of
affairs of the company and of the group as at 30 September 2004 and changes in equity of the company and of the group, and of the
results and cash flows of the group for the financial year then ended and at the date of this statement there are reasonable grounds to
believe that the company will be able to pay its debts as and when they fall due.




ON BEHALF OF THE DIRECTORS




Ting Yew Sue
Director




Tay Mian Cheo
Director

7 December 2004




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     Auditors’ Report                    To the Members of Technics Group Holdings Limited




     We have audited the accompanying financial statements of Technics Group Holdings Limited and of the group for the year ended
     30 September 2004. These financial statements are the responsibility of the company’s directors. Our responsibility is to express an
     opinion on these financial statements based on our audit.

     We conducted our audit in accordance with Singapore Standards on Auditing. Those Standards require that we plan and perform the
     audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes
     examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes
     assessing the accounting principles used and significant estimates made by the directors, as well as evaluating the overall financial
     statements presentation. We believe that our audit provides a reasonable basis for our opinion.

     In our opinion,

     (a)     the consolidated financial statements of the group and the balance sheet and statement of changes in equity of the company
             are properly drawn up in accordance with the provisions of the Companies Act, Cap. 50 (the “Act”) and the Singapore Financial
             Reporting Standards so as to give a true and fair view of the state of affairs of the Group and of the Company as at 30 September
             2004 and the results, changes in equity and cash flows of the group and the changes in equity of the company for the year
             ended on that date; and

     (b)     the accounting and other records required by the Act to be kept by the company and by those subsidiaries incorporated in
             Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act.




     Chio Lim & Associates
     Certified Public Accountants

     Teo Cheow Tong
     Partner-in-charge from 30 September 2002
     Singapore

     7 December 2004




24 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Balance Sheets                  As at 30 September 2004



                                                                               Group                           Company
                                                          Notes        2004            2003            2004              2003
                                                                      $’000            $’000          $’000              $’000

ASSETS
Current assets
Cash and cash equivalents                                  5         1,713             3,459             16           1,004
Trade receivables                                          6         5,709             5,424              –               –
Other receivables and prepayments                          7           308               243          5,158           3,354
Inventories                                                8           536               388              –               –
Contracts work-in-progress                                 9         4,064             1,285              –               –

Total current assets                                                12,330          10,799            5,174           4,358

Non-current assets
Investments in subsidiaries                                10            –                 –          2,212           3,849
Other investments                                          11            1                 –              1               –
Property, plant and equipment                              12        6,006             4,188              –               –

Total non-current assets                                             6,007             4,188          2,213           3,849

Total assets                                                        18,337          14,987            7,387           8,207

LIABILITIES AND EQUITY
Current liabilities
Short term borrowings                                      13        2,468             2,918              –                 –
Trade payables and accrued liabilities                     14        6,263             4,112            146               187
Other payables                                             15          176               151              –                10
Income tax payable                                                      11                 9              –                 –
Current portion of long-term borrowings                    16          324               133              –                 –
Current portion of finance lease                           17           64                 5              –                 –

Total current liabilities                                            9,306             7,328            146               197

Non-current liabilities
Long-term borrowings                                       16        1,906             1,512               –                 –
Finance lease                                              17          138                20               –                 –

Total non-current liabilities                                        2,044             1,532               –                 –

Minority interest                                                          –               –               –                 –

Capital and reserves
Issued capital                                             18        5,197             4,757          5,197           4,757
Reserves                                                             1,790             1,370          2,044           3,253

Total equity                                                         6,987             6,127          7,241           8,010

Total liabilities and equity                                        18,337          14,987            7,387           8,207




                                                                                 See accompanying notes to financial statements.



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     Consolidated Income Statement                            Year ended 30 September 2004



                                                                                                        Group
                                                                                  Notes        2004              2003
                                                                                               $’000             $’000

     Revenue                                                                        19       24,819         11,732

     Cost of sales                                                                           (21,531)           (9,485)

     Gross profit                                                                             3,288             2,247

     Other operating income                                                         20          276               174

     Distribution costs                                                                         (646)            (228)

     Administrative expenses                                                                  (6,213)           (4,040)

     Other (charges)/credits                                                        21          (236)              64

     Loss from operations                                                                     (3,531)           (1,783)
     Finance costs                                                                  22          (246)              (99)

     Loss before income tax                                                         23        (3,777)           (1,882)

     Income tax credit/(expense)                                                    24           47                (42)

     Loss after income tax                                                                    (3,730)           (1,924)

     Minority interest                                                                             –                 1

     Net loss for the year                                                                    (3,730)           (1,923)



     Loss per share (cents)                                                         25         (2.95)            (2.78)




     See accompanying notes to financial statements.



26 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Statements of Changes in Equity Year ended 30 September 2004

                                                                                       Foreign
                                                                                      exchange
                                                      Issued           Share         translation      Accumulated
                                                      capital         premium          reserve           losses             Total
                                                      $’000            $’000            $’000            $’000             $’000

Group

Balance at 30 September 2002                               *                –               –               (35)              (35)
Issuance of new ordinary shares                       4,757           4,500                 –                 –            9,257
Listing expenses @                                         –          (1,172)               –                 –           (1,172)
Net loss for the year                                      –                –               –           (1,923)           (1,923)
Currency translation differences +                         –                –               *                 –                     *

Balance at 30 September 2003                          4,757           3,328                 *           (1,958)            6,127
Issuance of new ordinary shares                         440           4,172                 –                 –            4,612
Share placement expenses                                   –             (22)               –                 –               (22)
Net loss for the year                                      –                –               –           (3,730)           (3,730)
Currency translation differences +                         –                –               *                 –                     –

Balance at 30 September 2004                          5,197           7,478                 –           (5,688)            6,987

*     Amount is less than 1,000.
+     This represents net gains and losses for the year not recognised in the income statement.


                                                                       Issued          Share          Accumulated
                                                                       capital        premium            losses             Total
                                                                       $’000            $’000            $’000             $’000

Company

Balance at 30 September 2002                                                *               –                (3)                (3)
Issuance of new ordinary shares                                       4,757            4,500                  –            9,257
Listing expenses @                                                          –         (1,172)                 –           (1,172)
Net loss for the year                                                       –               –               (72)              (72)

Balance at 30 September 2003                                          4,757            3,328                (75)           8,010
Issuance of new ordinary shares                                         440            4,172                  –            4,612
Share placement expenses                                                    –             (22)                –               (22)
Net loss for the year                                                       –               –           (5,359)           (5,359)

Balance at 30 September 2004                                          5,197            7,478            (5,434)            7,241

*     Amount is less than $1,000.
@     This includes professional fees of $110,000 paid to the company’s auditors for the purposes of acting as Reporting Accountants
      in the listing exercise.




                                                                                         See accompanying notes to financial statements.




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     Consolidated Cash Flow Statement                         Year ended 30 September 2004



                                                                             Notes            2004      2003
                                                                                              $’000     $’000

     Cash flows from operating activities:
     Loss before income tax                                                                  (3,777)   (1,882)
     Adjustments for:
     Depreciation expense                                                                      561       143
     Loss on disposal of plant and equipment                                                     7         –
     Goodwill on consolidation written off                                                       –         3
     Interest income                                                                            (5)      (12)
     Interest expense                                                                          246        99
     Operating loss before working capital changes                                           (2,968)   (1,649)
     Trade receivables                                                                         (285)    1,612
     Other receivables and prepayments                                                          (65)       91
     Inventories                                                                               (148)      122
     Contracts work-in-progress                                                              (2,779)   (1,358)
     Trade payables and accrued liabilities                                                   2,151    (1,153)
     Other payables                                                                              25       117
     Cash used in operations                                                                 (4,069)   (2,218)
     Interest paid                                                                             (246)      (99)
     Interest received                                                                            5        12
     Income tax paid                                                                              –      (968)
     Income tax refunded                                                                         49       517

     Net cash used in operating activities                                                   (4,261)   (2,756)

     Cash flows from investing activities:
     Increase in investment                                                                      (1)       (8)
     Purchase of property, plant and equipment                                               (2,163)   (4,150)
     Disposal of plant and equipment                                                              1         –
     Acquisition of subsidiaries                                               28                 –     1,476

     Net cash used in investing activities                                                   (2,163)   (2,682)

     Cash flows from financing activities:
     Net proceeds from issuing shares                                                        4,590     4,328
     Proceeds from issue of shares to minority interest                                          –         6
     Increase in borrowings                                                                    135     4,563
     Decrease in finance leases                                                28              (47)       (6)

     Net cash from financing activities                                                      4,678     8,891

     Net (decrease)/increase in cash                                                         (1,746)   3,453
     Cash at beginning of year                                                                3,459        6

     Cash at end of year                                                       5             1,713     3,459




     See accompanying notes to financial statements.




28 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Notes to Financial Statements 30 September 2004

1   GENERAL
    The company is incorporated in Singapore. The financial statements are expressed in Singapore dollars. They are drawn up in
    accordance with the provisions of the Companies Act, Cap. 50 (the “Act”) and the Singapore Financial Reporting Standards.
    The financial statements were approved and authorised for issue by the board of directors on 7 December 2004.

    The company is principally engaged in the design, fabrication, installation and commissioning of process modules and equipment
    for oil and gas exploration and production, investments holding and provision of management services to its related companies.

    The principal activities of the subsidiaries are disclosed in Note 10 to the financial statements.

    The registered office address of the company is: 18 Cross Street #08-03 Marsh & McLennan Centre Singapore 048423. The
    company is domiciled in Singapore.

    It is listed on the Stock Exchange of Singapore Dealing and Automated Quotation System (“SGX Sesdaq”).


2   (A)    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
           ACCOUNTING CONVENTION – The financial statements are prepared under the historical cost convention.

           BASIS OF PRESENTATION – The purchase accounting method is used for the consolidated financial statements which
           include the financial statements made up to 30 September each year of the company and of those companies in which
           it holds, directly or indirectly through subsidiaries over 50 percent of the shares and voting rights. All significant
           intercompany balances and transactions have been eliminated on consolidation. The results of the investees acquired
           or disposed of during the financial year are consolidated from the respective dates of acquisition or up to the dates of
           disposal. On disposal the attributable amount of unamortised goodwill is included in the determination of the gain or
           loss on disposal.

           GOODWILL – Goodwill or negative goodwill arising on acquisition is based on the purchase method. Goodwill arising
           on consolidation represents the excess of the cost of acquisition over the acquirer’s interest in the fair value of the
           identifiable assets and liabilities of a subsidiary, associate or jointly controlled entity at the date of acquisition. Goodwill
           is carried at cost less any accumulated amortisation and any accumulated impairment losses. It is amortised on the
           straight-line method over its useful life to reflect the best estimate of the period during which future economic benefits
           are expected to flow to the acquirer.

           MINORITY INTERESTS – Minority interests are stated at the appropriate proportion of the post-acquisition values of the
           identifiable assets and liabilities of the subsidiaries.

           SUBSIDIARIES – In the company’s own financial statements, the investments in subsidiaries are carried at cost less
           any provision for impairment in value. The book values of the subsidiaries are not necessarily indicative of the amounts
           that would be realised in a current market exchange.

           FOREIGN CURRENCY TRANSACTIONS – The functional currency is the Singapore dollar as it reflects the economic
           substance of the underlying events and circumstances of the entity. Transactions in foreign currencies are recorded in
           Singapore dollars at the rates ruling at the dates of the transactions. At each balance sheet date, recorded monetary
           balances and balances carried at fair value that are denominated in foreign currencies are reported at the rates ruling at
           the balance sheet date. All realised and unrealised exchange adjustment gains and losses are dealt with in the income
           statement.




                                                                           | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 29
     Notes to Financial Statements 30 September 2004

     2       (A)     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)
                     FOREIGN CURRENCY FINANCIAL STATEMENTS – In translating the financial statements of a foreign entity for
                     incorporation in the consolidated financial statements, the assets and liabilities of self-sustaining operations (except for
                     PT Technics Offshore Jaya of which the functional currency is Singapore dollar) denominated in currencies other than
                     Singapore dollars are translated at year end rates of exchange and the income and expense items are translated at
                     average rates of exchange for the year. The resulting translation adjustments are accumulated in a separate component
                     of shareholders’ equity until the disposal of the entity. Other currency gains or losses are included in the income
                     statement. The financial statements of foreign operations are restated in terms of the functional currency unit current at
                     the balance sheet date before they are translated into the presentation currency.

                     REVENUE RECOGNITION – Revenue from rendering of services is recognised by reference to the stage of completion of
                     the transaction at the balance sheet date determined by the proportion of that cost incurred to date bear to the estimated
                     total cost of transaction and the amount of revenue, stage of completion, and costs of transaction (including future costs
                     to complete) can be measured reliably. Rental revenue is recognised on a time-proportion basis. Interest revenue is
                     recognised on a time-proportion basis using the effective interest rate.

                     LONG-TERM CONTRACTS – When the outcome of a construction contract can be estimated reliably, contract revenue
                     and contract costs associated with the contract are recognised as revenue and expenses respectively by reference to the
                     stage of completion of the contract activity at the balance sheet date, as measured by the proportion that contract costs
                     incurred for work performed to date bear to the estimated total contract costs method. Contract costs consist of costs
                     that relate directly to the specific project, costs that are attributable to contract activity in general and can be allocated
                     to the project and such other costs as are specifically chargeable to the customer under the terms of the contract. When
                     it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense
                     immediately. Variations in contract work, claims and incentive payments are included to the extend that they have been
                     agreed with the customer. Where the outcome of a construction contract cannot be estimated reliably, contract revenue
                     is recognised to the extent of the contract costs incurred that it is probable will be recoverable. The long-term work in
                     progress projects have operating cycles longer than one year. The company includes in current assets amounts relating
                     to the long-term contracts realisable over a period in excess of one year.

                     INVENTORIES – Inventories of consumables are measured at the lower of cost (first-in first-out method) and net
                     realisable value.

                     BORROWING COSTS – All borrowing costs are recognised as an expense in the period in which they are incurred. All
                     borrowing costs are recognised as an expense in the period in which they are incurred.

                     NON-CURRENT ASSETS – Non-current assets, such as plant and equipment are reviewed for impairment whenever
                     events or changes in circumstances indicate that the net book value of these assets may not be recoverable through use
                     or by disposal. Impairment losses are determined based on the difference between fair value, which would generally
                     approximate estimated future cash flows discounted at the company’s cost of capital or where appropriate the sale
                     value, and net book value.

                     INCOME TAX – The income taxes are accounted using the asset and liability method which requires the recognition of
                     taxes payable or refundable for the current year and deferred tax liabilities and assets for the future tax consequence of
                     events that have been recognised in the financial statements or tax returns. The measurements of current and deferred
                     tax liabilities and assets are based on provisions of the enacted tax laws; the effects of future changes in tax laws or rates
                     are not anticipated. The measurement of deferred tax assets is reduced, if necessary, by the amount of any tax benefits
                     that, based on available evidence, are not expected to be realised. A deferred tax liability is recognised for all taxable
                     temporary differences, unless the deferred tax liability arises from (a) goodwill for which amortisation is not deductible
                     for tax purposes; or (b) the initial recognition of an asset or liability in a transaction which (i) is not a business
                     combination; and (ii) at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss).




30 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Notes to Financial Statements 30 September 2004

2   (A)   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont’d)
          PROPERTY, PLANT AND EQUIPMENT – Property, plant and equipment are carried at cost less any accumulated
          depreciation and any accumulated impairment losses. Depreciation is provided on gross carrying amounts in equal
          annual instalments over the estimated useful lives of the assets. The annual rates of depreciation are as follows:

          Leasehold properties            –      over terms of lease at 5.88%
          Plant and equipment             –      5.88% to 33.3%

          Fully depreciated assets still in use are retained in the financial statements.

          The useful life of an item of property, plant and equipment is reviewed periodically and, if expectations are significantly
          different from previous estimates, the depreciation charge for the current and future periods are adjusted.

          RETIREMENT BENEFIT COSTS – Contributions to defined contribution retirement benefit plans are recorded as an
          expense as they fall due. Contributions made to government managed retirement benefit plan such as the Central
          Provident Fund in Singapore which specifies the employer’s obligations are dealt with as defined contribution retirement
          benefit plans.

          LEASES – A finance lease is recognised as an asset and as liability in the balance sheet at amounts equal at the
          inception of the lease to the fair value of the leased assets or, if lower, at the present value of the lease payments based
          on the interest rate implicit in the lease. The excess of the lease payments over the recorded lease obligations are treated
          as finance charges which are allocated to each lease term so as to produce a constant rate of charge on the remaining
          balance of the obligations. The assets are depreciated as owned depreciable assets. Leases where the lessor effectively
          retains substantially all the risks and benefits of ownership of the leased assets are classified as operating leases. For
          operating leases, lease payments are recognised as an expense in the income statement on a straight line basis unless
          another systematic basis is representative of the time pattern of the user’s benefit, even if the payments are not on that
          basis.

          ACCOUNTING ESTIMATES – The preparation of financial statements in conformity with generally accepted accounting
          principles requires the directors to make estimates and assumptions that affect the reported amounts of assets and
          liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported
          amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

          FAIR VALUE OF FINANCIAL INSTRUMENTS – The carrying values of cash, accounts receivable, other current financial
          assets, short-term borrowings, accounts payable and other current financial liabilities approximate their fair values due
          to the short-term maturity of these instruments. The fair value of long-term debt was not determined because the book
          values approximate the fair value. Those financial assets that have a fixed maturity are measured at amortised cost
          using the effective interest rate method. Those that do not have a fixed maturity are measured at cost. All financial
          assets are subject to review for impairment.

          LIABILITIES AND PROVISIONS – A liability and provision is recognised when there is a present obligation (legal or
          constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be
          required to settle the obligation and a reliable estimate can be made of the amount of the obligation. It is measured at
          the amount payable.

          CASH AND CASH EQUIVALENTS – Cash for the cash flow statement includes cash and cash equivalents less bank
          overdrafts.




                                                                        | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 31
     Notes to Financial Statements 30 September 2004

     2       (B)     RISK MANAGEMENT POLICIES FOR FINANCIAL INSTRUMENTS
                     CREDIT RISK ON FINANCIAL ASSETS – Financial assets that are potentially subject to concentrations of credit risk
                     consist principally of cash, cash equivalents and trade and other accounts receivable. The directors believe that the
                     financial risks associated with these financial instruments are minimal. The company places its cash and cash equivalents
                     with high credit quality institutions. The company performs ongoing credit evaluation of its debtors’ financial condition
                     and maintains a provision for doubtful accounts receivable based upon the expected collectibility of all accounts receivable.
                     There is no significant concentration of credit risk, as the exposure is spread over a large number of counterparties and
                     customers except as disclosed in these notes to the financial statements.

                     OTHER RISKS ON FINANCIAL INSTRUMENTS – The company monitors its interest, foreign exchange risks, and
                     changes in fair values from time to time and any gains and losses are included in the income statement. The company
                     is exposed to interest rate price risk for financial instruments with a fixed interest rate and to interest rate or cash flow
                     risk for financial instruments with a floating interest rate that is reset as market rates change. The company is also
                     exposed to changes in foreign exchange rates and liquidity of businesses. The company does not utilise forward
                     contracts or other arrangements for trading or speculative purposes. At 30 September 2004, there were no such
                     arrangements, interest rate swap contracts or other derivative instruments outstanding.

                     OTHER BUSINESS RISK AND UNCERTAINTIES – The company is subject to a number of risks including the development
                     and marketing of unproven products, the need to maintain adequate financing, better capitalised competitors and
                     dependence on essential personnel. The industry is characterised by rapid technological developments, frequent products
                     introductions, evolving industry standards, changes in customer requirements and short product life cycles. Significant
                     technological changes or the emergence of competitive products with new capabilities could adversely affect the business
                     plan and operating results of the company.


     3       RELATED COMPANY TRANSACTIONS
             Some of the company’s transactions and arrangements are between members of the group and effects of these on the basis
             determined between the parties are reflected in these financial statements. The intercompany balances are without fixed
             repayment terms and interest unless stated otherwise.


     4       RELATED PARTY TRANSACTIONS
             Related parties are entities with common direct or indirect shareholders and or directors or management. Parties are considered
             to be related if one party has the ability to control the other party or exercise significant influence over the other party in making
             financial and operating decision.

             Some of the company’s and group’s transactions and arrangements are with related parties and the effect of these on the basis
             determined between the parties are reflected in these financial statements. The balances are on an average credit term of
             30 days (2003 : 30 days) and without interest unless stated otherwise.

             Significant related party transactions:

             In addition to the transactions and balances disclosed elsewhere in the notes to the financial statements, this item includes the
             following:

                                                                                                  Group                           Company
                                                                                          2004            2003            2004              2003
                                                                                         $’000            $’000           $’000             $’000

             Revenue                                                                       (81)             (7)               –                 –
             Purchase of goods                                                             120             280                –                 –
             Amount owing to a director waived                                             (20)            (24)             (10)                –




32 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Notes to Financial Statements 30 September 2004

5   CASH AND CASH EQUIVALENTS
                                                                                      Group                           Company
                                                                              2004            2003            2004              2003
                                                                              $’000           $’000          $’000              $’000

    Not restricted in use                                                    1,713            3,459             16          1,004

    Analysis of above amount by
    significant foreign currency:
    United States dollar                                                       683             542                –                 –


6   TRADE RECEIVABLES
                                                                                      Group                           Company
                                                                              2004            2003            2004              2003
                                                                              $’000           $’000          $’000              $’000

    Receivables on long-term contracts                                       5,557            5,394               –                 –
    Retention sum                                                               51                –               –                 –
    Outside party                                                              101               30               –                 –

                                                                             5,709            5,424               –                –

    Analysis of above amount by
    significant foreign currency:

    United States dollar                                                     4,699            3,832               –                 –

    The average credit period generally given to customers is about 60 days (2003: 60 days). A provision is made for estimated
    irrecoverable amounts from the customers. This provision is determined by reference to past default experience. The carrying
    amount of trade receivables approximates to their fair value. Short-duration receivables with no stated interest rate are normally
    measured at original invoice amount unless the effect of imputing interest would be significant.

                                                                                      Group                           Company
                                                                              2004            2003            2004              2003
                                                                              $’000           $’000          $’000              $’000

    Concentration of customers:
    Top 1 customer                                                           1,543            1,711               –                 –
    Top 2 customers                                                          2,408            2,917               –                 –
    Top 3 customers                                                          2,622                –               –                 –

    The group sells its trade receivables to a financial institution. Such trade receivables relating to projects undertaken by the
    group must be approved in advance by this financial institution. The financial institution assumes all credit risk associated with
    properly approved debt except for disputed debts. Such undisputed receivables, having been sold without recourse, are not
    reflected in the accompanying financial statements. On the date of sale, the difference between the carrying value of receivables
    and net proceeds received are charged to income statement. As at 30 September 2004, $2,807,510 (2003 : $4,010,888) of
    the trade receivables sold remains uncollected.




                                                                         | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 33
     Notes to Financial Statements 30 September 2004

     7       OTHER RECEIVABLES AND PREPAYMENTS

                                                                                                Group                          Company
                                                                                        2004             2003          2004              2003
                                                                                       $’000             $’000        $’000              $’000

             Related party (Note 4)                                                       1                 –             1              –
             Subsidiary (Note 3)                                                          –                 –         5,142          3,353
             Outside parties                                                              3                 3             –              –
             Deposits                                                                    66                67             –              –
             Prepayments                                                                238               173            15              1

                                                                                        308               243         5,158          3,354


     8       INVENTORIES
                                                                                                Group                          Company
                                                                                        2004             2003          2004              2003
                                                                                       $’000             $’000        $’000              $’000

             Raw material and consumables, at cost                                      536               388              –                 –


     9       CONTRACTS WORK-IN-PROGRESS
                                                                                                Group                          Company
                                                                                        2004             2003          2004              2003
                                                                                       $’000             $’000        $’000              $’000

             Costs incurred and attributable profits                                 13,325              5,833             –                 –
             Less : Progress payments received                                       (7,457)            (2,755)            –                 –
             Less : Progress payments receivable
                    included in trade receivable                                     (1,804)            (1,793)            –                 –

                                                                                      4,064             1,285              –                 –


     10      INVESTMENTS IN SUBSIDIARIES
                                                                                                Group                          Company
                                                                                        2004             2003          2004              2003
                                                                                       $’000             $’000        $’000              $’000

             Unquoted equity shares, at cost                                                –                –        7,599          3,849
             Provision for impairment                                                       –                –       (5,387)             –

                                                                                            –                –        2,212          3,849

             Fair values based on net book values of subsidiaries                           –                –        1,958          2,303

             The net book value of the subsidiaries is used as the fair value as it is impracticable to determine a reliable fair value for the
             unlisted equity shares by other methods.

             During the financial year, the company acquired additional 3,750,000 ordinary shares of $1 each at par, in Technics Offshore
             Engineering Pte Ltd (“TOE”), a company incorporated in Singapore by way of offset against amount owing from TOE.




34 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Notes to Financial Statements 30 September 2004

10   INVESTMENTS IN SUBSIDIARIES                   (Cont’d)
     The subsidiaries are listed below:-

     Name of company                                                Place of business        Percentage of               Cost of
     (and auditors)             Principal activities                and incorporation         equity held              investment
                                                                                           2004        2003         2004       2003
                                                                                             %           %          $’000      $’000

     Held by the company

     @ Petro Process            Engineering and design                 Singapore           100        100              92        92
       System Pte. Ltd.         of process modules and
                                equipment for oil and gas
                                exploration and production

     @ Technics Offshore        Design, fabrication, installation      Singapore           100        100          7,507     3,757
       Engineering Pte Ltd      and commissioning of process
                                modules and equipment for
                                oil and gas exploration and
                                production

     @ Technics Offshore        Dormant                                Singapore           100        100                *          *
       Jaya Pte. Ltd.

     # AMF Tech Asia            Dormant                                 Malaysia           100        100                *          *
       Sdn. Bhd.
       (SQ Morison)

                                                                                                                   7,599     3,849

     Held through Technics Offshore Engineering Pte Ltd
     # PT Technics              Fabrication and installation           Indonesia             99         99             86        86
       Offshore Jaya            of process modules and
       (Drs. Sukimto            equipment for oil and gas
       Sjamsuli                 exploration and production

     + Technics (Henan)         Dormant                               The People’s         100           –             (a)          –
       Enterprise Co., Ltd                                          Republic of China

     *     Amount is less than $1,000.
     @     Audited by Chio Lim & Associates or member firms of Horwath International.
     #     Audited by firms of accountants other than member firms of Horwath International of which Chio Lim & Associates,
           Singapore is a member. Their names are indicated above.
     +     Pending appointment of auditors. Not audited as it is not significant.
     (a)   A subsidiary incorporated on 16 September 2004 with registered capital of US$5 million and pending payment of share
           capital. The company has been dormant since its date of incorporation. See Note 30.




                                                                           | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 35
     Notes to Financial Statements 30 September 2004

     11      OTHER INVESTMENTS
                                                                                                 Group                         Company
                                                                                         2004             2003          2004             2003
                                                                                        $’000             $’000        $’000             $’000

             Unlisted equity shares at cost                                                  1                –            1                 –

             It is impracticable to determine a reliable fair value for the unlisted equity shares.

             During the financial year, the company invested in 10% of the share capital of Hyperbaric and Occupational Medicine Pte Ltd,
             a company incorporated in Singapore on 21 September 2004.


     12      PROPERTY, PLANT AND EQUIPMENT
                                                                                                        Leasehold
                                                                                                       property and   Plant and
                                                                                                      improvements    equipment      Total
                                                                                                         $’000         $’000         $’000

             Group
             Cost:
             At beginning of year                                                                        2,764         2,914         5,678
             Additions                                                                                     433         1,954         2,387
             Disposals                                                                                       –        (1,264)       (1,264)

             At end of year                                                                              3,197         3,604         6,801

             Accumulated depreciation:
             At beginning of year                                                                           27         1,463         1,490
             Additions                                                                                     165           396           561
             Disposals                                                                                       –        (1,256)       (1,256)

             At end of year                                                                                192           603              795

             Depreciation for last year                                                                      27          116              143

             Net book value:
             At beginning of year                                                                        2,737         1,451         4,188

             At end of year                                                                              3,005         3,001         6,006

             Also see Note 16.




36 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Notes to Financial Statements 30 September 2004

13   SHORT-TERM BORROWINGS
                                                                                   Group                            Company
                                                                            2004            2003            2004              2003
                                                                           $’000           $’000           $’000              $’000

     Bills payable to banks                                                2,468           2,918                –                 –

     Analysis of above amount by significant foreign currency:

     United States dollar                                                  1,248           2,139                –                 –

     The bills payable to banks are covered by corporate guarantees by the company to a subsidiary and interest rates varied from
     3.20% to 9.65% (2003 : 3.13% to 7.00%) per year.


14   TRADE PAYABLES AND ACCRUED LIABILITIES
                                                                                   Group                            Company
                                                                            2004            2003            2004              2003
                                                                           $’000           $’000           $’000              $’000

     Outside parties and accrued liabilities                               6,263           4,112             146               187

     Analysis of above amount by significant foreign currency:

     United States dollar                                                    909             462                –                 –

     The average credit period taken by the group to settle payables is about 110 days (2003 : 108 days).


15   OTHER PAYABLES
                                                                                   Group                            Company
                                                                            2004            2003            2004              2003
                                                                           $’000           $’000           $’000              $’000

     Related party (Note 4)                                                    –              20                –               10
     Outside party                                                           176             131                –                –

                                                                             176             151                –               10




                                                                       | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 37
     Notes to Financial Statements 30 September 2004

     16      LONG-TERM BORROWINGS
                                                                                           Group                          Company
                                                                                    2004           2003           2004              2003
                                                                                   $’000           $’000         $’000              $’000

             Bank loans I (secured)                                                1,505           1,645              –                 –
             Bank loans II (secured)                                                 725               –              –                 –

                                                                                   2,230           1,645              –                –


             The borrowings are repayable as follows:
             Amounts due within one year                                             324             133              –                 –
             Non-current portion                                                   1,906           1,512              –                 –

             Total bank loan (secured)                                             2,230           1,645              –                –


             The non-current portion is repayable as follows:
             Due within 2 to 5 years                                               1,337            530               –                 –
             After 5 years                                                           569            982               –                 –

             Total current portion                                                 1,906           1,512              –                –


             Bank loan I obtained for the leasehold property bears interest at 4.75% (2003 : 5.25%) per annum and is repayable in
             120 monthly instalments from 4 August 2003 or such amount as the bank may determine and notify from time to time with
             interest to be serviced monthly.

             Bank loan II obtained for the construction of subsidiary’s factory in Batam and renovation works at leasehold property bears
             interest rate at 6.25% per annum and is repayable in 48 monthly instalments from 8 April 2004 or such amounts as the bank
             may determine and notify from time to time based on the actual loan amount disbursed and would comprise principal and
             interest.

             The above bank loans are secured by:

                     1) First legal mortgage of 72 Loyang Way, Singapore 508762.
                     2) Corporate guarantees by the company.




38 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Notes to Financial Statements 30 September 2004

17   OBLIGATION UNDER FINANCE LEASE
                                                                                              Minimum          Finance        Present
     Group                                                                                    payments         charges         value
                                                                                                $’000           $’000          $’000

     2004

     Minimum lease payments payable:
     Due within one year                                                                           76             (12)               64
     Due within 2 to 5 years                                                                      147              (9)              138
     Due after 5 years                                                                              –               –                 –

     Total                                                                                        223             (21)              202

     Net book value of plant and equipment under finance lease                                                                      218

                                                                                              Minimum          Finance        Present
                                                                                              payments         charges         value
                                                                                                $’000           $’000          $’000

     2003

     Minimum lease payments payable:
     Due within one year                                                                            6               (1)               5
     Due within 2 to 5 years                                                                       25               (5)              20
     Due after 5 years                                                                              –                –                –

     Total                                                                                         31               (6)              25

     Net book value of plant and equipment under finance lease                                                                       23

     It is the group’s policy to lease certain of its plant and equipment under finance leases. The lease terms are 4 to 7 years. The
     rate of interest for finance leases is 3.3% to 5.0% (2003 : 3.3%) per year. Interest rates are fixed at the contract date. The lease
     is on a fixed repayment basis and no arrangements have been entered into for contingent rental payments. The lease obligation
     is denominated in S$. The fair value of the lease obligation approximates to their carrying amount. The obligation under finance
     lease is secured by the lessor’s charge over the leased asset.


18   ISSUED CAPITAL
                                                                                        Group                            Company
                                                                                 2004            2003            2004              2003
                                                                                $’000           $’000           $’000              $’000

     Authorised:
     1,000,000,000 ordinary shares of $0.04 each
      (2003 : 1,000,000,000 ordinary shares of $0.04 each)                    40,000          40,000          40,000          40,000

     Issued and fully paid:
     129,916,575 ordinary shares of $0.04 each
       (2003 : 118,916,575 ordinary shares of $0.04 each)                      5,197            4,757          5,197           4,757

     During the year, 11,000,000 ordinary shares of $0.04 each were issued for cash at a premium of $0.3929 each. The net
     proceeds have been deployed as additional working capital and for business developments in new and existing markets such
     as China, Indonesia, Malaysia, Myanmar, Singapore, Thailand and Vietnam.




                                                                           | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 39
     Notes to Financial Statements 30 September 2004

     19      REVENUE
                                                                          Group
                                                                  2004             2003
                                                                 $’000            $’000

             Amount recognised from long-term contracts         21,002            8,912
             Rendering of services                               3,817            2,548
             Sale of goods                                           –              272

                                                                24,819        11,732


     20      OTHER OPERATING INCOME
                                                                          Group
                                                                  2004             2003
                                                                 $’000            $’000

             Amount owing to a director waived                     20                –
             Interest income from non-related companies             5               12
             Government grant                                       –               73
             Rental income from non-related companies             191               47
             Sundry income                                         60               42

                                                                  276              174


     21      OTHER (CHARGES)/CREDITS
                                                                          Group
                                                                  2004             2003
                                                                 $’000            $’000

             Foreign exchange adjustment loss                     (167)            (46)
             Goodwill written off                                    –              (3)
             Insurance premium refunded                              –             113
             Loss on disposal of fixed assets                       (7)              –
             Write off of trade receivables – outside parties      (62)              –
                                                                  (236)             64


     22      FINANCE COSTS
                                                                          Group
                                                                  2004             2003
                                                                 $’000            $’000

             Interest expense to outside parties                  246               99




40 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Notes to Financial Statements 30 September 2004

23   LOSS BEFORE INCOME TAX
     In addition to the charges and credits disclosed elsewhere in the notes, this item includes the following charges/(credits):

                                                                                                                      Group
                                                                                                              2004            2003
                                                                                                             $’000            $’000

     Auditors’ remuneration
     – auditors of the company                                                                                  44              44
     – other auditors                                                                                            4               2
     Other fees to auditors of the company                                                                       2               4
     Directors’ fees to directors of the company                                                                60              50
     Directors’ remuneration
     – directors of the company                                                                               622             523
     – directors of subsidiaries                                                                                –              29
     Changes in inventories and contracts work-in-progress (increase)                                      (7,693)         (5,333)
     Raw materials and consumable used and charged to work-in-progress                                     22,704          11,465



24   INCOME TAX
                                                                                                                      Group
                                                                                                              2004            2003
                                                                                                             $’000            $’000

     Current                                                                                                   (47)             42
     Deferred                                                                                                    –               –

     Total income tax (credit)/expense                                                                         (47)             42

     The income tax expense varied from the amount of income tax expense determined by applying the Singapore income tax rate
     of 20% (2003 : 22%) to profit before income tax as a result of the following differences:

                                                                                                                      Group
                                                                                                              2004            2003
                                                                                                             $’000            $’000

     Income tax benefit at statutory rate                                                                     (755)           (414)
     Non-allowable items                                                                                        46               8
     (Over)/under provision in prior years                                                                     (47)             42
     Deferred tax assets valuation allowance                                                                   737             428
     Change in tax rate                                                                                         33               –
     Effect of different tax rates in different countries                                                      (40)            (22)
     Other items                                                                                               (21)              –

     Total income tax (credit)/expense                                                                         (47)             42

     There are no income tax consequences of dividends to shareholders of the company.

     The company is on the one-tier corporate tax system.




                                                                         | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 41
     Notes to Financial Statements 30 September 2004

     24      INCOME TAX          (Cont’d)
             The net deferred tax amount in the balance sheet of the group is as follows:

                                                                                                Group                          Company
                                                                                       2004             2003           2004              2003
                                                                                       $’000            $’000         $’000              $’000

             Deferred tax assets:
             Excess of tax written down value of
              property, plant and equipment                                              46                9              –                 –
             Foreign exchange adjustments                                                 –                8              –                 –
             Accrual for unutilised annual leave                                         16               20              –                 –
             Tax loss carryforwards                                                   1,112              397             14                15
             Capital allowances carryforwards                                             1                4              –                 –
             Total deferred tax assets                                                1,175              438              14               15
             Deferred tax assets valuation allowance                                 (1,175)            (438)            (14)             (15)

             Balance                                                                        –                –             –                 –

             An allowance is made to the extent that it is not probable that taxable profit will be available against which the unused tax loss
             carryforwards and temporary differences from capital allowances can be utilised. The realisation of the future income tax
             benefits from tax loss carryforwards and temporary differences from capital allowances are available for an unlimited future
             period subject to the conditions imposed by law including the retention of majority shareholders as defined.

             At the balance sheet date, the group has unused tax losses of $5,144,789 (2003 : $1,624,795) available for offset against
             future profits. No deferred tax asset has been recognised in respect of such losses as the future profit streams are not probable.

             Temporary differences arising in connection with interests in subsidiaries are insignificant.


     25      LOSS PER SHARE
             Basic loss per share is calculated by dividing the net loss for the year of $3,730,000 (2003 : $1,923,000) by the weighted
             average number of ordinary shares of 126,300,136 (2003 : 69,296,995) of $0.04 each in issue during the financial year.

             There are no diluted earnings per share.


     26      STAFF COSTS
                                                                                                                                Group
                                                                                                                       2004              2003
                                                                                                                      $’000              $’000

             Contributions to defined contribution plan                                                                 247               285
             Staff costs including directors                                                                          5,253             2,948

             Total staff costs                                                                                        5,500             3,233


     27      NUMBER OF EMPLOYEES
                                                                                                                                Group
                                                                                                                       2004              2003

             Number of employees at end of year (including directors)                                                   173               112




42 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Notes to Financial Statements 30 September 2004

28   NOTES TO CASH FLOW STATEMENT OF THE GROUP
     (a)    NON-CASH TRANSACTIONS – Additions to plant and equipment during the year amounting to $224,000 were financed
            by new finance leases.

                                                                                                               2004              2003
                                                                                                              $’000              $’000

     (b)    Cash acquired from acquisition of subsidiaries
            Cash and cash equivalents                                                                              –          1,476
            Trade receivables                                                                                      –          7,030
            Other receivables and prepayments                                                                      –            331
            Tax recoverable                                                                                        –            517
            Inventories                                                                                            –            510
            Contracts work-in-progress                                                                             –            378
            Plant and equipment                                                                                    –            177
            Trade payables and accrued liabilities                                                                 –         (5,244)
            Customers’ progress payments                                                                           –           (452)
            Income tax payable                                                                                     –           (935)
            Finance lease                                                                                          –            (31)
            Net assets acquired/(liabilities disposed)                                                             –         3,757
            Purchase consideration satisfied by the allotment and issue
             of ordinary shares of $1 each                                                                         –         (3,757)
            Cash of subsidiaries acquired                                                                          –          1,476

            Cash inflow on acquisition of subsidiaries                                                             –         1,476


29   CONTINGENT LIABILITIES
                                                                                       Group                           Company
                                                                               2004            2003            2004              2003
                                                                              $’000            $’000          $’000              $’000

     Bankers’ guarantees                                                        546                –              –                  –
     Letter of indemnity in favour of a subsidiary                                –                –            350                  –
     Corporate guarantees on behalf of its
      subsidiaries to third parties (secured)                                      –               –        15,494          15,450

                                                                                546                –        15,844          15,450

     The company has undertaken to provide continued financial support to its subsidiaries with net capital deficits. The extent of
     the exposure is not determinable.


30   CAPITAL EXPENDITURE COMMITMENTS
                                                                                       Group                           Company
                                                                               2004            2003            2004              2003
                                                                              $’000            $’000          $’000              $’000

     Approved and contracted for                                             8,455               302               –                 –
     Authorised but not yet contracted for                                       –             1,262               –                 –

                                                                             8,455             1,564               –                –

     During the year, the company registered a wholly owned subsidiary in The People’s Republic of China (Note 10) with a
     registered capital of USD5,000,000 (SGD 8,455,000). As at the balance sheet date, the company has not paid up any part of
     the share capital and the subsidiary did not commence operations.


                                                                          | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 43
     Notes to Financial Statements 30 September 2004

     31      OPERATING LEASE COMMITMENTS
             At the balance sheet date, the commitments in respect of operating leases with a term of more than one year were as follows:

                                                                                              Group                          Company
                                                                                      2004            2003           2004              2003
                                                                                      $’000           $’000          $’000             $’000

             Within 1 year                                                             370              615              –                 –
             Within 2 to 5 years                                                     1,444            2,626              –                 –
             After 5 years                                                           3,365            4,811              –                 –

             Rental expense for the year                                               664             370               –                 –

             Operating lease payments represent rentals payable by the group for certain of its factory and office properties. It comprises
             mainly the following:

             (a)     the lease from Jurong Town Corporation is for the period of 10 years and 10 months from 15 April 2003. The rentals
                     are subject to rebates from time to time which are not included in the above amounts; and

             (b)     the lease in Indonesia is for a period of 10 years with an option to extend for another 10 years from 1 September 2002.


     32      OPERATING LEASE INCOME COMMITMENTS
             At the balance sheet date, the commitments in respect of operating lease income with a term of more than one year were as
             follows:-

                                                                                              Group                          Company
                                                                                      2004            2003           2004              2003
                                                                                      $’000           $’000          $’000             $’000

             Within one year                                                           197             148               –                 –
             Within 2 to 5 years                                                        91             288               –                 –
             After 5 years                                                               –               –               –                 –

             Rental income for the year                                                215              53               –                 –

             Operating lease income represent rentals receivable for a factory property. The lease rental terms are negotiated for an average
             term of 2 to 3 years from 1 January 2004.


     33      SUBSEQUENT EVENTS
             Subsequent to the balance sheet date, the company entered into a memorandum of understanding with Wah Seong Corporation
             Berhad (“WSC”), a public company incorporated in Malaysia. The principal terms include:

             (a)     A convertible note in the company will be issued for cash of $5 million to be received from WSC. The convertible note
                     bears an interest rate of 1% per annum and will automatically expire on 30 June 2006 unless extended by mutual
                     agreement between both parties. The entire note may be converted at the option of WSC into new ordinary shares in the
                     capital of the company by WSC once only at anytime prior to the expiry date at the conversion price of SGD0.1675 per
                     ordinary share in the capital of the company.

             (b)     The company will grant WSC an option to require the company to buy the entire share capital of Wah Seong International
                     Pte Limited (“WSI”) (which is currently wholly-owned by WSC) and/or such other relevant assets at a consideration of
                     $24 million to be satisfied entirely by the issue of new ordinary shares in the capital of the company or by other mode
                     of payment that may be prescribed by WSC’s advisors on terms mutually acceptable to both parties. The WSI Option
                     will automatically expire and lapse on 30 June 2006 unless extended by the mutual written agreement of the parties.


44 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Notes to Financial Statements 30 September 2004

34   FINANCIAL INFORMATION BY SEGMENTS
     For management purpose, the group’s operating businesses are organised according to their nature of activities. These are
     grouped into the following three business segments and form the basis on which the group reports its primary segment:

     (a)      Engineering, procurement, construction and commissioning (“EPCC”) segment is the major business of the group and
              it is project based. This involves the design, procurement, fabrication, installation and commissioning of process modules
              and equipment for oil and gas production on a turnkey projects basis. These process modules and equipment form the
              operating system of the production and storage facility for oil and gas.

     (b)      Contract engineering (“CE”) segment includes designing, procurement and fabrication of modules, systems or equipment
              for the oil and gas industry.

     (c)      Procurement services (“PS”) segment provides after-sales services and supply spare parts and equipment for oil and
              gas exploration and production.

     Revenue and assets are attributed to geographical areas based on the location of the customers and assets respectively.

     “Others” comprises Australia, The People’s Republic of China, Germany, Taiwan, United Kingdom and USA.

     Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on
     a reasonable basis. Where costs cannot be directly attributable to a business segment, they were allocated based on revenue
     to each business segment, except for finance costs and depreciation expense which were allocated to EPCC and CE segments
     based on revenue. Segment assets consist principally of trade receivables. Segment liabilities include trade payables. Unallocated
     items comprise cash and cash equivalents, inventories and contracts work-in-progress, plant and equipment, customers progress
     payments and income tax payable. All plant and equipment are for common use. Therefore, the capital expenditure incurred
     are not allocated.

     Segment information about these businesses is presented below:

     Business segments

                                                      2004                                                 2003
                                 EPCC          CE             PS         Total        EPCC           CE            PS          Total
                                 $’000        $’000          $’000       $’000        $’000        $’000          $’000       $’000

     Revenue                    5,627       15,375           3,817     24,819         1,149        7,763          2,820      11,732

     Segment results             (545)      (2,478)           (754)     (3,777)         168       (1,377)          (673)      (1,882)
     Income tax expense                                                     47                                                   (42)
     Minority interests                                                      –                                                     1
     Net loss for the year                                              (3,730)                                               (1,923)

     Other information:
     Depreciation                 161           400                –       561           18          125                –        143

     Segment assets             2,900        2,314            424       5,638           333        4,419           672        5,424
     Unallocated assets                                                12,699                                                 9,563

     Total assets                                                      18,337                                                14,987

     Segment liabilities        1,284        3,923           1,056       6,263          247        2,756          1,109       4,112
     Unallocated liabilities                                             5,087                                                4,748

     Total liabilities                                                 11,350                                                 8,860



                                                                           | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 45
     Notes to Financial Statements 30 September 2004

     34      FINANCIAL INFORMATION BY SEGMENTS (Cont’d)
             Geographical segments

                                                                                      2004
                                                                          Asean Ex
                                                              Singapore   Singapore   Others   Elimination    Total
                                                               $’000       $’000      $’000      $’000       $’000

             Revenue                                          11,943       7,708      6,208    (1,040)       24,819

             Other geographical information:

             Segments assets                                   2,167       2,530      1,012           –       5,709



                                                                                      2003
                                                                          Asean Ex
                                                              Singapore   Singapore   Others   Elimination    Total
                                                               $’000       $’000      $’000      $’000       $’000

             Revenue                                           8,986       2,087       738         (79)      11,732

             Other geographical information:

             Segments assets                                   4,103       1,206       115            –       5,424




46 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Additional Information Required for Disclosure

                                                                                Approximate
Location                          Description                                Land Area (in sqm)         Tenure

72 Loyang Way                     Double-storey office building with              16,759                Leasehold 12 + 5 years
Singapore 508762                  adjoining factory space                                               from 23 October 2002

Sekupang Logistics Base Block G   Single-storey office building                   20,000                Leasehold 10 + 10 years
Jl. R.E. Martadinata Sekupang     with adjoining factory space                                          from 1 September 2002
Batam 29422 Indonesia

No. 1 Thu Khoa Huan St. Ward 1    Two-storey house                                    293               6-month lease
Vungtau City                                                                                            from 1 July 2004
Vietnam




                                                                       | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 47
     Shareholder’s Statistics                           As as 16 December 2004



     Authorised Share Capital                     :   S$40,000,000
     Issued & Fully paid-up capital               :   S$5,196,663
     Class of Equity Security                     :   Ordinary Shares of S$0.04 each fully paid up
     Voting Rights of Ordinary Shareholders       :   On a show of hands : 1 vote for each member
                                                  :   On a poll            : 1 vote for each ordinary share

     Distribution of Shareholdings
     Size of Shareholdings                                    No. of Shareholders           %              No. of Shares               %

     1 - 999                                                           3                    0.50                 1,650                 0.00
     1,000 - 10,000                                                  195                   32.83             1,325,000                 1.02
     10,001 - 1,000,000                                              378                   63.64            32,411,825                24.95
     1,000,001 and above                                              18                    3.03            96,178,100                74.03

     Total                                                           594                 100.00           129,916,575               100.00


     Shareholding held in hands of Public
     As at 16 December 2004, approximarely 42.47% of the issued ordinary shares of the Company is held by the public and therefore,
     Rule 723 of the Listing Manual is complied with.

     Twenty Largest Shareholders
             Name                                                                                          No. of Shares               %

     1.      Ting Yew Sue                                                                                   26,175,775                20.15
     2.      Hong Leong Finance Nominees Pte Ltd                                                            16,515,000                12.71
     3.      Mayban Nominees (S) Pte Ltd                                                                    12,930,000                 9.95
     4.      HL Bank Nominees (S) Pte Ltd                                                                    8,577,000                 6.60
     5.      Lim & Tan Securities Pte Ltd                                                                    5,513,000                 4.24
     6.      Koh Kian Kiong                                                                                  5,400,000                 4.16
     7.      Chew Leok Chuan Aloysius                                                                        4,100,000                 3.16
     8.      SBS Nominees Pte Ltd                                                                            2,600,000                 2.00
     9.      Ngiam Hoy Sen                                                                                   2,300,000                 1.77
     10.     Tay Mian Cheo                                                                                   2,026,675                 1.56
     11.     Tan Chan Kwang                                                                                  1,591,650                 1.23
     12.     Phillip Securities Pte Ltd                                                                      1,440,000                 1.11
     13.     United Overseas Bank Nominees Pte Ltd                                                           1,403,000                 1.08
     14.     DBS Vickers Securities (S) Pte Ltd                                                              1,257,000                 0.97
     15.     Kim Eng Securities Pte Ltd                                                                      1,183,000                 0.91
     16.     Lien Sheong Chye                                                                                1,100,000                 0.85
     17.     Huang Choong Shin                                                                               1,043,000                 0.80
     18.     DBS Nominees Pte Ltd                                                                            1,023,000                 0.79
     19.     OCBC Securities Private Ltd                                                                       852,000                 0.66
     20.     Xu Yanqi                                                                                          824,000                 0.63
             Total                                                                                          97,854,100                75.33


     Substantial Shareholders
                                                               Number of Ordinary Shares of S$0.04 each fully paid (as at 16 December 2004)
     Name of Substantial Shareholder                      Direct Interest           Deemed Interest            Total                    %

     Ting Yew Sue                                         45,775,775                          –             45,775,775                35.23
     Tay Mian Cheo                                         7,026,675                  5,000,000             12,026,675                 9.26
     Goh Lik San                                           7,983,825                          –              7,983,825                 6.15
     Tan Chan Kwang                                        8,891,650                          –              8,891,650                 6.84



48 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN that the Annual General Meeting of the shareholders of the Company will be held at 72 Loyang Way,
Singapore 508762 on Friday, 28 January 2005 at 2:00 p.m. to transact the following businesses:


ORDINARY BUSINESS:
1.    To receive and consider the Directors’ Report and Audited Accounts for the year ended 30 September
      2004 and the Auditors’ Report thereon.                                                                               Resolution 1

2.    To approve the payment of Directors’ fees of S$60,000 for the year ended 30 September 2004
      (2003 : S$50,000).                                                                                                   Resolution 2

3.    To re-elect Mr Ong Siew Peng who will retire by rotation pursuant to Article 107 of the Articles of
      Association of the Company and who, being eligible, will offer himself for re-election:                              Resolution 3

      Mr Ong Siew Peng will, upon re-election as a Director of the Company, remain as the Chairman of
      the Audit Committee and will be considered independent for the purposes of Rule 704(8) of the
      Listing Manual of The Singapore Exchange Securities Trading Limited.

4.    To re-appoint Messrs Chio Lim & Associates as Auditors and to authorise the Directors to fix their
      remuneration.                                                                                                        Resolution 4

      To consider and, if thought fit, to pass with or without any modifications, the following resolution as
      Ordinary Resolution:

5.    Ordinary Resolution : Authority to allot and issue shares up to 50% of the Company’s issued
      share capital                                                                                                        Resolution 5

      “That authority be given pursuant to Section 161 of the Companies Act, Chapter. 50, to the Directors
      to allot and issue shares in the Company (whether by way of rights, bonus or otherwise) and
      convertible securities at any time and from time to time thereafter to such persons and on such
      terms and conditions for and such purposes as the Directors may in their absolute discretion deem
      fit provided always that the aggregate number of shares and convertible securities to be issued shall
      not exceed 50% of the issued share capital of the Company, of which the aggregate number of
      shares and convertible securities to be issued other than on a pro rata basis to existing shareholders
      shall not exceed 20% of the issued share capital of the Company (the percentage issued share
      capital being based on the Company’s issued share capital at the time this Resolution is passed after
      adjusting for new shares arising from the conversion or exercise of any convertible securities or share
      options or vesting of share awards which are outstanding at the time this Resolution is passed and
      any subsequent consolidation or sub-division of shares) and unless revoked or varied by the Company
      in general meeting, such authority shall continue in force until the conclusion of the next Annual
      General Meeting or the expiration of the period within which the next Annual General Meeting of the
      Company is required by law to be held, whichever is the earlier.”




                                                                            | REACHING OUT TO OUR CUSTOMERS AND PENETRATE EMERGING MARKETS | 49
     Notice of Annual General Meeting

     SPECIAL BUSINESS :
     6.      To transact any other business which may be properly transacted at an Annual General Meeting.

     Explanatory Notes:

     (i)     Resolution 5, if passed, will empower the Directors from the date of the above Meeting until the date
             of the next Annual General Meeting, to allot and issue shares and convertible securities in the
             Company. The number of shares which the Directors may allot and issue under this Resolution
             would not exceed 50 per cent of the issued share capital of the Company at the time this Resolution
             is passed. For allotments and issues of shares and convertible securities other than on a pro-rata
             basis to all shareholders, the aggregate number of shares to be allotted and issued shall not exceed
             20 per cent of the total issued share capital of the Company at the time this Resolution is passed.




     BY ORDER OF THE BOARD




     Tan Eng Ann
     Low Mei Mei Maureen
     Company Secretaries

     Singapore :
     12 January 2005



     Proxies:
     A member entitled to attend and vote at the Annual General Meeting may appoint not more than two proxies to attend and vote on his behalf and where
     a member appoints more than one proxy, he shall specify the proportion of his shareholding to be represented by each proxy. A proxy need not be a
     member of the Company. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company at 18 Cross Street,
     #07-03 Marsh & McLennan Centre, Singapore 048423 not less than 48 hours before the time set for the Annual General Meeting.




50 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
    Proxy Form                                                     TECHNICS GROUP HOLDINGS LIMITED
                                                                       (REGISTRATION NO. 200205249E)


     IMPORTANT:
     1.    For investors who have used their CPF monies to buy the Company’s shares, this Annual Report is forwarded to them at the request of their CPF Approved
           Nominees and is sent solely FOR INFORMATION ONLY.
     2.    This Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents and purposes if used or purported to be used by them.



    I/We _____________________________________________________________________________________________________________

    of _______________________________________________________________________________________________________________

    being a member/members of Technics Group Holdings Limited (the “Company”) hereby appoint

                                                                                                                         NRIC/Passport         Proportion of
                         Name                                                     Address                                  Number            Shareholdings (%)




    and/or (delete as appropriate)

                                                                                                                         NRIC/Passport         Proportion of
                         Name                                                     Address                                  Number            Shareholdings (%)




    as my/our proxy/proxies to attend and to vote for me/us on my/our behalf and, if necessary, to demand a poll at the Annual General
    Meeting of the Company to be held at 72 Loyang Way, Singapore 508762 on Friday, 28 January 2005 at 2.00 p.m. and at any
    adjournment thereof.
    (Please indicate with an “X” in the spaces provided whether you wish your vote(s) to be cast for or against the resolutions as set out in
    the Notice of Annual General Meeting. In the absence of specific directions, the proxy/proxies will vote or abstain as he/they may think
    fit, as he/they will on any other matter arising at the Annual General Meeting.)

     No.     Resolutions                                                                                                       For                  Against

             ORDINARY BUSINESS
      1      To receive and consider Directors’ and Auditors’ Reports and Audited Accounts
      2      To approve payment of Directors’ fees of S$60,000
      3      To re-elect Director - Mr Ong Siew Peng
      4      To re-appoint Auditors
             SPECIAL BUSINESS
      5      To authorise Directors to allot and issue shares and convertible securities
             pursuant to Section 161 of the Companies Act, Chapter 50



    Dated this ______________ day of ______________ 2005
                                                                                                                             Total number of Shares held
✄




    Signature(s) of member(s) or common seal

    IMPORTANT: Please read notes overleaf.
     NOTES :

     1.      Please insert the total number of shares held by you. If you have shares entered against your name in the Depository Register (as defined in
             Section 130A of the Companies Act, Chapter 50), you should insert that number of shares. If you have shares registered in your name in the
             Register of Members, you should insert that number of shares. If you have shares entered against your name in the Depository Register and
             shares registered in your name in the Register of Members, you should insert the aggregate number of shares. If no number is inserted, this
             form of proxy will be deemed to relate to all the shares held by you.

     2.      A member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint not more than two proxies to attend
             and vote on his behalf. A proxy need not be a member of the Company.

     3.      Where a member appoints more than one proxy, he shall specify the proportion of his shareholding to be represented by each proxy.

     4.      The instrument appointing a proxy or proxies must be under the hand of the appointor or his attorney duly authorised in writing. Where the
             instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its common seal or under the hand of
             its attorney or duly authorised officer.

     5.      A corporation which is a member of the Company may authorise by resolution of its directors or other governing body such person as it thinks
             fit to act as its representative at the Annual General Meeting, in accordance with its Articles of Association and Section 179 of the Companies
             Act, Chapter 50.

     6.      The instrument appointing a proxy or proxies, together with the power of attorney or other authority (if any) under which it is signed, or
             notarially certified copy thereof, must be deposited at the registered office of the Company at 18 Cross Street, #07-03 Marsh & McLennan
             Centre, Singapore 048423 not later than 48 hours before the time set for the Annual General Meeting.

     7.      The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible or
             where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument appointing a
             proxy or proxies. In addition, in the case of members of the Company whose shares are entered against their names in the Depository Register,
             the Company may reject any instrument appointing a proxy or proxies lodged if such members are not shown to have shares entered against
             their names in the Depository Register at 48 hours before the time appointed for holding the Annual General Meeting as certified by The Central
             Depository (Pte) Limited to the Company.




52 | TECHNICS GROUP HOLDINGS LIMITED | ANNUAL REPORT 2004 |
DESIGN & PRODUCTION | AC Graphic Workshop Pte Ltd | TEL 6294 4688
          TECHNICS GROUP HOLDINGS LIMITED
          (REGISTRATION NO. 200205249E)

          SINGAPORE HEAD OFFICE
          72 Loyang Way
   TEL    (65) 6545 9968
   FAX    (65) 6545 0668
 EMAIL    technicsoffshore@toepl.com.sg
WEBSITE   www.technicsgrp.com
          SUBSIDIARIES
     s    AMF Tech Asia Sdn. Bhd.
     s    Petro Process System Pte. Ltd.
     s    PT Technics Offshore Jaya
     s    Technics (Henan) Enterprise Co., Ltd
     s    Technics Offshore Engineering Pte Ltd
     s    Technics Offshore Jaya Pte. Ltd.
          VIETNAM REPRESENTATIVE OFFICE
          No. 1 Thu Khoa Huan
          Vung Tau City, S.R. Vietnam
   TEL    (84) 64 856 832
   FAX    (84) 64 856 714

				
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