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RESINTECH - MalaysiaStock.Biz

Dec 24, 2021

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Page 1: RESINTECH - MalaysiaStock.Biz
Page 2: RESINTECH - MalaysiaStock.Biz

RESINTECH is a fully integrated group involved in Innovating, Designing, Manufacturing and Marketing a diversified range of plastic products and other investments. Resintech has been constantly pushing ahead, achieving goals after goals due to the untiring effort and able leadership from the Man at the Helm - The Founder and Managing Director, Dato’ Dr. Teh Kim Poo whose experience in manufacturing and trading dated back to 1977. He was assured an ever vibrant approach to the business of RESINTECH.

The Group owns modern plants with State-of-the-Art Production Machineries. It has experienced and highly qualified work force, advanced production techniques, an efficient infrastructure and long-term sustainable solutions to serve customer needs.

RESINTECH had enhanced its competitiveness to meet the challenges of Globalization, arising from the advent of the AFTA.

Staying ahead means hard work in the days ahead - we are to the task! RESINTECH has bright future based on the solid foundation consistent with its Quality Management System which is accredited to the MS ISO 9001: 2008.

Needless to say, RESINTECH will not be resting on its laurels, the relentless drive to improve existing products and services and to introduce more innovative products via the opportunities arising from today’s technologies.

Head Office, Multipurpose Hall, Factory and Warehouse (478,000 Sq. ft.) Telok Panglima Garang, Selangor, Malaysia

ABOUT US

Page 3: RESINTECH - MalaysiaStock.Biz

NOTICE IS HEREBY GIVEN that the Seventeenth Annual General Meeting of RESINTECH BERHAD will be held at Concorde Hotel Shah Alam, Concorde III, Level 2, No. 3 Jalan Tengku Ampuan Zabedah, 40100 Shah Alam, Selangor Darul Ehsan on Tuesday, 25 September 2012 at 9.30 a.m for the following purposes:

ANNUAL GENERAL MEETING

CONTENTS

CORPORATE INFORMATION 02

CORPORATE STRUCTURE 03

NOTICE OF ANNUAL GENERAL MEETING 04

STATEMENT ACCOMPANYINGNOTICE OF ANNUAL GENERAL MEETING 07

DIRECTORS’ PROFILE 08

CHAIRMAN’S STATEMENT 10

AUDIT COMMITTEE REPORT 12

CORPORATE GOVERNANCE STATEMENT 16

ADDITIONAL COMPLIANCE INFORMATION 21

STATEMENT ON INTERNAL CONTROL 22

DIRECTORS’ RESPONSIBILITY STATEMENT 23

CORPORATE SOCIAL RESPONSIBILITY 24

FINANCIAL STATEMENTS 25

LIST OF PROPERTIES 87

ANALYSIS OF ORDINARY SHAREHOLDINGS 90

WARRANT HOLDINGS STRUCTURE 92

FORM OF PROXY

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2 Resintech Berhad

CORPORATE INFORMATION

BOARD OF DIRECTORS

Y. Bhg. Dato’ Abu Sujak Bin Mahmud (Independent Non-Executive Chairman)

Y. Bhg. Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP (Managing Director)

Y. Bhg. Datin Gan Jew, PJK (Executive Director)

Teh Leng Kang (Executive Director)

Khairul Anuar Bin Shaharudin (Independent Non-Executive Director)

Wei Hwei Hong (Executive Director)

Kok Wee Wah (Independent Non-Executive Director)

AUDIT COMMITTEE

ChairmanY. Bhg. Dato’ Abu Sujak Bin Mahmud (Independent Non-Executive Chairman)

MembersKhairul Anuar Bin Shaharudin(Independent Non-Executive Director)

Kok Wee Wah (Independent Non-Executive Director)

NOMINATION COMMITTEE

Chairman Y. Bhg. Dato’ Abu Sujak Bin Mahmud (Independent Non-Executive Chairman)

MemberKhairul Anuar Bin Shaharudin (Independent Non-Executive Director)

REMUNERATION COMMITTEE

Chairman Y. Bhg. Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP (Managing Director)

MembersY. Bhg. Dato’ Abu Sujak Bin Mahmud (Independent Non-Executive Chairman)

Khairul Anuar Bin Shaharudin (Independent Non-Executive Director)

COMPANY SECRETARIES

Pang Chia Tyng(MAICSA 7034545)

Nalini d/o Subramaniam (LS 0009571)

REGISTERED OFFICE

Lot 3 & 5, Jalan Waja 14Kawasan Perindustrian Telok Panglima Garang42500 Telok Panglima GarangSelangor Darul EhsanTel : 03-3122.2422 Fax : 03-3122.2411

WEBSITE & EMAIL

[email protected]

CORPORATE OFFICE

Lot 3 & 5, Jalan Waja 14Kawasan Perindustrian Telok Panglima Garang42500 Telok Panglima GarangSelangor Darul EhsanTel : 03-3122.2422 Fax : 03-3122.2411

AUDITORS

Crowe HorwathChartered AccountantsLevel 16, Tower CMegan Avenue IINo. 12, Jalan Yap Kwan Seng50450 Kuala Lumpur

SHARE REGISTRAR

Symphony Share Registrars Sdn BhdLevel 6, Symphony HouseBlock D13, Pusat Dagangan Dana 1Jalan PJU 1A/4647301 Petaling JayaSelangor Darul EhsanTel : 03-78418000 Fax : 03-78418008

PRINCIPAL BANKERS

Hong Leong Bank Berhad No 90 Jalan Persiaran Raja Muda Musa42000 Port KlangSelangor Darul Ehsan

United Overseas Bank (Malaysia) Berhad80-84 Jalan 3/6DMedan Putra Business CentreSri Manjalara Off Jalan Damansara52200 Kuala Lumpur

AmBank (M) BerhadNo 42 & 44 Wisma SH NgPersiaran Sultan Ibrahim41300 KlangSelangor Darul Ehsan

STOCK EXCHANGE LISTING

Bursa Malaysia Securities BerhadMain MarketStock Name : RESINTCStock Code : 7232

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�Annual Report 2012

CORPORATE STRUCTURE

100%Vision MouldSpecialist (M)Sdn Bhd

100%ResintechEngineeringSdn Bhd

100%Exact LinkSdn Bhd

100%Resintech (Sabah)Sdn Bhd

100%Resintech Pro- ducts MarketingSdn Bhd

60%RT WaterTechnologySdn Bhd

100%Resintech Plastics(M) Sdn Bhd

100%Sarpino’s (M) Sdn Bhd

100%Resintech-KaparSdn Bhd

100%Resintech Bio- wood (Malaysia) Sdn Bhd

100%Sarpino’s Pizzeria (Cambodia) Pte. Ltd

100%PT ResintechIndomas

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4 Resintech Berhad

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN

that the Seventeenth Annual General Meeting of RESINTECH BERHAD will be held at Concorde Hotel Shah Alam, Concorde III, Level 2, No. 3 Jalan Tengku Ampuan Zabedah, 40100 Shah Alam, Selangor Darul Ehsan on Tuesday, 25 September 2012 at 9.30 a.m for the following purposes:

AGENDA

As Ordinary Business 1. To table the Audited Financial Statements for the financial period ended 31 March 2012 together with the Reports of Directors and Auditors thereon.

2. To re-elect the following Directors, who retire pursuant to Article 126 of the Articles of Association of the Company:

2.1 Dato’ Dr. Teh Kim Poo 2.2 Wei Hwei Hong 3. To approve the payment of the Directors’ Fees for the financial period ended 31 March 2012. 4. To re-appoint Messrs Crowe Horwath as Auditors of the Company and to authorise the Directors to fix their remuneration.

As Special Business

To consider and, if thought fit, to pass the following resolutions with or without any modification: 5. ORDINARY RESOLUTION

AUTHORITY TO ALLOT SHARES PURSUANT TO SECTION 132D OF THE COMPANIES ACT, 1965

“THAT pursuant to Section 132D of the Companies Act, 1965, the Directors be and are hereby empowered to allot and issue shares in the Company, at any time, at such price, until the conclusion of the next Annual General Meeting and upon such terms and conditions and for such purposes as the Directors may, in their absolute discretion, deem fit, provided that the aggregate number of shares does not exceed 10% of the issued share capital of the Company at the time of issue and THAT the Directors be and are also empowered to obtain the approval for the listing of and quotation for the additional shares so issued, subject to the Companies Act, 1965, the Articles of Association of the Company and approval from the Bursa Malaysia Securities Berhad and other relevant bodies where such approval is necessary.”

Ordinary Resolution 1

Ordinary Resolution 2

Ordinary Resolution 3

Ordinary Resolution 4

Ordinary Resolution 5

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�Annual Report 2012

notice of annual general meeting (cont’d)

6. ORDINARY RESOLUTION RE-APPOINTMENT OF DIRECTOR PURSUANT TO SECTION 129(6) OF THE COMPANIES ACT, 1965

To pass the following resolution in accordance with Section 129(6) of the Companies Act, 1965:

“THAT pursuant to Section 129(6) of the Companies Act, 1965, Dato’ Abu Sujak Bin Mahmud be and is hereby re-appointed as Director of the Company and to hold office until the conclusion of the next Annual General Meeting.”

7. SPECIAL RESOLUTION PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY

“THAT the proposed amendments to the Articles of Association of the Company as contained in the Appendix A attached to the 2012 Annual Report be and are hereby approved and adopted AND THAT the Directors and Secretary of the Company be and are hereby authorised to assent to any modifications, variations and/or amendments as may be required by the relevant authorities and to do all acts and things and take all steps as may be considered necessary to give full effect to the Proposed Amendments to the Articles of Association of the Company.”

By Order of the Board

PANG CHIA TYNG (MAICSA 7034545)NALINI A/P SUBRAMANIAM (LS 0009571)Company Secretaries

Selangor Darul Ehsan3 September 2012

(Ordinary Resolution 6)

(Special Resolution 1)

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� Resintech Berhad

notice of annual general meeting (cont’d)

Notes:

1. Member entitled to attend and vote at the meeting may appoint another person as his proxy to attend and vote in his stead. A proxy may but need not be a member of the Company. If the proxy is not a member, he need not be an advocate, an approved company auditor or a person approved by the Registrar of Companies.

2. A Member may appoint only one (1) proxy or attorney or authorised representative. Where a member is an authorised nominee as defined under the Securities Industry (Central Depositories) Act, 1991, it may appoint at least one (1) proxy in respect of each securities account it holds with ordinary shares of the company standing to the credit of the said securities account.

3. The instrument appointing a proxy shall be in writing (in the common or usual form) under the hand of the appointor or of his attorney duly authorised in writing or, if the appointor is a corporation, either under seal or under the hand of an officer or attorney duly authorised.

4. The instrument appointing a proxy and the power of attorney or other attorney, if any, under which it is signed or a notarially certified copy of that power or authority shall be deposited at Symphony Share Registrars Sdn Bhd, Level 6, Symphony House, Block D13, Pusat Dagangan Dana 1, Jalan PJU 1A/46, 47301 Petaling Jaya, Selangor Darul Ehsan not less than forty-eight (48) hours before the time for holding of the meeting or adjourned meeting.

Explanatory Notes to Special Business:

(i) Ordinary Resolution 5 Authority to Allot Shares pursuant to Section 132D of the Companies Act, 1965

The proposed Ordinary Resolution 5, if passed, will empower the Directors of the Company, from the date of the Annual General Meeting, to issue shares (other than bonus or rights issue) of the Company up to and not exceeding in total 10% of the issued share capital of the Company at the time of issue for such purpose as they considered would be in the best interest of the Company. This authority, unless revoked or varied at a general meeting, will expire at the next Annual General Meeting of the Company.

The rationale for this resolution is to eliminate the need to convene general meeting(s) from time to time to seek shareholders’ approval as and when the Company issues new shares for future business opportunities and thereby reducing administrative time and cost associated with the convening of such meeting(s). No shares had been issued and allotted by the Company since obtaining the said authority from its shareholders at the last Annual General Meeting held on 26 August 2011. The Directors would utilise the proceeds raised from this mandate for working capital or such other applications they may in their absolute discretion deem fit. Ordinary Resolution 6 Re-Appointment of Director pursuant to Section 129(6) of the Companies Act, 1965

The proposed Ordinary Resolution 6, if passed, will result the director who is over the age of seventy years shall be re-appointed to act as a director of public company pursuant to Section 129 of the Companies Act, 1965.

(ii) Special Resolution 1 Proposed Amendments to the Articles of Association of the Company

The proposed Special Resolution 1, if passed, will streamline the Company’s Articles of Association to be in line with the latest Main Market Listing Requirements of Bursa Malaysia Securities Berhad, prevailing regulatory requirements and market practices as well as to render clarity and consistency throughout.

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7Annual Report 2012

APPENDIX A- Proposed Amendments To The Articles Of Association Of The Company

“That the following Existing Articles in the Articles of Association of the Company be deleted in its entirety and the following be substituted in lieu thereof:

EXISTING ARTICLE

Article 96 – Vote

Subject to any rights or restrictions for the time being attached to any Shares, at meetings of Members, every Member who:

(1) being an individual, is present in person or by proxy or by attorney; or

(2) being a corporation, is present by a duly authorised representative or by proxy or attorney,

shall on a show of hands have (1) vote and on a poll every shall have one (1) vote for every share of which he is the holder. On a poll votes may be given either personally or by proxy or by attorney or by a duly authorised representative of a corporate Member. An attorney or duly authorised representative or proxy shall be entitled to vote on a show of hands on any question at any general meeting.

Article 100 (1) - Appointment and qualification of proxies

Where a member of the Company is an authorised nominee as defined under the Securities Industry (Central Depositories) Act 1991, it may appoint at least one (1) proxy in respect of each Securities Account it holds with ordinary shares of the Company standing to the credit of the said Securities Account.

Article 100 (3)

(3) Save for the authorised nominee as defined under Article 100(1) above, a proxy may but need not be a member of the Company. If the proxy is not a member, the proxy need not be an advocate, an approved company auditor or a person approved by the Registrar of Companies.

PROPOSED ARTICLE

Article 96 – Vote

Subject to any rights or restrictions for the time being attached to any Shares, at meetings of Members, every Member who:

(1) being an individual, is present in person or by proxy or by attorney; or

(2) being a corporation, is present by a duly authorised representative or by proxy or attorney,

shall on a show of hands have (1) vote and on a poll every shall have one (1) vote for every share of which he is the holder. On a poll votes may be given either personally or by proxy or by attorney or by a duly authorised representative of a corporate Member. An attorney or duly authorised representative or proxy shall be entitled to vote on a show of hands on any question at any general meeting. A proxy appointed to attend and vote at a meeting of the Company shall have the same rights as the member to speak at the meeting.

Article 100 (1) - Appointment and qualification of proxies

(1) Where a member of the Company is an authorised nominee as defined under the Securities Industry (Central Depositories) Act 1991, it may appoint only one (1) proxy in respect of each Securities Account it holds with ordinary shares of the Company standing to the credit of the said Securities Account.

(1a) Appointment of multiple proxies where a member of the company is an exempt authorised nominee which holds ordinary shares in the Company for multiple beneficial owners in one securities account (“omnibus account”), there is no limit to the number of proxies which the exempt authorized nominee may appoint in respect of each.

(1b)An exempt authorised nominee refers to an authorised nominee defined under the Securities Industry (Central Depositories) Act 1991 (“SICDA”) which is exempted from compliance with the provisions of subsection 25A(1) of SICDA.

Article 100 (3)

(3) A proxy may but need not be a member of the Company. If the proxy is not a member, the proxy need not be an advocate, an approved company auditor or a person approved by the Registrar of Companies.

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8 Resintech Berhad

DIRECTORS’ PROFILE

Y. Bhg. Dato’ Abu Sujak Bin Mahmud DSSA, KMN, PPT, PJK, a Malaysian aged 73, is the Independent Non-Executive Chairman of the Company and was appointed to the Board on 25 July 2006. He is also the Chairman of the Audit Committee and Nomination Committee and a member of the Remuneration Committee. He began his career as an audit clerk in Jabatan Pembangunan Koperasi Malaysia in 1958. He then joined the Maktab Perguruan Bahasa in 1960 and then taught for a period of five (5) years before pursuing his degree in the University of Malaya. He obtained a Bachelor of Arts in Malay Studies in 1970. In 1971, he joined Dewan Bandaraya Kuala Lumpur and subsequently was appointed as Secretary of Majlis Perbandaran Klang and Majlis Perbandaran Shah Alam. In 1986, he was chosen to stand for the election, which marked his career as a politician. He served as a member of the Selangor State Legislative Council for three (3) terms and was also a member of the Selangor State Executive Council from 1986 to 1995. He was also appointed as Timbalan Menteri Besar Selangor in 1990 until 1995. In the year 2000, he was appointed as the Datuk Bandar Majlis Bandaraya Shah Alam and was in office until 2002. He also sits on the Board of Brem Holding Berhad.

Y. Bhg. Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP, a Malaysian aged 61, is the founder and Managing Director of the Company. He was appointed to the Board on 24 April 1995 and he is also the Chairman of the Remuneration Committee. He obtained his PhD in Total Quality Management (TQM) from Newport University USA in 2002. He also possesses a Diploma in Accounting (LCCI), Post Graduate Diploma in Marketing (CIM, UK) and Master in Business Administration in Marketing from University of Hull, UK. He is also a chartered marketer of the Chartered Institute of Marketing (CIM, UK). Dato’ Dr. Teh possesses in-depth knowledge and vast experience in the plastics industry and has successfully built up the Group into one of the more prominent plastic pipe manufacturers in Malaysia. As the Managing Director, he is responsible for the overall management and strategic direction of the Group.

Y. Bhg. Dato’ Dr. Teh Kim Poo was the State Assemblyman of Kawasan Pandamaran Selangor from 2004 to 2008. He is currently the Chairman of Barisan Nasional Bahagian Klang and Chairman of Malaysia Chinese Association (MCA) Klang Division. He is also the Deputy Chairman of MCA Selangor, Committee Member of Barisan National Selangor and Central Working Committee of MCA Malaysia. He was also appointed as the Chairman of Klang Port Authority since 1st April 2011.

Teh Leng Kang, PJK, a Malaysian aged 36, was appointed to the Board on 25 July 2006 as an Executive Director. He graduated from Western Michigan University with a degree in Mechanical Engineering. He joined Resintech Plastics (M) Sdn Bhd in 1998. He was in the Production Department during the first two (2) years of his service, where he gained invaluable knowledge and experience in the machineries and production processes. Subsequently, he joined the Group’s Sales and Marketing Department, wherein he expanded his knowledge in our sales and marketing activities. He was one of the key persons involved in the launching and marketing of the HDPE corrugated sewer pipe in 2000. Over the years, he has continued to play a significant role in the managing our production operations and he has set his sights now on expanding our business. He currently oversees the Group’s entire operation. He is also a member of the Research & Development team, where he plays an important role in defining the scope of research and its objectives. He was appointed as the Management Representative position of Resintech Plastics (M) Sdn Bhd’s ISO team in 2003 and leads us through the ISO renewal audit.

Y. Bhg. Datin Gan Jew, PJK, a Malaysian aged 58, is the co-founder and Executive Director of the Company. She was appointed on the Board on 24 April 1995. She has vast experience in the handling of manufacturing operations of the Group. She is well versed with all the operations on the production floor and her management style encompasses a very hands-on approach. She is also experienced in human resource matters and she has been very much involved in the selection and co-ordination of the Group’s employees. She currently oversees the cost savings operations of the Group, a role where she is able to leverage upon her experience of over twenty (20) years in the industry.

Y. Bhg. Datin Gan, Jew is currently the Vice Chairman of Wanita MCA Selangor, Chairman of Wanita MCA Klang Division, Chairman of Wanita Gan Association Selangor, Chairman of Rukun Tetangga Southern Park Selangor, Treasurer of Rukun Tetangga Klang Division and Adviser to Wanita Hin Ann Association Selangor.

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9Annual Report 2012

directors’ profile (cont’d)

Khairul Anuar Bin Shaharudin, a Malaysian aged 38, was appointed to the Board on 25 July 2006 as an Independent Non-Executive Director of the Company. He is also a member of the Audit Committee and Nomination Committee. He obtained a LL.B (Hons) from the Universiti Kebangsaan Malaysia in 1998 and was duly admitted as an Advocate and Solicitor to the High Court of Malaya in 1999. He began his career by chambering in Messrs. Azmah & Maishiah during the period of 1998 to 1999. Subsequent to that, he progressed in his career and was made a partner in the legal firms of Messrs. Hanif Hassan & Co and Messrs. Khairul Anuar, Suhaila & Co. in the year 1999 and 2000 respectively. In 2001, he was appointed as the Managing Partner in the legal firm of Messrs. Jefrizal & Co. and is now the Managing Partner in Messrs. Khairul, Suhaila & Hazlina since 2002.

Wei Hwei Hong, a Malaysian aged 36, is an Executive Director and also Financial Controller. She was appointed to the Board on 25 July 2006 and was previously one of the members of the Audit Committee. She graduated from the University of Sheffield with a Bachelor of Arts (Hons) and has also obtained her membership in Association of Certified Chartered Accountants (ACCA). She is currently Fellow Member of ACCA. She also holds a membership in Malaysia Institute of Accountants (MIA). She possesses hands-on audit experience in one of the big four (4) accounting firms for a period of three (3) years, working on a vast array of projects. She joined Resintech Plastics (M) Sdn Bhd in May 2003 and currently is responsible for overseeing the Accounts and Finance Department of the Group.

Kok Wee Wah, a Malaysian aged 46, is a Independent Non-Executive Director. He was appointed to the Board on 22 February 2008. He is also a member of the Audit Committee. He obtained his membership in Association of Certified Chartered Accountants (ACCA) in 1992. He is now a Fellow Member of ACCA. He is also a member of Malaysia Institute of Accountants (MIA). He has many years experience in one of the big four (4) accounting firms and has worked in many other industries before he joined Resintech-Kapar Sdn Bhd in 2006. In February 2008, he resigned as the General Manager of Resintech-Kapar Sdn Bhd and took on the position in the Board of Directors as Non-Independent Non-Executive Director as well as a member of Audit Committee. He has designated as Independent Non-Executive Director since 15 June 2010.

Notes to Directors’ Profile

1. Family Relationship

Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP is the spouse to Datin Gan Jew, PJK, a director and major shareholder of the Company. He is also a father to Mr Teh Leng Kang, a director and major shareholder of the Company.

Teh Leng Kang is the spouse of Wei Hwei Hong.

2. Conflict of Interest

None of the Directors have any conflict of interest with the Company.

3. Directorship in other Public Listed Companies

The Directors do not have directorship in other public listed companies, except as disclosed for Dato’ Abu Sujak Bin Mahmud.

4. Conviction of Offences

None of the Directors have been convicted any offences (other than traffic offences) within the past 10 years.

5. Attendances at Board Meetings

The details of the Directors’ attendance at the Board Meetings are set out on pages 16 to 17 of this Annual Report.

6. Shareholdings

The details of the Directors’ interest in the securities of the Company are set on page 91 of this Annual Report.

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10 Resintech Berhad

CHAIRMAN’S STATEMENT

Dear Shareholders,

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11Annual Report 2012

Dear Shareholders,

On behalf of the Board of Directors of Resintech Berhad, it is my pleasure to present this Annual Report and Financial Statements of the Group for the financial period ended 31 March 2012.

chairman’s statement (cont’d)

FINANCIAL AND OPERATIONAL HIGHLIGHTS

The Group recorded a total revenue of RM97.1 million (2011 – RM83.5 million) for the financial period under review and a corresponding profit before taxation of RM3.5 million (2011 – RM2 million). Out of the total revenue recorded, the amount generated from outside Malaysia was RM10 million..

DIVIDENDS

The Board of Directos did not recommend any dividend payments since the end of the previous fanincial year. During the financial period, the Group has increased its authorised share capital from RM100,000,000 to RM200,000,000 by the creation of 200,000,000 new ordinary shares at RM0.50 each.

WARRANT

The Company had on 30 September 2011, issued 68,600,000 2011/2016 Warrants to all entitled shareholders of the Company on the basis of one (1) free Warrant for every two (2) existing ordinary shares of RM0.50 each held in the Company. The Warrants were listed on the Main Market of Bursa Malaysia Securities Berhad on 6 October 2011. The Warrants are constituted under a Deed Poll executed on 12 September 2011, and each Warrant entitles the registered holder the right at any time during the exercise period from 30 September 2011 to 29 September 2016 to subscribe in cash for one new ordinary share of RM0.50 each of the Company at an exercise price of RM0.50 each.

At the end of the financial period, the entire 68,600,000 Warrants remained unexercised. The main features of the Warrants are detailed in Note 18 to the financial statements.

OUTLOOK

The fiscal policy for the next year will remian prudent and supportive of economic growth due to the resilient domestic demands which is reinforced by strong intra-regional trade. The upcoming General Election will have a diverse impact on the nations economical infrastructure developments. the Group has thus embarked on Government and Private development projects to propel itself to a positive growth in the forthcoming years.

At current and in the future, there is increased need for more piped water to be distributed into new development areas. this should have positive impact to our business. The continuous importance of the palm oil industry in the country brings about many direct and indirect benefits to our business as well, especially in the East Malaysia meanwhile, the revenue from our production facility in Batam, Indonesia is growing positively.

The Group firmly believes in continuous product developments and is actively doing so. The Group also hopes to develop and improves its market shares especially in the emerging Asean countries.

ACKNOWLEDGEMENT

Last but not least, I, on behalf of the Board, wish to convey my heartfelt thanks to our dedicated and honourable team of management and staff and all stakeholders for their continued support and loyalty.

Y. Bhg. Dato Abu Sujak Bin MahmudChairman

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12 Resintech Berhad

AUDIT COMMITTEE REPORT

1. COMPOSITION AND MEETINGS

During the financial period ended 31 March 2012, a total of five (5) Audit Committee meetings were conducted. The attendance of members of the Audit Committee during the financial period are as follows:

Attendance of meetings

Chairman: Dato’ Abu Sujak Bin Mahmud 5/5 (Independent Non-Executive Chairman) Members: Khairul Anuar Bin Shaharudin 4/5 (Independent Non-Executive Director) Kok Wee Wah 5/5 (Independent Non-Executive Director)

Meetings agendas and relevant information are distributed to the Audit Committee members with sufficient notification. The Company Secretaries are also responsible for recording the proceedings of the Audit Committee meetings. The senior Management staff, internal auditors and external auditors were invited to attend the Audit Committee meetings.

2. SUMMARY OF TERMS OF REFERENCE

a) Composition

The Audit Committee shall be appointed from amongst the Board and shall comprise no fewer than three (3) members who are Non-Executive Directors and majority of whom are Independent Directors. No alternate director shall be appointed as a member of the Audit Committee.

All members of the Audit Committee should be financially literate and at least one (1) member of the Audit Committee must be a member of the Malaysian Institute of Accountants or if he is a not a member of the Malaysian Institute of Accountants, he must have at least 3 years’ working experience and fulfils such requirements as prescribed by Bursa Malaysia Securities Berhad;

In the event of any vacancy with the result that the number of members is reduced to below three, the vacancy shall be filled within two (2) months but in any case not later than three (3) months. Therefore a member of the Audit Committee who wishes to retire or resign should provide sufficient written notice to the Company so that a replacement may be appointed before he leaves.

The Board shall review the term of office and performance of the Audit Committee and each of its members at least once every three (3) years to determine whether the Audit Committee and its members have carried out their duties in accordance with their terms of reference.

b) Chairman

The Chairman, who shall be elected by the Audit Committee, shall be an Independent Director. In the event of the Chairman’s absence, the meeting shall be chaired by another Independent Director.

c) Secretary

The Company Secretary shall be the Secretary of the Committee and shall be responsible, in conjunction with the Chairman, for drawing up the agenda and circulating it prior to each meeting.

The Secretary and/or such other person as authorised by the Audit Committee shall also be responsible for keeping the minutes of meetings of the Committee.

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1�Annual Report 2012

2. TERMS OF REFERENCE (CONT’D)

d) Meetings

The Audit Committee shall meet at least four (4) times in each financial year and may regulate its own procedure in lieu of convening a formal meeting by means of conference telephone, conference videophone or any similar or other communications equipment by means of which all persons participating in the meeting can hear each other. Such participation in a meeting shall constitute presence in person at such meeting.

The quorum for a meeting shall be two (2) members, provided that the majority of members present shall be Independent Directors.

e) Rights

The Audit Committee shall:

(a) have authority to investigate any matter within its terms of reference; (b) have the resources which are required to perform its duties; (c) have full and unrestricted access to any information pertaining to the Group; (d) have direct communication channels with the external auditors and person(s) carrying out the internal audit function or activity; (e) have the right to obtain legal or independent professional or other advice at the Company’s expense; (f ) have the right to convene meetings with the external auditors, excluding the attendance of the executive members of the audit committee, whenever deemed necessary; (g) promptly report to the Bursa Malaysia Securities Berhad, or such other name(s) as may be adopted by Bursa Malaysia Securities Berhad, matters which have not been satisfactorily resolved by the Board of Directors resulting in a breach of the Listing Requirements of Bursa Malaysia Securities Berhad; (h) have the right to pass resolutions by a simple majority vote from the Committee and that the Chairman shall have the casting vote should a tie arise; (i) meet as and when required on a reasonable notice; (j) have the right to request the Chairman to call for a meeting upon the request of the internal auditors and external auditors; and (k) have the right to convene meetings with the external auditors, the internal auditors or both, excluding the attendance of other Directors and employees of the Company, whenever deemed necessary.

f) Duties

The duties of the Audit Committee shall include a review of:

(a) To review with the external auditors on: • the audit plan, its scope and nature; • the audit report; • the results of their evaluation of the accounting policies and systems of internal accounting controls within the Group; and • the assistance given by the officers of the Company to external auditors, including any difficulties or disputes with Management encountered during the audit.

audit committee report (cont’d)

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2. TERMS OF REFERENCE (CONT’D)

f) Duties (cont’d)

(b) To review the adequacy of the scope, functions, competency and resources and set the standards of the internal audit function.

(c) To recommend such measures as to be taken by the Board of Directors on the effectiveness of the system of internal control, management information and risk management practices of the Group.

(d) To review the internal audit programme and the results of the internal audit programme, processes or investigation undertaken and whether or not appropriate action is taken on the recommendations of the internal audit function.

(e) To review with Management: • audit reports and management letter issued by the external auditors and the implementation of audit recommendations; • interim financial information; and • the assistance given by the officers of the Company to external auditors.

(f ) To monitor related party transactions entered into by the Company or the Group and to determine if such transactions are undertaken on an arm’s length basis and normal commercial terms and on terms not more favourable to the related parties than those generally available to the public, and to ensure that the Directors report such transactions annually to shareholders via the annual report, and to review conflicts of interest that may arise within the Company or the Group including any transaction, procedure or course of conduct that raises questions of Management integrity.

(g) To review the quarterly reports on consolidated results and annual financial statements prior to submission to the Board of Directors, focusing particularly on: • changes in or implementation of major accounting policy and practices; • significant and / or unusual matters arising from the audit; • the going concern assumption; • compliance with accounting standards and other legal requirements; and • other major areas.

(h) To consider the appointment and / or re-appointment of auditors, the audit fee and any questions of resignation or dismissal including recommending the nomination of person or persons as auditors to the Board of Directors.

(i) To review the allocation of options pursuant to a share scheme, if any, for employees as being in compliance with the criteria for allocation of options under the employees’ share option scheme, at the end of each financial year.

(j) To approve any appointment or termination of senior staff members of the internal audit function.

(k) To consider the major findings of internal investigations and Management’s response.

(l) The Audit Committee should meet regularly, with due notice of issues to be discussed, and should record its conclusions in discharging its duties and responsibilities.

audit committee report (cont’d)

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3. SUMMARY OF ACTIVITIES

In line with the Terms of Reference of the Audit Committee, the following activities were undertaken by the Audit Committee during the financial period ended 31 March 2012, in the discharge of its functions and duties, included the deliberation and: (a) Reviewed the unaudited quarterly reports on the consolidated results of the Group;

(b) Reviewed the audited financial statements and ensured that the financial reporting and disclosure requirements of relevant authorities had been complied with before recommending to the Board for approval;

(c) Reviewed the Statement on Internal Control and Audit Committee Report for inclusion in the 2012 Annual Report;

(d) Considered related party transactions and conflict of interest situation that may arise within the Group;

(e) Considered the re-appointment of the external auditors after they have expressed their willingness to continue in office with the consultation of the Management and recommended to the Board of Directors for approval;

(f ) Considered the external audit fees and recommended the same for the approval of the Board of Directors;

(g) Reviewed the external auditors’ report in relation to audit and accounting issues arising from the audit, new development and updates on the Financial Reporting Standards issued by the Malaysian Accounting Standards Board and their impact on the Group;

(h) Meeting with the external auditors without the presence of the executive Board members and Management;

(i) Reviewed and follow-up reports presented by the internal auditors to ensure adequate scope and coverage of the activities of the Group; and

(j) Considered the appointment of the existing internal auditors and recommended to the Board members for approval.

4. INTERNAL AUDIT FUNCTION

The Company’s internal audit function is outsourced to an external professional services firm where its principal objective is to assist the Board to monitor the risks as well as periodically review the system of internal control. This is to ensure that the system of internal control established by the Management is functioning effectively and satisfactorily in the Group.

As an independent function, the professional services firm reported directly to the Audit Committee. An internal audit plan for the year was prepared by the professional services firm and was approved by the Audit Committee. In carrying out the internal audit plan for the year under review, the independent professional services firm carried out internal audit reviews on the Procure to Pay Cycle and Hire to Retire Cycle, both of Resintech-Kapar Sdn Bhd. These reviews were coordinated by the Group’s Management and Staff.

Recommendations for improvement to the system of internal control were made to the Management upon reviews made. Such reviews and its subsequent implementations status were updated to the Audit Committee.

audit committee report (cont’d)

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CORPORATE GOVERNANCE STATEMENT

The Board of Directors (“the Board”) of Resintech Berhad recognises the importance of establishing and maintaining good corporate governance within the Group. The Board is committed to ensure the adoption of the principles and best practices of the Malaysian Code on Corporate Governance (“the Code”) to safeguard the Group’s assets and shareholders’ interests. This statement sets out the manner in which the Group has applied the Principles and the extent of compliance with the Best Practices in Corporate Governance as set out in Part 1 and Part 2 respectively of the Code. The best practices that were not adopted during the financial year are explained in the relevant paragraphs.

THE BOARD OF DIRECTORS

• Composition

The Group is led by an effective and experienced Board members with from different backgrounds possessing a wide range of expertise. Together they bring a broad range of skills, experience and knowledge which give added strength to the leadership in managing and directing the Group’s operations.

The Board recognises its key role in charting the strategic direction, development and control of the Group which would include, among others, the reviewing and monitoring of matters relating to strategy, performance, resource allocation, standards of conduct, financial matters, succession planning, effectiveness and adequacy of the Group’s system of internal controls and risk management practices.

• Board Balance

The Board comprises seven (7) members, of whom, three (3) are Independent Non-Executive Directors and four (4) are Executive Directors. The profiles of the members of the Board are set out on page 8 to page 9 of this Annual Report.

The Executive Directors are primarily responsible for the implementation of policies and decisions of the Board, overseeing the Group’s operations and developing the Group’s business strategies. On the other hand, the role of the Independent Non-Executive Directors is to provide objective and independent judgment to the decision making of the Board. This provides as an effective check and balance to the Board’s decision making process.

With this composition of members, the Board is satisfied that it fairly reflects the investment of the minority shareholders and represents the mix of skills and experiences required for the effective discharge of Board’s duties and responsibilities.

There is a clear division of responsibilities between the roles of the Chairman and Managing Director to ensure that there is equilibrium of power and authority in managing and directing the Group. The Chairman is primarily responsible for the effective and efficient conduct and working of the Board whilst the Managing Director oversees the day-to-day management of the Group’s business operations and implementation of policies and strategies adopted by the Board.

• Board Meetings

During the financial period ended 31 March 2012, a total of five (5) Board meetings were conducted and the attendance details of individual Board members are shown below:

Name of Director Designation No. of meetings attended Y. Bhg. Dato’ Abu Sujak Bin Mahmud Independent Non-Executive Chairman 5/5 Y. Bhg. Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP Managing Director 4/5 Y. Bhg. Datin Gan Jew, PJK Executive Director 5/5 Teh Leng Kang, PJK Executive Director 4/5 Khairul Anuar Bin Shaharudin Independent Non-Executive Director 4/5 Wei Hwei Hong Executive Director 5/5 Kok Wee Wah Independent Non-Executive Director 5/5

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17Annual Report 2012

THE BOARD OF DIRECTORS (CONT’D)

• Board Meetings

Board meetings are scheduled every quarter and additional meetings are convened whenever necessary. During the meetings, Board members will deliberate on and consider matters relating to the Group’s financial performance, significant investments, corporate development, strategic issues and business plans. All meetings of the Board are duly recorded in the Board Minutes by the Company Secretaries.

All Directors have full access to the advice and services of the Company Secretaries who ensures that Board procedures are adhered to at all times during meetings and advises the Board on matters including corporate governance issues and the Directors’ responsibilities in complying with the relevant legislation and regulations.

• Supply of Information to Board Members

Directors are provided with sufficient notices for each Board meeting and board papers are distributed prior to the meetings to enable the Directors to review and consider the agenda items that will be discussed in the Board Meeting. The board papers providing updates on operations, financial, corporate developments and minutes of the Board Committees are circulated prior to each meeting. This is to provide the Directors with sufficient time to enable them to participate in the deliberations of the issues to be raised at the meetings and to make informed decisions.

• Appointment and Re-election of Directors

The appointment of Directors is undertaken by the Board as a whole guided by formal recommendations by the Nomination Committee.

In accordance with the Company’s Articles of Association, all Board members who are appointed by the Board shall be subject to election by shareholders at the first opportunity of their appointment. The Company’s Articles of Association also provide that at least one-third (1/3) of the Directors shall retire by rotation at each Annual General Meeting and that all Directors shall retire once every three (3) years. A retiring Director shall be eligible for re-election.

• Directors’ Training

All members of the Board have attended and successfully completed the Mandatory Accreditation Programme (“MAP”) as prescribed by Bursa Malaysia Securities Berhad (“Bursa Securities”). As an ongoing development, the Directors continued to undergo relevant trainings in order to further enhance thier skills and knowledge.

During the period, the Directors were also briefed by the Company Secretaries on the various amendments as and when arises to the Listing Requirements of the Bursa Securities, Companies Act, 1965 as well as the Code. Amongst the training programmes and seminars or courses attended by members of the Board during the financial period ended 31 March 2012 were:

Directors Date of Course Seminar / Course Dato’ Abu Sujak Bin Mahmud 14th Mar 2012 The Case for Diversity in The Boardroom Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP 19th – 26th November 2011 International Maritime Organisation Conference London Datin Gan Jew, PJK 19th – 26th November 2011 International Maritime Organisation Conference London Khairul Anuar Bin Shaharudin 4th - 5th October 2011 Kuala Lumpur Islamic Finance Forum 2011 Teh Leng Kang, PJK 27th – 29th March 2012 Asiawater 2012 Wei Hwei Hong 13th January 2012 GST Impact On Manufacturing and Export Sector Kok Wee Wah 14th Mar 2012 The Case for Diversity in The Boardroom

corporate governance statement (cont’d)

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BOARD COMMITTEES

Apart from the Audit Committee, there are two additional committees established to assist the Board of Directors in the execution of its responsibilities. All the committees are provided with written terms of reference. Details of the Board committees are provided below.

• Nomination Committee

The Nomination Committee has two (2) members, all of whom are Independent Non-Executive Directors. The members of the Nomination Committee are:

Chairman Dato’ Abu Sujak Bin Mahmud – Independent Non-Executive Chairman

Member Khairul Anuar Bin Shaharudin – Independent Non-Executive Director

The Nomination Committee is empowered by the Board of Directors and its terms of reference to assist the Board of Directors in their responsibilities in nominating new candidates for the Board and Board Committees and also assess their effectiveness.

• Remuneration Committee

The Remuneration Committee comprises one (1) Executive Director and two (2) Independent Non-Executive Directors. The members of the Remuneration Committee are:

Chairman Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP – Managing Director

Members Dato’ Abu Sujak Bin Mahmud – Independent Non-Executive Chairman Khairul Anuar Bin Shaharudin – Independent Non-Executive Director

The responsibility of the Remuneration Committee is to recommend the remuneration policy for Executive Directors. This includes recommending remuneration packages to attract, retain and motivate the Directors, which are reflective of the Directors’ experience and level of responsibilities.

None of the Executive Directors participate in any way in determining their individual remuneration. The remuneration of the Executive Directors is to be reviewed annually. The remuneration and entitlements of the Non-Executive Directors is a matter of the Board of Directors as a whole.

corporate governance statement (cont’d)

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19Annual Report 2012

DIRECTORS’ REMUNERATION

The aggregate remuneration of Directors for the financial period ended 31 March 2012 are categorised as follows:

(a) Total Remuneration

Executive Directors Non-Executive Directors Total RM RM RM

Basic Salary 882,000 - 882,000 Bonuses & incentives - - - Fees 110,000 113,500 223,500 Benefits-in-kind 108,526 - 108,526 Total 1,100,526 113,500 1,214,026

(b) Directors’ remuneration by bands

Executive Non-Executive Total

Below RM50,000 - 3 3 RM100,001 to RM150,000 1 - 1 RM200,001 to RM205,000 2 - 2 RM450,001 to RM500,000 1 - 1 Total number of Directors 4 3 7

The details of individual Director’s remuneration are not disclosed as the Board considers the above disclosures on the Directors’ remuneration are sufficient to cater to the transparency and accountability aspects of the Code.

RELATION WITH SHAREHOLDERS AND INVESTORS

Shareholders and Investors Relations

The Group recognises the importance of timely and thorough dissemination of information to shareholders. In this regard, the information that is disseminated to the investment community conforms strictly with the Bursa Securities disclosure rules and regulations. Care is taken to ensure that no market sensitive information such as corporate proposals, financial results and other material information is disseminated to any party without first making an official announcement through Bursa Securities. The annual report has comprehensive information pertaining to the Group, while various disclosures on quarterly and annual results provide investors with financial information.

The Group has also established a website at www.resintechmalaysia.my from which shareholders as well as members of the public may access for the latest information on operations and activities of the Group.

Annual General Meeting

The Annual General Meeting (“AGM”) is the principal platform for dialogue with the shareholders. At the AGM, the Board presents the progress and performance of the Group to provide shareholders with the opportunity to question the business issues, concerns and operations in general. The Board will also ensure that each item of special business is included in the notice of the AGM and will be accompanied by an explanation of the effects of the proposed resolutions.

corporate governance statement (cont’d)

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ACCOUNTABILITY AND AUDIT

Financial Reporting

In presenting the annual audited financial statements and interim financial statements on a quarterly basis to the shareholders, the Board is responsible to present a clear, balanced and understandable assessment of the Group’s performance and position. The Audit Committee assists the Board in reviewing the information to be disclosed, to ensure the completeness, accuracy and adequacy of financial disclosures.

Internal Controls

In relation to the internal audit function, having considered the Group’s operational requirements, the Board is of the view that the Group should still continue to outsource its internal audit function to external consultants. Nevertheless, this outsourcing arrangement shall be reviewed annually to ensure that it continues to meet the Group’s requirements. The outsourced internal auditors assist the Board and the Audit Committee in providing independent assessment of the adequacy, efficiency and effectiveness of the Group’s internal control systems. They report directly to the Audit Committee.

The Statement on Internal Control is set out on pages 22 to 23 of this Annual Report provides an overview of the state of internal controls within the Group.

Relationship with Auditors

Through the Audit Committee, the Board maintains a formal and transparent relationship with the external auditors in seeking professional advice and ensuring compliance with the appropriate accounting standards. The external auditors will highlight to the Audit Committee and the Board on matters that require their attention.

Information on the role of Audit Committee in relation to the external auditors is set out in the Audit Committee Report on pages 12 to 15 of this Annual Report.

corporate governance statement (cont’d)

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ADDITIONAL COMPLIANCE INFORMATION

1. SHARE BUY-BACK

During the financial period, the Company did not carry out any share buy-back transactions.

2. OPTIONS, WARRANTS OR CONVERTIBLE SECURITIES

The Company has issued 68,600,000 warrants during the financial period.

3. AMERICAN DEPOSITORY RECEIPTS (“ADR”) OR GLOBAL DEPOSITORY RECEIPT (“GDR”)

The Company did not participate in any ADR or GDR Programme during the financial period.

4. SANCTIONS AND/OR PENALTIES

There were no material sanctions and/or penalties imposed on the Company and its subsidiaries, Directors or Management by any regulatory bodies during the financial period.

5. NON-AUDIT FEES

During the financial period, the non-audit fees paid by the Company to the external auditors amounted to RM5,000.

6. VARIATION IN RESULTS FOR THE FINANCIAL PERIOD

There was no material variance between the audited results for the financial period ended 31 March 2012 and the unaudited results previously announced.

7. PROFIT GUARANTEE

No profit guarantees were given by the Company during the financial period.

8. MATERIAL CONTRACTS

There were no material contracts entered into by the Company and its subsidiaries involving the Company’s Directors’ and major shareholders’ interests, either still subsisting at the end of the financial period, or which were entered into since the end of the previous financial period.

9. UTILISATION OF PROCEEDS There were no proceeds raised from any corporate proposals during the financial period.

10. RECURRENT RELATED PARTY TRANSACTIONS

The Company and its subsidiaries did not enter into any recurrent related party transactions during the financial period ended 31 March 2012 which exceeded the value prescribed by the Listing Requirements of Bursa Malaysia Securities Berhad.

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In accordance with the Paragraph 15.26(b) of the Listing Requirements of Bursa Malaysia Securities Bhd., the Board is pleased to presents herewith its Statement on Internal Control.

BOARD RESPONSIBILITY

The Board of Directors recognizes the importance of sound system of internal control to safeguard shareholders’ investment and the Group’s assets against potential shortcomings.

The Board is also aware of the limitations inherent in any internal control systems. As such, a sound internal control system manages the potential risk of failure to achieve corporate objectives rather than totally eliminating it. Therefore, the system of internal control can only provide reasonable assurance, not absolute assurance, against any material misstatements or losses. With such benefits and limitations, due consideration was given to weigh the cost as compared to the expected benefits from the devising and implementing the control procedures. The Board confirms that this process is in place for the year under review and that it accords with the Internal Control Guidance.

RISK MANAGEMENT

The Board acknowledges that there is an underlying and ongoing process in the Group for the identification, evaluation and mitigation of its significant risks. Management from each department identifies their risks within the defined parameters and standards. Such process was exercised through periodic management meetings held to communicate and deliberate key issues and risks amongst Management team members. Where appropriate, controls are devised, revised, improved and implemented.

INTERNAL AUDIT FUNCTION

In carrying out the internal audit function, the Board has continued to be assisted by the outsourced external consultants and the Management team to review and evaluate the adequacy and integrity of the Group’s internal audit systems. The presence of ISO auditors in the Group also helps the Management in carrying out the assessment. The results of ISO auditors’ review are brought to the attention of the Management with follow-up reviews being conducted to ensure that the recommendations for improvement are implemented on a timely basis.

During the financial period under review, the cost incurred for the internal audit function amounted to RM 47,840.

OTHER KEY ELEMENTS OF INTERNAL CONTROLS

The other key elements of the Group’s internal control system are as follows:-

a) Well Defined Organisational Structure

Key responsibilities are clearly defined and authorization policy sets out appropriate authorization limit. Operational issues are highlighted during management meetings.

b) Operating Manual Internal policies and procedures are properly documented in the Standard Operating Procedures manuals.

STATEMENT ON INTERNAL CONTROL

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2�Annual Report 2012

c) Management Meetings

Regular management meetings are conducted and chaired by the Group’s Managing Director. Relevant progress and reports are presented for review and discussion.

d) Internal Audit Activities

Audit activities are conducted to assess adequacy of controls and monitor of compliance with the Group’s Policies and Procedures. During the financial year, 2 reviews were carried out.

e) Management Visits

Regular inspections of operations are performed by members of the senior management team.

f ) Financial Results

Financial results are reviewed quarterly by the Audit Committee and the Board.

CONCLUSION

During the financial period under review, a number of internal control weaknesses were identified and presented for improvement discussion. These are not expected to result in any material loss.

Moving forward, the Group will continue improving and enhancing the existing system of internal control pertaining to the identified risks with the anticipation of changing business environment.

statement on internal control (cont’d)

DIRECTORS’ RESPONSIBILITIES STATEMENT

The Directors of the Company are required to prepare the financial statements for each financial year which gives a true and fair view of the state of affairs and results of the Company and the Group.

The Directors are responsible for ensuring that the Company and the Group keep proper accounting records to enable the Company and the Group to disclose, with reasonable accuracy and without any material misstatement, the financial position of the Company and the Group as at 31 March 2012 and the profit and loss of the Company and the Group for the financial year ended on that date.

In preparing the financial statements for the financial period ended 31 March 2012, the Directors have:

a) adopted the relevant and appropriate accounting policies consistently;b) made judgements and estimates that are reasonable and prudent;c) adopted applicable accounting standards, subjects to any material departures, if any, which will be disclosed and explained in the financial statements; andd) prepared the financial statements on the assumption that the Company and the Group will operate as going concern.

In assessing the adequacy and effectiveness of the system of internal control and accounting control procedures of the Group, the Audit Committee reports to the Board its activities, significant results, findings and the necessary recommendations or changes.

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CORPORATE SOCIAL RESPONSIBILITY STATEMENT

The RB Group is fully aware of its corporate responsibilities for the community, employees, the environment, community and other stakeholders. RB undertakes to incorporate corporate social responsibilities (“CSR”) concepts into its daily operations and decision making by implementing transparent approach in communicating to its stakeholders and encouraging their feedback through prompt and detail disclosure.

Its employees well being is constantly reviewed. The Group encourages continuous learning through training and seminars. RB also promotes conductive working environment. RB hopes these will improve the quality of life for all people at large. RB supports CSR practices and hope to continue contributing actively in future.

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DIRECTORS’ REPORT 26

STATEMENT BY DIRECTORS 30

STATUTORY DECLARATION 30

INDEPENDENT AUDITORS’ REPORT 31

STATEMENTS OF FINANCIAL POSITION 33

STATEMENTS OF COMPREHENSIVE INCOME 35

STATEMENTS OF CHANGES IN EQUITY 37

STATEMENTS OF CASH FLOWS 38

NOTES TO THE FINANCIAL STATEMENTS 40

CONTENTS

FINANCIAL STATEMENTS

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2� Resintech Berhad

The directors of Resintech Berhad have pleasure in submitting their report and the audited financial statements of the Group and of the Company for the financial period ended 31 March 2012.

CHANGE OF ACCOUNTING YEAR END

The Company changed its accounting year end from 28 February to 31 March to facilitate the efficiency in financial reporting.

PRINCIPAL ACTIVITIES

The Company is principally engaged in the business of investment holding. The principal activities of the subsidiaries are disclosed in Note 5 to the financial statements. There have been no significant changes in the nature of these activities during the financial period.

RESULTS THE GROUP THE COMPANY RM’000 RM’000

Profit/(loss) after taxation 2,827 (487)

Attributable to:Owners of the Company 2,840 (487)Non-controlling interests (13) - 2,827 (487)

DIVIDENDS

No dividend was paid since the end of the previous financial year and the directors do not recommend the payment of any dividend for the current financial period.

RESERVES AND PROVISIONS

All material transfers to or from reserves or provisions during the financial period are disclosed in the financial statements.

ISSUES OF SHARES AND DEBENTURES

During the financial period,

(a) the Company increased its authorised share capital from RM100,000,000 to RM200,000,000 by the creation of 200,000,000 new ordinary shares of RM0.50 each;(b) there were no changes in the paid-up share capital of the Company; and(c) there were no issues of debentures by the Company.

WARRANTS

The Company had on 30 September 2011, issued 68,600,000 2011/2016 Warrants to all entitled shareholders of the Company on the basis of one (1) free Warrant for every two (2) existing ordinary shares of RM0.50 each held in the Company. The Warrants were listed on the Main Market of Bursa Malaysia Securities Berhad on 6 October 2011. The Warrants are constituted under a Deed Poll executed on 12 September 2011, and each Warrant entitles the registered holder the right at any time during the exercise period from 30 September 2011 to 29 September 2016 to subscribe in cash for one new ordinary share of RM0.50 each of the Company at an exercise price of RM0.50 each.

As at 31 March 2012, the entire 68,600,000 Warrants remained unexercised.

The main features of the Warrants are detailed in Note 18 to the financial statements.

DIRECTORS’ REPORT

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WARRANTS (CONT’D)

Ordinary shares issued from the exercise of Warrants shall rank pari passu in all respects with the existing issued ordinary shares of the Company except that they shall not be entitled to any dividends, distributions, rights, allotments and/or other distributions where the entitlement date of which precedes the relevant date of the allotment and issuance of the new shares arising from the exercise of Warrants.

OPTIONS GRANTED OVER UNISSUED SHARES

During the financial period, no options were granted by the Company to any person to take up any unissued shares in the Company.

EMPLOYEES’ SHARE OPTION SCHEME (“ESOS”)

The Company established an ESOS which was governed by the ESOS By-laws adopted by the shareholders on 16 October 2006. The ESOS involved the grant of Options to Eligible Persons (an employee or a director of the Company and its subsidiaries on the date of the offer) to subscribe for new ordinary shares of up to 15% of the issued and paid-up ordinary share capital of the Company at any time during the existence of the scheme in accordance with the provisions of the ESOS By-laws.

The ESOS was effective for a period of 5 years and lapsed on 15 October 2011. No options had been granted as at the expiry date.

BAD AND DOUBTFUL DEBTS

Before the financial statements of the Group and of the Company were made out, the directors took reasonable steps to ascertain that action had been taken in relation to the writing off of bad debts and the making of allowance for impairment losses on receivables, and satisfied themselves that all known bad debts had been written off and that adequate allowance had been made for impairment losses on receivables.

At the date of this report, the directors are not aware of any circumstances that would require the further writing off of bad debts, or the additional allowance for impairment losses on receivables in the financial statements of the Group and of the Company.

CURRENT ASSETS

Before the financial statements of the Group and of the Company were made out, the directors took reasonable steps to ascertain that any current assets other than debts, which were unlikely to be realised in the ordinary course of business, including their values as shown in the accounting records of the Group and of the Company, have been written down to an amount which they might be expected to realise.

At the date of this report, the directors are not aware of any circumstances which would render the values attributed to the current assets in the financial statements of the Group and of the Company misleading.

VALUATION METHODS

At the date of this report, the directors are not aware of any circumstances which have arisen which render adherence to the existing methods of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate.

CONTINGENT AND OTHER LIABILITIES

The contingent liability is disclosed in Note 41 to the financial statements. There does not exist:-

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

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

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

DIRECTORS’ REPORT (cont’d)

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28 Resintech Berhad

DIRECTORS’ REPORT (cont’d)

CHANGE OF CIRCUMSTANCES

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

ITEMS OF AN UNUSUAL NATURE

The results of the operations of the Group and of the Company during the financial period were not, in the opinion of the directors, substantially affected by any item, transaction or event of a material and unusual nature.

There has not arisen in the interval between the end of the financial period and the date of this report any item, transaction or event of a material and unusual nature likely, in the opinion of the directors, to affect substantially the results of the operations of the Group and of the Company for the financial period.

DIRECTORS

The directors who served since the date of the last report are as follows:-

Dato’ Dr. Teh Kim Poo, DSSA, PJK, JPDatin Gan Jew, PJKDato’ Abu Sujak Bin MahmudKhairul Anuar Bin ShaharudinTeh Leng KangWei Hwei HongKok Wee Wah

DIRECTORS’ INTERESTS

According to the register of directors’ shareholdings, the interests of directors holding office at the end of the financial period in shares in the Company and its related corporations during the financial period are as follows:-

NUMBER OF ORDINARY SHARES OF RM0.50 EACH AT AT 1.3.2011 BOUGHT SOLD 31.3.2012

The Company

Direct InterestsDato’ Dr. Teh Kim Poo, DSSA, PJK, JP 56,405,999 - - 56,405,999Datin Gan Jew, PJK 9,647,400 - - 9,647,400Dato’ Abu Sujak Bin Mahmud 4,569,600 - - 4,569,600Teh Leng Kang 4,200,002 - - 4,200,002

Deemed InterestsDato’ Dr. Teh Kim Poo, DSSA, PJK, JP 13,952,402 - - 13,952,402Datin Gan Jew, PJK 60,711,001 - - 60,711,001

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DIRECTORS’ REPORT (cont’d)

NUMBER OF WARRANTS 2011/2016 AT DATE OF ISSUE ON SOLD / AT 30.9.2011 BOUGHT EXERCISED 31.3.2012

The Company

Direct InterestsDato’ Dr. Teh Kim Poo, DSSA, PJK, JP 28,203,000 - - 28,203,000Datin Gan Jew, PJK 4,823,700 - - 4,823,700Dato’ Abu Sujak Bin Mahmud 2,284,800 - - 2,284,800Teh Leng Kang 2,100,001 - - 2,100,001

Deemed InterestsDato’ Dr. Teh Kim Poo, DSSA, PJK, JP 6,976,201 - - 6,976,201Datin Gan Jew, PJK 30,355,501 - - 30,355,501

By virtue of their shareholdings in the Company, Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP and Datin Gan Jew, PJK are deemed to have interests in shares in its related corporations during the financial period to the extent of the Company’s interest, in accordance with Section 6A of the Companies Act 1965.

The other directors holding office at the end of the financial period had no interest in shares in the Company and its related corporations during the financial period.

DIRECTORS’ BENEFITS

Since the end of the previous financial year, no director has received or become entitled to receive any benefit (other than a benefit included in the aggregate amount of emoluments received or due and receivable by directors as shown in the financial statements, or the fixed salary of a full-time employee of the Company) by reason of a contract made by the Company or a related corporation with the director or with a firm of which the director is a member, or with a company in which the director has a substantial financial interest except for any benefits which may be deemed to arise from transactions entered into in the ordinary course of business with a company in which certain directors have substantial financial interests as disclosed in Note 39 to the financial statements.

Neither during nor at the end of the financial period was the Group or the Company a party to any arrangements whose object is to enable the directors to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate.

SIGNIFICANT EVENTS DURING THE FINANCIAL PERIOD

The significant events during the financial period are disclosed in Note 45 to the financial statements.

AUDITORS

The auditors, Messrs. Crowe Horwath, have expressed their willingness to continue in office.

SIGNED IN ACCORDANCE WITH A RESOLUTION OF THE DIRECTORSDATED 30 JULY 2012

Datin Gan Jew, PJK

Teh Leng Kang

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STATEMENT BY DIRECTORS

We, Datin Gan Jew, PJK and Teh Leng Kang, being two of the directors of Resintech Berhad, state that, in the opinion of the directors, the financial statements set out on pages 33 to 86 are drawn up in accordance with Financial Reporting Standards and the Companies Act 1965 in Malaysia so as to give a true and fair view of the state of affairs of the Group and of the Company at 31 March 2012 and of their results and cash flows for the financial period ended on that date.

The supplementary information set out in Note 47, which is not part of the financial statements, is prepared in all material respects, in accordance with Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants and the directive of Bursa Malaysia Securities Berhad.

SIGNED IN ACCORDANCE WITH A RESOLUTION OF THE DIRECTORSDATED 30 JULY 2012

Datin Gan Jew, PJK Teh Leng Kang

STATUTORY DECLARATION

I, Wei Hwei Hong, I/C No. 760909-10-5544, being the director primarily responsible for the financial management of Resintech Berhad, do solemnly and sincerely declare that the financial statements set out on pages 33 to 86 are, to the best of my knowledge and belief, correct, and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declarations Act 1960.

Subscribed and solemnly declared byWei Hwei Hong, I/C No. 760909-10-5544,at Kuala Lumpur in the FederalTerritory on this 30 July 2012

Before me Wei Hwei HongDatin Hajah Raihela Wanchik (No. W275)Commissioner for Oaths

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INDEPENDENT AUDITORS’ REPORTTo the Members of Resintech Berhad(Incorporated in Malaysia) Company No : 341662 - X

REPORT ON THE FINANCIAL STATEMENTS

We have audited the financial statements of Resintech Berhad, which comprise the statements of financial position as at 31 March 2012 of the Group and of the Company, and the statements of comprehensive income, statements of changes in equity and statements of cash flows of the Group and of the Company for the financial period then ended, and a summary of significant accounting policies and other explanatory information, as set out on pages 33 to 86.

Directors’ Responsibility for the Financial Statements

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

Auditors’ Responsibility

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

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

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

Opinion

In our opinion, the financial statements have been properly drawn up in accordance with Financial Reporting Standards and the Companies Act 1965 in Malaysia so as to give a true and fair view of the financial position of the Group and of the Company as of 31 March 2012 and of their financial performance and cash flows for the financial period then ended.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

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

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

(b) We have considered the financial statements and the auditors’ reports of the subsidiary of which we have not acted as auditors, which are indicated in Note 5 to the financial statements.

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INDEPENDENT AUDITORS’ REPORTTo the Members of Resintech Berhad (cont’d)(Incorporated in Malaysia) Company No : 341662 - X

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS (CONT’D)

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

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

The supplementary information set out in Note 47 on page 86 is disclosed to meet the requirement of Bursa Malaysia Securities Berhad and is not part of the financial statements. The directors are responsible for the preparation of the supplementary information in accordance with Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants (“MIA Guidance”) and the directive of Bursa Malaysia Securities Berhad. In our opinion, the supplementary information is prepared, in all material respects, in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities Berhad.

OTHER MATTERS

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

Crowe Horwath Ooi Song WanFirm No: AF 1018 Approval No: 2901/10/12 (J)Chartered Accountants Chartered Accountant

31 July 2012

Kuala Lumpur

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��Annual Report 2012

STATEMENTS OFFINANCIAL POSITIONAt 31 March 2012

THE GROUP THE COMPANY 31.3.2012 28.2.2011 31.3.2012 28.2.2011 NOTE RM’000 RM’000 RM’000 RM’000

ASSETS NON-CURRENT ASSETS Investments in subsidiaries 5 - - 44,418 44,418 Investment in an associate 6 463 623 540 540Property, plant and equipment 7 82,093 79,048 - -Investment properties 8 1,295 240 - -Intangible assets 9 548 424 - - 84,399 80,335 44,958 44,958

CURRENT ASSETSInventories 10 24,042 23,770 - -Short-term investment 11 101 101 - -Trade receivables 12 19,438 16,524 - -Other receivables, deposits and prepayments 1,670 3,431 22 22Amount owing by subsidiaries 13 - - 24,773 25,252Tax refundable 2,218 1,880 61 51Fixed deposits with a licensed bank 14 392 150 - -Cash and bank balances 3,530 1,918 12 17 51,391 47,774 24,868 25,342

Non-current asset classified as held for sale 15 7,582 7,536 - -

TOTAL ASSETS 143,372 135,645 69,826 70,300

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

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STATEMENTS OFFINANCIAL POSITIONAt 31 March 2012 (cont’d)

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

THE GROUP THE COMPANY 31.3.2012 28.2.2011 31.3.2012 28.2.2011 NOTE RM’000 RM’000 RM’000 RM’000

EQUITY AND LIABILITIESEQUITYShare capital 16 68,600 68,600 68,600 68,600Share premium 17 - - - -Revaluation reserves 19 6,273 6,469 - -Retained profits 20 8,702 5,666 1,113 1,600

TOTAL ATTRIBUTABLE TO THE OWNERS OF THE COMPANY 83,575 80,735 69,713 70,200

NON-CONTROLLING INTERESTS -* 13 - -

TOTAL EQUITY 83,575 80,748 69,713 70,200

NON-CURRENT LIABILITIESLong-term borrowings 21 8,122 6,081 - -Deferred tax liabilities 24 9,524 10,121 - - 17,646 16,202 - -

Note:* - Represents an amount below RM1,000.

CURRENT LIABILITIESTrade payables 25 9,019 4,526 - -Other payables and accruals 26 3,407 3,234 74 58Amount owing to a related party 27 288 365 - -Provision for taxation 1,425 1,023 39 42Short-term borrowings 28 22,465 24,406 - -Bank overdrafts 29 4,707 4,301 - - 41,311 37,855 113 100

Liability directly associated with asset classified as held for sale 15 840 840 - -

TOTAL LIABILITIES 59,797 54,897 113 100

TOTAL EQUITY AND LIABILITIES 143,372 135,645 69,826 70,300

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��Annual Report 2012

STATEMENTS OFCOMPREHENSIVE INCOMEFor the financial period from 1 March 2011 to 31 March 2012

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011 NOTE RM’000 RM’000 RM’000 RM’000

REVENUE 30 97,059 83,536 81 21,000COST OF SALES (81,774) (70,123) - -

GROSS PROFIT 15,285 13,413 81 21,000OTHER INCOME 31 1,872 736 - 120

17,157 14,149 81 21,120

SELLING AND DISTRIBUTION EXPENSES (2,302) (2,079) - -

ADMINISTRATIVE EXPENSES (7,273) (6,044) (541) (343)

OTHER EXPENSES (1,823) (1,820) - - (11,398) (9,943) (541) (343) 5,759 4,206 (460) 20,777

FINANCE COSTS (2,138) (2,292) - -

3,621 1,914 (460) 20,777SHARE OF (LOSS)/PROFIT OF AN ASSOCIATE (160) 83 - -

PROFIT/(LOSS) BEFORE TAXATION 32 3,461 1,997 (460) 20,777

INCOME TAX EXPENSE 33 (634) 8 (27) (29)

PROFIT/(LOSS) AFTER TAXATION 2,827 2,005 (487) 20,748

OTHER COMPREHENSIVE INCOME, NET OF TAX - - - -

TOTAL COMPREHENSIVE INCOME FOR THE FINANCIAL PERIOD 2,827 2,005 (487) 20,748

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

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STATEMENTS OFCOMPREHENSIVE INCOMEFor the financial period from 1 March 2011 to 31 March 2012 (cont’d)

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011 NOTE RM’000 RM’000 RM’000 RM’000

PROFIT/(LOSS) AFTER TAXATION ATTRIBUTABLE TO:-Owners of the Company 2,840 2,058 (487) 20,748Non-controlling interests (13) (53) - - 2,827 2,005 (487) 20,748

TOTAL COMPREHENSIVE INCOME/ (EXPENSES) ATTRIBUTABLE TO:-Owners of the Company 2,840 2,058 (487) 20,748Non-controlling interests (13) (53) - - 2,827 2,005 (487) 20,748 EARNINGS PER SHARE (SEN)Basic 34 2 2

Not Not Diluted 34 applicable applicable

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

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STATEMENTS OFCHANGES IN EQUITYFor the financial period from 1 March 2011 to 31 March 2012

ATTRIBUT- ABLE REVALUA- TO OWNERS NON- SHARE SHARE RETAINED TION OF THE CONTROLLING TOTAL CAPITAL PREMIUM PROFITS RESERVES COMPANY INTERESTS EQUITY

RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

THE GROUP

Balance at 1.3.2010 49,000 1,274 23,013 6,566 79,853 66 79,919

Contribution by and distribution to owners of the Company - bonus issue 19,600 (1,274) (18,326) - - - - - interim tax-exempt dividend of 1.20 sen per ordinary share - - (1,176) - (1,176) - (1,176)

Profit after taxation/Total comprehensive income for the financial year - - 2,058 - 2,058 (53) 2,005

Realisation of revaluation surplus - - 97 (97) - - -

Balance at 1.3.2011/28.2.2011 68,600 - 5,666 6,469 80,735 13 80,748

Profit after taxation/ Total comprehensive income for the financial period - - 2,840 - 2,840 (13) 2,827

Realisation of revaluation surplus - - 196 (196) - - -

Balance at 31.3.2012 68,600 - 8,702 6,273 83,575 - 83,575 THE COMPANY

Balance at 1.3.2010 49,000 1,274 354 - 50,628 - 50,628

Contribution by and distribution to owners of the Company - bonus issue 19,600 (1,274) (18,326) - - - - - interim tax-exempt dividend of 1.20 sen per ordinary share - - (1,176) - (1,176) - (1,176)

Profit after taxation/ Total comprehensive income for the financial year - - 20,748 - 20,748 - 20,748

Balance at 1.3.11/ 28.2.2011 68,600 - 1,600 - 70,200 - 70,200

Profit after taxation/ Total comprehensive income for the financial period - - (487) - (487) - (487)

Balance at 31.3.2012 68,600 - 1,113 - 69,713 - 69,713

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

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STATEMENTS OFCASH FLOWSFor the financial period from 1 March 2011 to 31 March 2012

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

CASH FLOWS FROM/(FOR) OPERATING ACTIVITIESProfit/(Loss) before taxation 3,461 1,997 (460) 20,777

Adjustments for:-Amortisation of intangible assets 87 46 - -Bad debts written off 1 5 - -Deposits written off 145 - - -Depreciation of property, plant and equipment 7,694 8,002 - -Property, plant and equipment written off 287 115 - -Intangible assets written off 18 - - -Impairment loss on investment properties 8 - - -Impairment loss on property, plant and equipment 201 - - -Impairment loss on trade receivables 106 345 - -Interest expense 2,138 2,057 - -Share of loss/(profit) of an associate 160 (83) - -Dividend income (86) - (81) (21,000)Fair value adjustments of investment properties (24) - - -Interest income (8) - - -Net gain on disposal of plant and equipment (162) (2) - -Reversal of impairment loss on trade receivables (455) (118) - -Unrealised gain on foreign exchange (53) (116) - -

Operating profit/(loss) before working capital changes 13,518 12,248 (541) (223)(Increase)/Decrease in inventories (272) 2,318 - -(Increase)/Decrease in trade and other receivables (923) (896) - 496Increase/(Decrease) in other payables and accruals 4,692 (1,528) 16 14

CASH FROM/(FOR) OPERATIONS 17,015 12,142 (525) 287Income tax paid (1,167) (1,164) (40) (45)Interest received 8 - - -Interest paid (2,138) (2,057) - -

NET CASH FROM/(FOR) OPERATING ACTIVITIES CARRIED FORWARD 13,718 8,921 (565) 242

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

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STATEMENTS OFCASH FLOWSFor the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011 NOTE RM’000 RM’000 RM’000 RM’000

NET CASH FROM/(FOR) OPERATING ACTIVITIES BROUGHT FORWARD 13,718 8,921 (565) 242

CASH FLOWS (FOR)/FROM INVESTING ACTIVITIESProceeds from disposal of plant and equipment 522 2 - -(Advances to)/ Repayment from subsidiaries - - 479 (18,177)Dividend received 86 - 81 21,000Investment in a subsidiary - - - (1,358)Investment in an associate - (540) - (540)Purchase of investment properties (1,039) - - -Purchase of intangible asset 9 (229) (156) - -Purchase of short-term investment 11 - (101) - -Purchase of property, plant and equipment 36 (11,233) (4,912) - -

NET CASH (FOR)/FROM INVESTING ACTIVITIES (11,893) (5,707) 560 925

CASH FLOWS FROM/(FOR)FINANCING ACTIVITIES(Repayment to)/Advances from a related party (77) 155 - -Net (repayment)/drawdown of bills payable (547) 4,313 - -Net drawdown/(repayment of ) term loans 376 (3,926) - -Net repayment of hire purchase payables (129) (244) - -Dividend paid - (1,176) - (1,176)

NET CASH FOR FINANCING ACTIVITIES (377) (878) - (1,176)

NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 1,448 2,336 (5) (9)

CASH AND CASH EQUIVALENTS AT BEGINNING OF THE FINANCIAL PERIOD/YEAR (2,233) (4,569) 17 26

CASH AND CASH EQUIVALENTS AT END OF THE FINANCIAL PERIOD/ YEAR 37 (785) (2,233) 12 17

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40 Resintech Berhad

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012

1. GENERAL INFORMATION

The Company is a public company limited by shares and is incorporated under the Companies Act 1965. The domicile of the Company is Malaysia. The registered office, which is also the principal place of business, is at Lot 3 & 5, Jalan Waja 14, Kawasan Perindustrian Telok Panglima Garang, 42500 Telok Panglima Garang, Selangor Darul Ehsan. The financial statements were authorised for issue by the Board of Directors in accordance with a resolution of the directors dated 30 July 2012.

2. PRINCIPAL ACTIVITIES

The Company is principally engaged in the business of investment holding. The principal activities of the subsidiaries are disclosed in Note 5 to the financial statements. There have been no significant changes in the nature of these activities during the financial period.

3. BASIS OF PREPARATION

The financial statements of the Group are prepared under the historical cost convention and modified to include other bases of valuation as disclosed in other sections under significant accounting policies, and in compliance with Financial Reporting Standards (“FRS”) and the Companies Act 1965 in Malaysia.

(a) During the current financial period, the Group has adopted the following new accounting standards and interpretations (including the consequential amendments):-

FRSs and IC Interpretations (Including the Consequential Amendments) FRS 1 (Revised) First-time Adoption of Financial Reporting Standards FRS 3 (Revised) Business Combinations FRS 127 (Revised) Consolidated and Separate Financial Statements Amendments to FRS 1 (Revised): Limited Exemption from Comparative FRS 7 Disclosures for First-time Adopters Amendments to FRS 1 (Revised): Additional Exemption for First-time Adopters Amendments to FRS 2: Scope of FRS 2 and FRS 3 (Revised) Amendments to FRS 2: Group Cash-settled Share-based Payment Transactions Amendments to FRS 5: Plan to Sell the Controlling Interest in a Subsidiary Amendments to FRS 7: Improving Disclosures about Financial Instruments Amendments to FRS 138: Consequential Amendments Arising from FRS 3 (Revised) IC Interpretation 4 Determining Whether An Arrangement Contains a Lease IC Interpretation 12 Service Concession Arrangements IC Interpretation 16 Hedges of a Net Investment in a Foreign Operation IC Interpretation 17 Distribution of Non-cash Assets to Owners IC Interpretation 18 Transfers of Assets from Customers Amendments to IC Interpretation 9: Scope of IC Interpretation 9 and FRS 3 (Revised) Annual Improvement to FRSs (2010)

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41Annual Report 2012

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

3. BASIS OF PREPARATION (CONT’D)

(a) The adoption of the above accounting standards and interpretations (including the consequential amendments) did not have any material impact on the Group’s financial statements, other than the following:-

(i) FRS 3 (Revised) introduces significant changes to the accounting for business combinations, both at the acquisition date and post acquisition, and requires greater use of fair values. In addition, all transaction costs, other than share and debt issue costs, will be expensed as incurred.

The Group has applied FRS 3 (Revised) prospectively. Accordingly, business combinations entered into prior 1 March 2011 have not been adjusted to comply with this revised standard.

(ii) FRS 127 (Revised) requires accounting for changes in ownership interests by the group in a subsidiary, whilst maintaining control, to be recognised as an equity transaction. When the group loses control of a subsidiary, any interest retained in the former subsidiary will be measured at fair value with the gain or loss recognised in profit or loss. The revised standard also requires all losses attributable to the non-controlling interests to be absorbed by the non-controlling interests instead of by the parent.

The Group has applied FRS 127 (Revised) prospectively.

(iii) Amendments to FRS 7 expand the disclosure requirements in respect of fair value measurements and liquidity risk. In particular, the amendments require additional disclosure of fair value measurements by level of a fair value measurement hierarchy, as shown in Note 44(e) to the financial statements. Comparatives are not presented by virtue of the exemption given in the amendments.

(iv) Annual Improvements to FRSs (2010) contain amendments to 11 accounting standards that result in accounting changes for presentation, recognition or measurement purposes.

The amendments to FRS 101 (Revised) clarify that an entity may choose to present the analysis of the items of other comprehensive income either in the statement of changes in equity or in the notes to the financial statements. The Group has chosen to present the items of other comprehensive income in the statement of changes in equity.

(b) The Group has not applied in advance the following accounting standards and interpretations (including the consequential amendments) that have been issued by the Malaysian Accounting Standards Board (MASB) but are not yet effective for the current financial period:-

FRSs and IC Interpretations (Including the Consequential Amendments) Effective date FRS 9 Financial Instruments 1 January 2015 FRS 10 Consolidated Financial Statements 1 January 2013 FRS 11 Joint Arrangements 1 January 2013 FRS 12 Disclosure of Interests in Other Entities 1 January 2013 FRS 13 Fair Value Measurement 1 January 2013 FRS 119 (Revised) Employee Benefits 1 January 2013 FRS 124 (Revised) Related Party Disclosures 1 January 2012 FRS 127 (2011) Separate Financial Statements 1 January 2013 FRS 128 (2011) Investment in Associates and Joint Ventures 1 January 2013 Amendments to FRS 1 (Revised): Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters 1 January 2012 Amendments to FRS 1 (Revised): Government Loans 1 January 2013 Amendments to FRS 7: Disclosures - Transfers of Financial Assets 1 January 2012 Amendments to FRS 7: Disclosures – Offsetting Financial Assets and Financial Liabilities 1 January 2013 Amendments to FRS 9: Mandatory Effective Date of FRS 9 And Transition Disclosures 1 January 2015 Amendments to FRS 101 (Revised): Presentation of Items of Other Comprehensive Income 1 July 2012 Amendments to FRS 112: Recovery of Underlying Assets 1 January 2012 Amendments to FRS 132: Offsetting Financial Assets and Financial Liabilities 1 January 2014 IC Interpretation 15 Agreements for the Construction of Real Estate Withdrawn on 19 November 2011 IC Interpretation 19 Extinguishing Financial Liabilities with Equity Instruments 1 July 2011 IC Interpretation 20 Stripping Costs in the Production Phase Of a Surface Mine 1 January 2013 Amendments to IC Interpretation 14: Prepayments of a Minimum Funding Requirement 1 July 2011

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42 Resintech Berhad

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

3. BASIS OF PREPARATION (CONT’D)

The Group’s next set of financial statements for the annual period beginning on 1 April 2012 will be prepared in accordance with the Malaysian Financial Reporting Standards (“MFRSs”) issued by the MASB that will also comply with International Financial Reporting Standards (“IFRs”). As a result, the Group will not be adopting the above accounting standards and interpretations (including the consequential amendments) that are effective for annual periods beginning on or after 1 January 2012.

(c) Following the issuance of MFRSs (equivalent to IFRSs) by the MASB on 19 November 2011, the Group will be adopting the new accounting standards in the next financial year. The Group is currently in the process of assessing the impact of the adoption of these new accounting standards and the directors do not expect any significant impact on the financial statements arising from the adoption.

4. SIGNIFICANT ACCOUNTING POLICIES

(a) Critical Accounting Estimates and Judgements

Estimates and judgements are continually evaluated by the directors and management and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The estimates and judgements that affect the application of the Group’s accounting policies and disclosures, and have a significant risk of causing a material adjustment to the carrying amounts of assets, liabilities, income and expenses are discussed below:-

(i) Depreciation of Property, Plant and Equipment

The estimates for the residual values, useful lives and related depreciation charges for the property, plant and equipment are based on commercial and production factors which could change significantly as a result of technical innovations and competitors’ actions in response to market conditions.

The Group anticipates that the residual values of its property, plant and equipment will be insignificant. As a result, residual values are not being taken into consideration for the computation of the depreciable amount.

Changes in the expected level of usage and commercial factors could impact the economic useful lives and the residual values of these assets, therefore future depreciation charges could be revised.

(ii) Income Taxes

There are certain transactions and computations for which the ultimate tax determination may be different from the initial estimate. The Group recognises tax liabilities based on its understanding of the prevailing tax laws and estimates of whether such taxes will be due in the ordinary course of business. Where the final outcome of these matters is different from the amounts that were initially recognised, such difference will impact the income tax and deferred tax provisions in the period in which such determination is made.

(iii) Impairment of Non-financial Assets

When the recoverable amount of an asset is determined based on the estimate of the value-in-use of the cash-generating unit to which the asset is allocated, the Group is required to make an estimate of the expected future cash flows from the cash-generating unit and also to apply a suitable discount rate in order to determine the present value of those cash flows.

(iv) Classification between Investment Properties and Owner-Occupied Properties

The Group determines whether a property qualifies as an investment property, and has developed criteria in making that judgement. Investment property is a property held to earn rentals or for capital appreciation or both. Therefore, the Group considers whether a property generates cash flows largely independent of the other assets held by the Group.

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NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(a) Critical Accounting Estimates and Judgements (Cont’d)

(iv) Classification between Investment Properties and Owner-Occupied Properties (Cont’d)

Some properties comprise a portion that is held to earn rentals or for capital appreciation and another portion that is held for use in the production or supply of goods or services or for administrative purposes. If these portions could be sold separately (or leased out separately under a finance lease), the Group accounts for the portions separately. If the portions could not be sold separately, the property is an investment property only if an insignificant portion is held for use in the production or supply of goods or services or for administrative purposes.

Judgement is made on an individual property basis to determine whether ancillary services are so significant that a property does not qualify as investment property.

(v) Impairment of Trade and Other Receivables An impairment loss is recognised when there is objective evidence that a financial asset is impaired. Management specifically reviews its loans and receivables financial assets and analyses historical bad debts, customer concentrations, customer creditworthiness, current economic trends and changes in the customer payment terms when making a judgment to evaluate the adequacy of the allowance for impairment losses. Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on historical loss experience for assets with similar credit risk characteristics. If the expectation is different from the estimation, such difference will impact the carrying value of receivables.

(vi) Writedown of Inventories

Reviews are made periodically by management on damaged, obsolete and slow-moving inventories. These reviews require judgement and estimates. Possible changes in these estimates could result in revisions to the valuation of inventories.

(vii) Fair Value Estimates for Certain Financial Assets and Liabilities

The Group carries certain financial assets and liabilities at fair value, which requires extensive use of accounting estimates and judgement. While significant components of fair value measurement were determined using verifiable objective evidence, the amount of changes in fair value would differ if the Group uses different valuation methodologies. Any changes in fair value of these assets and liabilities would affect profit and/or equity.

(viii) Revaluation of Properties

The Group’s properties which are reported at valuation are based on valuation performed by independent professional valuers.

The independent professional valuers have exercised judgement in determining factors used in the valuation process. Also, judgement has been applied in estimating prices for less readily observable external parameters. Other factors such as model assumptions, market dislocations and unexpected correlations can also materially affect these estimates and the resulting valuation estimates.

(ix) Impairment of Available-for-sale Financial Assets

The Group reviews its available-for-sale financial assets at the end of each reporting period to assess whether they are impaired. The Group also records impairment loss on available-for-sale equity investments when there has been a significant or prolonged decline in the fair value below their cost. The determination of what is “significant” or “prolonged” requires judgement. In making this judgement, the Group evaluates, among other factors, historical share price movements and the duration and extent to which the fair value of an investment is less than its cost.

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4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (a) Critical Accounting Estimates and Judgements (Cont’d)

(x) Classification of Leasehold Land

The classification of leasehold land as a finance lease or an operating lease requires the use of judgement in determining the extent to which risks and rewards incidental to its ownership lie. Despite the fact that there will be no transfer of ownership by the end of the lease term and that the lease term does not constitute the major part of the indefinite economic life of the land, management considered that the present value of the minimum lease payments approximated to the fair value of the land at the inception of the lease. Accordingly, management judged that the Group has acquired substantially all the risks and rewards incidental to the ownership of the land through a finance lease.

(b) Basis of Consolidation The consolidated financial statements include the financial statements of the Company and its subsidiaries made up to the end of the reporting period.

A subsidiary is defined as a company in which the parent company has the power, directly or indirectly, to exercise control over its financial and operating policies so as to obtain benefits from its activities.

Subsidiaries are consolidated from the date on which control is transferred to the Group up to the effective date on which control ceases, as appropriate.

Intragroup transactions, balances, income and expenses are eliminated on consolidation. Where necessary, adjustments are made to the financial statements of subsidiaries to ensure consistency of accounting policies with those of the Group.

Non-controlling interests are presented within equity in the consolidated statement of financial position, separately from the Company’s shareholders’ equity, and are separately disclosed in the consolidated statement of comprehensive income. Transactions with non-controlling interests are accounted for as transactions with owners and are recognised directly in equity. Profit or loss and each component of other comprehensive income are attributed to the owners of the parent and to the non-controlling interests. Total comprehensive income is attributed to non-controlling interests even if this results in the non-controlling interests having a deficit balance.

At the end of each reporting period, the carrying amount of non-controlling interests is the amount of those interests at initial recognition plus the non-controlling interest’s share of subsequent changes in equity.

All changes in the parent’s ownership interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. Any difference between the amount by which the non-controlling interest is adjusted and the fair value of consideration paid or received is recognised directly in equity and attributed to owners of the parent.

Upon loss of control of a subsidiary, the profit or loss on disposal is calculated as the difference between:- (i) the aggregate of the fair value of the consideration received and the fair value of any retained interest in the former subsidiary; and

(ii) the previous carrying amount of the assets (including goodwill), and liabilities of the former subsidiary and any non- controlling interests.

Amounts previously recognised in other comprehensive income in relation to the former subsidiary are accounted for (i.e. reclassified to profit or loss or transferred directly to retained profits) in the same manner as would be required if the relevant assets or liabilities were disposed of. The fair value of any investments retained in the former subsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting under FRS 127.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(b) Basis of Consolidation (Cont’d)

Business combinations from 1 March 2011 onwards

Acquisitions of businesses are accounted for using the acquisition method. Under the acquisition method, the consideration transferred for acquisition of a subsidiary is the fair value of the assets transferred, liabilities incurred and the equity interests issued by the Group at the acquisition date. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs, other than the costs to issue debt or equity securities, are recognised in profit or loss when incurred.

In a business combination achieved in stages, previously held equity interests in the acquiree are remeasured to fair value at the acquisition date and any corresponding gain or loss is recognised in profit or loss.

Non-controlling interests in the acquiree may be initially measured either at fair value or at the non-controlling interests’ proportionate share of the fair value of the acquiree’s identifiable net assets at the date of acquisition. The choice of measurement basis is made on a transaction-by-transaction basis.

The Group has applied the FRS 3 (Revised) in accounting for business combinations from 1 March 2011 onwards. The change in accounting policy has been applied prospectively in accordance with the transitional provisions provided by the standard.

Business combinations before 1 March 2011

All subsidiaries are consolidated using the purchase method. At the date of acquisition, the fair values of the subsidiaries’ net assets are determined and these values are reflected in the consolidated financial statements. The cost of acquisition is measured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for control of the acquiree, plus any costs directly attributable to the business combination.

Non-controlling interests are initially measured at their share of the fair values of the identifiable assets and liabilities of the acquiree as at the date of acquisition.

(c) Goodwill

Goodwill is measured at cost less accumulated impairment losses, if any. The carrying value of goodwill is reviewed for impairment annually. The impairment value of goodwill is recognised immediately in profit or loss. An impairment loss recognised for goodwill is not reversed in a subsequent period.

Business combinations from 1 March 2011 onwards

Under the acquisition method, any excess of the sum of the fair value of the consideration transferred in the business combination, the amount of non-controlling interests recognised and the fair value of the Group’s previously held equity interest in the acquire (if any), over the net fair value of the acquiree’s identifiable assets and liabilities at the date of acquisition is recorded as goodwill.

Where the latter amount exceeds the former, after reassessment, the excess represents a bargain purchase gain and is recognised as a gain in profit or loss.

Business combinations before 1 March 2011 onwards

Under the purchase method, goodwill represents the excess of the fair value of the purchase consideration over the Group’s share of the fair values of the identifiable assets, liabilities and contingent liabilities of the subsidiaries at the date of acquisition.

If, after reassessment, the Group’s interest in the fair values of the identifiable net assets of the subsidiaries exceeds the cost of the business combinations, the excess is recognised as income immediately in profit or loss.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(d) Functional and Foreign Currencies

(i) Functional and Presentation Currency

The individual financial statements of each entity in the Group are presented in the currency of the primary economic environment in which the entity operates, which is the functional currency.

The consolidated financial statements are presented in Ringgit Malaysia (“RM”) which is the Company’s functional and presentation currency.

(ii) Transactions and Balances

Transactions in foreign currencies are converted into the respective functional currencies on initial recognition, using the exchange rates approximating those ruling at the transaction dates. Monetary assets and liabilities at the end of the reporting period are translated at the rates ruling as of that date. Non-monetary assets and liabilities are translated using exchange rates that existed when the values were determined. All exchange differences are recognised in profit or loss.

(iii) Foreign Operations

Assets and liabilities of foreign operations are translated to RM at the rates of exchange ruling at the end of the reporting period. Revenues and expenses of foreign operations are translated at exchange rates ruling at the dates of the transactions. All exchange differences arising from translation are taken directly to other comprehensive income and accumulated in equity under the translation reserve. On the disposal of a foreign operation, the cumulative amount recognised in other comprehensive income relating to that particular foreign operation is reclassified from equity to profit or loss.

Goodwill and fair value adjustments arising from the acquisition of foreign operations are treated as assets and liabilities of the foreign operations and are recorded in the functional currency of the foreign operations and translated at the closing rate at the end of the reporting period.

(e) Financial Instruments

Financial instruments are recognised in the statements of financial position when the Group or the Company has become a party to the contractual provisions of the instruments.

Financial instruments are classified as liabilities or equity in accordance with the substance of the contractual arrangement. Interest, dividends, gains and losses relating to a financial instrument classified as a liability are reported as an expense or income. Distributions to holders of financial instruments classified as equity are charged directly to equity.

Financial instruments are offset when the Group or the Company has a legally enforceable right to offset and intends to settle either on a net basis or to realise the asset and settle the liability simultaneously.

A financial instrument is recognised initially, at its fair value plus, in the case of a financial instrument not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financial instrument.

Financial instruments recognised in the statements of financial position are disclosed in the individual policy statement associated with each item.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(e) Financial Instruments (Cont’d)

(i) Financial Assets

On initial recognition, financial assets are classified as either financial assets at fair value through profit or loss, held-to- maturity investments, loans and receivables financial assets, or available-for-sale financial assets, as appropriate.

• Financial Assets at Fair Value Through Profit or Loss

Financial assets are classified as financial assets at fair value through profit or loss when the financial asset is either held for trading or is designated to eliminate or significantly reduce a measurement or recognition inconsistency that would otherwise arise. Derivatives are also classified as held for trading unless they are designated as hedges.

Financial assets at fair value through profit or loss are stated at fair value, with any gains or losses arising on remeasurement recognised in profit or loss. Dividend income from this category of financial assets is recognised in profit or loss when the Group’s right to receive payment is established.

• Held-to-maturity Investments

Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturities that the management has the positive intention and ability to hold to maturity. Held-to-maturity investments are measured at amortised cost using the effective interest method less any impairment loss, with revenue recognised on an effective yield basis.

• Loans and Receivables Financial Assets

Trade receivables and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as loans and receivables financial assets. Loans and receivables financial assets are measured at amortised cost using the effective interest method, less any impairment loss. Interest income is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.

• Available-for-sale Financial Assets

Available-for-sale financial assets are non-derivative financial assets that are designated in this category or are not classified in any of the other categories.

After initial recognition, available-for-sale financial assets are remeasured to their fair values at the end of each reporting period. Gains and losses arising from changes in fair value are recognised in other comprehensive income and accumulated in the fair value reserve, with the exception of impairment losses. On derecognition, the cumulative gain or loss previously accumulated in the fair value reserve is reclassified from equity into profit or loss.

Dividends on available-for-sale equity instruments are recognised in profit or loss when the Group’s right to receive payments is established.

Investments in equity instruments whose fair value cannot be reliably measured are measured at cost less accumulated impairment losses, if any.

(ii) Financial Liabilities

All financial liabilities are initially at fair value plus directly attributable transaction costs and subsequently measured at amortised cost using the effective interest method other than those categorised as fair value through profit or loss.

Fair value through profit or loss category comprises financial liabilities that are either held for trading or are designated to eliminate or significantly reduce a measurement or recognition inconsistency that would otherwise arise. Derivatives are also classified as held for trading unless they are designated as hedges.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(e) Financial Instruments (Cont’d)

(iii) Equity Instruments

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from proceeds.

Dividends on ordinary shares are recognised as liabilities when approved for appropriation.

(f) Intangible Assets

An intangible asset shall be recognised if, and only if it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity and that the cost of the asset can be measured reliably. An entity shall assess the probability of the expected future economic benefits using reasonable and supportable assumptions that represent management’s best estimate of the set of economic conditions that will exist over the useful life of the asset. An intangible asset shall be measured initially at cost.

The useful lives of intangible assets are assessed to be either finite or indefinite.

Intangible assets with finite lives are amortised over their useful economic lives and assessed for impairment whenever there is an indication that the intangible assets may be impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life is reviewed at least at each financial period end. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset is accounted for by changing the amortisation period or method, as appropriate, and treated as changes in accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in profit or loss in the expense category consistent with the function of the intangible asset.

The principal amortisation rate used for this purpose is:-

Franchisor fee 5 years Patent right 10 years

Intangible assets with indefinite useful lives are tested for impairment annually either individually or at the cash generating unit level. Such intangibles are not amortised. The useful life of an intangible asset with an indefinite life is reviewed annually to determine whether indefinite life assessment continues to be supportable. If not, the change in the useful life assessment from indefinite to finite is made on a prospective basis.

(g) Investments in Subsidiaries

Investments in subsidiaries are stated at cost in the statement of financial position of the Company, and are reviewed for impairment at the end of the reporting period if events or changes in circumstances indicate that their carrying values may not be recoverable.

On the disposal of the investments in subsidiaries, the difference between the net disposal proceeds and the carrying amount of the investments is recognised in profit or loss.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(h) Investments in Associates

An associate is an entity in which the Group and the Company have a long-term equity interest and where it exercises significant influence over the financial and operating policies.

The investment in an associate is accounted for under the equity method, based on the financial statements of the associate made up to the end of the reporting period. The Group’s share of the post acquisition profits of the associate is included in the consolidated statement of comprehensive income and the Group’s interest in the associate is carried in the consolidated statement of financial position at cost plus the Group’s share of the post-acquisition retained profits and reserves.

Unrealised gains on transactions between the Group and the associate are eliminated to the extent of the Group’s interest in the associate. Unrealised losses are eliminated unless cost cannot be recovered.

On the disposal of the investment in associates, the difference between the net disposal proceeds and the carrying amount of the investments is recognised in profit or loss.

(i) Property, Plant and Equipment

Property, plant and equipment, other than the freehold and leasehold land and buildings are stated at cost less accumulated depreciation and impairment losses, if any.

Freehold land is stated at valuation less impairment losses recognised after the date of the revaluation. Freehold land is not depreciated. Buildings are stated at revalued amount less accumulated depreciation and impairment losses recognised after the date of the revaluation.

Leasehold land is stated at revalued amount less amortisation and impairment losses, if any.

Properties are revalued periodically, at least once in every five years. Surpluses arising from the revaluation of the properties are recognised in other comprehensive income and accumulated in equity under the revaluation reserve. Deficits arising from the revaluation, to the extent that they are not supported by any previous revaluation surpluses, are recognised in profit or loss.

Depreciation is calculated under the straight-line method to write off the depreciable amount of the assets over their estimated useful lives. Depreciation of an asset does not cease when the asset becomes idle or is retired from active use unless the asset is fully depreciated. The principal annual rates used for this purpose are:

Leasehold land Over the lease period Buildings 2% Plant and machinery 10% Tools and equipment 10% - 20% Moulds 10% Furniture and fittings 10% Office equipment 10% - 12% Motor vehicles and forklifts 20% Electrical installation 10% Renovation 10% Store 20%

The depreciation method, useful lives and residual values are reviewed, and adjusted if appropriate, at the end of each reporting period to ensure that the amounts, method and periods of depreciation are consistent with previous estimates and the expected pattern of consumption of the future economic benefits embodied in the items of the property, plant and equipment.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(i) Property, Plant and Equipment (Cont’d)

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when the cost is incurred and it is probable that the future economic benefits associated with the asset will flow to the Group and the cost of the asset can be measured reliably. The carrying amount of parts that are replaced is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred. Cost also comprises the initial estimate of dismantling and removing the asset and restoring the site on which it is located for which the Group is obligated to incur when the asset is acquired, if applicable.

Capital work-in-progress represents assets under construction, and which are not ready for commercial use at the reporting date. Capital work-in-progress is stated at cost, and is transferred to the relevant category of assets and depreciated accordingly when the assets are completed and ready for commercial use.

Cost of capital work-in-progress includes direct cost, related expenditure and interest cost on borrowings taken to finance the construction or acquisition of the assets till the date that the assets are completed and put into use, net of interest income on the temporary investment of those borrowings.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use. Any gain or loss arising from derecognition of the asset is included in profit or loss. The revaluation reserve included in equity is transferred directly to retained profits on retirement or disposal of the asset. In addition, the Group also makes an annual transfer of the revaluation reserve to retained profits as the asset is used. In such a case, the amount of the revaluation reserve transferred would be the difference between depreciation based on the revalued carrying amount of the asset and depreciation based on the asset’s original cost.

(j) Impairment (i) Impairment of Financial Assets

All financial assets (other than those categorised at fair value through profit or loss), are assessed at the end of each reporting period whether there is any objective evidence of impairment as a result of one or more events having an impact on the estimated future cash flows of the asset. For an equity instrument, a significant or prolonged decline in the fair value below its cost is considered to be objective evidence of impairment.

An impairment loss in respect of held-to-maturity investments and loans and receivables financial assets is recognised in profit or loss and is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.

An impairment loss in respect of available-for-sale financial assets is recognised in profit or loss and is measured as the difference between its cost (net of any principal payment and amortisation) and its current fair value, less any impairment loss previously recognised in the fair value reserve. In addition, the cumulative loss recognised in other comprehensive income and accumulated in equity under fair value reserve, is reclassified from equity to profit or loss.

With the exception of available-for-sale equity instruments, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed through profit or loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised. In respect of available-for-sale equity instruments, impairment losses previously recognised in profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss made is recognised in other comprehensive income.

For available-for-sale debt investments, impairment losses are subsequently reversed in profit or loss if an increase in the fair value of the investment can be objectively related to an event occurring after the recognition of the impairment loss in profit or loss.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(j) Impairment (Cont’d)

(ii) Impairment of Non-Financial Assets

The carrying values of assets, other than those to which FRS 136 - Impairment of Assets does not apply, are reviewed at the end of each reporting period for impairment when there is an indication that the assets might be impaired. Impairment is measured by comparing the carrying values of the assets with their recoverable amounts. The recoverable amount of the assets is the higher of the assets’ fair value less costs to sell and their value-in-use, which is measured by reference to discounted future cash flow.

An impairment loss is recognised in profit or loss immediately unless the asset is carried at its revalued amount. Any impairment loss of a revalued asset is treated as a revaluation decrease to the extent of a previously recognised revaluation surplus for the same asset.

In respect of assets other than goodwill, and when there is a change in the estimates used to determine the recoverable amount, a subsequent increase in the recoverable amount of an asset is treated as a reversal of the previous impairment loss and is recognised to the extent of the carrying amount of the asset that would have been determined (net of amortisation and depreciation) had no impairment loss been recognised. The reversal is recognised in profit or loss immediately, unless the asset is carried at its revalued amount. A reversal of an impairment loss on a revalued asset is credited to other comprehensive income. However, to the extent that an impairment loss on the same revalued asset was previously recognised as an expense in the statements of comprehensive income, a reversal of that impairment loss is recognised as income in the statements of comprehensive income. (k) Assets Under Hire Purchase

Assets acquired under hire purchase are capitalised in the financial statements and are depreciated in accordance with the policy set out in Note 4(i) above. Each hire purchase payment is allocated between the liability and finance charges so as to achieve a constant rate on the finance balance outstanding. Finance charges are recognised in profit or loss over the periods of the respective hire purchase arrangements.

(l) Investment Properties

Investment properties are properties held either to earn rental income or for capital appreciation or for both. Initially investment properties are measured at cost including transaction costs. Subsequent to initial recognition, investment properties are stated at fair value. Gains or losses arising from changes in the fair values of investment properties are included in profit or loss in the year in which they arise.

Investment properties are derecognised when they have either been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal.

On the derecognition of an investment property, the difference between the net disposal proceeds and the carrying amount is recognised in profit or loss.

(m) Inventories

Inventories are stated at the lower of cost and net realisable value. Cost is determined on the weighted average basis, and comprises the purchase price and incidentals incurred in bringing the inventories to their present location and condition. Cost of finished goods and work-in-progress includes cost of materials, labour and an appropriate proportion of production overheads.

Net realisable value represents the estimated selling price less the estimated costs of completion and the estimated costs necessary to make the sale.

Where necessary, due allowance is made for all damaged, obsolete, and slow-moving items. The Group writes down its obsolete or slow moving inventories based on assessment of the condition and the future demand for the inventories. These inventories are written down when events or changes in circumstances indicate that the carrying amounts may not be recovered.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(n) Revaluation Reserve

Surpluses arising from the revaluation of properties are credited to the revaluation reserve account. Deficits arising from the revaluation, to the extent that they are not supported by any previous revaluation surpluses, are charged to profit or loss.

In the year of disposal of the revalued asset, the attributable remaining revaluation surplus is transferred from the revaluation reserve account to retained profits.

(o) Income Taxes

Income tax for the period comprises current and deferred tax.

Current tax is the expected amount of income taxes payable in respect of the taxable profit for the year and is measured using the tax rates that have been enacted or substantively enacted at the end of the reporting period.

Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements.

Deferred tax liabilities are recognised for all taxable temporary differences other than those that arise from goodwill or excess of the acquirer’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities over the business combination costs or from the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction, affects neither accounting profit nor taxable profit.

Deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused tax credits to the extent that it is probable that future taxable profits will be available against which the deductible temporary differences, unused tax losses and unused tax credits can be utilised. The carrying amounts of deferred tax assets are reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient future taxable profits will be available to allow all or part of the deferred tax assets to be utilised.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realised or the liability is settled, based on the tax rates that have been enacted or substantively enacted at the end of the reporting period.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when the deferred income taxes relate to the same taxation authority.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax items are recognised in correlation to the underlying transactions either in other comprehensive income or directly in equity and deferred tax arising from a business combination is included in the resulting goodwill or excess of the acquirer’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities over the business combination costs.

(p) Borrowing Costs

Borrowing costs that are directly attributable to the construction of property, plant and equipment are capitalised as part of the cost of those assets until time the assets are ready for their intended use or sale. Capitalisation of borrowing costs is suspended during extended periods in which active development is interrupted.

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

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(q) Research and Development Expenditure

Research expenditure is written off in profit or loss when incurred. Development expenditure is recognised as an expense except that costs incurred on development projects are capitalised as long-term assets to the extent that such expenditure is expected to generate future economic benefits. Development expenditure capitalised comprises costs incurred for development including direct and attributable indirect costs. Development costs initially recognised as an expense are not recognised as assets in the subsequent period.

Development costs that have been capitalised are amortised on a straight-line basis over the period of their expected benefit, but not exceeding 5 years, from the commencement of the commercial production of the products.

(r) Operating Segments

An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s other components. An operating segment’s operating results are reviewed regularly by the chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available.

(s) Non-Current Assets Held for Sale

Non-current assets that are expected to be recovered primarily through sale rather than through continuing use are classified as held for sale. Upon classification as held for sale, non-current assets or components of a disposal group are not depreciated and are measured at the lower of their carrying amount and fair value less cost to sell. Any differences are recognised in profit or loss.

(t) Cash and Cash Equivalents

Cash and cash equivalents comprise cash in hand, bank balances, demand deposits, deposits pledged with financial institutions, bank overdrafts and short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

(u) Employee Benefits

(i) Short-term Benefits

Wages, salaries, paid annual leave and sick leave, bonuses and non-monetary benefits are accrued in the period in which the associated services are rendered by employees of the Group.

(ii) Defined Contribution Plans

The Group’s contributions to defined contribution plans are recognised in profit or loss in the period to which they relate. Once the contributions have been paid, the Group has no further liability in respect of the defined contribution plans.

(v) Related Parties

A party is related to an entity if:-

(i) directly, or indirectly through one or more intermediaries, the party:- • controls, is controlled by, or is under common control with, the entity (this includes parents, subsidiaries and fellow subsidiaries); • has an interest in the entity that gives it significant influence over the entity; or • has joint control over the entity; (ii) the party is an associate of the entity; (iii) the party is a joint venture in which the entity is a venturer; (iv) the party is a member of the key management personnel of the entity or its parent; (v) the party is a close member of the family of any individual referred to in (i) or (iv);

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(v) Related Parties (Cont’d)

(vi) the party is an entity that is controlled, jointly controlled or significantly influenced by, or for which significant voting power in such entity resides with, directly or indirectly, any individual referred to in (iv) or (v); or (vii) the party is a post-employment benefit plan for the benefit of employees of the entity, or of any entity that is a related party of the entity.

Close members of the family of an individual are those family members who may be expected to influence, or be influenced by, that individual in their dealings with the entity.

(w) Revenue Recognition

(i) Sale of Goods

Revenue is recognised upon delivery of goods and customers’ acceptance and where applicable, net of returns and trade discounts.

(ii) Services

Revenue is recognised upon rendering of services and when the outcome of the transaction can be estimated reliably. In the event the outcome of the transaction could not be estimated reliably, revenue is recognised to the extent of the expenses incurred that are recoverable.

(iii) Dividend Income

Dividend income from investment is recognised when the right to receive dividend payment is established.

(iv) Rental Income

Rental income is recognised on an accrual basis.

(x) Contingent Liabilities and Contingent Assets

A contingent liability is a possible obligation that arises from past events and whose existence will only be confirmed by the occurrence of one or more uncertain future events not wholly within the control of the Group. It can also be a present obligation arising from past events that is not recognised because it is not probable that an outflow of economic resources will be required or the amount of obligation cannot be measured reliably.

A contingent liability is not recognised but is disclosed in the notes to the financial statements. When a change in the probability of an outflow occurs so that the outflow is probable, it will then be recognised as a provision.

A contingent asset is a probable asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain events not wholly within the control of the Group.

(y) Provisions

Provisions are recognised when the Group has a present obligation as a result of past events, when it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and when a reliable estimate of the amount can be made. Provisions are reviewed at the end of each reporting period and adjusted to reflect the current best estimate. Where the effect of the time value of money is material, the provision is the present value of the estimated expenditure required to settle the obligation.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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5. INVESTMENTS IN SUBSIDIARIES

THE COMPANY 31.3.2012 28.2.2011 RM’000 RM’000

Unquoted shares, at cost 44,418 44,418

Details of the subsidiaries are as follows:-

NAME OF COMPANY COUNTRY OF EFFECTIVE EQUITY INTEREST PRINCIPAL ACTIVITIES INCORPORATION 31.3.2012 28.2.2011 Direct subsidiaries:-

Resintech Plastics Malaysia 100% 100% Designing, manufacturing, trading (M) Sdn. Bhd. marketing of a diversified range of plastic pipes, water tanks and fittings, and investment holding.

Resintech-Kapar Malaysia 100% 100% Designing, manufacturing, trading Sdn. Bhd. and marketing of a diversified range of PE and ABS pipes and fittings. Resintech Biowood Malaysia 100% - Trading and marketing of composite (Malaysia) Sdn. Bhd. wood and diversified building material.

Sarpino’s (M) Sdn. Malaysia 100% - Acting as franchisor, restaurant Bhd. operator and in general trading. Sarpino’s Pizzeria Cambodia 100% 100% Acting as franchisor, restaurant (Cambodia) Co., Ltd. operator and in general trading. Indirect subsidiaries:- Resintech Engineering Malaysia 100% 100% Providing engineering services and Sdn. Bhd.^ investment holding. Resintech (Sabah) Sdn. Malaysia 100% 100% Trading and marketing of a diversified Bhd.^ range of plastic pipes, water tanks and fittings.

Resintech Products Malaysia 100% 100% Trading and marketing of a diversified Marketing Sdn. Bhd.^ range of plastic pipes, water tanks and fittings and children’s playground equipment.

Vision Mould Specialist Malaysia 100% 100% Fabrication of plastic moulds and (M) Sdn. Bhd.^ roto-moulding moulds.

Exact Link Sdn. Bhd.^ Malaysia 100% 100% Property holding.

RT Water Technology Malaysia 60% 60% Designing and contracting for sewerage Sdn. Bhd.# treatment plants and the provision of consultancy services including survey, design and project management.

PT Resintech Indonesia 100% 100% Designing and manufacturing a range Indomas*√ of plastic pipes, water tanks and fittings.

^ Interest held by Resintech Plastics (M) Sdn. Bhd. # Interest held by Resintech Engineering Sdn. Bhd. * Interest held by Resintech Plastics (M) Sdn. Bhd. √ Not audited by Messrs. Crowe Horwath and Resintech-Kapar Sdn. Bhd.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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6. INVESTMENT IN AN ASSOCIATE

THE GROUP THE COMPANY 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Unquoted shares, at cost 540 540 540 540Share of post acquisition (loss)/profit (77) 83 - - 463 623 540 540

(a) The details of the associate are as follows:-

NAME OF COMPANY COUNTRY OF EFFECTIVE EQUITY INTEREST PRINCIPAL ACTIVITIES INCORPORATION 31.3.2012 28.2.2011 Asia Herbal Biotech Malaysia 27% 27% Provision of health and herbal centre Sdn. Bhd. for health food and drinks, herbal products, organic food products and other environmentally friendly products. (b) The summarised financial information of the associate is as follows:-

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000

Assets and liabilitiesTotal assets 2,481 3,078

Total liabilities 763 682

Results Revenue 9,607 5,602(Loss)/Profit after taxation (379) 307

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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�7Annual Report 2012

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NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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�8 Resintech Berhad

7. PROPERTY, PLANT AND EQUIPMENT (CONT’D)

ACCUMULATED NET BOOK AT COST AT VALUATION DEPRECIATION VALUE AT 31.3.2012 RM’000 RM’000 RM’000 RM’000

Land and buildings - 63,605 (6,355) 57,250Plant, machinery, tools, equipment and moulds 86,371 - (64,216) 22,155Furniture, fittings and office equipment 2,165 - (1,668) 497Motor vehicles and forklifts 4,946 - (4,100) 846Electrical installation and renovation 4,145 - (2,866) 1,279Store 95 - (29) 66 97,722 63,605 (79,234) 82,093

AT 28.2.2011

Land and buildings - 55,175 (5,439) 49,736 Plant, machinery, tools, equipment and moulds 85,572 - (58,264) 27,308 Furniture, fittings and office equipment 1,997 - (1,560) 437 Motor vehicles and forklifts 4,328 - (3,709) 619 Electrical installation and renovation 3,430 - (2,559) 871 Store 86 - (9) 77

95,413 55,175 (71,540) 79,048

(a) The net book values of the freehold and leasehold land and buildings at the end of the reporting period were as follows:- THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000

Freehold land 7,454 6,625 Leasehold land 19,793 17,346 Buildings 30,003 25,765 57,250 49,736

(b) The net book values of the property, plant and equipment at the end of the reporting period pledged as security with the banks for credit facilities were as follows:- THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000

Freehold land 7,180 6,350 Leasehold land 12,274 11,720 Buildings 25,479 23,868 Plant and machinery 2,520 14,582 47,453 56,520

(c) Included in the net book values of property, plant and equipment at the end of the reporting period were the following assets acquired under hire purchase terms:- THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000

Motor vehicles 495 76

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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�9Annual Report 2012

7. PROPERTY, PLANT AND EQUIPMENT (CONT’D)

(d) The titles to the following assets have not yet been issued by the relevant authorities:-

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000

Freehold land 4,840 4,840 Leasehold land 7,706 11,720 12,546 16,560

(e) Land and buildings have been revalued in financial year 2010. The valuation was based on professional appraisals by independent valuers using the open market value basis. The deferred tax on the revaluation surplus has been accounted for in the financial statements, as disclosed in Note 24 to the financial statements.

(f ) The carrying amount, had the revalued freehold and leasehold land and building of the Group been carried at cost less accumulated depreciation, would have been RM42,920,000 (2011 - RM43,378,000).

8. INVESTMENT PROPERTIES

AT IMPAIRMENT FAIR VALUE AT 1.3.2011 ADDITION LOSS ADJUSTMENTS 31.3.2012 RM’000 RM’000 RM’000 RM’000 RM’000 AT FAIR VALUE:-

Leasehold land 45 192 (8) 24 253 Buildings 195 847 - - 1,042 240 1,039 (8) 24 1,295

AT FAIR VALUE AT 1.3.2010 ADJUSTMENTS 28.2.2011 RM’000 RM’000 RM’000 AT FAIR VALUE:-

Leasehold land 45 - 45 Buildings 195 - 195 240 - 240

Investment properties have been revalued in the current financial period based on professional appraisals by independent valuers using the open market value basis.

Direct operating expenses arising from the investment properties are as follows:-

THE GROUP THE COMPANY 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Properties that did not generate income:- assessment 1 1 - -- quit rent 1 - - -- maintenance fee 2 - - -

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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�0 Resintech Berhad

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

9. INTANGIBLE ASSETS

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 Licence fees:- At 1 March 2011/2010 616 460 Addition during the period/year 229 156 Written off during the period/year (18) - At 31 March 2012/28 February 2011 827 616 Accumulated amortisation:- At 1 March 2011/2010 (192) (146) Amortisation during the financial period/year (87) (46) At 31 March 2012/28 February 2011 (279) (192)

548 424 This represents the following:- (a) the licensing right to use a design patent acquired from KWH Pipe Ltd; and (b) the grant of master franchise licences by Sarpino’s World Pte.Ltd.

10. INVENTORIES

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 At Cost:- Raw materials 6,185 4,266 Work-in-progress 9 18 Finished goods 17,848 19,486 24,042 23,770 None of the inventories were stated at net realisable value at the end of the reporting period.

11. SHORT-TERM INVESTMENT

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 Quoted shares in Malaysia, at fair value 101 101 The short-term investment is classified as financial asset at fair value through profit or loss, measured at fair value.

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NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

12. TRADE RECEIVABLES

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 Trade receivables 20,672 18,107 Impairment loss:- At 1 March 2011/2010 (1,583) (1,356) Addition during the financial period/year (106) (345) Writeback during the financial period/year 455 118 At 31 March 2012/28 February 2011 (1,234) (1,583)

19,438 16,524

The Group’s normal credit terms range from 30 to 120 days. Other credit terms are assessed and approved on a case-by-case basis.

13. AMOUNT OWING BY SUBSIDIARIES

The amount owing is non-trade in nature, unsecured, interest-free and repayable on demand. The amount owing is to be settled in cash.

14. FIXED DEPOSITS WITH A LICENSED BANK

The effective interest rates of the deposits with a licensed bank at the end of the reporting period range from 2.70% to 2.75% (2011 - 2.70% to 2.85%) per annum. The fixed deposits have a maturity period of 12 months (2011 - 12 months).

The fixed deposits have been pledged as security for banking facilities granted to a subsidiary of the Company.

15. NON-CURRENT ASSET CLASSIFIED AS HELD FOR SALE

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 At 1 March 2011/1 March 2010 7,536 - Reclassified from property, plant and equipment (Note 7) 46 7,536 At 31 March 2012/28 February 2011 7,582 7,536

The above relates to a piece of property which had been contracted for sale during the previous financial year and had been completed subsequent to the current financial period.

The liability directly associated with asset classified as held for sale relates to the deposit received from the purchaser.

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�2 Resintech Berhad

16. SHARE CAPITAL

THE COMPANY 31.3.2012 28.2.2011 31.3.2012 28.2.2011 NUMBER OF SHARES (‘000) RM’000 RM’000

ORDINARY SHARES OF RM0.50 EACH

AUTHORISED

At 1 March 2011/2010 200,000 200,000 100,000 100,000Increase during the period 200,000 - 100,000 -

At 31 March 2012/28 February 2011 400,000 200,000 200,000 100,000

ISSUED AND FULLY PAID-UP

At 1 March 2011/2010 137,200 98,000 68,600 49,000Issuance of shares pursuant to bonus issue - 39,200 - 19,600

At 31 March 2012/28 February 2011 137,200 137,200 68,600 68,600

17. SHARE PREMIUM

THE GROUP/THE COMPANY 31.3.2012 28.2.2011 RM’000 RM’000 At 1 March 2011/2010 - 1,274 Issuance of share pursuant to bonus issue - (1,274)

At 31 March 2012/28 February 2011 - -

The share premium is not distributable by way of cash dividends and may be utilised in the manner set out in Section 60(3) of the Companies Act 1965.

18. WARRANTS

The Company had on 30 September 2011, issued 68,600,000 2011/2016 Warrants to all entitled shareholders of the Company on the basis of one (1) free Warrant for every two (2) existing ordinary shares of RM0.50 each held in the Company. The Warrants were listed on the Main Market of Bursa Malaysia Securities Berhad on 6 October 2011. The Warrants are constituted under a Deed Poll executed on 12 September 2011, and each Warrant entitles the registered holder the right at any time during the exercise period from 30 September 2011 to 29 September 2016 to subscribe in cash for one new ordinary share of RM0.50 each of the Company at an exercise price of RM0.50 each.

As at 31 March 2012, the entire 68,600,000 Warrants remained unexercised.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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18. WARRANTS (CONT’D)

The movements of Warrants during the financial period are as follows:- THE COMPANY Number of Warrants 2011/2016 31.3.2012 28.2.2011 (’000) (’000) At 1 March 2011/2010 - - Issued during the period 68,600 - Exercised during the period - - At 31 March 2012/28 February 2011 68,600 -

The main features of the Warrants are as follows:-

(i) Each Warrant will entitle the registered holder to subscribe for one (1) new ordinary share of par value of RM0.50 each in the Company at an exercise price of RM0.50 each subject to adjustment in accordance with the conditions stipulated in the Deed Poll;

(ii) The Warrants may be exercised at any time on or before the maturity date falling five years (2011/2016) from the date of issue of the Warrants on 30 September 2011. Warrants not exercised after the exercise period will thereafter lapse and cease to be valid;

(iii) The new shares to be issued pursuant to the exercise of the Warrants shall, upon allotment and issue, rank pari passu in all respects with the existing ordinary shares of the Company in issue except that they will not be entitled to any dividends, rights, allotments and/or other distributions, the entitlement date of which is before the allotment and issuance of the new shares; and

(iv) The persons to whom the Warrants have been granted have no rights to participate in any distribution and/or offer of further securities in the Company until/and unless Warrant holders exercise their Warrant for new shares.

19. REVALUATION RESERVES THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 At 1 March 2011/2010 6,469 6,566 Realisation of revaluation reserve (196) (97) At 31 March 2012/28 February 2011 6,273 6,469

The revaluation reserve represents the surplus arising from the revaluation of the land and buildings and is not distributable by way of cash dividends.

20. RETAINED PROFITS

At the end of the reporting period, the Company will be able to distribute dividends out of its entire retained profits under the single tier tax system.

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 SECURED: Hire purchase payables (Note 22) 156 17 Term loans (Note 23) 7,966 6,064

8,122 6,081

21. LONG-TERM BORROWINGS

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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�4 Resintech Berhad

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 Minimum hire purchase payments: - not later than one year 161 18 - later than one year and not later than five years 167 18

328 36 Future finance charges (23) (2) Present value of hire purchase payables 305 34 Current: - not later than one year (Note 28) 149 17 Non-current: - later than one year and not later than five years (Note 21) 156 17 305 34

The hire purchase payables of the Group at the end of the reporting period bore an effective interest rate of 5.05% (2011 - 5.33%) per annum.

22. HIRE PURCHASE PAYABLES

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 Current portion: - not later than one year (Note 28) 3,227 4,753 Non-current portion: - later than one year and not later than two years 4,981 1,944 - later than two years and not later than five years 2,754 3,557 - later than five years 231 563

Total non-current portion (Note 21) 7,966 6,064

11,193 10,817

23. TERM LOANS

THE GROUP TERM NUMBER OF MONTHLY EFFECTIVE DATE 31.3.2012 28.2.2011 LOAN MONTHLY INSTALMENTS INSTALMENT (RM) OF REPAYMENT RM’000 RM’000 1 84 94,840 May 2006 272 1,004 2 60 63,300 August 2006 - 1,055 3 60 193,000 October 2006 640 1,547 4 60 25,897 March 2009 131 942 5 60 5,420 May 2009 129 193 6 60 5,364 May 2009 1,724 191 7 60 59,000 October 2009 1,189 2,495 8 60 39,700 November 2009 1,297 1,585 9 60 22,487 February 2011 252 1,508 10 60 4,638 March 2011 2,104 297 11 60 70,546 November 2011 3,455 - 11,193 10,817

The term loans of the Group at the end of the reporting period bore effective interest rates ranging from 4.65% to 7.52% (2011-from 5.22% to 8.80%) per annum and are secured in the same manner as the bills payable disclosed in Note 28 to the financial statements.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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24. DEFERRED TAX LIABILITIES

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 At 1 March 2011/2010 10,121 10,401 Recognised in profit or loss (Note 33) (597) (280) At 31 March 2012/28 February 2011 9,524 10,121

The deferred tax consists of the tax effects of the following items:- THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 Deferred tax liabilities:- Accelerated capital allowances 8,189 8,699 Revaluation of properties 1,438 1,604 9,627 10,303 Deferred tax assets:- Unabsorbed capital allowances - (12) Other temporary differences (103) (170) (103) (182) 9,524 10,121

No deferred tax assets/(liabilities) are recognised on the following items:- THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 Unabsorbed capital allowances 129 151 Unutilised tax losses 1,240 908 Provision 222 - Accelerated capital allowances (92) (37)

1,499 1,022

Subject to agreement with the tax authorities, the Group had unutilised reinvestment allowances of approximately RM6,763,000 at the end of the previous reporting period available to be carried forward for offset against future taxable business income.

25. TRADE PAYABLES

The normal trade credit terms granted to the Group range from 30 to 90 days.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 SECURED: Bills payable 19,089 19,636 Hire purchase payables (Note 22) 149 17 Term loans (Note 23) 3,227 4,753

22,465 24,406

The bills payable of the Group at the end of the reporting period bore effective interest rates ranging from 3.34% to 8.10% (2011 - 3.07% to 7.80%) per annum and are secured by:-

(a) legal charges over certain long leasehold land and buildings of the subsidiaries and of a related party;

(b) legal charges over certain freehold land and buildings of the subsidiaries; (c) legal charges over certain investment property of a subsidiary;

(d) a debenture over certain plant and machinery of a subsidiary;

(e) a joint and several guarantee of certain directors and a related party; and

(f ) a corporate guarantee of the Company.

28. SHORT-TERM BORROWINGS

26. OTHER PAYABLES AND ACCRUALS

THE GROUP THE COMPANY 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Other payables 1,138 1,400 32 26Accruals 1,815 1,831 40 30Deposit received 454 3 2 2

3,407 3,234 74 58

27. AMOUNT OWING TO A RELATED PARTY

The amount owing is non-trade in nature, unsecured, interest-free and repayable on demand. The amount owing is to be settled in cash.

29. BANK OVERDRAFTS

The bank overdrafts of the Group at the end of the reporting period bore effective interest rates ranging from 7.85% to 8.10% (2011 - 7.30% to 7.93%) per annum and are secured in the same manner as the bills payable disclosed in Note 28 to the financial statements.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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�7Annual Report 2012

30. REVENUE

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Sale of goods 97,059 83,536 - -Dividend income - - 81 21,000

97,059 83,536 81 21,000

31. OTHER INCOME

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Reversal of impairment loss on trade receivables 455 118 - -Bad debts recovered - 20 - -Fair value gain on investment properties 24 - - -Net gain on disposal of plant and equipment 162 2 - -Management fee - - - 120Gain on foreign exchange:- realised 358 265 - -- unrealised 53 116 - -Rental income 514 - - -Interest income 8 - - -Dividend income 86 - - -Sundry income 212 215 - - 1,872 736 - 120

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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�8 Resintech Berhad

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Impairment loss on trade receivables 106 345 - -Amortisation of intangible assets 87 46 - -Audit fee:- statutory audit 134 108 33 24- underprovision in the previous financial year 20 12 3 2- other non-statutory services 10 15 - -Bad debts written off 1 5 - -Depreciation of property, plant and equipment 7,694 8,002 - -Deposits written off 145 - - -Directors’ fee 98 100 98 100Directors’ non-fee emoluments- salaries, bonuses and allowances 882 800 - -- defined contribution plan 106 96 - -- other benefits 129 2 16 -Property, plant and equipment written off 287 115 - -Impairment loss on investment properties 8 - - -Intangible assets written off 18 - - -Impairment loss on property, plant and equipment 201 - - -Interest expense:- bank overdrafts 433 652 - -- bills payable 942 559 - -- hire purchase 10 25 - - - term loans 753 821 - -Loss on foreign exchange:- realised 193 670 - -Rental of premises 864 54 - -Research expenses 102 158 - -Staff costs:- salaries, wages, bonuses and allowances 9,292 5,588 - -- defined contribution plan 443 421 - -- other benefits 282 464 - -

32. PROFIT/(LOSS) BEFORE TAXATION

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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33. INCOME TAX EXPENSE

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Current tax expense:- for the financial period/year 1,324 783 39 42- overprovision in the previous financial year (93) (520) (12) (13) 1,231 263 27 29

Real property gains tax:- underprovision in the previous financial year - 9 - -

Deferred tax expense (Note 24):- relating to origination and reversal of temporary differences (319) (254) - -- overprovision in the previous financial year (278) (26) - -

(597) (280) - - 634 (8) 27 29

During the financial period, the statutory tax rate remained at 25%.

A reconciliation of the income tax expense applicable to the profit/(loss) before taxation at the statutory tax rate to the income tax expense at the effective tax rate of the Group and the Company is as follows:-

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Profit/(Loss) before taxation 3,461 1,997 (460) 20,777

Tax at the statutory tax rate of 25% 865 500 (115) 5,194

Tax effects of:-Non-taxable gain/income (73) (110) (20) (5,250)Non-deductible expenses 1,094 678 174 98Deferred tax assets not recognised during the financial period/year 119 36 - -Utilisation of reinvestment allowances (998) (553) - -Utilisation of deferred tax assets not recognised in the previous financial year (2) (22) - -(Over)/Underprovision in the previous financial year:- current tax (93) (520) (12) (13)- deferred tax (278) (26) - -- real property gains tax - 9 - -

Income tax expense for the financial period/year 634 (8) 27 29

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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34. EARNINGS PER SHARE

The basic earnings per share (“EPS”) is arrived at by dividing the Group’s profit attributable to the owners of the Company of RM2,840,000 (2011 – RM2,058,000) by the number of ordinary shares in issue during the financial period of 137,200,000 (2011 - 137,200,000).

There is no dilution in the earning per share as the average market value of the Company’s ordinary shares during the financial period were lower than the exercise price of the outstanding Warrants 2011/2016. Accordingly there would be no conversion of these outstanding instruments for the purpose of calculating diluted earning per share.

35. ACQUISITION OF SUBSIDIARIES

(a) On 15 July 2011, the Company acquired 2 ordinary shares of RM1.00 each, representing 100% of the total issued and paid-up capital of Resintech Biowood (Malaysia) Sdn. Bhd. for a total cash consideration of RM2.00.

(b) On 15 February 2012, the Company acquired 2 ordinary shares of RM1.00 each representing 100% of the total issued and paid-up capital of Sarpino’s (M) Sdn. Bhd. for a total cash consideration of RM2.00.

The acquired businesses contributed a net loss of approximately RM57,910 and a net profit of approximately RM33,087 respectively to the Group for the period from the date of acquisition to the end of the reporting period.

THE GROUP 1.3.2011 1.3.2010 to to 31.3.2012 28.2.2011 RM’000 RM’000

Cost of property, plant and equipment purchased (Note 7) 11,633 4,912Amount financed through hire purchase (400) -

Cash disbursed for the purchase of property, plant and equipment 11,233 4,912

36. PURCHASE OF PROPERTY, PLANT AND EQUIPMENT

37. CASH AND CASH EQUIVALENTS

For the purpose of the statements of cash flows, cash and cash equivalents comprise the following:-

THE GROUP THE COMPANY 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Fixed deposit with a licensed bank (Note 14) 392 150 - -Cash and bank balances 3,530 1,918 12 17Bank overdrafts (Note 29) (4,707) (4,301) - -

(785) (2,233) 12 17

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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38. DIRECTORS’ REMUNERATION

The aggregate amounts of remuneration received and receivable by directors during the financial period/year are as follows:-

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Executive directors:- non-fee emoluments 1,117 898 16 -Non-Executive directors:- fee 98 100 98 100

1,215 998 114 100

The remuneration received/receivable by directors from the Group and the Company during the financial period/year falls within the following bands:-

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011

Executive directors: RM100,001 - RM150,000 1 1 - -RM150,001 - RM200,000 - 2 - -RM200,001 - RM250,000 2 - - -RM400,001 - RM450,000 - 1 - -RM450,001 – RM500,000 1 - - -

4 4 - -Non-Executive directors:Below RM50,000 3 3 3 3 7 7 3 3

39. RELATED PARTY DISCLOSURES

(a) Identities of related parties

(i) the Company has related party relationships with its subsidiaries as disclosed in Note 5 to the financial statements; (ii) the directors of the Company and its subsidiary who are the key management personnel; and (iii) an entity controlled by certain key management personnel.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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39. RELATED PARTY DISCLOSURES (CONT’D)

(b) In addition to the information disclosed elsewhere in the financial statements, the Group and the Company carried out the following transactions with its related parties during the financial period/year:

THE GROUP THE COMPANY 1.3.2011 1.3.2010 1.3.2011 1.3.2010 to to to to 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

(i) Subsidiaries Management fee received/receivable - - - 120

(ii) Key management personnel Short-term employee benefits 1,519 1,158 114 100

(iii) Entity controlled by certain key management personnel Rental paid/payable 163 30 - -

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 Approved and contracted for: - Purchase of properties - 5,202 - Purchase of machinery 108 -

108 5,202

40. CAPITAL COMMITMENTS

THE COMPANY 31.3.2012 28.2.2011 RM’000 RM’000 Unsecured:- Corporate guarantees given to licensed bank for banking facilities granted to the subsidiaries 23,844 20,242

41. CONTINGENT LIABILITY

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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42. FOREIGN EXCHANGE RATES

The principal closing foreign exchange rates used (expressed on the basis of one unit of foreign currency to Ringgit Malaysia equivalent) for the translation of the foreign currency balances at the end of the reporting period are as follows:-

THE GROUP 31.3.2012 28.2.2011 RM RM United States Dollar 3.065 3.051 Singapore Dollar 2.436 2.396 Euro 4.088 4.194 Chinese Renminbi 0.487 0.464 100 Indonesian Rupiah 0.034 0.034 100 Thai Baht 9.942 9.975

43. OPERATING SEGMENTS

Operating segments are prepared in a manner consistent with the internal reporting provided to the Board of Directors as its chief operating decision maker in order to allocate resources to segments and to assess their performance. For management purposes, the Group is organised into business units based on their products and services provided.

The Group is organised into three main business segments as follows:

(i) Manufacturing and trading segment - involved in manufacturing and trading of diversified range of plastics pipes, water tanks and fittings.

(ii) Services - involved in property holding. (iii) Investment holding - involved in investment holding. (iv) Others

The Board of Directors assesses the performance of the operating segments based on operating profit or loss which is measured differently from those disclosed in the consolidated financial statements.

Group financing (including finance costs) and income taxes are managed on a group basis and are not allocated to operating segments.

Assets, liabilities and expenses which are common and cannot be meaningfully allocated to the operating segments are presented under unallocated items. Unallocated items comprise mainly current tax assets, current tax liabilities and deferred tax liabilities.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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43. OPERATING SEGMENTS (CONT’D)

MANUFACTURING INVESTMENT AND TRADING SERVICES HOLDING OTHERS ELIMINATION GROUP RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

31.3.2012GROUP

REVENUE External sales 95,276 - - 1,783 - 97,059Inter-segment sales 49,735 423 81 - (50,239) - 145,011 423 81 1,783 (50,239) 97,059

RESULTSSegment results 9,925 1,541 (461) (1,610) (3,636) 5,759

Finance costs (2,138) - - - - (2,138)

Profit/(Loss) before taxation 7,787 1,541 (461) (1,610) (3,636) 3,621

Share of loss of an associate (160)

Income tax expense (634)

Profit after taxation 2,827

ASSETSSegment assets 173,660 14,536 69,765 2,440 (119,247) 141,154

Unallocated corporate assets 2,218

Consolidated total assets 143,372

LIABILITIESSegment liabilities 103,644 1,426 74 2,853 (59,149) 48,848

Unallocated corporate liabilities 10,949

Consolidated total liabilities 59,797

OTHER INFORMATIONImpairment loss on trade receivables 101 - - 5 - 106Amortisation of intangible asset 50 - - 37 - 87Bad debts written off 1 - - - - 1Capital expenditure 10,312 - - 1,321 - 11,633Depreciation of property, plant and equipment 7,323 89 - 282 - 7,694Equipment written off - - - 287 - 287Impairment loss on property,plant and equipment 201 - - - - 201Impairment loss on intangible asset 8 - - - - 8Intangible asset written off - - - 18 - 18Deposit written off 53 6 - 86 - 145Gain on disposal of property, plant and equipment (162) - - - - (162)Reversal of impairment loss on trade receivables (395) - - (60) - (455)

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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43. OPERATING SEGMENTS (CONT’D)

MANUFACTURING INVESTMENT AND TRADING SERVICES HOLDING OTHERS ELIMINATION GROUP RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

28.2.2011GROUP

REVENUEExternal sales 83,324 - - 212 - 83,536Inter-segment sales 42,270 390 21,000 - (63,660) -

125,594 390 21,000 212 (63,660) 83,536

RESULTSSegment results 4,589 308 20,777 (294) (21,174) 4,206

Finance costs (2,292) - - - - (2,292)

Profit/(Loss) before taxation 2,297 308 20,777 (294) (21,174) 1,914

Share of profit of an associate 83

Income tax expense 8

Profit after taxation 2,005

ASSETSSegment assets 155,046 13,306 70,249 1,581 (106,417) 133,765

Unallocated corporate assets 1,880

Consolidated total assets 135,645

LIABILITIESSegment liabilities 91,768 1,679 58 362 (50,114) 43,753

Unallocated corporate liabilities 11,144

Consolidated total liabilities 54,897

OTHER INFORMATIONImpairment loss on trade receivables 258 - - 87 - 345Amortisation of intangible asset 46 - - - - 46Bad debts written off 5 - - - - 5Capital expenditure 4,540 - - 372 - 4,912Depreciation of property, plant and equipment 8,000 1 - 1 - 8,002Equipment written off 1 - - - - 1Reversal of impairment loss on trade receivables (118) - - - - (118)Net gain on disposal of plant and equipment (2) - - - - (2)Bad debts recovered (20) - - - - (20)

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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REVENUE NON-CURRENT ASSETS 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Malaysia 86,985 70,769 76,909 79,499Indonesia 4,495 5,322 6,197 308Cambodia 2,137 1,225 1,293 528Sri Lanka - 3,593 - -Singapore 2,251 1,481 - -Others 1,191 1,146 - -

97,059 83,536 84,399 80,335

43. OPERATING SEGMENTS (CONT’D) Geographical Information

The following is an analysis of the Group’s revenue and non-current assets by geographical markets:

44. FINANCIAL INSTRUMENTS The Group’s activities are exposed to a variety of market risks (including foreign currency risk, interest rate risk and equity price risk), credit risk and liquidity risk. The Group’s overall financial risk management policy focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial performance. (a) Financial Risk Management Policies The Group’s policies in respect of the major areas of treasury activity are as follows:- (i) Market Risk (i) Foreign Currency Risk

The Group is exposed to foreign currency risk on transactions and balances that are denominated in currencies other than Ringgit Malaysia. The currencies giving rise to this risk are primarily United States Dollar, Singapore Dollar, Euro, Chinese Renminbi and Indonesian Rupiah. Foreign currency risk is monitored closely on an ongoing basis to ensure that the net exposure is at an acceptable level.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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44. FINANCIAL INSTRUMENTS (CONT’D) (a) Financial Risk Management Policies (Cont’d) (i) Market Risk (Cont’d)

(i) Foreign Currency Risk (Cont’d)

The Group’s exposure to foreign currency is as follows:-

UNITED STATES SINGAPORE INDONESIAN CHINESE RINGGIT DOLLAR DOLLAR EURO RUPIAH RENMINBI MALAYSIA TOTAL RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

THE GROUP 31.3.2012

Financial assetsShort-term investment - - - - - 101 101Trade receivables 1,182 13 - - - 18,243 19,438Other receivables 344 192 - 127 62 889 1,614Fixed deposits with licensed bank - - - - - 392 392Cash and bank balances 233 57 1 78 - 3,161 3,530

1,759 262 1 205 62 22,786 25,075

Financial liabilities Trade payables 1,882 - - - - 7,137 9,019Other payables and accruals 236 - - 75 - 3,096 3,407Amount owing to a related party - - - - - 288 288Bills payable - - - - - 19,089 19,089Hire purchase - - - - - 305 305Term loans 3,455 - - - - 7,738 11,193Bank overdrafts - - - - - 4,707 4,707

5,573 - - 75 - 42,360 48,008

Net financial assets/(liabilities) (3,814) 262 1 130 62 (19,574) (22,933)

Less: Net financial assets denominated in the entity’s functional currency (14) - - (86) - 19,574 19,474

Currency exposure (3,828) 262 1 44 62 - (3,459)

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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44. FINANCIAL INSTRUMENTS (CONT’D) (a) Financial Risk Management Policies (Cont’d) (i) Market Risk (Cont’d)

(i) Foreign Currency Risk (Cont’d)

UNITED STATES SINGAPORE INDONESIAN RINGGIT DOLLAR DOLLAR EURO RUPIAH MALAYSIA TOTAL RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

THE GROUP 28.2.2011

Financial assetsShort-term investment - - - - 101 101Trade receivables 490 - - - 16,034 16,524Other receivables 780 1,804 - 45 802 3,431Fixed deposits with licensed bank - - - - 150 150Cash and bank balances 768 223 1 3 923 1,918 2,038 2,027 1 48 18,010 22,124

Financial liabilitiesTrade payables 425 - - - 4,101 4,526Other payables and accruals 65 4 - - 3,165 3,234Amount owing to a related party - - - - 365 365Bills payable - - - - 19,636 19,636Hire purchase - - - - 34 34Term loans - - - - 10,817 10,817Bank overdrafts - - - - 4,301 4,301

490 4 - - 42,419 42,913

Net financial assets/(liabilities) 1,548 2,023 1 48 (24,409) (20,789)

Less: Net financial (liabilities)/assets denominated in the entity’s functional currency (868) - - (48) 24,409 23,493

Currency exposure 680 2,023 1 - - 2,704

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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44. FINANCIAL INSTRUMENTS (CONT’D) (a) Financial Risk Management Policies (Cont’d) (i) Market Risk (Cont’d)

(i) Foreign Currency Risk (Cont’d)

RINGGIT MALAYSIA TOTAL RM’000 RM’000

THE COMPANY 31.3.2012

Financial assetsOther receivables 22 22Amount owing by subsidiaries 24,773 24,773Cash and bank balances 12 12 24,807 24,807

Financial liabilitiesOther payables and accruals 74 74

Net financial assets 24,733 24,733Less: Net financial assets denominated in the entity’s functional currency (24,733) (24,733)

Currency exposure - -

THE COMPANY 28.2.2011

Financial assetsOther receivables 22 22Amount owing by subsidiaries 25,252 25,252Cash and bank balances 17 17 25,291 25,291

Financial liabilitiesOther payables and accruals 58 58

Net financial assets 25,233 25,233Less: Net financial assets denominated in the entity’s functional currency (25,233) (25,233)

Currency exposure - -

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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44. FINANCIAL INSTRUMENTS (CONT’D) (a) Financial Risk Management Policies (Cont’d) (i) Market Risk (Cont’d)

(i) Foreign Currency Risk (Cont’d) Foreign currency risk sensitivity analysis

A 5% strengthening/weakening of the RM against all the foreign currency as at the end of the reporting period would have immaterial impact on profit after tax and equity. This assumes that all other variables remain constant.

(ii) Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Group’s exposure to interest rate risk arises mainly from interest-bearing financial assets and liabilities. The Group’s policy is to obtain the most favourable interest rates available. Any surplus funds of the Group will be placed with licensed financial institutions to generate interest income.

Interest rate risk sensitivity analysis

The following table details the sensitivity analysis to a reasonably possible change in the interest rates as at the end of the reporting period, with all other variables held constant:-

(iii) Equity Price Risk

A 5% strengthening/weakening of the prices for quoted investment as at the end of the reporting period would have immaterial impact on profit after tax and equity. This assumes that all other variables remain constant.

(ii) Credit Risk

The Group’s exposure to credit risk, or the risk of counterparties defaulting, arises mainly from trade and other receivables. The Group manages its exposure to credit risk by the application of credit approvals, credit limits and monitoring procedures on an ongoing basis. For other financial assets (including quoted investments and cash and bank balances), the Group minimises credit risk by dealing exclusively with high credit rating counterparties.

The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of the trade and other receivables as appropriate. The main components of this allowance are a specific loss component that relates to individually significant exposures, and a collective loss component established for groups of similar assets in respect of losses that have been incurred but not yet identified. Impairment is estimated by management based on prior experience and the current economic environment.

THE GROUP 31.3.2012 28.2.2011 Increase/ Increase/ (Decrease) (Decrease) RM’000 RM’000 Effects on profit after tax Increase of 1% (373) (261) Decrease of 1% 373 261 Effects on equity Increase of 1% (373) (261) Decrease of 1% 373 261

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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44. FINANCIAL INSTRUMENTS (CONT’D) (a) Financial Risk Management Policies (Cont’d) (ii) Credit Risk (Cont’d)

Credit risk concentration profile

The Group does not have any major concentration of credit risk related to any individual customer or counterparty.

Exposure to credit risk

As the Group does not hold any collateral, the maximum exposure to credit risk is represented by the carrying amount of the financial assets as at the end of the reporting period.

The exposure of credit risk for trade receivables by geographical region is as follows:-

Ageing analysis The ageing analysis of the Group’s trade receivables at the end of the reporting period is as follows:-

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 Cambodia 36 - Indonesia 494 343 Mauritius - 245 Singapore 24 74 Thailand 2 27 Malaysia 18,882 15,835 19,438 16,524

GROSS INDIVIDUAL CARRYING AMOUNT IMPAIRMENT VALUE RM’000 RM’000 RM’000 THE GROUP 31.3.2012

Not past due 7,582 - 7,582 Past due:- - less than 3 months 9,055 - 9,055 - 3 to 5 months 2,055 - 2,055 - over 5 months 1,980 (1,234) 746

20,672 (1,234) 19,438

THE GROUP 28.2.2011

Not past due 3,299 - 3,299 Past due:- - less than 3 months 8,993 - 8,993 - 3 to 5 months 3,516 - 3,516 - over 5 months 2,299 (1,583) 716 18,107 (1,583) 16,524

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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44. FINANCIAL INSTRUMENTS (CONT’D) (a) Financial Risk Management Policies (Cont’d) (ii) Credit Risk (Cont’d) Ageing analysis (Cont’d)

At the end of the reporting period, trade receivables that are individually impaired were those in significant financial difficulties and have defaulted on payments. These receivables are not secured by any collateral or credit enhancement.

Trade receivables that are past due but not impaired

The Group believes that no impairment allowance is necessary in respect of these trade receivables. They are substantially companies with good collection track record and no recent history of default.

Trade receivables that are neither past due nor impaired

A significant portion of trade receivables that are neither past due nor impaired are regular customers that have been transacting with the Group. The Group uses ageing analysis to monitor the credit quality of the trade receivables. Any receivables having significant balances past due or more than 120 days, which are deemed to have higher credit risk, are monitored individually.

(iii) Liquidity Risk Liquidity risk arises mainly from general funding and business activities. The Group practises prudent risk management by maintaining sufficient cash balances and the availability of funding through certain committed credit facilities.

The following table sets out the maturity profile of the financial liabilities as at the end of the reporting period based on contractual undiscounted cash flows (including interest payments computed using contractual rates or, if floating, based on the rates at the end of the reporting period):-

WEIGHT AVERAGE CONSTRACTUAL EFFECTIVE CARRYING UNDISCOUNTED WITHIN 1-5 OVER RATE AMOUNT CASH FLOWS 1 YEAR YEARS 5 YEARS % RM’000 RM’000 RM’000 RM’000 RM’000

THE GROUP 31.3.2012

Bills payable 4.60 19,089 19,386 19,386 - -Hire purchase 5.05 305 328 161 167 -Term loans 4.99 11,193 12,651 3,838 8,631 182Trade payables - 9,019 9,019 9,019 - -Other payables and accruals - 3,407 3,407 3,407 - -Amount owing to a related party - 288 288 288 - -Bank overdrafts 7.94 4,707 4,707 4,707 - -

48,008 49,786 40,806 8,798 182

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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44. FINANCIAL INSTRUMENTS (CONT’D) (a) Financial Risk Management Policies (Cont’d) (iii) Liquidity Risk (Cont’d)

WEIGHT AVERAGE CONSTRACTUAL EFFECTIVE CARRYING UNDISCOUNTED WITHIN 1-5 OVER RATE AMOUNT CASH FLOWS 1 YEAR YEARS 5 YEARS % RM’000 RM’000 RM’000 RM’000 RM’000

THE GROUP 28.2.2011

Bills payable 5.32 19,636 19,636 19,636 - -Hire purchase 5.33 34 36 18 18 -Term loans 7.02 10,817 12,060 5,512 5,624 924Trade payables - 4,526 4,526 4,526 - -Other payables and accruals - 3,234 3,234 3,234 - -Amount owing to a related party - 365 365 365 - -Bank overdrafts 7.89 4,301 4,301 4,301 - -

42,913 44,158 37,592 5,642 924

THE COMPANY 31.3.2012

Other payables and accruals - 74 74 74 - -

THE COMPANY 28.2.2011

Other payables and accruals - 58 58 58 - -

(b) Capital Risk Management The Group manages its capital to ensure that entities within the Group will be able to maintain an optimal capital structure so as to support their businesses and maximise shareholders’ value. To achieve this objective, the Group may make adjustments to the capital structure in view of changes in economic conditions, such as adjusting the amount of dividend payment, returning of capital to shareholders or issuing new shares.

The Group manages its capital based on debt-to-equity ratio. The Group’s strategies were unchanged from the previous financial year. The debt-to-equity ratio is calculated as net debt divided by total equity. Net debt is calculated as interest-bearing borrowings less cash and cash equivalents.

The debt-to-equity ratio of the Group as at the end of the reporting period was as follows:-

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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44. FINANCIAL INSTRUMENTS (CONT’D) (b) Capital Risk Management (Cont’d)

Under the requirement of Bursa Malaysia Practice Note No. 17/2005, the Company is required to maintain a consolidated shareholders’ equity (total equity attributable to owners of the Company) equal to or not less than the 25% of the issued and paid-up share capital (excluding treasury shares) and such shareholders’ equity is not less than RM40 million. The Company has complied with this requirement.

(c) Classification Of Financial Instruments

THE GROUP 31.3.2012 28.2.2011 RM’000 RM’000 Bills payable 19,089 19,636 Hire purchase 305 34 Term loans 11,193 10,817 Bank overdrafts 4,707 4,301

35,294 34,788 Less: Fixed deposits with a licensed bank (392) (150) Less: Cash and bank balances (3,530) (1,918) Net debt 31,372 32,720 Total equity 83,575 80,735 Debt-to-equity ratio 0.37 0.41

THE GROUP THE COMPANY 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Financial assets

Loans and receivables financial assetsTrade receivables 19,438 16,524 - -Other receivables 1,614 3,431 22 22Amount owing by subsidiaries - - 24,773 25,252Fixed deposits with licensed banks 392 150 - -Cash and bank balances 3,530 1,918 12 17 24,974 22,023 24,807 25,291

Fair value through profit and lossShort-term investments 101 101 - -

Financial liabilities

Other financial liabilitiesBills payable 19,089 19,636 - -Hire purchase 305 34 - -Term loans 11,193 10,817 - -Trade payables 9,019 4,526 - -Other payables and accruals 3,407 3,234 74 58Amount owing to a related party 288 365 - -Bank overdrafts 4,707 4,301 - - 48,008 42,913 74 58

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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44. FINANCIAL INSTRUMENTS (CONT’D) (d) Fair Values of Financial Instruments

The following summarises the methods used to determine the fair values of the financial instruments:-

(i) The financial assets and financial liabilities maturing within the next 12 months approximated their fair values due to the relatively short-term maturity of the financial instruments.

(ii) The fair value of quoted investments is estimated based on their quoted market prices as at the end of the reporting period. (iii) The carrying amounts approximated their fair values. The fair values of term loans and hire purchase payables are determined by discounting the relevant cash flows using current interest rates for similar instruments as at the end of the reporting period. (e) Fair Value Hierarchy

The fair values of the financial assets and liabilities are analysed into level 1 to 3 as follows:-

Level 1: Fair value measurements derive from quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Fair value measurements derive from inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3: Fair value measurements derive from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

As at 31 March 2012, the Group has carried its quoted investments that are classified as fair value through profit or loss financial assets at their fair values. These financial assets belong to level 1 of the fair value hierarchy.

45. SIGNIFICANT EVENTS DURING THE FINANCIAL PERIOD

The details of the significant events during the financial period are as follows:- (a) On 15 July 2011, the Company acquired 2 ordinary shares of RM1.00 each, representing 100% of the total issued and paid-up capital of Resintech Biowood (Malaysia) Sdn. Bhd. for a total cash consideration of RM2.00.

(b) On 30 September 2011, the Company issued 68,600,000 2011/2016 Warrants to all entitled shareholders of the Company on the basis of one (1) free Warrant for every two (2) existing ordinary shares of RM0.50 each held in the Company. The exercise price of the Warrants is RM0.50 each.

(c) On 15 February 2012, the Company acquired 2 ordinary shares of RM1.00 each representing 100% of the total issued and paid- up capital of Sarpino’s (M) Sdn. Bhd. for a total cash consideration of RM2.00.

46. COMPARATIVES

The Company and its subsidiaries have changed their financial year end from 28 February to 31 March. Accordingly, the financial statements of the Group and the Company for the financial period ended 31 March 2012 cover a 13-month period from 1 March 2011 to 31 March 2012 as compared to the 12 month period from 1 March 2010 to 28 February 2011.

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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47. SUPPLEMENTARY INFORMATION – DISCLOSURE OF REALISED AND UNREALISED PROFITS/LOSSES The breakdown of retained profits of the Group and of the Company as at the end of the reporting period into realised and unrealised profits are presented in accordance with the directive issued by Bursa Malaysia Securities Berhad and prepared in accordance with Guidance on Special Matter No.1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants, as follows:-

THE GROUP THE COMPANY 31.3.2012 28.2.2011 31.3.2012 28.2.2011 RM’000 RM’000 RM’000 RM’000

Total retained profits- realised 21,974 18,537 1,113 1,600- unrealised (9,471) (10,005) - - 12,503 8,532 1,113 1,600

Total share of retained profit of an associate:- realised (77) 83 - - 12,426 8,615

Less: Consolidated adjustments (3,724) (2,949)

At 31 March/28 February 8,702 5,666 1,113 1,600

NOTES TO THE FINANCIAL STATEMENTS For the financial period from 1 March 2011 to 31 March 2012 (cont’d)

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87Annual Report 2012

LIST OF PROPERTIES At 31 July 2012

BUILD-UP APPROXI- AREA/ LAND MATE NET BOOK DATE DESCRIPTION/ AREA* REGISTERED AGE OF VALUE OF LASTLOCATION EXISTING USE (SQ.FT.) TENURE OWNER BUILDINGS (RM) VALUATION

Lot 5, Jalan Waja 14 Single-storey 177,139 / To be RPSB 12 years 16,330,478 25 FebruaryKawasan Perindustrian detached factory, 237,185* issued with 2010Telok Panglima Garang a 3- storey office a 99-year 42500 Telok block and single leaseholdPanglima Garang storey hall with qualifiedSelangor Darul Ehsan additional 2 floors title. No 21 Jalan Taming 7, Intermediate 1½ 2,970 / Freehold RPSB 14 years 459,302 3 AprilTaman Taming Jaya storey terrace 2,160* 201243300 Balakong light industrialSelangor Darul Ehsan factory

Lot PT 13749 Vacant 1,600* Leasehold RPSB n/a 100,557 25 FebruaryPandamaran commercial 99 years 2010Port Klang land expiring on Selangor Darul Ehsan 26 August 2087

Lot PT 14229 Single-storey 6,000 / Leasehold RPSB 3 years 987,500 25 FebruaryPandamaran Jaya semi-detached 9,075* 60 years 2010Industrial Mukim Klang warehouse expiring on Selangor Darul Ehsan 16 Mac 2068 Lot PT 14228 Single-storey 6,000 / Leasehold RPSB 3 years 374,866 25 MayPandamaran Jaya semi-detached 9,075* 60 years 2012Industrial Mukim Klang warehouse expiring on Selangor Darul Ehsan 16 Mac 2068 Lot 1851 Jalan Camp, Vacant industrial 215,056* Leasehold RPSB n/a 2,480,043 25 FebruaryPort Klang land 99 years 2010Selangor Darul Ehsan expiring on 7 April 2090

Lot 107 Block 14 Single-storey 12,680 / Leasehold RPSB 2 years 2,432,644 25 February Batu 24, Kuching/ detached 150,898* 60 years 2010Serian Road Sentah/ factory expiring onSegu Land District 6 January 2012Kuching Division Sarawak

Lot 24 & 25 Export Single-storey 36,152 / To be issued RPSB 2 years 5,419,984 25 FebruaryOriented Industrial detached 175,547* with a 99-year 2010Zone Phase 2 Kota warehouse leaseholdKinabalu Industrial and a double-storey qualified titlePark Sabah office block

Lot 3 Jalan Waja 15 4 single- 117,600 / Leasehold ELSB 12 years 11,073,409 3 AprilKaw Perindustrian storey 240,508* 99 years 2012Telok Panglima Garang warehouses expiring on42500 Telok 9 SeptemberPanglima Garang 2103Selangor Darul Ehsan

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LIST OF PROPERTIES At 31 July 2012 (cont’d)

BUILD-UP APPROXI- AREA/ LAND MATE NET BOOK DATE DESCRIPTION/ AREA* REGISTERED AGE OF VALUE OF LASTLOCATION EXISTING USE (SQ.FT.) TENURE OWNER BUILDINGS (RM) VALUATION

Lot 6461 Batu 5¾ Double-storey 41,924 / Freehold RPSB 19 years 6,465,710 3 AprilJalan Kapar factory building 219,978* 201242200 Kapar cum office block, Selangor Darul Ehsan a double storey canteen block cum store, a guard house and a motorcycle shed

No 9 Jalan MJ 49 Single-storey 1,200 / Leasehold RPSB 13 years 85,000 3 AprilTaman Merdeka terrace 1,195* 99 years 2012Jaya Batu Berendam shop-office expiring on75350 Melaka 31 October 2097

No 7 Jalan MJ 49 Single-storey 1,200 / Leasehold RPSB 13 years 85,000 3 April Taman Merdeka terrace 1,195* 99 years 2012Jaya Batu Berendam shop-office expiring on75350 Melaka 31 October 2097

No 5 Jalan MJ 49 Single-storey 1,200 / Leasehold RPSB 13 years 85,000 3 AprilTaman Merdeka Jaya terrace 1,195* 99 years 2012Batu Berendam shop-office expiring on 75350 Melaka 31 October 2097

Sub-Lot 298, Kawasan Vacant 27,975* Leasehold RPMSB n/a 401,954 25 FebruaryPerindustrian Gebeng, industrial land 99 years 2010Mukim Sungai Karang, expiring onDaerah Kuantan, Pahang 15 January 2102

Sub-Lot 302, Kawasan Vacant 28,363* Leasehold RPMSB n/a 407,521 25 FebruaryPerindustrian Gebeng, industrial land 99 years 2010Mukim Sungai Karang, expiring onDaerah Kuantan, Pahang 15 January 2102

No 906, Jalan IKS Juru, Single-storey 6,000 / Freehold RPMSB 2 years 1,894,738 25 FebruaryJuru, 14100 Simpang store and office 47,899* 2010Ampat, Pulau Pinang

Lot 3911 Jalan Riang Two and half – 31,484 / Freehold RPMSB 4 years 3,018,048 Acquisition21/6 Storey detached 29,554* completed inTaman Gembira factory 201181200 Johor Bahru

No 13, Jalan AP 1 Three-storey 3,914 / Leasehold RPSB 8 years 200,000 31 MarchTaman Alai Perdana commercial 1,323* 99 years 201275460 Melaka office expiring on 1 October 2096

Blok E2 Latrade Single-storey 6,743 / Leasehold PTRI 6 years 3,642,582 10 MarchIndustrial Park factory with 6,753* expiring on 2011Jl Sei Binti attached 25 March 2030Tanjung Uncang two-storey office29422 Batam, Indonesia

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LIST OF PROPERTIES At 31 July 2012 (cont’d)

BUILD-UP APPROXI- AREA/ LAND MATE NET BOOK DATE DESCRIPTION/ AREA* REGISTERED AGE OF VALUE OF LASTLOCATION EXISTING USE (SQ.FT.) TENURE OWNER BUILDINGS (RM) VALUATION

Blok E4 Latrade Vacant 8,612* Leasehold PTRI n/a 1,450,693 10 MarchIndustrial Park industrial land expiring on 2011Jl Sei Binti 28 SeptemberTanjung Uncang 203629422 Batam, Indonesia

Blok D No 1 Single-storey 1,345 / Leasehold PTRI 3 years 365,248 AcquisitionTop100 Mall commercial 1,152* expiring on completed inBatam shop lot 13 April 2034 2011

Blok D No 2 Single-storey 1,485 / Leasehold PTRI 3 years 329,902 AcquisitionTop100 Mall commercial 893* expiring on completed inBatam shop lot 13 April 2034 2011

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90 Resintech Berhad

ANALYSIS OF ORDINARY SHAREHOLDINGSAs at 24 August 2012

Authorised Share Capital : RM200,000,000.00 divided into 400,000,000 ordinary shares of RM0.50 each

Issued and Fully Paid-Up Share Capital : RM68,600,000 divided into 137,200,000 ordinary shares of RM0.50 each

Class of Shares : Ordinary shares of RM0.50 each

Voting Rights : Every member of the Company, present in person or by proxy or by attorney or other duly authorised representative, shall have on a show of hands, one (1) vote or on a poll, one (1) vote for each ordinary share held

Number of Shareholders : 1,176

DISTRIBUTION OF SHAREHOLDINGS

SIZE OF SHAREHOLDINGS NO. OF HOLDERS % NO. OF SHARES %

Less than 100 23 1.96 982 0.00100 to 1,000 80 6.80 16,177 0.011,001 to 10,000 526 44.73 2,534,180 1.8510,001 to 100,000 470 39.97 14,912,040 10.87100,001 to 6,859,999 shares* 73 6.21 37,524,422 27.356,860,000 shares and above** 4 0.34 82,212,199 59.92

1,176 100.00 137,200,000 100.00

Notes:* Less than 5% of issued shares** 5% and above of issued shares

THIRTY (30) LARGEST SECURITIES ACCOUNT HOLDERS FOR ORDINARY SHARES(without aggregating securities from different securities accounts belonging to the same person)

NO. NAME NO. OF SHARES HELD %

1 Dato’ Dr. Teh Kim Poo 35,982,790 26.232 EB Nominees (Tempatan) Sendirian Berhad Pledged Securities Account for Dato’ Dr. Teh Kim Poo (PKG) 20,423,209 14.89 3 Tema Evolusi Sdn Bhd 16,158,800 11.784 Datin Gan Jew, PJK 9,647,400 7.035 UBB (Malaysia) Trustee Berhad For Dato’ Abu Sujak Bin Mahmud (Trust) 4,569,600 3.336 Teh Leng Kang, 4,200,002 3.067 Techvilla Engineering Sdn. Bhd. 3,321,200 2.428 Ei Kim Hock 3,280,000 2.399 Maybank Nominees (Tempatan) Sdn. Bhd. Pledged Securities Account for Mak Siew Wei 3,238,200 2.3610 Chee Kwai Heong 3,064,300 2.2311 Lim Boon Siong 843,500 0.6112 Tee Chee Chong 744,140 0.5413 Ong Pick Shya 651,000 0.4714 Lim Siew Hwa 574,000 0.4215 Tew Shau Yeng 543,200 0.4016 Ng Hong Khim 512,000 0.37 17 Teo Chow Seng 471,800 0.3418 Affin Nominees (Tempatan) Sdn Bhd Pledged Securities Account for Ng Teh Ate (NGT0039C) 434,000 0.3219 Mohamad Nizam Bin Yaacob 420,760 0.31

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ANALYSIS OF ORDINARY SHAREHOLDINGSAs at 24 August 2012 (cont’d)

THIRTY (30) LARGEST SECURITIES ACCOUNT HOLDERS FOR ORDINARY SHARES (CONT’D)(without aggregating securities from different securities accounts belonging to the same person)

NO. NAME NO. OF SHARES HELD %

20 How Thong Guan 420,000 0.31 21 Tan Ah Lan 407,400 0.3022 Ong Seng Swee @ Ong Ah Bah 400,000 0.2923 UBB (Malaysia) Trustee Berhad For Beh Hang Kong (Trust) 389,200 0.2824 Maybank Nominees (Tempatan) Sdn. Bhd. Ding Ying Hieng 374,700 0.2725 Khoo Ting Hock 364,000 0.27

26 Tan Hai Kiang 301,000 0.2227 Kenanga Nominees (Tempatan) Sdn Bhd Pledged Securities Account for Khoo Tew Choon 280,000 0.2028 Chai Mooi Chong 252,000 0.1829 Beh Khim Eik 250,000 0.1830 Hon Sue Dip 235,000 0.17

SUBSTANTIAL SHAREHOLDERS ACCORDING TO THE REGISTER OF SUBSTANTIAL SHAREHOLDERS

NO. SUBSTANTIAL SHAREHOLDERS DIRECT INTEREST % INDIRECT INTEREST %

1 Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP 56,405,999 41.11 13,952,402* 10.172 Tema Evolusi Sdn Bhd 16,158,800 11.78 - -3 Datin Gan Jew, PJK 9,647,400 7.03 60,711,001* 44.25

* Deemed interest by virtue of family relationship.

DIRECTORS’ SHAREHOLDING ACCORDING TO THE REGISTER OF DIRECTORS’ SHAREHOLDINGS

DIRECTORS DIRECT INTEREST % INDIRECT INTEREST %

Dato’ Abu Sujak Bin Mahmud 4,569,600 3.33 - -Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP 56,405,999 41.11 13,952,402* 10.17Datin Gan Jew, PJK 9,647,400 7.03 60,711,001* 44.25Teh Leng Kang, PJK 4,200,002 3.06 - -Khairul Anuar Bin Shaharudin - - - -Wei Hwei Hong - - 4,200,002* 3.06Kok Wee Wah - - - -

* Deemed interest by virtue of family relationship.

DIRECTORS’ SHARE OPTIONS HELD UNDER THE EMPLOYEES’ SHARE OPTION SCHEME OF THE COMPANY AS AT 24 AUGUST 2012

DIRECTORS NO. OF SHARE OPTIONS

Dato’ Abu Sujak Bin Mahmud -Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP -Datin Gan Jew, PJK -Teh Leng Kang, PJK -Khairul Anuar Bin Shaharudin -Wei Hwei Hong -Kok Wee Wah -

Note:No options have been granted as at to-date.

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92 Resintech Berhad

WARRANT HOLDINGS STRUCTURE As at 24 August 2012

Number of Warrants : 68,600,000 five (5) years Warrants 2011/2016

Maturity Date : 29 September 2016

Exercise Price : RM0.50 per warrant

Exercise Rights : Each warrant entitles the registered holder to subscribe for One (1) ordinary share of RM0.50 each in the Company

Voting Rights : Nil

DISTRIBUTION OF WARRANT

DISTRIBUTION OF WARRANT NO. OF NO. OF % OF WARRANT HOLDERS % WARRANT HELD WARRANT HELD Less than 100 96 8.83 5,451 0.01100 to 1,000 139 12.79 95,328 0.141,001 to 10,000 519 47.75 2,269,040 3.3110,001 to 100,000 290 26.68 8,463,250 12.34100,001 to 3,429,999 shares* 39 3.59 16,660,831 24.293,430,000 shares and above** 4 0.37 41,106,100 59.92 1,087 100 68,600,000 100.00Notes:* Less than 5% of issued shares** 5% and above of issued shares

DIRECTORS’ WARRANTS HOLDINGS(based on the Register of Directors’ Shareholdings as at 24 August 2012)

DIRECTORS DIRECT INTEREST % INDIRECT INTEREST %

Dato’ Abu Sujak bin Mahmud 2,284,800 3.33 - -Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP 28,203,000 41.11 6,976,201 10.17Datin Gan Jew, PJK 4,823,700 7.03 30,355,500* 44.25Teh Leng Kang, PJK 2,100,001 3.06 - -Khairul Anuar bin Shaharudin - - - -Wei Hwei Hong - - 2,100,001* 3.06Kok Wee Wah - -- -

* Deemed interest by virtue of family relationship.

THIRTY (30) LARGEST SECURITIES ACCOUNT HOLDERS FOR WARRANTS(without aggregating securities from different securities accounts belonging to the same person)

NO. NAME NO. OF SHARES HELD %

1 Dato’ Dr. Teh Kim Poo, DSSA, PJK, JP 17,991,395 26.23 2 EB Nominees (Tempatan) Sendirian Berhad Pledged Securities Account for Dato’ Dr. Teh Kim Poo (PKG) 10,211,605 14.893 Tema Evolusi Sdn Bhd 8,079,400 11.784 Datin Gan Jew 4,823,700 7.035 Techvilla Engineering Sdn Bhd 3,413,400 4.986 UBB (Malaysia) Trustee Berhad For Dato’ Abu Sujak Bin Mahmud (Trust) 2,284,800 3.337 Teh Leng Kang 2,100,001 3.068 Chee Kwai Heong 1,209,900 1.769 Tan Kok Keng 480,000 0.70

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WARRANT HOLDINGS STRUCTURE As at 24 August 2012 (cont’d)

THIRTY (30) LARGEST SECURITIES ACCOUNT HOLDERS FOR WARRANTS(without aggregating securities from different securities accounts belonging to the same person)

NO. NAME NO. OF SHARES HELD %

10 JF Apex Nominees (Tempatan) Sdn Bhd AISB for Adlan Bin Abdul Rahman (STA 3) 453,500 0.6611 Lim Boon Siong 421,750 0.6112 CIMSEC Nominees (Tempatan) Sdn Bhd CIMB Bank for Pek Kiam Kek (MM0606) 420,000 0.6113 Tee Chee Chong 372,070 0.5414 Ong Pick Shya 325,500 0.4715 Lim Siew Hwa 287,000 0.4216 Maybank Nominees (Tempatan) Sdn Bhd Pledged Securities Account for Adlan Bin Abdul Rahman 256,300 0.3717 Lim Keng Tiong 240,000 0.3518 Teo Chow Seng 235,900 0.3419 Yap Beng Chai 220,000 0.3220 Yip Kum Fook 219,740 0.3221 Affin Nominees (Tempatan) Sdn Bhd Pledged Securities Account for Ng Teh Ate (NGT0039C) 217,000 0.3222 How Thong Guan 210,000 0.3123 Yap Teo Kwee 210,000 0.3124 Mohamad Nizam Bin Yaacob 205,380 0.3025 Tan Ah Lan 203,700 0.3026 Ng Kiam Song 200,000 0.2927 Ong Seng Swee @ Ong Ah Bah 200,000 0.2928 UBB (Malaysia) Trustee Berhad for Beh Hang Kong (Trust) 194,600 0.2829 Ng Hong Khim 186,000 0.2730 Khoo Ting Hock 182,000 0.27

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FORM OF PROXY CDS Account No. (i)

No. of Shares held

Notes:1. Member entitled to attend and vote at the meeting may appoint another person as his proxy to attend and vote in his stead. A proxy may but need not be a member of the Company. If the proxy is not a member, he need not be an advocate, an approved company auditor or a person approved by the Registrar of Companies.

2. A Member may appoint only (1) proxy to attend the same meeting. Where a member is an authorised nominee as defined under the Securities Industry (Central Depositories) Act, 1991, it may appoint at least one (1) proxy in respect of each securities account it holds with ordinary shares of the company standing to the credit of the said securities account.

3. The instrument appointing a proxy shall be in writing (in the common or usual form) under the hand of the appointor or of his attorney duly authorised in writing or, if the appointor is a corporation, either under seal or under the hand of an officer or attorney duly authorised.

4. The instrument appointing a proxy and the power of attorney or other attorney, if any, under which it is signed or a notarially certified copy of that power or authority shall be deposited at Symphony Share Registrars Sdn Bhd, Level 6, Symphony House, Block D13, Pusat Dagangan Dana 1, Jalan PJU 1A/46, 47301 Petaling Jaya, Selangor Darul Ehsan not less than forty-eight (48) hours before the time for holding of the meeting or adjourned meeting.

*I/We NRIC No./Company No.

of

being a member/members of RESINTECH BERHAD (341662-X), hereby appoint

NRIC No.

of

or failing *him/her,

NRIC No. of

or failing *him/her, *the Chairman of the Meeting as *my/our proxy to attend and vote on *my/our behalf at the Seventeenth Annual General Meeting of the Company to be held at Concorde Hotel Shah Alam, Concorde III, Level 2, No. 3 Jalan Tengku Ampuan Zabedah, 40100 Shah Alam, Selangor Darul Ehsan on Tuesday, 25 September 2012 at 9.30 a.m. and at any adjournment thereof and to vote as indicated below:

(FULL ADDRESS)

(FULL NAME IN BLOCK CAPITALS)

(FULL NAME IN BLOCK CAPITALS)

(FULL ADDRESS)

(FULL ADDRESS)

(FULL NAME IN BLOCK CAPITALS)

RESOLUTIONS FOR AGAINST

1 To re-elect Dato’ Dr. Teh Kim Poo (Ordinary Resolution 1)

2 To re-elect Wei Hwei Hong (Ordinary Resolution 2)

3 To approve the payment of Directors’ Fees (Ordinary Resolution 3)

4 To re-appoint Messrs Crowe Horwath as Auditors of the Company (Ordinary Resolution 4)

Special Business

5 Authority to Allot Shares pursuant to Section 132D of the Companies Act, 1965 (Ordinary Resolution 5)

6 To re-appoint Dato’ Abu Sujak bin Mahmud (Ordinary Resolution 6)

7 Proposed Amendment to the Articles of Association of the Company (Special Resolution 1)

(Please indicate with an “X” in the appropriate boxes on how you wish your vote to be cast. Unless voting instructions are indicated in the space above, the proxy will vote as he/she thinks fit.)(i) Applicable to shares held through a nominee account.* Delete where applicable

Signed this day of 2012

Signature/Common Seal of Member

For appointment of two proxies, percentage if shareholdings to be represented by the proxies:

NO. OF SHARES PERCENTAGE

Proxy 1

Proxy 2

Total 100%

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THE SHARE REGISTRAR

Symphony Share Registrars Sdn Bhd Level 6, Symphony House Pusat Dagangan Dana 1, Jalan PJU 1A/46 47301 Petaling Jaya Selangor Darul Ehsan

STAMP

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