(638899-k) profile of directors • none of the directors has conviction for any offence within the...

A N N U A L R E P O R T

CAN-ONE BERHAD(638899-K)

GROUP FINANCIAL HIGHLIGHTS

Financial Year Ended 31 December 2009 2010 2011 2012 2013 (Restated) (Restated) (Restated) (Restated) Revenue (RM’Million) 405.93 449.05 630.98 789.82 772.88

Earnings Before Interest, Taxes, Depreciation and Amortisation (RM’Million) 58.89 49.48 62.41 229.72 129.93

Profit Before Tax (RM’Million) 37.11 26.39 41.91 194.88 93.96

Profit After Tax (RM’Million) 31.34 20.79 34.52 178.13 77.27

Net Profit Attributable to Equity Holders (RM’Million) 31.05 19.44 32.41 170.73 69.67

Total Assets (RM’Million) 444.89 467.29 567.48 991.07 1,052.22

Shareholders’ Equity (RM’Million) 175.22 200.82 228.65 396.98 460.61

Return on Equity (%) 17.89 10.35 15.10 44.87 16.78

Earnings Per Share (Sen) 20.37 12.76 21.27 112.02 45.71

Net Asset Per Share (RM) 1.15 1.32 1.50 2.60 3.02

800

700

600

500

400

300

200

100Revenue(RM’Million)

405.93449.05

630.98

789.82 772.88

1100

1000

900

800

700

600

500

400

300

200

100

TotalAssets

(RM’Million)

444.89 467.29

567.48

991.07

1,052.22120

100

80

60

40

20

EarningsPer Share(Sen)

20.37

12.76

21.27

112.03

45.72

200

180

160

140

120

100

80

60

40

20

2009 2010 2011 2012 2013

2009 2010 2011 2012 20132009 2010 2011 2012 2013

2009 2010 2011 2012 2013

37.11/31.34 26.39/

20.79

41.91/34.52

194.88/178.13

93.96/77.27

Profit Beforeand After Tax(RM’Million)

ProfitAfter Tax

ProfitBefore Tax

2 Corporate Information

3 Corporate Structure

4 Profile of Directors

6 Chairman’s Statement

9 Statement on Corporate Governance

16 Other Information

18 Audit Committee Report

21 Statement on Risk Management and Internal Control

24 Directors’ Responsibility Statement

25 Directors’ Report and Financial Statements

25 Directors’ Report

28 Statement by Directors

28 Statutory Declaration

29 Independent Auditors’ Report

31 Consolidated Statement of Financial Position

32 Consolidated Statement of Profit or Loss and Other Comprehensive Income

33 Consolidated Statement of Changes in Equity

34 Consolidated Statement of Cash Flows

36 Statements of Financial Position

37 Statement of Profit or Loss and Other Comprehensive Income

38 Statement of Changes in Equity

39 Statement of Cash Flows

40 Notes to the Financial Statements

95 List of Properties

97 Analysis of Shareholdings

99 Notice of Annual General Meeting

Form of Proxy

CONTENTS

BOARD OF DIRECTORSWilliam Maurice SamsonChairman/Independent Non-Executive Director

Marc Francis Yeoh Min ChangChief Operating Officer cum Executive Director

Tan Beng WahExecutive Director

BOARD OF DIRECTORSYeoh Jin HoeNon-Independent Non-Executive Director

Yeoh Jin BengNon-Independent Non-Executive Director

Razmi Bin AliasIndependent Non-Executive Director

AUDIT COMMITTEE/ REMUNERATION COMMITTEE/NOMINATING COMMITTEEWilliam Maurice Samson (Chairman)

Razmi Bin Alias

Yeoh Jin Beng

COMPANY SECRETARIESTan Bee Keng MAICSA 0856474

Kwong Shuk Fong MAICSA 7032330

AUDITORSKPMG Chartered AccountantsLevel 18, Hunza Tower163E Jalan Kelawei10250 PenangTelephone No. : 604-2382 288Fax No. : 604-2382 222Email Address : [email protected]

SHARE REGISTRARTricor Investor Services Sdn Bhd Level 17, The Gardens North TowerMid Valley CityLingkaran Syed Putra59200 Kuala Lumpur, Malaysia Telephone No. : 603-2264 3883Fax No. : 603-2282 1886Email Address : [email protected]

REGISTERED AND CORPORATE OFFICE 2B-4, Level 4Jalan SS 6/6, Kelana Jaya47301 Petaling JayaSelangor Darul Ehsan, Malaysia Telephone No. : 603-7804 8590Fax No. : 603-7880 1605Email Address : [email protected]

PRINCIPAL PLACE OF BUSINESSLot 2244, Jalan RajawaliBatu 9, Kampung Kebun Baru42500 Telok Panglima GarangKuala LangatSelangor Darul Ehsan, MalaysiaTelephone No. : 603-3122 1988Fax No. : 603-3122 2188Email Address : [email protected]

PRINCIPAL BANKERSKuwait Finance House (Malaysia) BerhadHSBC Bank Malaysia BerhadHong Leong Bank BerhadBangkok Bank Berhad

STOCK EXCHANGE LISTINGMain Market Bursa Malaysia Securities BerhadStock Name : CANONEStock Code : 5105Sector : Industrial Products

WEBSITEwww.canone.com.my

CORPORATE INFORMATION

CAN-ONE BERHAD (638899-K)2

CORPORATE STRUCTURE

100% Aik Joo Can Factory Sdn Berhad

100% Canzo Sdn Bhd

100% Ajcan Sdn Bhd

100% Sanjung Nuri Sdn Bhd

100% Newmarq Sdn Bhd

100% PT Corum

100% Lumiera Corporation (Labuan) Pte Ltd

100% Grensing Pte Ltd

100% Amber Alliance Sdn Bhd

80% F & B Nutrition Sdn Bhd

100% Can-One International Sdn Bhd

32.9% Kian Joo Can Factory Berhad *

100% Kian Joo Packaging Sdn Bhd

100% KJM Aluminium Can Sdn Bhd

100% Federal Metal Printing Factory, Sdn Berhad

100% Metal-Pak (Malaysia) Sdn Bhd

100% KJ Can (Selangor) Sdn Bhd

100% KJ Can (Johore) Sdn Bhd

100% Kian Joo Canpack Sdn Bhd

100% Kian Joo Canpack (Shah Alam) Sdn Bhd

100% Multi-Pet Sdn Bhd

100% Indastri Kian Joo Sdn Bhd

100% KJO International Sdn Bhd (Formerly known as KJO Systems Sdn Bhd)

100% KJ Can (Singapore) Pte Ltd

100% Kian Joo Can (Vietnam) Co., Ltd

54.83% Box-Pak (Malaysia) Bhd *

50% Kian Joo-Visypak Sdn Bhd

19%

81% Bintang Seribu Sdn Bhd

100% Great Asia Tin Cans Factory Company, Sdn Berhad

100% Can Ridge Sdn Bhd

100% Box-Pak (Johore) Sdn Bhd

100% AMBM Packaging Distribution Sdn Bhd

100% Box-Pak (Vietnam) Co., Ltd

100% Box-Pak (Hanoi) Co., Ltd

(638899-K)

* Listed on the Main Market of Bursa Malaysia Securities Berhad

*

ANNUAL REPORT 2013 3

PROFILE OF DIRECTORS

He was appointed to the Board of Can-One as Independent Non-Executive Director on 8 April 2005 and assumed the position as Chairman of the Board on 29 April 2005. As the appointed Senior Independent Director to whom concerns may be conveyed, he also sits on the Audit Committee, Remuneration Committee and Nominating Committee of Can-One as Chairman.

His experience is extensive covering management, marketing, insurance, finance and also shipping, having been the Managing Director of Sandilands Buttery & Company Ltd (“Sandilands”) prior to his retirement in 1980. After his

retirement, he started his own trading company in which he is still actively involved.

He was a member of the British Institute of Management (United Kingdom), Institute of Management (Malaysia) and a Fellow of the Institute of Directors (London).

He has no family relationship with any Director and/or major shareholder of Can-One and has no conflict of interest with Can-One.

WILLIAM MAURICE SAMSON Independent Non-Executive Chairman, Malaysian. Aged 88

He was appointed to the Board of Can-One as Chief Operating Officer cum Executive Director on 6 July 2012.

He holds a Bachelor of Science Degree in Electrical and Electronic Engineering (Magna cum Laude) from Marquette University, United States of America (“USA”) and a Master of Business Administration in Finance from University of Southern Queensland, Australia.

He is currently responsible for implementation of Can-One Group’s board operational strategies and policies. In addition, he also oversees the day-to-day operations and performance of the Group. His experience covers engineering, business development, management and marketing.

He was General Manager of the Engineering and Business Development units of the Group before his appointment to the Board. He was with Axiata Group Berhad group of companies from 2007 to 2010 serving in various senior engineering positions abroad before he left to join Can-One Group.

He is the son of Yeoh Jin Hoe (a Director and major shareholder of the Company) while Yeoh Jin Beng (a Director of the Company) is his uncle. He has no conflict of interest with Can-One.

MARC FRANCIS YEOH MIN CHANG Chief Operating Officer cum Executive Director, Malaysian. Aged 29

He was appointed to the Board of Can-One as Executive Director on 16 July 2012. He is responsible for the financial and administration affairs of the Group.

He holds a Bachelor of Accounting Degree and a Master in Business Administration from University Utara Malaysia. He is also a member of the Malaysian Institute of Accountants.

His experience covers finance, human resource, administration and marketing. He was General Manager of the Finance and

Administration units of wholly-owned subsidiary, Aik Joo Can Factory Sdn Berhad prior to his appointment to the Board. Previously, he was attached to Messrs KPMG Peat Marwick and a subsidiary of a listed company.


TAN BENG WAH Executive Director, Malaysian. Aged 45


PROFILE OF DIRECTORS

• None of the Directors has conviction for any offence within the past ten (10) years.

He joined the Board of Can-One as Non-Independent Non-Executive Director on 8 April 2005 and was re-designated as Independent Non-Executive Director on 16 July 2012. He is also a member of the Audit Committee, Remuneration Committee and Nominating Committee.

He holds a Diploma in Business Studies from Universiti Teknologi Mara, Malaysia, a Degree in Business Administration from Western Michigan University, USA and a Masters in Business Administration from Central Michigan University, Michigan, USA.

His experience covers finance and corporate functions, business development and trading. He owns several companies which are involved in financial consultancy, poultry farming, trading, transport, logistics, property and investment holding. Prior to that, he was a senior management staff in a local financial institution for fifteen (15) years.


RAZMI BIN ALIAS Independent Non-Executive Director, Malaysian. Aged 56

He was appointed as Non-Independent Non-Executive Director on the Board of Can-One on 8 April 2005. He is also a member of the Audit Committee, Remuneration Committee and Nominating Committee.

His expertise is in the manufacture and trading of fast moving consumer products. He is one (1) of the co-founders of Kaiserkorp Group which manufactures and distributes “KingKoil” and other branded mattresses in Malaysia. Prior to that, he was working for an international pharmaceutical company which deals in pharmaceutical and other specialty medical products.

He is the Managing Director of Ibufood Group which is involved in the manufacture and distribution of instant noodles and other consumer food products.

He is the brother of Yeoh Jin Hoe (Director and major shareholder of the Company) and uncle of Marc Yeoh (the Chief Operating Officer cum Executive Director of the Company). He has no conflict of interest with Can-One.

YEOH JIN BENG Non-Independent Non-Executive Director, Malaysian. Aged 61

He was appointed to the Board of Can-One as Managing Director on 8 April 2005. He relinquished the position on 11 July 2012 when he was appointed Group Managing Director (“MD”) of Kian Joo Can Factory Berhad (“KJCFB”) and remained on the Board of Can-One as Non-Independent Non-Executive Director.

He has extensive experience in the manufacturing and trading industries, having been the founder of several companies involved in the manufacturing sector. The Kaiserkorp Sdn Bhd group of companies (“Kaiserkorp Group”) which manufacture and distribute “KingKoil” and other branded mattresses as well as other sleep related products in Malaysia were started by him in the 1980s. He also founded Agrow (Malaysia) Sdn Bhd group of companies, which distribute sanitary wares, ironmongery, locks and builders’ hardware. Thereafter, he went on to establish Ibufood Corporation Sdn Bhd group

of companies (“Ibufood Group”) which manufacture and distribute instant noodles, food seasonings, instant soups and marinades.

Under his leadership and guidance, Can-One Group had expanded its core business as a tin can manufacturer to include the manufacture of plastic jerry cans, bag-in-boxes, dairy and non-dairy products. He was instrumental in the acquisition by the Group of 32.9% equity interest in KJCFB.

He is currently an Executive Director in KJCFB’s subsidiary company, Box-Pak (Malaysia) Bhd which is listed on the main market of Bursa Securities. He is a major shareholder of Can-One. He is the father of Marc Francis Yeoh Min Chang (“Marc Yeoh”) (the Chief Operating Officer cum Executive Director of the Company) and the brother of Yeoh Jin Beng (a Director of the Company). He has no conflict of interest with Can-One.

YEOH JIN HOE Non-Independent Non-Executive Director, Malaysian. Aged 67


CHAIRMAN’S STATEMENT

FINANCIAL REVIEW

Can-One Group recorded a slight drop in revenue to RM772.9 million as compared to RM789.8 million in the immediate preceding year.

The food division continued to be the main contributor to the overall turnover of the Group with a strong demand for its products from existing and new customers.

Revenue of the General Cans division dropped by 0.2% due mainly to commencement of the operation of a tin can line in the food product division. Pre-tax profit and post tax profit of the Group dropped to RM135 million and RM103 million respectively for the year under review compared to RM194.9 million and RM178.1 million respectively in financial year ended 31 December 2012 (“FYE 2012”). The profit of the Group for FYE 2013 is inclusive of the share of the results of associated company, Kian Joo Can Factory Berhad (“KJCFB”) of RM39.0 million compared to RM135.0 million in FYE 2012. The lower equity results for FYE 2013 is mainly due to a one-off bargain purchase gain of RM103.8 million arising from acquisition of KJCFB which was included in the FYE 2012.

DIVIDEND

The Board is pleased to recommend a first and final tax exempt dividend of 10% (5 sen per share), aggregating RM7.620 million, for the FYE 2013 for approval by shareholders at the forthcoming Tenth Annual General Meeting of the Company.

CORPORATE DEVELOPMENT

Associated Company

On 26 November 2013, associated company, KJCFB received a letter of offer from Aspire Insight Sdn Bhd (“Aspire”) to acquire the entire business and undertaking including all of the assets and liabilities of KJCFB (“Offer”) for a cash consideration of approximately RM1.466 billion. On 10 January 2014, the Board of Directors of KJCFB, via its Advisor announced that it had deliberated and agreed to accept Aspire’s Offer. On 29 January 2014, KJCFB received a written request for an extension of time from Aspire for the completion of the ongoing due diligence exercise and the signing of the definitive agreement in relation to the Offer. In response, KJCFB agreed to the extension of time from 31 January 2014 to 14 March 2014.

Changes in Key Management

Chee Khay Leong resigned as Executive Director of Can-One on 22 November 2013 to pursue a full-time key position outside Can-One.

See Ewe Lin resigned as Independent Non-Executive Director of Can-One and as a member of the Audit, Nominating and Remuneration Committees on 3 September 2013 for health reasons.

Yeoh Jin Beng was appointed as a member of the Audit, Nominating and Remuneration Committees to replace See Ewe Lin.

Dear Shareholders,

On behalf of the Board of Directors (“Board”), I have pleasure in presenting the

Annual Report and Audited Financial Statements of Can-One Berhad (“Can-One”

or “the Company”) for the financial year ended 31 December 2013 (“FYE 2013).


PENDING LITIGATION

The Kuala Lumpur High Court (“High Court”) had on 10 April 2013 allowed the Company’s and seven (7) Others’ (collectively, “the Applicants”) Notice of Application For Leave To Apply For Judicial Review against Bursa Malaysia Securities Berhad (“the Respondent” or “Bursa Securities”) on the following terms:

(i) that leave be granted to the Applicants to make an Application for Judicial Review pursuant to Order 53 Rule 3 of the Rules of Court, 2012 read with Section 25(2) of the Courts of Judicature Act, 1964;

(ii) that leave be granted to the Applicants to make an Application for Judicial Review by way of an Order of certiorari to remove into the High Court for the purpose of quashing the following decisions of the Listing Committee of the Respondent made on 6 November 2012 and as affirmed by the Appeals Committee of the Respondent on 22 February 2013, namely:

(a) that the Company had breached Paragraph 9.16(1)(a) of the Main Market Listing Requirements of Bursa Securities (“Listing Requirements”) in respect of the Company’s announcement dated 5 January 2012 in response to the unusual market activity query from Bursa Securities (“UMA Query”);

(b) that the Directors of the Company had breached Paragraph 16.13(b) of the Listing Requirements for permitting, knowingly or where they had reasonable means of obtaining such knowledge, the Company to breach Paragraph 9.16(1)(a) of the Listing Requirements in respect of the Company’s announcement dated 5 January 2012 in response to the UMA Query; and

(c) that there be imposed a public reprimand on the Company, and a public reprimand and fine of RM50,000 on each of the Directors of the Company in respect of the aforesaid breach on the part of the Company and breach on the part of the Directors of the Company;

(hereinafter referred to collectively as the whole of the said decisions of the Respondent)

(iii) that the leave granted to the Applicants to make an Application for Judicial Review shall operate as a stay of any proceedings before the Respondent in consequence of the said decisions of the Respondent or otherwise;

(iv) that there shall be such further and/or other reliefs, including an order of injunction or damages, and/or directions as may be deemed just and proper by the High Court; and

(v) that the costs of the proceedings herein shall be costs in the cause of the Application for Judicial Review.

The High Court on 29 October 2013 dismissed the Applicants’ Application For Judicial Review. On 21 November 2013, the Applicants filed a Notice of Appeal to the Court of Appeal against the High Court’s decision.

THE INDUSTRY-TREND AND DEVELOPMENT

General Cans Division

The General Cans division contributed revenue and pre-tax profit of RM360.4 million and RM24.1 million respectively in FYE 2013 compared to RM361.2 million and RM27.9 million respectively in FYE 2012.

The Group is aggressively pursuing cost improvement programme and enhancement of the Group’s operational efficiency to ensure the competitiveness of its products.

Food Division

The Food division contributed revenue and pre-tax profit of RM484.5 million and RM48.7 million respectively in FYE 2013 as compared to RM518.2 million and RM45.5 million respectively in FYE 2012.

The drop in revenue was due to lower export sales to Africa.



International Trading Division

The International Trading division contributed revenue of RM81.2 million and pre-tax profit of RM1.2 million in FYE 2013 compared to RM115.3 million and RM3.3 million respectively in FYE 2012. It is mainly involved in the trading of dairy products.

PROSPECTS

Despite global uncertainties and slowdown, Malaysia’s economy continues to grow steadily. The Group expects a steady growth based on the outlook for the Malaysian economy which is forecast to grow between 5.0% to 5.5% in 2014.

The Board is confident that the expansion and marketing strategies adopted by the Group will position the Group for further growth in 2014.

Barring any unfavorable movements in foreign currencies exchange rates, interest rates and cost of key raw materials, the Board anticipates the results of the Group for the financial year ending 2014 to be satisfactory.

CORPORATE SOCIAL RESPONSIBILITY

The Group recognises its responsibilities as a corporate citizen and will continue to play an important role in the society.

During the year under review, the Group conducted the following activities:

• Donatedcashandgoodstolocalcharitableorganisations;

• Providedinternshiptrainingopportunitiesforlocalundergraduates;

• Continuedtoinvestinenvironmentfriendlyandenergysavingequipment;and

• ContinuedtoprovideemploymentopportunitiesforMalaysians.

APPRECIATION

On behalf of the Board, I would like to thank the management and staff for their dedication and commitment to the Group.

I would also like to express our sincere gratitude to our shareholders, customers, suppliers, bankers and business associates for their continued trust and support.

And last but not least, I would like to commend and thank my fellow Board Members for their active participation in the Board and for their wise counsel.

“Success Comes in Cans”

William Maurice SamsonChairman

7 March 2014



STATEMENT ON CORPORATE GOVERNANCE

The Board of Can-One continues to uphold its commitment to good corporate governance practices throughout the Group as part of its duty to enhance stakeholders’ value.

The Board is pleased to report on the manner in which Can-One has applied the Principles as set out in the Malaysian Code on Corporate Governance (“MCCG”) 2012. Except for the departures explained in this statement, the Board is of the view that it has complied with the recommendations of good corporate governance as set out in MCCG 2012 and the provisions of the Listing Requirements.

A. BOARD OF DIRECTORS

Role of the Board

The Board’s main roles are to create value for shareholders and provide leadership to the Group. It is primarily responsible for the Group’s overall strategic plans and directions, establishment of policies for the Group, ensuring high standards of ethics and corporate conduct, implementation of corporate disclosure policies and procedures, overseeing the conduct of the businesses, risk management, succession planning of senior management, implementing investor relations programmes and ensuring the system of internal controls and management information system are adequate and effective.

In this regard, the Board is guided by the documented and approved Board Charter which defines the Board’s responsibilities and matters specifically reserved for the Board as well as those which the Board may delegate to the Chief Operating Officer (“COO”) and Executive Directors (“ED”). The Board Charter will be reviewed and amended as and when required, to ensure an optimum structure for efficient and effective decision making in the Group. Key matters specifically reserved for the Board’s collective approval include the annual business plan and budget, dividend policy, business continuity plan, issuance of new securities, business restructuring, expenditure above a certain limit, disposals of significant fixed assets and the acquisition or disposal of companies within the Group.

The division of responsibilities between the Board, the different Board Committees, the Chairman, the COO and EDs as well as the Directors’ Code of Best Practice are also incorporated in the Board Charter for reference by the Directors.

Board Composition and Balance

The Board is made up of six (6) members, one (1) COO cum ED, one (1) ED and four (4) Non-EDs, two (2) of whom are Independent.

The Board is headed and led by the Chairman while the COO and EDs lead the senior management team and take on the primary responsibility of executive management and oversee the operation of the Group. Their roles are separate with clearly defined responsibilities. The Chairman is primarily responsible for the effective running and orderly conduct of the Board. The COO cum ED is responsible for the day-to-day management of the Group. The COO and EDs are responsible for the overall performance and profitable operation of the Company and the Group. They work together with the senior management team to manage the business of the Group in a manner consistent with all relevant policies, standards, guidelines, procedures and practices of the Group and in accordance with any specific plans, instructions and directions of the Board.

The role of the Non-ED is to help the Board to develop strategy and to provide constructive challenge to proposals by the management. They are responsible for scrutinising management’s performance in meeting goals and objectives set by the Board. The Board considers that all its Independent Directors are independent in that they are not employees and they do not participate in the day-to-day management as well as the daily business of the Company. In staying clear of any potential conflict of interest situation, the Independent Directors remain in a position to fulfill their responsibility to provide a check and balance to the Board. Having a deep appreciation of the Group’s business and activities, they are able to make a thorough evaluation of information received and to provide independence and objective views, advice and judgment which take into account the interests of the Group as well as shareholders and investors.

The Board is satisfied with its existing number and composition. It is of the view that its members have the mix of skills, knowledge, experience and qualities which are essential in carrying out its responsibilities in an effective and competent manner as well as providing balance and independence of the Board. A brief description of the background of each Director is presented in the Profile of Directors in this Annual Report.



Tenure of Independent Director

MCCG 2012 recommends that the tenure of an Independent Director should not exceed a cumulative term of nine (9) years. The Board composition was reviewed in line with the aforesaid recommendation to ensure effective functioning of the Board as well as to enable progressive refreshing on the Independent Non-EDs by bringing in new experience, knowledge and expertise on the Board to meet the current and future needs of the Company and of the Group.

The Chairman, William Maurice Samson, will have served more than nine (9) years as Independent Director in April 2014. He has indicated that he will not seek re-appointment at the forthcoming Tenth Annual General Meeting (“AGM”) of the Company on 24 April 2014 when he vacates office as Director at the conclusion of the said AGM in accordance with Section 129 of the Companies Act, 1965 (“CA”) and the Articles of Association of the Company.

Appointments and Re-election of Directors

The Company has in place a formal and transparent procedure for the appointment of new Directors. The Nominating Committee established by the Board, reviews and considers the suitability of new nominee to be appointed as Director of the Company prior to recommending the proposed appointment to the Board for approval.

In accordance with the Company’s Articles of Association (“Articles”), all Directors are required to retire from office once at least in each two (2) years but shall be eligible for re-election. Directors, Yeoh Jin Hoe, Yeoh Jin Beng and Razmi Bin Alias are due to retire at the forthcoming Tenth AGM of the Company. They have expressed their intention to seek re-election.

The Articles also provide that all newly appointed Directors shall hold office until the next AGM of the Company after their appointment and shall be eligible for re-election.

In accordance with Section 129(2) of the CA, Directors who are of or over the age of seventy (70) years shall vacate office at the conclusion of every AGM of the Company.

The Chairman, William Maurice Samson who is over the age of seventy (70) years, will vacate office accordingly at the conclusion of the Tenth AGM of the Company.

Board Committees

The Board has delegated separate responsibilities to three (3) Board Committees, namely, the Audit Committee, Nominating Committee and Remuneration Committee to assist it in the execution of its duties and responsibilities. These Committees which comprise of a majority of Independent Non-EDs, deliberate on matters delegated to them and report to the Board with their recommendations. The ultimate responsibility for the final decision on all matters, however, lies with the Board.

(i) Audit Committee

The key functions, role and responsibilities of the Audit Committee which was formed on 15 September 2005 as well as its activities for the FYE 2013 are presented on pages 18 to 20 of this Annual Report.

(ii) Nominating Committee

The Nominating Committee which was formed on 15 September 2005 is responsible for making recommendations for appointments to the Board and the Board Committees. The composition of the Nominating Committee is presented on page 2 of this Annual Report.

The Nominating Committee recommends to the Board:

• candidatesfordirectorshipsproposedbyanyotherseniorexecutiveoranyDirectororshareholder;and • DirectorstofilltheseatsonBoardcommittees.

In addition, this Committee assesses:

• theeffectivenessoftheBoardasawholeandtheCommitteesoftheBoard;and • thecontributionofDirectors.



In making these recommendations, the Nominating Committee reviews the composition and size of the Board and determines the Board balance. It also reviews the required mix of skills, experience, qualification and other core competencies required of a Director.

The Committee shall meet at least once a year. Additional meetings will be scheduled, if considered necessary, by the Chairman of the Committee.

(iii) Remuneration Committee

The Remuneration Committee which was formed on 15 September 2005 is responsible for reviewing succession planning as well as the remuneration policies and practices of the Group. The composition of the Remuneration Committee is presented on page 2 of this Annual Report.

The Committee shall meet at least once a year. Additional meetings will be scheduled, if considered necessary, by the Chairman of the Committee.

Both the Nominating Committee and the Remuneration Committee held one (1) meeting during the FYE 2013 which was attended by all its members.

Board Meetings and Supply of Information The Board is satisfied with the level of time commitment given by the Directors towards fulfilling their roles and

responsibilities as Directors of Can-One. This was evidenced by the full attendance record of the Directors at the Board meetings held during the FYE 2013 as set out below:

Director Number of Board Meetings Attended in FYE 2013 Percentage (%) of Attendance William Maurice Samson 5 out of 5 100

Marc Francis Yeoh Min Chang 5 out of 5 100

Tan Beng Wah 5 out of 5 100

Yeoh Jin Hoe 5 out of 5 100

Yeoh Jin Beng 5 out of 5 100

Razmi Bin Alias 5 out of 5 100

See Ewe Lin (a) 4 out of 4 100

Chee Khay Leong (b) 4 out of 4 100

Notes :

(a) Resigned on 3 September 2013 (b) Resigned on 22 November 2013

Prior to the Board meetings, every Director is given an agenda and a comprehensive set of Board papers consisting of reports on the Group’s financial performance, future development, the quarterly or annual financial results, the minutes of preceding meetings of the Board and Board Committees, and relevant proposal papers (if any) to allow them sufficient time to review, consider and deliberate knowledgeably on the matters to be tabled.

Senior management staff as well as advisers and professionals appointed to act for the Company on corporate proposals to be undertaken by the Company are invited to attend the meetings to furnish the Board with their views and explanations on relevant agenda items tabled to the Board and to provide clarification on issues that may be raised by any Director.

In between Board meetings, approvals on matters requiring the sanction of the Board are sought by way of circular resolutions enclosing all the relevant information to enable the Board to make informed decisions. All circular resolutions approved by the Board are tabled for notation at the subsequent Board meeting.



The Board also perused the decisions deliberated by the Board Committees through minutes of these Committees. The Chairman of the Board Committees is responsible for informing the Board at the Directors’ Meetings of any salient matters noted by the Committees and which may require the Board’s direction.

The Directors have full access to all information pertaining to the Group’s businesses and affairs to enable them to discharge their duties. They have direct access to the services of the senior management employees and the Company Secretaries who responsible to the Board for ensuring that all Board procedures are followed and that applicable laws and regulations are complied with.

In addition, Directors may seek external independent professional advice at the Company’s expense on matters pertaining to the Group’s operations or undertakings, as and when necessary, in fulfillment of their duties and responsibilities as Directors of the Company.

Directors’ Training and Education

All Directors have attended the Mandatory Accreditation Programme (“MAP”) prescribed by Bursa Securities.

The Directors are mindful in evaluating their own training needs on a continuous basis to determine the relevant programmes or conference to keep themselves abreast with new statutory and regulatory requirements and current business developments relevant to the Directors’ area of responsibility.

During the FYE 2013, the Directors had attended the following training courses/programmes:

Director Course Title Organiser Date

William Maurice Samson Tax and Deferred Tax Seminar KPMG 21 October 2013

Marc Francis Yeoh Deloitte TaxMax @ Penang Deloitte KassimChan 19 November 2013 Min Chang Tax Services Sdn Bhd

Tan Beng Wah Tax and Deferred Tax Seminar KPMG 21 October 2013 BDO GST Seminar BDO 26 November 2013

2014 Budget Seminar Malaysian Institue 3 December 2013 of Accountants

Yeoh Jin Hoe Governance and Enterprise Malaysian Investor 19 September 2013 Risk Management – Managing the Relations Association Challenges Ahead (“MIRA”) and Boardroom Corporate Services (KL) Sdn Bhd Investigation, Prosecution XcelLearn 9 and 10 and Domestic Inquiry Resources Bhd October 2013

Enhanced Understanding of Bursa Securities 12 December 2013 Risk Management and Internal Control for Chief Financial Officers, Internal Auditors and Risk Officers

Yeoh Jin Beng Tax and Deferred Tax Seminar KPMG 21 October 2013

Razmi Bin Alias Palm Oil : Green Opportunities MPOB International 19 to 21 from the Golden Crops Palm Oil Congress November 2013 Biomass SME Recognition EU-Malaysia Biomass 12 November 2013 Programme and Knowledge Sustainable Production Exchange Seminar Initiative (Biomass-SP)



Directors’ Remuneration

The Remuneration Committee is responsible for recommending to the Board the remuneration framework for Directors as well as the remuneration package of the EDs. The Directors do not participate in decisions regarding their own remuneration packages.

The current remuneration packages for the COO and EDs comprise of a combination of basic salary and a variable performance incentive. The remuneration of the Non-EDs are based on a standard fee determined by the Board that reflects their expected roles and responsibilities. The Directors’ fees are approved by the Company’s shareholders at the AGM. Meeting allowance is paid to Directors and Board Committee members in accordance with the number of Board meetings and Board Committee meetings attended by each of them during a financial year. The Directors are also reimbursed reasonable expenses incurred by them in the course of carrying out their duties on behalf of the Company.

The remuneration of the Directors categorised into appropriate components for the FYE 2013 are as follows:

Category COO and EDs Non-EDs Past Directors Total RM RM RM RM Fees 180,000 260,000 130,000 570,000 Salaries 791,000 142,000 732,000 1,665,000 Bonuses 268,000 60,000 497,500 825,500 Allowances - - - - Other remuneration 128,520 24,200 147,500 300,220 Benefits-in-kind 32,750 - 13,325 46,075

Total 1,400,270 486,200 1,520,325 3,406,795

The number of Directors whose total remuneration falls within the following bands are:

Remuneration Range Number of Directors COO and EDs RM650,001 – RM700,000 1 RM700,001 – RM750,000 1 RM1,450,001 – RM1,500,000 1

Non-EDs RM50,000 and below 3 Between RM50,001 – RM100,000 1 Between RM300,001 – RM350,000 1



B. SHAREHOLDERS

Communication with Shareholders and Investors

The Company recognises the importance of effective and timely communication with shareholders and investors and had established a “Disclosure Guideline” to keep them informed on the Group’s latest financial performance and material business/corporate matters affecting the Company. Such information is communicated through the Annual Report, the various disclosures and announcements to Bursa Securities and the Company’s corporate website.

In addition, the Company’s website at www.canone.com.my provides an easy and convenient avenue for shareholders and investors to gain access to information on the Group such as its history, corporate structure, corporate information, corporate governance matters as well as the products offered by the Group. The COO, EDs and senior management of the Company, where they deem it practicable to do so, will engage with institutional shareholders based on mutual understanding of objectives and entertain visits from other fund managers or analysts.

The Company also uses the AGM as a forum for dialogue and interaction with shareholders. Members of the Board as well as the External Auditors of the Company are present to answer questions raised during the meetings on the agenda items and the performance of the Group. Each item of special business included in the notice of general meeting will be accompanied by a full explanation of the effects of a proposed resolution. Separate resolutions are proposed for substantially separate issues at the meeting. William Maurice Samson, is the designated Senior Independent Non-ED to whom concerns relating to the Group may be conveyed by shareholders and other stakeholders.

The Chairman of the Board will announce before the start of all general meetings the right of the shareholders to demand a poll in accordance with the Company’s Articles of Association.

C. ACCOUNTABILITY AND AUDIT

Financial Reporting

The Board takes due care and responsibility in presenting a balanced, clear and meaningful assessment of the Group’s performance and prospects in the announcement of the Group’s quarterly and annual financial statements. The Audit Committee plays a crucial role in reviewing the presentation of and information to be disclosed in the financial statements to ensure accuracy, adequacy and compliance with the appropriate accounting standards and provisions of the Companies Act, 1965 prior to recommendation of the financial statements for release to Bursa Securities and the Securities Commission.

Risk Management and Internal Control

The Board recognises the importance of maintaining and reviewing its risk management and internal control procedures to identify and assess key risks and controls and management’s plans to mitigate or eliminate the significant risks identified. This is to ensure a sound system of risk management and internal control to safeguard shareholders’ investment and the Group’s assets.

The Statement on Risk Management and Internal Control which provides an overview of the state of risk management and internal controls within the Group is set out on page 21 of this Annual Report.

Relationship with the External Auditors

The Board through the Audit Committee, has established transparent and appropriate relationship with the Group’s External Auditors. The role of the External Auditors and their participation during the FYE 2013 are set out in the Audit Committee Report on pages 19 and 20 of this Annual Report.



D. SUSTAINABILITY

The Company recognises the importance of sustainability and its increasing impact to the business and is committed to the goal of developing a sustainable future. The Group is committed to providing a safe workplace for its employees and conducting its business in a way that is environmentally sound.

The Group’s dedication in supporting the local community within which it operates will remain steadfast and consistent. The Group has and will continue to implement initiatives designed to give back to the local community by donating cash and goods to local charitable organisations and providing internship training opportunity for the local undergraduates.

The Group maintains its various ISO certifications to systematically address its responsibility for safety, health and environment. To help safeguard and sustain the environment, the Group invests in environment friendly and energy saving equipment. It regularly maintains and upgrades its manufacturing plant to optimise use of energy and to ensure dust emissions are below the prescribed limits. The Group places utmost priority in maintaining the highest level of corporate governance and compliance with laws and regulations.

E. COMPLIANCE WITH MCCG 2012

The Group has substantially complied with the Principles of MCCG 2012 except as disclosed below:

Board Gender Diversity Policy

Corporate Governance Blueprint 2011 stated that the Board should ensure women participation on Board to reach thirty per centum (30%) by year 2016. The Company does not have a policy on boardroom diversity including gender diversity. In its selection for Board representation, the Company believes in and provides equal opportunity to candidates with merit.

This Statement is made in accordance with a resolution of the Board dated 7 March 2014.


OTHER INFORMATION

SHARE BUY-BACKS

During the FYE 2013, there were no share buy-backs by the Company.

OPTIONS OR CONVERTIBLE SECURITIES

The Company’s Employees’ Share Option Scheme was established in conjunction with the Company’s listing on the Main Board (now referred to as Main Market) of Bursa Securities on 29 July 2005. However, as at 31 December 2013, the Company has not granted any option.

No convertible securities were issued by the Company and/or exercised during the FYE 2013.

DEPOSITORY RECEIPT PROGRAMME

The Company did not sponsor any depository receipt programme during the FYE 2013.

IMPOSITION OF SANCTIONS/PENALTIES

Save as disclosed below, there were no public sanctions and/or penalties imposed on the Company and its subsidiary companies, Directors or management by the relevant regulatory bodies during the FYE 2013:

On 22 February 2013, the Company was publicly reprimanded by Bursa Securities for alleged breach of Paragraph 9.16(1)(a) of the Listing Requirements in respect of the Company’s announcement dated 5 January 2012 in response to the unusual market activity query from Bursa Securities (“UMA Query”).

At the same time, the Directors of the Company then, i.e. William Maurice Samson, Yeoh Jin Hoe, Chee Khay Leong, Ooi Teik Huat, Yeoh Jin Beng, Razmi bin Alias and See Ewe Lin were publicly reprimanded by Bursa Securities and fined a sum of RM50,000 each for alleged breach of Paragraph 16.13(b) of the Listing Requirements for permitting, knowingly or where they had reasonable means of obtaining such knowledge, the Company to breach Paragraph 9.16(1)(a) of the Listing Requirements in respect of the Company’s announcement dated 5 January 2012 in response to the UMA Query.

The Company and all the aforesaid seven (7) Directors (“Applicants”) had on 10 April 2013 filed Notice of Application for Leave to apply for judicial review against Bursa Securities.

The High Court on 29 October 2013 dismissed the Applicants’ Application For Judicial Review. On 21 November 2013, the Applicants filed a Notice of Appeal to the Court of Appeal against the High Court’s decision.

NON-AUDIT FEES

During the FYE 2013, the Company paid non-audit fees of RM28,100 to Messrs KPMG and KPMG’s affiliate.

PROFIT GUARANTEES

The Company did not receive any profit guarantee during the FYE 2013.

MATERIAL CONTRACTS

Saved as disclosed below, there were no material contracts (not being contracts entered into in the ordinary course of business) entered into by the Company and/or its subsidiaries involving Directors’ and major shareholders’ interests which subsisted at the end of the FYE 2013 or, if not then subsisting, which were entered into since the end of the previous financial year:


OTHER INFORMATION

Recurrent Related Party Transactions

At the Ninth AGM of the Company held on 19 June 2013, the Company had obtained shareholders’ mandate to allow the Company and its subsidiaries to enter into recurrent related party transactions (“RRPTs”) of a revenue or trading nature which are necessary for the day-to-day operations of the Group and in the ordinary course of business, with related parties.

The aforesaid mandate will lapse at the conclusion of the coming Tenth AGM of the Company.

In accordance with Paragraph 3.1.5 of Practice Note 12 of the Listing Requirements, details of the RRPTs conducted during the FYE 2013 pursuant to the aforesaid shareholders’ mandate are as follows:

Notes:

(1) Yeoh Jin Hoe is a Director and major shareholder of Can-One. He holds 6,690,000 in shares in Can-One (“Can-One Shares”) representing 4.39% of the issued and paid-up share capital of Can-One and has an indirect equity interest over 45,157,281 Can-One Shares representing 29.63% of the issued and paid-up capital of Can-One held via Eller Axis Sdn Bhd (“Eller Axis”) in which he has more than 15% voting shares. He is also the Group Managing Director and a major shareholder of KJCFB having indirect equity interest over 146,131,500 shares in KJCFB (“KJCFB Shares”) representing 32.9% of the issued and paid-up share capital of KJCFB held via Can-One International Sdn Bhd (“Can-One International”). He is also an Executive Director and a major shareholder of Box-Pak (Malaysia) Bhd (“Box-Pak”) by virtue of his indirect equity interest over 32,910,000 shares in Box-Pak (“Box-Pak Shares”) representing 54.83% of issued and paid-up share capital of Box-Pak held via KJCFB.

(2) Eller Axis is a major shareholder of Can-One holding 45,157,281 Can-One Shares representing 29.63% of the issued and paid-up share capital of Can-One. Accordingly, it is a major shareholder of KJCFB having indirect equity interest over 146,131,500 KJCFB Shares representing 32.9% of the issued and paid-up share capital of KJCFB held by Can-One International as well as a major shareholder of Box-Pak having indirect equity interest over 32,910,000 Box-Pak Shares representing 54.83% of issued and paid-up share capital of Box-Pak held by KJCFB.

(3) Chee Khay Leong resigned as Executive Director of Can-One on 22 November 2013. He holds 1,554,100 Can-One Shares representing 1.02% of the issued and paid-up share capital of Can-One. He is the Chief Operating Officer cum Executive Director of KJCFB and is also Executive Director of Box-Pak. He does not have any interest, direct or indirect, in the shares of KJCFB and Box-Pak.

Actual value transacted from 19 June 2013 up to Provider of products/ Recipient of Nature of 31 December 2013 Interested services products/services Transaction (RM’000) Related Party

KJCFB group of Can-One Group Purchase of can 737 Yeoh Jin Hoe (1)

companies excluding parts/components, Eller Axis Box-Pak (Malaysia) Bhd contract coil cutting Sdn Bhd (2) group of companies services and contract Chee Khay (“KJCFB Group”) printing services Leong (3)

KJCFB Group Can-One Group Purchase of tin cans 1,682

KJCFB Group Can-One Group Purchase of contract Nil packing services

Can-One Group KJCFB Group Sale of can parts/ 226 components and contract printing services

Can-One Group KJCFB Group Sale of tin cans and Nil soft pack materials Box-Pak (Malaysia) Bhd Can-One Group Purchase of cartons 206 group of companies Total : 2,851


AUDIT COMMITTEE REPORT

COMPOSITION

The Audit Committee comprises of the following: MembersWilliam Maurice Samson(Chairman/Independent Non-Executive Director)

Razmi Bin Alias (Member/Independent Non-Executive Director)

See Ewe Lin (Resigned on 3 September 2013)(Member/Independent Non-Executive Director)

Yeoh Jin Beng (Appointed on 1 October 2013)(Member/Non-Independent Non-Executive Director)

SecretariesTan Bee KengKwong Shuk Fong

FUNCTIONS, ROLES AND RESPONSIBILITIES

The Audit Committee (“the Committee”) is responsible to the Board for the following in its role to ensure proper management of assets, liabilities, revenue and expenses of the Company and the Group and compliance with statutory obligations:

(a) To recommend appointment of the external auditors and their fees and consider any questions of resignation or dismissal including whether there is reason (supported by grounds) to believe that the external auditors are not suitable for re-appointment, including making an assessment of their independence where the external auditors also provide non-audit services;

(b) To review the external auditors’ proposed plan scope and approach of audit before the audit commences and ensure co-ordination where more than one (1) audit firm is involved;

(c) To review the quarterly financial announcements and year-end financial statements of the Group, prior to the approval by the Board, focusing particularly on:

- changes in of major accounting policy and practices and their implementation;

- major judgemental areas;

- significant and unusual events;

- significant adjustments arising from the audit;

- going concern assumption; and

- compliance with accounting standards and the stock exchange and other legal requirements.

(d) To discuss problems and reservations arising from the audits and any matter the auditor may wish to discuss (in the absence of management, where necessary) including assistance given by employees of the Group to the auditor;

(e) To review with the external auditors, their evaluation of the system of internal controls, including any significant suggestions for improvements and management’s response;

(f) To review with the external auditors, their audit report;

(g) To review the Group’s business risk management process, including adequacy of the Group’s overall control environment and controls in selected areas representing significant financial and business risk;



(h) To do the following where an internal audit function exists:

- review the adequacy of the scope, function, competency and resources of the internal audit function and that it has the necessary authority to carry out its work;

- review the internal audit programme, process and results of the internal audit programme, processes or investigation undertaken and where necessary, ensure that appropriate action is taken on the recommendations of the internal audit function;

- the internal audit function should be independent of the activities it audits; the internal audit activities should be free from interference in determining the scope of internal audit, performing work and communicating results;

- the internal audit function reports directly to the Committee.

(i) To review any related party transactions and conflict of interest situation that may arise within the Company or Group including any transaction, procedure or course of conduct that raises questions of management integrity;

(j) To review the major findings of internal investigations and management’s response;

(k) To review the findings of any examinations by regulatory authorities;

(l) Where the Audit Committee is of the view that a matter reported by it to the Board has not been satisfactorily resolved resulting in a breach of these requirements, the Audit Committee must promptly report such matters to Bursa Securities; and

(m) Perform other oversight functions as requested by the Board.

NUMBER OF MEETINGS AND ATTENDANCE

The Audit Committee held five (5) meetings during the FYE 2013 which were attended by all its members.

SUMMARY OF ACTIVITIES

The main activities undertaken by the Audit Committee in discharging their responsibility during the FYE 2013 were as follows:

(i) Reviewed the quarterly unaudited financial reports of the Company and of the Group before recommendation to the Board for consideration and approval;

(ii) Reviewed the quarterly internal audit reports regarding significant risk areas and internal control matters coming to the attention of the Audit Committee and discussion on the findings with senior management to ensure that appropriate and timely measures have been taken to improve on the internal control system;

(iii) Reviewed the report of the Risk Management Committee on significant key risks and the risk management activities carried out during the FYE 2013;

(iv) Reviewed with the external auditors the audit report and their findings arising from the final audit;

(v) Reviewed the annual financial statements of the Group and of the Company for the FYE 2012 with the external auditors prior to the submission to the Board for approval;

(vi) Discussed with the management and the external auditors on developments in respect of the new Approved Accounting Framework – Malaysian Financial Reporting Standards (“MFRSs”) applicable to the financial statements of the Group and of the Company for the FYE 2013 and their judgment of the items that may affect the financial statements;

(vii) Reviewed the assistance given by the Company’s employees to the internal auditors and external auditors;

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



(ix) Evaluated the performance of the external auditors and made recommendation to the Board for their re-appointment;

(x) Reviewed and approved the External Audit Plan in respect of the financial statements of the Group and of the Company for FYE 2013 and the scope for the annual audit for the Group presented by the External Auditors; and

(xi) Reviewed and approved the Internal Audit Plan for the Group for year 2014 presented by the Internal Auditors.

INTERNAL AUDIT FUNCTION

In discharging its function, the Company engaged an external independent firm of professionals (“Internal Auditors”) to undertake independent regular and systematic review of the system of internal controls within the Group based on the approved Internal Audit Plan so as to provide reasonable assurance on the adequacy and effectiveness of governance, risk management and the internal control processes. The Internal Auditors provide the Audit Committee with independent and objective reports on the state of internal control of the Group’s operations, the extent of the branches’ compliance with the Group’s policies procedures and relevant statutory requirements and made recommendations, where necessary. The Audit Committee then deliberates on the Internal Audit reports to ensure recommendations made are duly acted upon by the management.

A summary of activities of the internal audit function during the FYE 2013 is presented in the Statement on Risk Management and Internal Control. The Group paid a total fee of RM32,839 for services rendered in respect of internal audit for the FYE 2013.

This Statement is made in accordance with a resolution of the Board dated 7 March 2014.


STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL

INTRODUCTION

The Board recognises the importance of a sound risk management and system of internal control to meet the Group’s business objectives, safeguard shareholders’ interest and the Group’s assets. It affirms its overall responsibility for the Group’s risk management and system of internal control which includes the establishment of an appropriate control environment and framework as well as reviewing the adequacy and effectiveness of the systems.

However, due to the inherent limitations in any system of internal controls, such a system is designed to identify and manage the Group’s risk within the acceptable risk profile, rather than eliminate the risk of failure to achieve business objectives.

Thus, the system can only provide reasonable but not absolute assurance against material misstatement, loss or fraud. The significant areas covered by the Group’s risk management and system of internal controls are financial, organisational, operational, environmental and compliance controls.

RISK MANAGEMENT

The Board confirms that there is an on-going process for identifying, assessing and responding to risks to achieve the objectives of the Group for the financial year under review. The process is in place for the period under review and up to the date of issuance of the Statement on Risk Management and Internal Control.

The Group has a formalised risk management process in place to identify, evaluate and manage the significant risks faced by the Group in meeting its business objectives. The risk management process is conducted in accordance with the Group’s Risk Management Framework which sets out the Risk Management Policy and Risk Management Methodologies.

In accordance with the Group’s Risk Management Framework, the Group formed a Risk Management Committee (“RMC”) during the financial year under review to oversee the Group’s risk management process. The RMC consists of the Chief Operating Officer (“COO”), Executive Director (“ED”) and senior management staff of the Group. At each business unit, a Risk Management Working Group (“RMWG”) was formed which consists of managers and key staff of each business unit.

The RMWG is tasked to identify major business and compliance risks, oversees and ensures integration of risk management into their business process to safeguard the interest of the Group covering strategic, operations, factories’ facilities, human resource and commercial risks. Risks are identified and assessed by employing the following methodologies:

• Identificationofrisksbytheprocessowners• Assessmentofthelikelihoodandimpactoftherisksidentified• Evaluatingthecontrolstrategiesinrelationtotherisks• Formulatingactionplantoaddresscontroldeficiencies• SettingKeyRiskIndicatorstomonitortherisks

Each business unit of RMWG reports to the RMC on a periodic basis. The RMC will then meet to discuss and evaluate the RMWGs’ reports for adoption. Thereafter, the RMC will report to the Audit Committee about key risks and risk management activities carried out during that period.

During FYE 2013, the RMC met once while the RMWG held two (2) meetings.

INTERNAL CONTROL SYSTEM

The Group’s internal control mechanism is embedded in the various work processes and procedures at appropriate levels in the Group. The Board maintains an organisational structure with clearly defined levels of responsibility and authority and appropriate reporting procedures which are clearly set out in the Board Charter. The Board meets regularly and has a Schedule of Matters specifically reserved for its collective decision in order that effective control over strategic, management, financial, operational, environmental and compliance issues can be maintained.



The COO, ED and senior management team are assigned with the responsibility of managing the Group. Key functions such as finance, tax, treasury, corporate, legal matters and contract awarding are controlled centrally by them. They are also accountable for the conduct and performance of the various business units. The COO, ED and senior management team monitor the affairs of the business units through review of performance and operation reports and having regular management meetings with the heads of the business units to identify, discuss and resolve business, financial, operational and management issues. The meetings also serve as an excellent platform whereby the Group’s goals and objectives are communicated.

INTERNAL AUDIT

The Audit Committee is responsible for reviewing and monitoring the adequacy and effectiveness of the Group’s system of internal control. The reviewing and monitoring of the adequacy and effectiveness of the system of internal control is carried out through the internal audit function. In this respect, the Group outsourced the internal audit function to an independent external consulting firm, Messrs Tan Yen Yeow & Company (“Internal Auditors”). The internal audit function assists the Audit Committee to achieve the following objectives:

• Assesstheadequacyandeffectivenessofthecurrentinternalcontrolsystemandproviderecommendationstoimproveonthe existing control environment in relation to key business processes and risk management practices;

• Highlightopportunitytoimproveefficiency,effectivenessandeconomicaspectsoftheGroup’soperations;and• Promote a systemof internal control that is responsive to thedynamic andever changingbusiness environment, cost

effective and sustainable.

The annual Internal Audit Plan is reviewed and approved by the Audit Committee prior to each financial year. The plan is developed based on the analysis of the businesses of the Group as well as past experience. The internal audit will focus its resources on areas of high risks which will be audited more frequently than low risk areas.

For purposes of identifying and prioritising risks, the internal audit team will discuss with the RMWG and the RMC, review management reports and financial statements.

During the financial year under review, the Internal Auditors carried out reviews on the following core areas of the branches to assess the adequacy and effectiveness of the internal control system, compliance with regulations and the Group’s policies and procedures by each of the branches:

• HumanResourceDevelopment• Payroll• SafetyandHealth• SalesTransaction• AccountsReceivable• ProductionControl• AccountsPayable• InventoryManagement• QualityAssurance• PreventiveMaintenance

The findings of their audits were tabled at the Audit Committee meetings for deliberation and the Audit Committee’s expectation on the corrective measures were communicated to the respective heads of departments and business units.

OTHER ACTIVITIES

Subsidiary operating companies were accredited ISO 9001:2008 and ISO:22000:2005 by Global Group Certification and SGS United Kingdom Ltd respectively. Documented internal procedures and standard operating procedures (“SOPs”) have been put in place since their accreditation. The SOPs covered major functional aspects such as product quality, productivity benchmarks, cost control, asset security and occupational safety procedures, human capital management, compliance with regulatory standards, among other matters. Surveillance audits are conducted periodically by assessors of the ISO certification bodies to ensure that the SOPs are adequately implemented.



The Group also operates a comprehensive information system which enables transactions to be captured, compiled and reported in a timely and accurate manner. The information system provides management with dependable data, analysis and other inputs relevant to the Group’s business operations.

Continuous training and development programmes are also provided to enhance employees’ competencies and maintain a risk adverse and control conscious culture.

CONCLUSION

The Board, having received assurance from the COO, ED and Group Chief Financial Officer, is satisfied with the adequacy and effectiveness of the Group’s risk management and internal control system for the year under review and up to the date of approval of this Statement. There were no material internal control weaknesses which had resulted in material losses, uncertainties or contingencies that would require disclosure in this Annual Report.

This Statement on Risk Management and Internal Control only covers Can-One and its subsidiaries excluding the associated company, KJCFB, and is made in accordance with a resolution of the Board dated 7 March 2014.


DIRECTORS’ RESPONSIBILITY STATEMENT

The Directors are required by law to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the Group and of the Company as at the end of the financial year and of the results and cash flows and changes in equity of the Group and of the Company for that period.

The Directors consider that, in preparing the financial statements for the financial year ended 31 December 2013 as set on pages 31 to 94 of this Annual Report, the Group has used the Malaysian Financial Reporting Standards (“MFRSs”) and International Financial Reporting Standards (“IFRSs”), applied them consistently and made judgments and estimates that are reasonable and prudent. The Directors also consider that the MFRSs and IFRSs have been followed and confirm that the financial statements have been prepared on going concern basis.

The Directors are responsible for ensuring that the Group and the Company keep accounting records which disclose with reasonable accuracy at any time the financial position of the Group and of the Company and which enable them to ensure that the financial statements comply with the provisions of the Companies Act, 1965, disclosure provisions of the Listing Requirements of Bursa Securities and MFRSs and IFRSs.


The Directors have pleasure in submitting their report and the audited financial statements of the Group and of the Company for the financial year ended 31 December 2013.

PRINCIPAL ACTIVITIES

The Company is principally engaged in investment holding activities and providing management services. The principal activities of its subsidiaries are disclosed in Note 4 to the financial statements.

There have been no significant changes in the nature of these activities during the financial year, other than as disclosed in Note 4 to the financial statements.

Results

Group Company RM’000 RM’000 Profit for the year attributable to: Owners of the Company 69,669 8,781 Non-controlling interests 7,601 - 77,270 8,781

RESERVES AND PROVISIONS

There were no material transfers to or from reserves and provisions during the financial year under review except as disclosed in the financial statements.

DIVIDENDS

Since the end of the previous financial year, the Company paid a first and final tax exempt dividend of 8% (4 sen) per share of RM0.50 each, totalling RM6,096,000 for the financial year ended 31 December 2012 on 31 July 2013.

The Board of Directors has proposed a first and final tax exempt dividend of 10% (5 sen) per share of RM0.50 each, totalling RM7,620,000 for the financial year ended 31 December 2013, subject to shareholders’ approval at the forthcoming annual general meeting.

DIRECTORS OF THE COMPANY

Directors who served since the date of the last report are :

William Maurice Samson

Yeoh Jin Hoe

Yeoh Jin Beng

Razmi Bin Alias

Marc Francis Yeoh Min Chang

Tan Beng Wah

Chee Khay Leong (Resigned on 22.11.2013)

See Ewe Lin (Resigned on 3.9.2013)

DIRECTORS’ REPORTFOR THE YEAR ENDED 31 DECEMBER 2013


DIRECTORS’ INTERESTS IN SHARES

The interests and deemed interests in the ordinary shares of the Company and of its related companies (other than wholly-owned subsidiaries) of those who were Directors at financial year end (including the interests of the spouses or children of the Directors who themselves are not Directors of the Company) as recorded in the Register of Directors’ Shareholdings are as follows :

Balance at Balance at 1.1.2013 Bought (Sold) 31.12.2013

The Company

Direct interest in ordinary shares of RM0.50 each William Maurice Samson 80,000 - - 80,000Yeoh Jin Hoe 6,690,000 - - 6,690,000Yeoh Jin Beng 300,000 - - 300,000Marc Francis Yeoh Min Chang 343,100 - - 343,100Tan Beng Wah 2,000 - - 2,000 Deemed interest in ordinary shares of RM0.50 each Yeoh Jin Hoe 45,157,281 - - 45,157,281Razmi Bin Alias 911,119 - - 911,119 Subsidiary- PT Corum

Direct interest in ordinary shares of USD100 each Marc Francis Yeoh Min Chang # 70 - - 70 # Held in trust for Newmarq Sdn. Bhd. By virtue of his interests of more than 15% in the shares of the Company, Mr Yeoh Jin Hoe is also deemed to have interests in the shares of all its subsidiaries during the financial year to the extent the Company has an interest.

DIRECTORS’ BENEFITS

Since the end of the previous financial year, no Director of the Company has received nor 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) by reason of a contract made by the Company or a related company with the Director or with a firm in which the Director is a member, or with a company in which the Director has a substantial financial interest.

There were no arrangements during and at the end of the financial year which had the object of enabling Directors of the Company to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate.

ISSUE OF SHARES AND DEBENTURES

There were no changes in the authorised, issued and paid-up capital of the Company and no debentures were issued during the financial year.

OPTIONS GRANTED OVER UNISSUED SHARES

No options were granted to any person to take up unissued shares of the Company during the financial year.




OTHER STATUTORY INFORMATION

Before the financial statements of the Group and of the Company were made out, the Directors took reasonable steps to ascertain that:

i) all known bad debts have been written off and adequate provision made for doubtful debts, and

ii) all current assets which were unlikely to be realised in the ordinary course of business have been written down to an amount which they might be expected so to realise.

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

i) that would render the amount written off for bad debts, or the amount of the provision for doubtful debts, in the Group and in the Company inadequate to any substantial extent, or

ii) that would render the value attributed to the current assets in the financial statements of the Group and of the Company misleading, or

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

iv) not otherwise dealt with in this report or the financial statements, that would render any amount stated in the financial statements of the Group and of the Company misleading.

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

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

ii) any contingent liability in respect of the Group and of the Company that has arisen since the end of the financial year.

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

In the opinion of the Directors, the financial performance of the Group and of the Company for the financial year ended 31 December 2013 have not been substantially affected by any item, transaction or event of a material and unusual nature nor has any such item, transaction or event occurred in the interval between the end of that financial year and the date of this report.

SIGNIFICANT EVENTS

Details of such events are disclosed in Note 33 to the financial statements.

AUDITORS

The auditors, Messrs KPMG, have indicated their willingness to accept re-appointment.

Signed on behalf of the Board of Directors in accordance with a resolution of the Directors:


Tan Beng Wah

Kuala Lumpur7 March 2014


In the opinion of the Directors, the financial statements set out on pages 31 to 93 are drawn up in accordance with Malaysian Financial Reporting Standards, International 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 December 2013 and of their financial performance and cash flows for the financial year then ended.

In the opinion of the Directors, the information set out in Note 34 on page 94 to the financial statements has been compiled in accordance with the Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosures Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, issued by the Malaysian Institute of Accountants, and presented based on the format prescribed by Bursa Malaysia Securities Berhad.

Signed on behalf of the Board of Directors in accordance with a resolution of the Directors :


Tan Beng Wah

Kuala Lumpur7 March 2014

I, Khoo Kay Leong, the officer primarily responsible for the financial management of Can-One Berhad, do solemnly and sincerely declare that the financial statements set out on pages 31 to 94 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 by the above named at Georgetown in the State of Penang on 7 March 2014.

Khoo Kay Leong

Before me :

Chan Kam Chee (No. P120)Commisioner for OathsPenang

STATEMENT BY DIRECTORSPURSUANT TO SECTION 169(15) OF THE COMPANIES ACT, 1965

STATUTORY DECLARATIONPURSUANT TO SECTION 169(16) OF THE COMPANIES ACT, 1965


INDEPENDENT AUDITORS’ REPORT

REPORT ON THE FINANCIAL STATEMENTS

We have audited the financial statements of Can-One Berhad, which comprise the statements of financial position as at 31 December 2013 of the Group and of the Company, and the statements of profit or loss and other comprehensive income, changes in equity and cash flows of the Group and of the Company for the year then ended, and a summary of significant accounting policies and other explanatory information, as set out on pages 31 to 93.

Directors’ Responsibility for the Financial Statements

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

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance 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 entity’s preparation of financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by 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 give a true and fair view of the financial position of the Group and of the Company as of 31 December 2013 and of their financial performance and cash flows for the year then ended in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

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

(a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and its 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 accounts and the auditors’ reports of all the subsidiaries of which we have not acted as auditors, which are indicated in Note 4 to the financial statements.

(c) We are satisfied that the accounts 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 accounts of the subsidiaries did not contain any qualification or any adverse comment made under Section 174(3) of the Act.

TO THE MEMBERS OF CAN-ONE BERHAD


INDEPENDENT AUDITORS’ REPORT

OTHER REPORTING RESPONSIBILITIES

Our audit was made for the purpose of forming an opinion on the financial statements taken as a whole. The information set out in Note 34 on page 94 to the financial statements has been compiled by the Company as required by the Bursa Malaysia Securities Berhad Listing Requirements and is not required by the Malaysian Financial Reporting Standards or International Financial Reporting Standards. We have extended our audit procedures to report on the process of compilation of such information. In our opinion, the information has been properly compiled, in all material respects, in accordance with the Guidance on Special Matter No.1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosures Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, issued by the Malaysian Institute of Accountants and presented based on the format prescribed by Bursa Malaysia Securities Berhad.

OTHER MATTER(S)

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.

KPMG AF 0758 Chartered Accountants

Ooi Kok Seng 2432/05/15 (J)Chartered Accountant

7 March 2014Penang

TO THE MEMBERS OF CAN-ONE BERHAD


CONSOLIDATED STATEMENT OF FINANCIAL POSITIONAS AT 31 DECEMBER 2013

Note 2013 2012 RM’000 RM’000 Assets Property, plant and equipment 3 287,148 281,419Investment in associate 5 381,470 360,740Goodwill on consolidation 6 1,408 1,712 Total non-current assets 670,026 643,871

Inventories 7 123,899 100,710Current tax assets 1,405 586Trade and other receivables 8 215,220 193,544Derivative financial assets 9 - 6Cash and cash equivalents 10 38,021 52,354Assets classified as held for sale 11 3,644 - Total current assets 382,189 347,200 Total assets 1,052,215 991,071 Equity Share capital 12 76,200 76,200Reserves 13 384,414 320,778 Total equity attributable to owners of the Company 460,614 396,978 Non-controlling interests 21,910 14,309 Total equity 482,524 411,287

Liabilities Loans and borrowings 14 299,692 309,304Deferred tax liabilities 15 29,282 26,825 Total non-current liabilities 328,974 336,129 Loans and borrowings 14 130,491 145,360Trade and other payables 16 106,919 95,947Current tax payables 3,291 2,348Derivative financial liabilities 9 16 - Total current liabilities 240,717 243,655 Total liabilities 569,691 579,784 Total equity and liabilities 1,052,215 991,071

The notes on pages 40 to 94 are an integral part of these financial statements.


CONSOLIDATED STATEMENT OF PROFIT OR LOSS ANDOTHER COMPREHENSIVE INCOMEFOR THE YEAR ENDED 31 DECEMBER 2013

Note 2013 2012 RM’000 RM’000 (restated)Continuing operations Revenue 17 772,881 789,815Cost of sales (662,967) (682,443) Gross profit 109,914 107,372 Selling and distribution expenses (11,303) (10,265)Administrative expenses (23,823) (18,585)Other operating expenses (1,560) (17) (36,686) (28,867)Other operating income 2,114 4,003 Results from operating activities 75,342 82,508 Interest income 235 178Finance costs 18 (20,637) (22,785) Net finance costs (20,402) (22,607) Share of profit of equity-accounted investee, net of tax 39,016 134,980 Profit before tax 19 93,956 194,881Tax expense 22 (16,686) (16,753) Profit for the year 77,270 178,128 Other comprehensive income/(expense), net of tax Items that are or may be reclassified subsequently to profit or loss Foreign currency translation differences of foreign operations 83 6Share of other comprehensive (expense)/income of equity-accounted investee, net of tax (20) 2,173 63 2,179 Total comprehensive income for the year 77,333 180,307 Profit attributable to : Owners of the Company 69,669 170,725Non-controlling interests 7,601 7,403 Profit for the year 77,270 178,128 Total comprehensive income attributable to : Owners of the Company 69,732 172,904Non-controlling interests 7,601 7,403 Total comprehensive income for the year 77,333 180,307 Basic earnings per ordinary share - sen 23 45.71 112.02



Attributable to the owners of the Company Non-distributable Distributable Foreign currency Non- Share Share translation Retained controlling Total capital premium reserve earnings Total interests equity RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

At 1 January 2012 76,200 8,560 - 143,886 228,646 6,906 235,552

Other comprehensive income for the year - Foreign currency translation differences of foreign operations - - 6 - 6 - 6 - Share of currency translation differences of equity-accounted investee, net of tax - - 2,173 - 2,173 - 2,173

Total other comprehensive income for the year - - 2,179 - 2,179 - 2,179

Profit for the year - - - 170,725 170,725 7,403 178,128

Total comprehensive income for the year - - 2,179 170,725 172,904 7,403 180,307

Dividends (Note 24) - - - (4,572) (4,572) - (4,572)

Total distribution to owners - - - (4,572) (4,572) - (4,572)

At 31 December 2012 76,200 8,560 2,179 310,039 396,978 14,309 411,287

Note 12 Note 13 Note 13 Note 13 Attributable to the owners of the Company Non-distributable Distributable Foreign currency Non- Share Share translation Retained controlling Total capital premium reserve earnings Total interests equity RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

At 1 January 2013 76,200 8,560 2,179 310,039 396,978 14,309 411,287

Other comprehensive income for the year - Foreign currency translation differences of foreign operations - - 83 - 83 - 83 - Share of currency translation differences of equity-accounted investee, net of tax - - (20) - (20) - (20)

Total other comprehensive income for the year - - 63 - 63 - 63

Profit for the year - - - 69,669 69,669 7,601 77,270

Total comprehensive income for the year - - 63 69,669 69,732 7,601 77,333

Dividends (Note 24) - - - (6,096) (6,096) - (6,096)

Total distribution to owners - - - (6,096) (6,096) - (6,096)

At 31 December 2013 76,200 8,560 2,242 373,612 460,614 21,910 482,524

Note 12 Note 13 Note 13 Note 13


CONSOLIDATED STATEMENT OF CHANGES IN EQUITYFOR THE YEAR ENDED 31 DECEMBER 2013


Note 2013 2012 RM’000 RM’000 Cash flows from operating activities Profit before tax from continuing operations 93,956 194,881 Adjustments for : Depreciation of property, plant and equipment 3 16,831 15,062 Loss/(Gain) on disposal of plant and equipment 301 (261) Interest expense 18 19,379 19,962 Interest income 19 (235) (178) Impairment loss on assets held for sale 365 - Impairment loss on goodwill 304 - Unrealised loss/(gain) on forward exchange contracts 16 (6) Share of profit of equity-accounted investee, net of tax (39,016) (31,226) Bargain purchase gain on acquisition of equity-accounted investee - (103,754) Operating profit before changes in working capital 91,901 94,480 Changes in working capital : Inventories (23,189) 12,900 Trade and other receivables (21,655) (52,874) Trade and other payables 10,957 30,141 Cash generated from operations 58,014 84,647 Tax paid (14,043) (6,364) Net cash from operating activities 43,971 78,283

Cash flows from investing activities Proceeds from disposal of plant and equipment 416 1,663 Acquisition of property, plant and equipment A (25,626) (41,507) Interest received 235 178 Dividend received 18,266 18,266 Acquisition of an associate - (217,753) Net cash used in investing activities (6,709) (239,153) Cash flows from financing activities Drawdown of term loans 9,947 263,694 Repayment of term loans (21,460) (30,168) Dividend paid 24 (6,096) (4,572) Revolving credits, net (4,000) (9,000) Bankers’ acceptances, net 541 (28,865) Foreign currency trade loans, net (33,827) 13,101 Repayment of finance lease liabilities (2,291) (2,417) Interest paid (19,379) (19,962) Pledged deposits for bank borrowings - (6,400) Bills receivable refinancing 25,180 -


CONSOLIDATED STATEMENT OF CASH FLOWSFOR THE YEAR ENDED 31 DECEMBER 2013


Note 2013 2012 RM’000 RM’000 Net cash (used in)/from financing activities (51,385) 175,411 Net (decrease)/increase in cash and cash equivalents (14,123) 14,541Cash and cash equivalents at 1 January 45,954 31,381Effect of exchange differences on cash and cash equivalents (210) 32 Cash and cash equivalents at 31 December B 31,621 45,954

NOTE

A. Acquisition of property, plant and equipment

During the year, the Group acquired property, plant and equipment with an aggregate cost of RM27,055,000 (2012: RM42,753,000) of which RM1,429,000 (2012: RM1,246,000) was acquired by means of finance lease. The balance of RM25,626,000 (2012: RM41,507,000) was made by cash payments.

B. Cash and cash equivalents

Cash and cash equivalents included in the consolidated statement of cash flows comprise the following statement of financial position amounts :

Note 2013 2012 RM’000 RM’000 Cash and bank balances 10 31,621 39,904Short-term deposit with licensed banks (excluding deposits pledged) 10 - 6,050 31,621 45,954


CONSOLIDATED STATEMENT OF CASH FLOWSFOR THE YEAR ENDED 31 DECEMBER 2013 (CONT’D)


STATEMENTS OF FINANCIAL POSITIONAS AT 31 DECEMBER 2013

Note 2013 2012 RM’000 RM’000 Assets Property, plant and equipment 3 7 10Investment in subsidiaries 4 82,486 82,486 Total non-current assets 82,493 82,496 Trade and other receivables 8 270,421 267,758Cash and cash equivalents 10 6,730 6,689 Total current assets 277,151 274,447 Total assets 359,644 356,943 Equity Share capital 12 76,200 76,200Reserves 13 41,849 39,164 Total equity attributable to owners of the Company 118,049 115,364 Liabilities Loans and borrowings 14 241,117 238,092 Total non-current liabilities 241,117 238,092 Loans and borrowings 14 - 3,025Trade and other payables 16 478 462 Total current liabilities 478 3,487 Total liabilities 241,595 241,579 Total equity and liabilities 359,644 356,943



STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2013

Note 2013 2012 RM’000 RM’000 Continuing operations Revenue 17 11,296 16,000Administrative expenses (2,699) (1,562)Other operating income 187 - Results from operating activities 8,784 14,438Interest income 11,782 11,160Finance costs 18 (11,785) (11,515) Profit before tax 19 8,781 14,083Tax expense 22 - - Profit for the year representing total comprehensive income for the year 8,781 14,083



STATEMENTS OF CHANGES IN EQUITYFOR THE YEAR ENDED 31 DECEMBER 2013

Non- distributable Distributable Share Share Retained capital premium earnings Total equity RM’000 RM’000 RM’000 RM’000 At 1 January 2012 76,200 8,560 21,093 105,853 Profit for the year representing total comprehensive income for the year - - 14,083 14,083Dividends (Note 24) - - (4,572) (4,572) At 31 December 2012/1 January 2013 76,200 8,560 30,604 115,364 Profit for the year representing total comprehensive income for the year - - 8,781 8,781Dividends (Note 24) - - (6,096) (6,096) At 31 December 2013 76,200 8,560 33,289 118,049

Note 12 Note 13 Note 13



STATEMENT OF CASH FLOWSFOR THE YEAR ENDED 31 DECEMBER 2013

Note 2013 2012 RM’000 RM’000 Cash flows from operating activities Profit before tax from continuing operations 8,781 14,083 Adjustments for : Depreciation of equipment 3 3 2 Dividend income (10,500) (16,000) Interest expense 18 11,782 11,514 Interest income 19 (11,782) (11,160) Operating loss before changes in working capital (1,716) (1,561) Changes in working capital : Trade and other receivables (2,663) (215,969) Trade and other payables 16 (28,536) Cash used in operations (4,363) (246,066) Tax refunded - 475 Dividend received 10,500 16,000 Net cash from/(used in) operating activities 6,137 (229,591) Cash flows from investing activities Acquisition of equipment 3 - (6) Interest received 11,782 11,160 Net cash from investing activities 11,782 11,154 Cash flows from financing activities Drawdown of term loan - 241,117 Dividend paid 24 (6,096) (4,572) Interest paid (11,782) (11,514) Pledged deposits for bank borrowings - (6,400) Net cash (used in)/from financing activities (17,878) 218,631 Net increase in cash and cash equivalents 41 194 Cash and cash equivalents at 1 January 289 95 Cash and cash equivalents at 31 December A 330 289

NOTE

A. Cash and cash equivalents

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

Note 2013 2012 RM’000 RM’000 Cash and bank balances 10 330 289



NOTES TO THE FINANCIAL STATEMENTS

Can-One Berhad is a public limited liability company, incorporated and domiciled in Malaysia and is listed on the Main Market of Bursa Malaysia Securities Berhad. The addresses of the registered office and principal place of business of the Company are as follows :

REGISTERED OFFICE

2B-4 Level 4Jalan SS 6/6Kelana Jaya47301 Petaling JayaSelangor Darul Ehsan

PRINCIPAL PLACE OF BUSINESS

Lot 2244, Jalan RajawaliBatu 9, Kampung Kebun Baru42500 Telok Panglima GarangKuala LangatSelangor Darul Ehsan

The consolidated financial statements of the Company as at and for the financial year ended 31 December 2013 comprise the Company and its subsidiaries (together referred to as the “Group” and individually referred to as “Group entities”) and the Group’s interest in associate. The financial statements of the Company as at and for the financial year ended 31 December 2013 do not include other entities.

The Company is principally engaged in investment holding activities and providing management services. The principal activities of its subsidiaries are disclosed in Note 4.

The financial statements were authorised for issue by the Board of Directors on 7 March 2014.

1. BASIS OF PREPARATION

(a) Statement of compliance

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

The following are accounting standards, amendments and interpretations of the MFRS framework that have been

issued by the Malaysian Accounting Standards Board (MASB) but have not been adopted by the Group and the Company :

MFRSs, Interpretations and amendments effective for annual periods beginning on or after 1 January 2014

• AmendmentstoMFRS10,ConsolidatedFinancialStatements:InvestmentEntities • AmendmentstoMFRS12,DisclosureofInterestsinOtherEntities:InvestmentEntities • AmendmentstoMFRS127,SeparateFinancialStatements(2012):InvestmentEntities • Amendments toMFRS 132, Financial Instruments: Presentation - Offsetting Financial Assets and Financial

Liabilities • AmendmentstoMFRS136,ImpairmentofAssets-RecoverableAmountDisclosuresforNon-FinancialAssets • AmendmentstoMFRS139,Financial Instruments:RecognitionandMeasurement-NovationofDerivatives

and Continuation of Hedge Accounting • ICInterpretation21,Levies

MFRSs, Interpretations and amendments effective for annual periods beginning on or after 1 July 2014

• AmendmentstoMFRS1,First-timeAdoptionofMalaysianFinancialReportingStandards(AnnualImprovements2011-2013 Cycle)

• AmendmentstoMFRS2,Share-basedPayment(AnnualImprovements2010-2012Cycle) • AmendmentstoMFRS3,BusinessCombinations(AnnualImprovements2010-2012Cycleand2011-2013Cycle) • AmendmentstoMFRS8,OperatingSegments(AnnualImprovements2010-2012Cycle) • AmendmentstoMFRS13,FairValueMeasurement(AnnualImprovements2010-2012Cycleand2011-2013Cycle)



1. BASIS OF PREPARATION (continued)

(a) Statement of compliance (continued)

• AmendmentstoMFRS116,Property,PlantandEquipment(AnnualImprovements2010-2012Cycle) • AmendmentstoMFRS119,EmployeeBenefits–DefinedBenefitPlans:EmployeeContributions • AmendmentstoMFRS124,RelatedPartyDisclosures(AnnualImprovements2010-2012Cycle) • AmendmentstoMFRS138,IntangibleAssets(AnnualImprovements2010-2012Cycle) • AmendmentstoMFRS140,InvestmentProperty(AnnualImprovements2011-2013Cycle)

MFRSs, Interpretations and amendments effective for a date yet to be confirmed

• MFRS9,FinancialInstruments(2009) • MFRS9,FinancialInstruments(2010) • MFRS9,FinancialInstruments–HedgeAccountingandAmendmentstoMFRS9,MFRS7andMFRS139 • AmendmentstoMFRS7,FinancialInstruments:Disclosures–MandatoryEffectiveDateofMFRS9andTransition

Disclosures

The Group and the Company plan to apply the abovementioned accounting standards, amendments and interpretations:

• from the annual period beginning on 1 January 2014 for those accounting standards, amendments orinterpretations that are effective for annual periods beginning on or after 1 January 2014, except for MFRS 12 which is not applicable to the Group and the Company.

• from the annual period beginning on 1 January 2015 for those accounting standards, amendments orinterpretations that are effective for annual periods beginning on or after 1 July 2014, except for MFRS 140 which is not applicable to the Group and the Company.

The initial application of the abovementioned standards, amendments and interpretations are not expected to have any material impacts to the financial statements of the Group and the Company except as mentioned below :

MFRS 9, Financial Instruments

MFRS 9 replaces the guidance in MFRS 139, Financial Instruments: Recognition and Measurement on the classification and measurement of financial assets and financial liabilities, and on hedge accounting.

The Group is currently assessing the financial impact of adopting MFRS 9.

(b) Basis of measurement

The financial statements have been prepared on the historical cost basis, other than as disclosed in Note 2.

(c) Functional and presentation currency

These financial statements are presented in Ringgit Malaysia (“RM”), which is the Company’s functional currency. All financial information is presented in RM and has been rounded to the nearest thousand, unless otherwise stated.

(d) Use of estimates and judgements

The preparation of the financial statements in conformity with Malaysian Financial Reporting Standards (“MFRSs”) requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

There are no significant areas of estimation uncertainty and critical judgements in applying accounting policies that have significant effect on the amounts recognised in the financial statements.



2. SIGNIFICANT ACCOUNTING POLICIES

The accounting policies set out below have been applied consistently to the periods presented in these financial statements and have been applied consistently by Group entities, unless otherwise stated.

(a) Basis of consolidation

(i) Subsidiaries

Subsidiaries are entities, including structured entities, controlled by the Company. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

The Group adopted MFRS 10, Consolidated Financial Statements in the current financial year. This resulted in changes to the following policies :

• ControlexistswhentheGroupisexposed,orhasrights,tovariablereturnsfromitsinvolvementwiththeentity and has the ability to affect those returns through its power over the entity. In the previous financial years, control exists when the Group has the ability to exercise its power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

• Potentialvotingrightsareconsideredwhenassessingcontrolonlywhensuchrightsaresubstantive.Intheprevious financial years, potential voting rights are considered when assessing control when such rights are presently exercisable.

• TheGroupconsidersithasdefactopoweroveraninvesteewhen,despitenothavingthemajorityofvoting

rights, it has the current ability to direct the activities of the investee that significantly affect the investee’s return. In the previous financial years, the Group did not consider de facto power in its assessment of control.

The change in accounting policy has been made retrospectively and in accordance with the transitional provision of MFRS 10. The adoption of MFRS 10 has no significant impact to the financial statements of the Group.

Investments in subsidiaries are measured in the Company’s statement of financial position at cost less any impairment losses, unless the investment is classified as held for sale or distribution. The cost of investments includes transaction costs.

(ii) Business combinations

Business combinations are accounted for using the acquisition method from the acquisition date, which is the date on which control is transferred to the Group.

For new acquisitions, the Group measures the cost of goodwill at the acquisition date as:

• thefairvalueoftheconsiderationtransferred;plus • therecognisedamountofanynon-controllinginterestsintheacquiree;plus • if the business combination is achieved in stages, the fair value of the existing equity interest in the

acquiree; less • thenetrecognisedamount(generallyfairvalue)oftheidentifiableassetsacquiredandliabilitiesassumed.

When the excess is negative, a bargain purchase gain is recognised immediately in profit or loss.

For each business combination, the Group elects whether it measures the non-controlling interests in the acquiree either at fair value or at the proportionate share of the acquiree’s identifiable net assets at the acquisition date.

Transaction costs, other than those associated with the issue of debt or equity securities, that the Group incurs in connection with a business combination are expensed as incurred.



2. SIGNIFICANT ACCOUNTING POLICIES (continued)

(a) Basis of consolidation (continued)

(iii) Acquisitions of non-controlling interests

The Group treats all changes in its ownership interest in a subsidiary that do not result in a loss of control as equity transactions between the Group and its non-controlling interest holders. Any difference between the Group’s share of net assets before and after the change, and any consideration received or paid, is adjusted to or against Group reserves.

(iv) Loss of control

Upon the loss of control of a subsidiary, the Group derecognises the assets and liabilities of the former subsidiary, any non-controlling interests and the other components of equity related to the former subsidiary from the consolidated statement of financial position. Any surplus or deficit arising on the loss of control is recognised in profit or loss. If the Group retains any interest in the former subsidiary, then such interest is measured at fair value at the date that control is lost. Subsequently, it is accounted for as an equity-accounted investee or as an available-for-sale financial asset depending on the level of influence retained.

(v) Associates

Associates are entities, including unincorporated entities, in which the Group has significant influence, but not control, over the financial and operating policies.

Investments in associates are accounted for in the consolidated financial statements using the equity method less any impairment losses, unless it is classified as held for sale or distribution. The cost of the investment includes transaction costs. The consolidated financial statements include the Group’s share of the profit or loss and other comprehensive income of the associates, after adjustments if any, to align the accounting policies with those of the Group, from the date that significant influence commences until the date that significant influence ceases.

When the Group’s share of losses exceeds its interest in an associate, the carrying amount of that interest including any long-term investments is reduced to zero, and the recognition of further losses is discontinued except to the extent that the Group has an obligation or has made payments on behalf of the associate.

When the Group ceases to have significant influence over an associate, any retained interest in the former

associate at the date when significant influence is lost is measured at fair value and this amount is regarded as the initial carrying amount of a financial asset. The difference between the fair value of any retained interest plus proceeds from the interest disposed of and the carrying amount of the investment at the date when equity method is discontinued is recognised in profit or loss.

When the Group’s interest in an associate decreases but does not result in a loss of significant influence, any retained interest is not re-measured. Any gain or loss arising from the decrease in interest is recognised in profit or loss. Any gains or losses previously recognised in other comprehensive income are also reclassified proportionately to profit or loss if that gain or loss would be required to be reclassified to profit or loss on the disposal of the related assets or liabilities.

Investments in associates are measured in the Company’s statement of financial position at cost less any impairment losses, unless the investment is classfied as held for sale or distribution. The cost of the investment includes transaction costs.

(vi) Non-controlling interests

Non-controlling interests at the end of the reporting period, being the equity in a subsidiary not attributable directly or indirectly to the equity holders of the Company, are presented in the consolidated statement of financial position and statement of changes in equity within equity, separately from equity attributable to the owners of the Company. Non-controlling interests in the results of the Group is presented in the consolidated statement of profit or loss and other comprehensive income as an allocation of the profit or loss and the comprehensive income for the year between non-controlling interests and owners of the Company.




(a) Basis of consolidation (continued)

(vi) Non-controlling interests (continued)

Losses applicable to the non-controlling interests in a subsidiary are allocated to the non-controlling interests even if doing so causes the non-controlling interests to have a deficit balance.

(vii) Transactions eliminated on consolidation

Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements.

Unrealised gains arising from transactions with equity-accounted associates and joint ventures are eliminated

against the investment to the extent of the Group’s interest in the investees. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

(b) Non-current assets held for sale

Non-current assets, or disposal group comprising assets and liabilities that are expected to be recovered primarily through sale rather than through continuing use, are classified as held for sale.

Immediately before classification as held for sale, the assets, or components of a disposal group, are remeasured in accordance with the Group’s accounting policies. Thereafter generally the assets, or disposal group are measured at the lower of their carrying amount and fair value less costs of disposal.

Any impairment loss on a disposal group is first allocated to goodwill, and then to remaining assets and liabilities on pro rata basis, except that no loss is allocated to inventories, financial assets, deferred tax assets, employee benefit assets and investment property, which continue to be measured in accordance with the Group’s accounting policies. Impairment losses on initial classification as held for sale and subsequent gains or losses on remeasurement are recognised in profit or loss. Gains are not recognised in excess of any cumulative impairment loss.

Intangible assets and property, plant and equipment once classified as held for sale are not amortised or depreciated. In addition, equity accounting of equity-accounted associates and joint venture ceases once classified as held for sale.

(c) Foreign currency

(i) Foreign currency transactions

Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the dates of the transactions.

Monetary assets and liabilities denominated in foreign currencies at the end of the reporting period are retranslated to the functional currency at the exchange rate at that date.

Non-monetary assets and liabilities denominated in foreign currencies are not retranslated at the end of the

reporting date, except for those that are measured at fair value are retranslated to the functional currency at the exchange rate at the date that the fair value was determined.

Foreign currency differences arising on retranslation are recognised in profit or loss, except for differences arising on the retranslation of available-for-sale equity instruments or a financial instrument designated as a hedge of currency risk, which are recognised in other comprehensive income.




(c) Foreign currency (continued)

(ii) Operations denominated in functional currencies other than Ringgit Malaysia

The assets and liabilities of operations denominated in functional currencies other than RM, including goodwill and fair value adjustments arising on acquisition, are translated to RM at exchange rates at the end of the reporting period, except for goodwill and fair value adjustments arising from business combinations before 1 January 2011 (the date when the Group first adopted MFRS) which are treated as assets and liabilities of the Company. The income and expenses of foreign operations are translated to RM at exchange rates at the dates of the transactions.

Foreign currency differences are recognised in other comprehensive income and accumulated in the foreign currency translation reserve (FCTR) in equity. However, if the operation is a non-wholly-owned subsidiary, then the relevant proportionate share of the translation difference is allocated to the non-controlling interests. When a foreign operation is disposed of such that control, significant influence or joint control is lost, the cumulative amount in the FCTR related to that foreign operation is reclassified to profit or loss as part of the profit or loss on disposal.

When the Group disposes of only part of its interest in a subsidiary that includes a foreign operation, the relevant proportion of the cumulative amount is reattributed to non-controlling interests. When the Group disposes of only part of its investment in an associate or joint venture that includes a foreign operation while retaining significant influence or joint control, the relevant proportion of the cumulative amount is reclassified to profit or loss.

In the consolidated financial statements, when settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor likely in the foreseeable future, foreign exchange gains and losses arising from such a monetary item are considered to form part of a net investment in a foreign operation and are recognised in other comprehensive income, and are presented in the FCTR in equity.

(d) Financial instruments

(i) Initial recognition and measurement

A financial asset or a financial liability is recognised in the statement of financial position when, and only when, the Group or the Company becomes a party to the contractual provisions of the instrument.

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.

An embedded derivative is recognised separately from the host contract and accounted for as a derivative if, and only if, it is not closely related to the economic characteristics and risks of the host contract and the host contract is not categorised at fair value through profit or loss. The host contract, in the event an embedded derivative is recognised separately, is accounted for in accordance with policy applicable to the nature of the host contract.

(ii) Financial instrument categories and subsequent measurement

The Group and the Company categorise financial instruments as follows:

Financial assets

(a) Financial assets at fair value through profit or loss

Fair value through profit or loss category comprises financial assets that are held for trading, including derivatives (except for a derivative that is a financial guarantee contract or a designated and effective hedging instrument) or financial assets that are specifically designated into this category upon initial recognition.




(d) Financial instruments (continued)

(ii) Financial instrument categories and subsequent measurement (continued)

Financial assets (continued)

(a) Financial assets at fair value through profit or loss (continued)

Derivatives that are linked to and must be settled by delivery of unquoted equity instruments whose fair values cannot be reliably measured are measured at cost.

Other financial assets categorised as fair value through profit or loss are subsequently measured at their fair values with the gain or loss recognised in profit or loss.

(b) Held-to-maturity investments

Held-to-maturity investments category comprises debt instruments that are quoted in an active market and the Group or the Company has the positive intention and ability to hold them to maturity.

Financial assets categorised as held-to-maturity investments are subsequently measured at amortised cost

using the effective interest method.

(c) Loans and receivables

Loans and receivables category comprises debt instruments that are not quoted in an active market.

Financial assets categorised as loans and receivables are subsequently measured at amortised cost using the effective interest method.

(d) Available-for-sale financial assets

Available-for-sale category comprises investment in equity and debt securities instruments that are not held for trading.

Investments in equity instruments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured are measured at cost. Other financial assets categorised as available-for-sale are subsequently measured at their fair values with the gain or loss recognised in other comprehensive income, except for impairment losses, foreign exchange gains and losses arising from monetary items and gains and losses of hedged items attributable to hedge risks of fair value hedges which are recognised in profit or loss. On derecognition, the cumulative gain or loss recognised in other comprehensive income is reclassified from equity into profit or loss. Interest calculated for a debt instrument using the effective interest method is recognised in profit or loss.

All financial assets, except for those measured at fair value through profit or loss, are subject to review for impairment (see Note 2(h)(i)).

Financial liabilities

All financial liabilities are subsequently measured at amortised cost other than those categorised as fair value through profit or loss.

Fair value through profit or loss category comprises financial liabilities that are derivatives (except for a derivative

that is a financial guarantee contract or a designated and effective hedging instrument) or financial liabilities that are specifically designated into this category upon initial recognition.

Derivatives that are linked to and must be settled by delivery of equity instruments that do not have a quoted price in an active market for identical instruments whose fair values otherwise cannot be reliably measured are measured at cost.




(d) Financial instruments (continued)

(ii) Financial instrument categories and subsequent measurement (continued)

Financial liabilities (continued)

Other financial liabilities categorised as fair value through profit or loss are subsequently measured at their fair values with the gain or loss recognised in profit or loss.

(iii) Financial guarantee contracts

A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with the original or modified terms of a debt instrument.

Fair value arising from financial guarantee contracts are classified as deferred income and is amortised to profit or loss using a straight-line method over the contractual period or, when there is no specified contractual period, recognised in profit or loss upon discharge of the guarantee. When settlement of a financial guarantee contract becomes probable, an estimate of the obligation is made. If the carrying value of the financial guarantee contract is lower than the obligation, the carrying value is adjusted to the obligation amount and accounted for as a provision.

(iv) Regular way purchase or sale of financial assets

A regular way purchase or sale is a purchase or sale of a financial asset under a contract whose terms require delivery of the asset within the time frame established generally by regulation or convention in the marketplace concerned.

A regular way purchase or sale of financial assets is recognised and derecognised, as applicable, using trade

date accounting. Trade date accounting refers to:

(a) the recognition of an asset to be received and the liability to pay for it on the trade date, and (b) derecognition of an asset that is sold, recognition of any gain or loss on disposal and the recognition of a

receivable from the buyer for payment on the trade date.

(v) Derecognition

A financial asset or part of it is derecognised when, and only when the contractual rights to the cash flows from the financial asset expire or the financial asset is transferred to another party without retaining control or substantially all risks and rewards of the asset. On derecognition of a financial asset, the difference between the carrying amount and the sum of the consideration received (including any new asset obtained less any new liability assumed) and any cumulative gain or loss that had been recognised in equity is recognised in profit or loss.

A financial liability or a part of it is derecognised when, and only when, the obligation specified in the contract is discharged or cancelled or expires. On derecognition of a financial liability, the difference between the carrying amount of the financial liability extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in profit or loss.

(e) Goodwill

Goodwill arises on business combinations is measured at cost less any accumulated impairment losses. In respect of equity-accounted associates, the carrying amount of goodwill is included in the carrying amount of the investment and an impairment loss on such an investment is not allocated to any asset, including goodwill, that forms part of the carrying amount of the equity-accounted associates.

Goodwill with indefinite useful life is not amortised but is tested for impairment annually and whenever there is an indication that they may be impaired.




(f) Property, plant and equipment (i) Recognition and measurement

Items of property, plant and equipment are measured at cost less accumulated depreciation and any accumulated impairment losses.

Cost includes expenditures that are directly attributable to the acquisition of the asset and any other costs directly attributable to bringing the asset to working condition for its intended use, and the costs of dismantling and removing the items and restoring the site on which they are located. The cost of self-constructed assets also includes the cost of materials and direct labour. For qualifying assets, borrowing costs are capitalised in accordance with the accounting policy on borrowing costs. Cost also may include transfers from equity of any gain or loss on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment.

Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment.

The cost of property, plant and equipment recognised as a result of a business combination is based on fair value at acquisition date. The fair value of property is the estimated amount for which a property could be exchanged between knowledgeable willing parties in an arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion. The fair value of other items of plant and equipment is based on the quoted market prices for similar items when available and replacement cost when appropriate.

When significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

The gain or loss on disposal of an item of property, plant and equipment is determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment and is recognised net within “other operating income” and “other operating expenses” respectively in profit or loss.

(ii) Subsequent costs

The cost of replacing a component of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the component will flow to the Group or the Company, and its cost can be measured reliably. The carrying amount of the replaced component is derecognised to profit or loss. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred.

(iii) Depreciation

Depreciation is based on the cost of an asset less its residual value. Significant components of individual assets are assessed, and if a component has a useful life that is different from the remainder of that asset, then that component is depreciated separately.

Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each component of an item of property, plant and equipment. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Group will obtain ownership by the end of the lease term. Freehold land is not depreciated. Property, plant and equipment under construction (capital expenditure-in-progress) are not depreciated until the assets are ready for their intended use.

The estimated useful lives for the current and comparative periods are as follows: Years Leasehold land 44 – 99 Buildings 50 Plant and machinery 7 – 20 Furniture, fittings and office equipment 5 – 10 Motor vehicles 5 – 10




(f) Property, plant and equipment (continued)

(iii) Depreciation (continued)

Depreciation methods, useful lives and residual values are reviewed at the end of the reporting period and adjusted as appropriate.

(g) Leased assets

(i) Finance lease Leases in terms of which the Group or the Company assumes substantially all the risks and rewards of ownership

are classified as finance leases. Upon initial recognition, the leased asset is measured at an amount equal to the lower of its fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that asset.

Minimum lease payments made under finance leases are apportioned between the finance expense and the

reduction of the outstanding liability. The finance expense is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability. Contingent lease payments are accounted for by revising the minimum lease payments over the remaining term of the lease when the lease adjustment is confirmed.

Leasehold land which in substance is a finance lease is classified as property, plant and equipment.

(ii) Operating lease

Leases, where the Group or the Company does not assume substantially all the risks and rewards of ownership are classified as operating leases, and the leased assets are not recognised on the statement of financial position.

Payments made under operating leases are recognised in profit or loss on a straight-line basis over the term of the lease. Lease incentives received are recognised in profit or loss as an integral part of the total lease expense, over the term of the lease. Contingent rentals are charged to profit or loss in the reporting period in which they are incurred.

Leasehold land which in substance is an operating lease is classified as prepaid lease payments.

(h) Impairment

(i) Financial assets

All financial assets (except for financial assets categorised as fair value through profit or loss, investment in subsidiaries and investment in associates) are assessed at each reporting date 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. Losses expected as a result of future events, no matter how likely, are not recognised. For an investment in an equity instrument, a significant or prolonged decline in the fair value below its cost is an objective evidence of impairment. If any such objective evidence exists, then the financial asset’s recoverable amount is estimated.

An impairment loss in respect of loans and receivables and held-to-maturity investments 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 asset’s original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account.

An impairment loss in respect of available-for-sale financial assets is recognised in profit or loss and is measured

as the difference between the asset’s acquisition cost (net of any principal repayment and amortisation) and the asset’s current fair value, less any impairment loss previously recognised. Where a decline in the fair value of an available-for-sale financial asset has been recognised in other comprehensive income, the cumulative loss in other comprehensive income is reclassified from equity to profit or loss.




(h) Impairment (continued)

(i) Financial assets (continued)

An impairment loss in respect of unquoted equity instrument that is carried at cost 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 current market rate of return for a similar financial asset.

Impairment losses recognised in profit or loss for an investment in an equity instrument classified as available for sale is not reversed through profit or loss.

If, in a subsequent period, the fair value of a debt instrument increases and the increase can be objectively related to an event occurring after the impairment loss was recognised in profit or loss, the impairment loss is reversed, to the extent that the asset’s carrying amount does not exceed what the carrying amount would have been had the impairment not been recognised at the date the impairment is reversed. The amount of the reversal is recognised in profit or loss.

(ii) Other assets

The carrying amounts of other assets (except for inventories) are reviewed at the end of each reporting period to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. For goodwill, and intangible assets that have indefinite useful lives or that are not yet available for use, the recoverable amount is estimated each period at the same time.

For the purpose of impairment testing, assets are grouped together into the smallest group of assets that

generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or cash-generating units. Subject to an operating segment ceiling test, for the purpose of goodwill impairment testing, cash-generating units to which goodwill has been allocated are aggregated so that the level at which impairment testing is performed reflects the lowest level at which goodwill is monitored for internal reporting purposes. The goodwill acquired in a business combination, for the purpose of impairment testing, is allocated to a group of cash-generating units that are expected to benefit from the synergies of the combination.

The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value

less costs of disposal. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or cash-generating unit.

An impairment loss is recognised if the carrying amount of an asset or its related cash-generating unit exceeds its estimated recoverable amount.

Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to the cash-generating unit (group of cash-generating units) and then to reduce the carrying amount of the other assets in the cash-generating unit (group of cash-generating units) on a pro rata basis.

An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognised in prior periods are assessed at the end of each reporting period for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount since the last impairment loss was recognised. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. Reversals of impairment losses are credited to profit or loss in the financial year in which the reversals are recognised.




(i) Inventories

Inventories are measured at the lower of cost and net realisable value.

The cost of inventories is measured based on first-in, first-out principle and includes expenditure incurred in acquiring the inventories, production or conversion costs and other costs incurred in bringing them to their existing location and condition. In the case of work-in-progress and manufactured inventories, cost includes an appropriate share of production overheads based on normal operating capacity.

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

(j) Cash and cash equivalents

Cash and cash equivalents consist of cash on hand, balances and deposits with banks and highly liquid investments which have an insignificant risk of changes in fair value with original maturities of three months or less, and are used by the Group and the Company in the management of their short term commitments. For the purpose of the statement of cash flows, cash and cash equivalents are presented net of bank overdrafts and pledged deposits.

(k) Equity instruments

Instruments classified as equity are measured at cost on initial recognition and are not remeasured subsequently.

(i) Issue expenses

Costs directly attributable to issue of instruments classified as equity are recognised as a deduction from equity.

(ii) Ordinary shares

Ordinary shares are classified as equity.

(l) Provisions

A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognised as finance cost.

(m) Contingent liabilities

Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation is not recognised in the statements of financial position and is disclosed as a contingent liability, unless the probability of outflow of economic benefits is remote. Possible obligations, whose existence will only be confirmed by the occurrence or non-occurrence of one or more future events are also disclosed as contingent liabilities unless the probability of outflow of economic benefits is remote.

(n) Income tax

Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognised in profit or loss except to the extent that it relates to a business combination or items recognised directly in equity or other comprehensive income.



(n) Income tax (continued)

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted by the end of the reporting period, and any adjustment to tax payable in respect of previous financial years.

Deferred tax is recognised using the liability method, providing for temporary differences between the carrying amounts of assets and liabilities in the statement of financial position and their tax bases. Deferred tax is not recognised for the following temporary differences : the initial recognition of goodwill, the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.

A deferred tax asset is recognised to the extent that it is probable that future taxable profits will be available against which temporary difference can be utilised. Deferred tax assets are reviewed at the end of each reporting period and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

Unutilised reinvestment allowance and investment tax allowance, being tax incentives that is not a tax base of an asset, is recognised as a deferred tax asset to the extent that it is probable that the future taxable profits will be available against the unutilised tax incentive can be utilised.

(o) Revenue and other income

(i) Goods sold

Revenue from the sale of goods in the course of ordinary activities is measured at fair value of the consideration received or receivable, net of returns and allowances, trade discount and volume rebates. Revenue is recognised when persuasive evidence exists, usually in the form of an executed sales agreement, that the significant risks and rewards of ownership have been transferred to the customer, recovery of the consideration is probable, the associated costs and possible return of goods can be estimated reliably, and there is no continuing management involvement with the goods, and the amount of revenue can be measured reliably. If it is probable that discounts will be granted and the amount can be measured reliably, then the discount is recognised as a reduction of revenue as the sales are recognised.

(ii) Dividend income

Dividend income is recognised in profit or loss on the date that the Group’s or the Company’s right to receive payment is established, which in the case of quoted securities is the ex-dividend date.

(iii) Interest income

Interest income is recognised as it accrues using the effective interest method in profit or loss except for interest income arising from temporary investment of borrowings taken specifically for the purpose of obtaining a qualifying asset which is accounted for in accordance with the accounting policy on borrowing costs.

(iv) Management fee

Management fees are recognised on accrual basis.

(p) Borrowing costs

Borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying asset are recognised in profit or loss using the effective interest method.





(p) Borrowing costs (continued)

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are capitalised as part of the cost of those assets.

The capitalisation of borrowing costs as part of the cost of a qualifying asset commences when expenditure for the

asset is being incurred, borrowing costs are being incurred and activities that are necessary to prepare the asset for its intended use or sale are in progress. Capitalisation of borrowing costs is suspended or ceases when substantially all the activities necessary to prepare the qualifying asset for its intended use or sale are interrupted or completed.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on

qualifying assets is deducted from the borrowing costs eligible for capitalisation.

(q) Employee benefits

(i) Short-term employee benefits Short-term employee benefit obligations in respect of salaries, annual bonuses, paid annual leave and sick leave

are measured on an undiscounted basis and are expensed as the related service is provided.

A liability is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

(ii) State plans

The Group’s contributions to statutory pension funds are charged to profit or loss in the financial year to which they relate. Once the contributions have been paid, the Group has no further payment obligations.

(r) Earnings per ordinary share

The Group presents basic earnings per share data for its ordinary shares (“EPS”).

Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period, adjusted for own shares held.

(s) 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. All operating segments’ operating results are reviewed regularly by the chief operating decision makers, which in this case is the Chief Operating Officer of the Group, to make decisions about resources to be allocated to the segment and to assess its performance, and for which discrete financial information is available.

(t) Fair value measurements

From1January2013,theGroupadoptedMFRS13,FairValueMeasurementwhichprescribedthatfairvalueofanasset or a liability, except for share-based payment and lease transactions, is determined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The measurement assumes that the transaction to sell the asset or transfer the liability takes place either in the principal market or in the absence of a principal market, in the most advantageous market.



(t) Fair value measurements (continued)

For non-financial asset, the fair value measurement takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

In accordance with the transitional provision of MFRS 13, the Group applied the new fair value measurement guidance prospectively, and has not provided any comparative fair value information for new disclosures. The adoption of MFRS 13 has not significantly affected the measurements of the Group’s assets or liabilities other than the additional disclosures.




3. PROPERTY, PLANT AND EQUIPMENT

At Transfer to Foreign At 1 January assets held exchange 31 December 2013 Additions Reclassifications for sale Disposals differences 2013 Group RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 Cost Freehold land 20,734 2,500 - - - - 23,234 Freehold building 28,409 80 65 - - - 28,554 Long-term leasehold land 17,833 - - - - - 17,833 Short-term leasehold land 2,910 - - (1,350) - - 1,560 Leasehold building 54,165 861 (50) (3,000) - - 51,976 Plant & machinery 241,544 14,676 2,596 - (859) 267 258,224 Furniture, fittings and office equipment 7,887 836 115 - (6) 4 8,836 Motor vehicles 10,692 2,164 - - (750) - 12,106 Capital expenditure-in-progress 4,272 5,938 (2,726) - - 3 7,487 388,446 27,055 - (4,350) (1,615) 274 409,810

(Note 11) At Transfer to Foreign At 1 January Charge for assets held exchange 31 December 2013 the year for sale Disposals differences 2013 Group RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 Accumulated depreciation Freehold building 1,413 625 - - - 2,038 Long-term leasehold land 614 309 - - - 923 Short-term leasehold land 154 67 (106) - - 115 Leasehold building 1,757 1,161 (235) - - 2,683 Plant and machinery 93,717 13,158 - (350) 43 106,568 Furniture, fittings and office equipment 4,033 642 - (5) - 4,670 Motor vehicles 5,339 869 - (543) - 5,665 107,027 16,831 (341) (898) 43 122,662

(Note 11) At At 1 January 31 December 2012 Additions Reclassifications Disposals 2012 Group RM’000 RM’000 RM’000 RM’000 RM’000 Cost Freehold land 20,722 12 - - 20,734 Freehold building 28,409 - - - 28,409 Long-term leasehold land 17,410 423 - - 17,833 Short-term leasehold land 2,910 - - - 2,910 Leasehold building 39,831 1,401 12,933 - 54,165 Plant & machinery 207,908 24,555 11,336 (2,255) 241,544 Furniture, fittings and office equipment 6,206 1,666 15 - 7,887 Motor vehicles 9,311 1,791 - (410) 10,692 Capital expenditure-in-progress 15,651 12,905 (24,284) - 4,272 348,358 42,753 - (2,665) 388,446


3. PROPERTY, PLANT AND EQUIPMENT (continued)

At Foreign At 1 January Charge for exchange 31 December 2012 the year Disposals differences 2012 Group RM’000 RM’000 RM’000 RM’000 RM’000

Accumulated depreciation Freehold building 831 582 - - 1,413 Long-term leasehold land 248 366 - - 614 Short-term leasehold land 70 84 - - 154 Leasehold building 723 1,034 - - 1,757 Plant and machinery 82,770 11,822 (890) 15 93,717 Furniture, fittings and office equipment 3,526 507 - - 4,033 Motor vehicles 5,045 667 (373) - 5,339 93,213 15,062 (1,263) 15 107,027

At 31 At 31 December December 2013 2012 Group RM’000 RM’000 Carrying amounts Freehold land 23,234 20,734 Freehold building 26,516 26,996 Long-term leasehold land * 16,910 17,219 Short-term leasehold land 1,445 2,756 Leasehold building 49,293 52,408 Plant and machinery 151,656 147,827 Furniture, fittings and office equipment 4,166 3,854 Motor vehicles 6,441 5,353 Capital expenditure-in-progress 7,487 4,272 287,148 281,419

* Long-term leasehold land with unexpired lease period of more than 50 years.

Included in property, plant and equipment of the Group is an amount of RM1,928,000 (2012 : RM1,990,000) representing the carrying amount of buildings erected on land belonging to third parties.




3. PROPERTY, PLANT AND EQUIPMENT (continued)

The carrying amounts of plant and equipment acquired under finance lease arrangement are as follows :

2013 2012 RM’000 RM’000 Plant and machinery 3,190 4,252 Motor vehicles 3,780 3,578 6,970 7,830

A motor vehicle with carrying amount of RM107,000 (2012 : RM124,000) is registered in the name of a Director and is held in trust on behalf of the Group.

The carrying amounts of freehold land, factory building, plant and machinery pledged for banking facilities granted to the Group are as follows :

2013 2012 RM’000 RM’000 Freehold land 14,579 14,579 Leasehold land 4,285 4,363 Freehold building 31,306 31,050 Leasehold building 13,281 13,558 Plant and machinery 6,551 6,970 70,002 70,520

At At 1 January Additions 31 December Company RM’000 RM’000 RM’000

2013 Cost Furniture, fittings and office equipment 16 - 16 Accumulated depreciation Furniture, fittings and office equipment 6 3 9

2012 Cost Furniture, fittings and office equipment 10 6 16 Accumulated depreciation Furniture, fittings and office equipment 4 2 6

At At 31 December 31 December 2013 2012 RM’000 RM’000 Carrying amounts Furniture, fittings and office equipment 7 10


4. INVESTMENT IN SUBSIDIARIES – COMPANY

2013 2012 RM’000 RM’000 Unquoted shares, at cost 82,486 82,486

Details of the subsidiaries are as follows :

Name of Country of Effective ownership interest Principal subsidiary incorporation and voting interest activities 2013 2012 % % Aik Joo Can Factory Malaysia 100 100 Manufacture of metal Sdn. Berhad and lithographed tin cans and plastic jerry cans Ajcan Sdn. Bhd. Malaysia 100 100 Letting of landed property

and property investment. Commenced manufacture of metal and lithographed tin cans and plastic jerry cans

Canzo Sdn. Bhd. Malaysia 100 100 Manufacture and trading of

plastic jerry cans and related products

Newmarq Sdn. Bhd. Malaysia 100 100 Investment holding Sanjung Nuri Sdn. Bhd. Malaysia 100 100 Property investment Can-One International Malaysia 100 100 Investment holding Sdn. Bhd. Amber Alliance Sdn. Bhd. Malaysia 100 100 Investment holding Subsidiary of Amber Alliance Sdn. Bhd. F&B Nutrition Sdn. Bhd. Malaysia 80 80 Manufacture of dairy and non-

dairy products Subsidiary of F & B Nutrition Sdn. Bhd. Can Ridge Sdn. Bhd. Malaysia 100 - Dormant Subsidiaries of Newmarq Sdn. Bhd. PT Corum # Indonesia 100 100 Manufacturing and trading

of metal and lithographed tin cans and plastic jerry cans

Lumiera Corporation Malaysia 100 100 Dormant (Labuan) Pte Ltd * Grensing Pte Ltd # Singapore 100 100 International trading

* The unaudited management financial statements were consolidated in the Group’s financial statements.

# Audited by other member firms of KPMG International.




4. INVESTMENT IN SUBSIDIARIES – COMPANY (continued)

Non-controlling interests in subsidiaries

The Group’s subsidiaries that have material non-controlling interests (“NCI”) are as follows :

F & B Nutrition Sdn. Bhd. 2013 2012 RM’000 RM’000 NCI percentage of ownership interest and voting interest 20% 20% Carrying amount of NCI 21,910 14,309 Profit allocated to NCI 7,601 7,403 Summarised financial information before intra-group elimination As at 31 December Non-current assets 98,506 91,595 Current assets 173,725 181,109 Non-current liabilities (26,289) (27,567) Current liabilities (129,535) (166,735) Net assets 116,407 78,402 Year ended 31 December Revenue 484,452 518,192 Profit for the year 38,005 37,014 Total comprehensive income 38,005 37,014 Cash flows from operating activities 29,598 23,386 Cash flows from investing activities (11,541) (13,531) Cash flows from financing activities (27,301) 7,417 Net (decrease)/increase in cash and cash equivalents (9,244) 17,272 Dividends paid to NCI - -

Restriction imposed by bank covenants

The covenants of bank facilities taken by certain subsidiaries of the Group, restrict the ability of the subsidiaries to provide advances to other companies within the Group and to declare dividends to its shareholders unless prior written consent from the bank is obtained.


5. INVESTMENT IN ASSOCIATES – GROUP

2013 2012 RM’000 RM’000 At cost : Quoted shares in Malaysia 241,864 241,864 Share of post-acquisition reserves 139,606 118,876 381,470 360,740 Market value of quoted shares 455,930 326,000

Details of the associate are as follows :

Effective Principal place of ownership Name of business/Country interest and entity of incorporation Principal activities voting interest 2013 2012 Kian Joo Can Factory Berhad Malaysia Manufacture and distribution 32.9% 32.9% of tin cans and investment holding

The following table summarises the information of the Group’s associate, adjusted for any differences in accounting policies and reconciles the information to the carrying amount of the Group’s interest in the associate.

Kian Joo Can Factory Berhad 2013 2012 Group RM’000 RM’000

Summarised financial information As at 31 December Non-current assets 946,681 856,866 Current assets 765,166 687,409 Non-current liabilities (217,298) (170,948) Current liabilities (257,977) (204,846) Net assets 1,236,572 1,168,481

Year ended 31 December Profit from continuing operations 123,766 119,453 Other comprehensive income 1,904 (2,673) Total comprehensive income 125,670 116,780



5. INVESTMENT IN ASSOCIATE - GROUP (continued)

Kian Joo Can Factory Berhad 2013 2012 Group RM’000 RM’000

Included in the total comprehensive income is : Revenue 1,284,863 1,161,922 Net assets/carrying amount As at 31 December Group’s share of net assets/carrying amount in the consolidated 381,470 360,740 statement of financial position Group’s share of results Year ended 31 December Group’s share of profit or loss from continuing operations 39,016 31,226 Bargain purchase gain on acquisition of equity – accounted investee - 103,754 Group’s share of other comprehensive income (20) 2,173 Group’s share of total comprehensive income 38,996 137,153 Other information Dividends received 18,266 18,266

Significant restrictions

There are no significant restriction on the ability of the associate to declare cash dividends.

Contingent liabilities

On 7 January 2012, the associate received a writ and statement from its former managing director’s solicitors. The former managing director had claimed for, among other things, retirement gratuity amounting to RM6,530,000. The case is now pending Court decision.



6. GOODWILL ON CONSOLIDATION – GROUP

RM’000 At cost At 1 January 2012 1,712 At 31 December 2012 / 1 January 2013 1,712 Less: Impairment loss (304) At 31 December 2013 1,408

The above goodwill is in respect of the Group’s acquisition of the subsidiaries.

(a) Key sources of estimation

The Group determines whether goodwill is impaired at least on an annual basis. This requires an estimation of the value in use of the cash-generating units (“CGU”) to which the goodwill is allocated. Estimating the value in use requires the Group to make an estimate of the expected future cash flows from cash-generating unit and also to apply a suitable discount rate in order to calculate the present value of those cash flows.

(b) Recoverable amount based on value in use

The recoverable amount of a CGU is determined based on value in use calculations with the following key assumptions:

(i) Cash flows are projected based on the financial budgets approved by the Directors.

(ii) Discount rate used for cash flows discounting purposes is the management’s estimate of average cost of capital required in the respective segments. The discount rate applied for cash flow projections is at 10%.

(iii) Profit margins are projected based on the industry trends, historical profit margins achieved or predetermined profit margins for dairy products.

With regards to the assessment of value in use and fair value less costs of disposal, management believes that no reasonably possible change in any of the above key assumptions would cause the recoverable amounts of the unit to be materially below its carrying amounts.

7. INVENTORIES – GROUP

2013 2012 RM’000 RM’000 At cost Raw materials 74,476 54,981 Work-in-progress 27,061 27,947 Manufactured inventories 21,541 17,782 123,078 100,710

At net realisable value Work-in-progress 810 - Manufactured inventories 11 -

821 -

123,899 100,710

The write down of inventories to net realisable value during the year amounted to RM2,204,000 (2012 : Nil) is included in cost of sales.




8. TRADE AND OTHER RECEIVABLES

Note 2013 2012 RM’000 RM’000 Group

Trade Trade receivables 209,850 186,566 Less: Allowance for impairment loss (1,687) (1,895) 208,163 184,671 Non-trade Other receivables 1,104 290 Deposits 2,968 1,754 Prepayments 2,985 6,829 7,057 8,873 215,220 193,544

Company Trade Amount due from subsidiaries 796 -

Non-trade Amount due from subsidiaries 8.1 269,624 267,757 Deposits 1 1 270,421 267,758

8.1 Amount due from subsidiaries

Included in the amount due from subsidiaries is RM241,117,000 (2012 : RM241,942,000) which earns interest at 4.90% (2012 : 4.50% to 4.71%) per annum. Other than as disclosed, the non-trade receivables due from subsidiaries are unsecured, interest free and repayable on demand.

9. DERIVATIVE FINANCIAL ASSETS/(LIABILITIES) - GROUP

2013 2012 Nominal Assets/ Nominal Assets/ value (Liabilities) value (Liabilities) RM’000 RM’000 RM’000 RM’000 Derivatives held for trading at fair value through profit or loss - Forward exchange contracts 572 (16) 14,248 6


10. CASH AND CASH EQUIVALENTS

2013 2012 RM’000 RM’000 Group Cash and bank balances 31,621 39,904 Short-term deposits with licensed banks 6,400 12,450 38,021 52,354 Company Cash and bank balances 330 289 Short-term deposits with licensed banks 6,400 6,400 6,730 6,689

Included in short-term deposits placed with licensed banks of the Group and the Company is RM6,400,000 (2012 : RM6,400,000) pledged for bank borrowings.

11. ASSETS CLASSIFIED AS HELD FOR SALE - GROUP

2013 2012 RM’000 RM’000 Property, plant and equipment : Cost 4,350 - Accumulated depreciation (341) - Impairment loss (365) - 3,644 -

Assets classified as held for sale consist of a leasehold land and building and are measured at their carrying amount. The Group has collected RM500,000 deposit in 2013 and the sale is expected to be completed during the financial year ending 31 December 2014.

12. SHARE CAPITAL – GROUP/COMPANY

2013 2012 Number of Number of Amount shares Amount shares RM’000 ’000 RM’000 ’000 Ordinary shares of RM0.50 each Authorised 100,000 200,000 100,000 200,000

Issued and fully paid 76,200 152,400 76,200 152,400




13. RESERVES

Note 2013 2012 RM’000 RM’000 Group Non-distributable Share premium 13.1 8,560 8,560 Foreign currency translation reserve 13.2 2,242 2,179 Distributable Retained earnings 373,612 310,039 384,414 320,778 Company Non-distributable Share premium 13.1 8,560 8,560 Distributable Retained earnings 33,289 30,604 41,849 39,164

13.1 Share premium The share premium arose from the public issue. 13.2 Foreign currency translation reserve Translation reserve relates to foreign currency differences arising from the translation of the financial statements of

foreign operations.

14. LOANS AND BORROWINGS

2013 2012 RM’000 RM’000 Group Current Secured Term loans 5,879 8,919 Foreign currency trade loans 18,865 27,314 Finance lease liabilities 1,083 2,110 25,827 38,343 Unsecured Term loans 16,067 14,763 Bankers’ acceptances 2,763 2,222 Foreign currency trade loans 54,654 80,032 Revolving credits 6,000 10,000 Bills receivable refinancing 25,180 - 130,491 145,360


14. LOANS AND BORROWINGS (continued)

2013 2012 RM’000 RM’000 Group

Non-current Secured Term loans 266,111 267,006 Finance lease liabilities 1,380 1,215 267,491 268,221 Unsecured Term loans 32,201 41,083 299,692 309,304 Company Current Secured term loans - 3,025

Non-current Secured term loans 241,117 238,092

Security

The secured borrowings are secured against legal charges over certain land and building and plant and machinery of certain subsidiaries, investment in associate, fixed deposits and corporate guarantee from the Company and certain subsidiaries.

Finance lease liabilities are payable as follows :

2013 2012 Present Present Future value of Future value of minimum minimum minimum minimum lease lease lease lease payments Interest payments payments Interest payments RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 Group Less than 1 year 1,185 102 1,083 2,229 119 2,110 Between 1 and 5 years 1,479 99 1,380 1,267 52 1,215 2,664 201 2,463 3,496 171 3,325




15. DEFERRED TAX LIABILITIES – GROUP

Deferred tax liabilities are attributable to the following :

2013 2012 RM’000 RM’000 Property, plant and equipment 28,792 27,110 Revaluation 2,670 2,714 Provision & others (2,180) (2,999) 29,282 26,825

Movement in temporary differences during the year :

Recognised Recognised in profit in profit Foreign At or loss At or loss exchange At 1.1.2012 (Note 22) 31.12.2012 (Note 22) differences 31.12.2013 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 Property, plant and 16,586 10,524 27,110 1,713 (31) 28,792 equipment Revaluation 2,820 (106) 2,714 (44) - 2,670 Provision & others (1,284) (1,715) (2,999) 819 - (2,180) 18,122 8,703 26,825 2,488 (31) 29,282

16. TRADE AND OTHER PAYABLES

2013 2012 RM’000 RM’000 Group

Trade Trade payables 74,112 68,201 Non-trade Other payables 15,505 19,345 Accrued expenses 16,802 8,401 Deposit received 500 - 32,807 27,746 106,919 95,947


16. TRADE AND OTHER PAYABLES (continued)

2013 2012 Note RM’000 RM’000 Company

Non-trade Amount due to a subsidiary 16.1 - 11 Accrued expenses 478 451 478 462

16.1 Amount due to a subsidiary The non-trade amount due to a subsidiary was unsecured, interest free and repayable on demand.

17. REVENUE

Revenue for the Group represents the invoiced value of goods sold less discounts and returns.

Revenue for the Company represents dividend income and management fees receivable.

18. FINANCE COSTS

Group Company 2013 2012 2013 2012 RM’000 RM’000 RM’000 RM’000 Interest payable : Bank overdrafts 1 4 - - Term loans 16,954 17,662 - - Other short-term borrowings 2,255 1,946 11,782 11,514 Finance lease liabilities 169 350 - - 19,379 19,962 11,782 11,514 Bank charges 1,258 2,823 3 1 20,637 22,785 11,785 11,515




19. PROFIT BEFORE TAX

Profit before tax is arrived at :

Group Company 2013 2012 2013 2012 Note RM’000 RM’000 RM’000 RM’000 After charging : Auditors’ remuneration Audit fees - KPMG - current year 130 120 37 22 - prior year 2 (8) 2 (8) - Affiliates of KPMG 72 63 - - Other services - KPMG - current year 5 5 5 5 - prior year 8 - 8 - - Affiliates of KPMG 24 24 3 3 Depreciation of property, plant and equipment 3 16,831 15,062 3 2 Directors’ emoluments: Current Directors - Fees 440 490 240 240 - Others 1,414 1,739 586 421 Past Directors - Fees 130 - 80 - - Others 1,377 304 226 87 Other Directors - Fees 113 50 - - - Others 182 211 - - Impairment loss on asset held for sale 365 - - - Impairment loss on goodwill 304 - - - Loss on disposal of plant and equipment 301 - - - Loss on foreign exchange - unrealised 926 - - - - realised - 17 - - Rental of land and building 905 205 - - Loss on forward exchange contracts - unrealised 16 - - - Inventories written down 2,204 - - - and after crediting : Reversal of impairment loss on receivables 208 - - - Dividend income from a subsidiary - unquoted shares - - 10,500 16,000 Bargain purchase gain on acquisition of associate - 103,754 - - Interest income 235 178 11,782 11,160 Gain on disposal of plant and equipment - 261 - - Gain on forward exchange contracts - unrealised - 6 - - Gain on foreign exchange - unrealised - 1,958 186 - - realised 717 - 1 - Rental income from property 1,056 792 - -


20. KEY MANAGEMENT PERSONNEL COMPENSATIONS

The key management personnel compensations are as follows :

Group Company 2013 2012 2013 2012 RM’000 RM’000 RM’000 RM’000 Current Directors - Fees 440 490 240 240 - Remuneration 1,414 1,739 586 421 - Benefits-in-kind 33 35 - - 1,887 2,264 826 661

Past Directors - Fees 130 - 80 - - Remuneration 1,377 304 226 87 - Benefits-in-kind 13 - - - 1,520 304 306 87

Other Directors - Fees 113 50 - - - Remuneration 182 211 - - - Benefits-in-kind 7 7 - - 302 268 - -

Other key management personnel - Remuneration 1,605 1,006 519 166 - Benefits-in-kind 35 23 15 5 1,640 1,029 534 171 5,349 3,865 1,666 919

Other key management personnel comprises persons other than the Directors of Group entities, having authority and responsibility for planning, directing and controlling the activities of the entity either directly or indirectly.

21. EMPLOYEE INFORMATION Group Company 2013 2012 2013 2012 RM’000 RM’000 RM’000 RM’000 Staff costs 51,354 40,298 1,903 1,008

Staff costs of the Group and of the Company include contributions to the Employees’ Provident Fund of RM2,728,000 (2012 : RM2,134,000) and RM203,000 (2012 : RM105,000) respectively.




22. TAX EXPENSE

Recognised in profit or loss

Group Company 2013 2012 2013 2012 RM’000 RM’000 RM’000 RM’000 Income tax expense on continuing operations 16,686 16,753 - - Share of tax of equity- accounted investee* 7,711 5,780 - - Total income tax expense 24,397 22,533 - - Current tax expense Malaysian - current year 13,521 7,140 - - - prior years 577 403 - - Overseas - current year 145 507 - - - prior years (45) - - - 14,198 8,050 - -

Deferred tax expense - current year 3,954 9,093 - - - prior years (1,466) (390) - - 2,488 8,703 - - Share of tax of equity - accounted investee - current year 8,884 5,780 - - - prior years (1,173) - - - 7,711 5,780 - - Total income tax expense 24,397 22,533 - -

* It represents share of tax of equity-accounted investee which has been included in the share of results of equity-accounted investee as presented in the consolidated statement of profit or loss and other comprehensive income.


22. TAX EXPENSE (continued)

Reconciliation of tax expense

Group Company 2013 2012 2013 2012 RM’000 RM’000 RM’000 RM’000 Profit for the year 77,270 178,128 8,781 14,083 Total tax expense 24,397 22,533 - - Profit excluding tax 101,667 200,661 8,781 14,083 Income tax calculated using Malaysian tax rate of 25% (2012 : 25%) 25,417 50,165 2,195 3,521 Non-deductible expenses 7,163 4,655 430 479 Effect of tax rates in foreign jurisdictions (2,741) (267) - - Tax exempt income (378) (29,786) (2,625) (4,000) Tax incentives (2,410) (2,216) - - Reversal of deferred tax on revaluation of property (44) (31) - - Other items 103 - - - Effect of future reduction in Malaysia income tax rate to deferred tax (606) - - - 26,504 22,520 - - Under provision in prior years (2,107) 13 - - Total income tax expense 24,397 22,533 - -

23. EARNINGS PER ORDINARY SHARE

The calculation of basic earnings per ordinary share as at 31 December 2013 was based on the Group’s profit attributable to the owners of the Company of RM69,669,000 (2012 : RM170,725,000) and on the weighted average number of ordinary shares outstanding during the year of 152,400,000 (2012 : 152,400,000).




24. DIVIDENDS

Dividends recognised by the Company :

Sen per Total share amount Date of (gross) RM’000 payment 2013 First and final 2012 tax exempt dividend 4.00 6,096 31 July 2013 2012 First and final 2011 tax exempt dividend 3.00 4,572 30 July 2012

2013 2012 Dividend per ordinary share – Gross (sen) 5.00 4.00

A first and final tax exempt dividend of 10% (5 sen) per share of RM0.50 each, totalling RM7,620,000 for the financial year ended 31 December 2013 has been proposed for shareholders’ approval at the forthcoming annual general meeting. These financial statements do not reflect the above dividend which will be accounted for as an appropriation of retained earnings in the financial year ending 31 December 2014 when approved by the shareholders. The gross dividend per ordinary share as disclosed above takes into account the first and final tax exempt dividend proposed for the financial year ended 31 December 2013.

25. OPERATING SEGMENTS - GROUP

The Group has four reportable segments (four reportable segments in year 2012), as described below, which are the Group’s strategic business units. The strategic business units offer different products and services, and are managed separately because they require different technology and marketing strategies. For each of the strategic business units, the Group’s Chief Operating Officer (the chief operating decision maker) reviews internal management reports at least on a quarterly basis.

The following summary describes the operations in each of the Group’s reportable segments :

• Segment1-Generalcans-manufactureanddistributionoflithographedtincansandplasticjerrycans • Segment2-Foodproducts-manufactureanddistributionoffoodproducts • Segment3-Internationaltrading • Segment4-Propertyandinvestmentholding Performance is measured based on segment profit before tax, interest, depreciation and amortisation as included in the

internal management reports that are reviewed by the Group’s Chief Operating Officer (the chief operating decision maker). Segment profit is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries. Management monitors the operating results of its business units separately for the purpose of making decision about resource allocation and performance assessment.

Segment assets The total of segment asset is measured based on all assets of a segment (excluding current tax assets), as included in the

internal management reports that are reviewed by the Group’s Chief Operating Officer. Segment total asset is used to measure the return of assets of each segment.

Segment liabilities

Segment liabilities information is neither included in the internal management reports nor provided regularly to the Group’s Chief Operating Officer. Hence, no disclosure is made on segment liability.


25. OPERATING SEGMENTS - GROUP (continued)

Segment capital expenditure

Segment capital expenditure is the total cost incurred during the financial year to acquire property, plant and equipment and intangible assets other than goodwill.

Property Per and consolidated General Food International investment Reconciliations/ financial cans products trading holding Total Eliminations Note statements RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 31 December 2013 Segment profit/(loss) 27,341 51,975 1,337 33,705 114,358 (20,402) A 93,956

Included in the measure of segment profit/ (loss) are :

Revenue from external customers 280,080 469,391 23,410 - 772,881 - 772,881 Inter-segments sales 80,359 15,061 57,828 28,767 182,015 (182,015) - Inventories written down (2,204) - - - (2,204) - (2,204) Impairment loss on asset held for sale (365) - - - (365) - B (365) Impairment loss on goodwill - - - (304) (304) - B (304) Reversal of impairment loss on receivables 71 137 - - 208 - B 208 Share of profit of associate - - - 39,016 39,016 - 39,016 Depreciation and amortisation (11,891) (4,642) - (20) (16,553) (278) (16,831)

Not included in the measure of segment profit/(loss) but provided to Group Chief Operating Officer :

Finance costs (7,245) (3,245) (172) (23,722) (34,384) 13,747 (20,637) Interest income 2,189 11 - 11,782 13,982 (13,747) 235 Income tax expense (5,843) (11,104) (41) 1 (16,987) 301 (16,686)

Segment assets 385,664 268,384 8,523 388,239 1,050,810 1,405 C 1,052,215

Included in the measure of segment assets are :

Addition to non-current assets other than financial instruments 15,501 11,552 2 - 27,055 - 27,055





Property Per and consolidated General Food International investment Reconciliations/ financial cans products trading holding Total Eliminations Note statements RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 31 December 2012 Segment profit/(loss) 32,930 49,080 3,467 132,011 217,488 (22,607) A 194,881

Included in the measure of segment profit/ (loss) are :

Revenue from external customers 266,248 451,783 71,784 - 789,815 - 789,815 Inter-segments sales 94,880 66,409 43,475 34,326 239,090 (239,090) - Share of profit of associate - - - 134,980 134,980 - 134,980 Depreciation and amortisation (11,130) (3,795) - (50) (14,975) (87) (15,062)

Not included in the measure of segment profit/ (loss) but provided to Group Chief Operating Officer :

Finance costs (7,633) (3,610) (79) (13,214) (24,536) 1,751 (22,785) Interest income 1,915 14 - - 1,929 (1,751) 178 Income tax expense (7,710) (8,470) (509) - (16,689) (64) (16,753) Segment assets 338,549 273,443 10,582 367,911 990,485 586 C 991,071

Included in the measure of segment assets are : Addition to non- current assets other than financial instruments 28,522 14,226 - 5 42,753 - 42,753



Notes: Nature of adjustments and eliminations to arrive at amounts reported in the consolidated financial statements

A The following items are added to/(deducted from) segment profit to arrive at “Profit before tax from continuing operations” presented in the consolidated statement of comprehensive income:

2013 2012 RM’000 RM’000 Finance costs (20,637) (22,785) Interest income 235 178 (20,402) (22,607)

B Other material non-cash expenses consist of the following items as presented in the respective notes to the financial statements

2013 2012 RM’000 RM’000 Reversal of impairment loss on receivables (208) - Impairment of non-financial assets 669 - 461 -

C The following items are added to/(deducted from) segment assets to arrive at total assets reported in the consolidated statement of financial position :

2013 2012 RM’000 RM’000 Current tax assets 1,405 586

In presenting geographical information, segment revenue is based on geographical location of customers. Segment assets are based on the geographical location of the assets. The amounts of non-current assets do not include financial instruments (including investment in associate) and deferred tax assets.

Geographical information

Revenue Non-current assets 2013 2012 2013 2012 RM’000 RM’000 RM’000 RM’000 Malaysia 614,189 550,474 281,645 280,754 Asia (excluding Malaysia) 149,068 228,942 6,911 2,377 Others 9,624 10,399 - - Consolidated 772,881 789,815 288,556 283,131





Major customers

The following are major customers with revenue equal or more than 10% of the Group’s total revenue:

Revenue General Food International cans products trading Total RM’000 RM’000 RM’000 RM’000 2013 All common control companies of : - Customer A 75,662 155,227 7,197 238,086

2012 All common control companies of :

- Customer A 52,717 89,434 1,918 144,069

26. FINANCIAL INSTRUMENTS

26.1 Categories of financial instruments

The table below provides an analysis of financial instruments categorised as follows :

(a) Loans and receivables (L&R); (b) Fairvaluethroughprofitorloss(FVTPL); - Held for trading (HFT); and (c) Other financial liabilities measured at amortised cost (OL).

Carrying FVTPL amount L&R/(OL) -HFT RM’000 RM’000 RM’000 Group 31 December 2013 Financial assets Trade and other receivables 209,267 209,267 - Cash and cash equivalents 38,021 38,021 - 247,288 247,288 - Financial liabilities Loans and borrowings (430,183) (430,183) - Trade and other payables (106,919) (106,919) - Derivative financial liabilities (16) - (16) (537,118) (537,102) (16)


26. FINANCIAL INSTRUMENTS (continued)

26.1 Categories of financial instruments (continued)

Carrying FVTPL amount L&R/(OL) -HFT RM’000 RM’000 RM’000

31 December 2012 Financial assets Trade and other receivables 184,961 184,961 - Derivative financial assets 6 - 6 Cash and cash equivalents 52,354 52,354 -

237,321 237,315 6

Financial liabilities Loans and borrowings (454,664) (454,664) - Trade and other payables (95,947) (95,947) -

(550,611) (550,611) -

Carrying amount L&R/(OL) RM’000 RM’000

Company

31 December 2013

Financial assets

Trade and other receivables 270,420 270,420 Cash and cash equivalents 6,730 6,730

277,150 277,150


Loans and borrowings (241,117) (241,117) Trade and other payables (478) (478)

(241,595) (241,595)

31 December 2012

Financial assets

Trade and other receivables 267,757 267,757 Cash and cash equivalents 6,689 6,689

274,446 274,446


Loans and borrowings (241,117) (241,117) Trade and other payables (462) (462)

(241,579) (241,579)





26.2 Net gains and losses arising from financial instruments

Group Company 2013 2012 2013 2012 RM’000 RM’000 RM’000 RM’000 Net (losses)/gains arising on : Loans and receivables 2,598 (6,003) 11,970 11,160 Fair value through profit or loss : - HFT (23) 675 - - Financial liabilities measured at amortised cost (23,001) (14,663) (11,785) (11,515) (20,426) (19,991) 185 (355)

26.3 Financial risk management

The Group has exposure to the following risks from its use of financial instruments:

• Creditrisk • Liquidityrisk • Marketrisk

26.4 Credit risk

Credit risk is the risk of a financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The Group’s exposure to credit risk arises principally from its receivables from customers, advances to subsidiaries and financial guarantees given to banks for credit facilities granted to subsidiaries.

Receivables

Risk management objectives, policies and processes for managing the risk Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Normally

financial guarantees by banks, shareholders or Directors of customers are obtained, and credit evaluations are performed on customers requiring credit over a certain amount.

Exposure to credit risk, credit quality and collateral As at the end of the reporting period, the maximum exposure to credit risk arising from receivables is represented

by the carrying amounts in the statement of financial position.

Management has taken reasonable steps to ensure that receivables that are neither past due nor impaired are measured at their realisable values. A significant portion of these receivables are regular customers that have been transacting with the Group. The Group uses ageing analysis to monitor the credit quality of the receivables. Any receivables having significant balances past due more than 120 days, which are deemed to have higher credit risk, are monitored individually.

The exposure of credit risk for trade receivables as at the end of the reporting period by geographic region was :

Group Company 2013 2012 2013 2012 RM’000 RM’000 RM’000 RM’000 Domestic 190,860 149,187 796 - Asia, other than Malaysia 17,039 35,484 - - Others 264 - - - 208,163 184,671 796 -



26.4 Credit risk (continued)

Receivables (continued)

Impairment losses

The Group and the Company maintain an ageing analysis in respect of trade receivables only. The ageing of trade receivables as at the end of the reporting period was :

Individual Gross impairment Net RM’000 RM’000 RM’000 Group 31 December 2013 Not past due 101,122 - 101,122 Past due 1-30 days 35,833 - 35,833 Past due 31-120 days 49,437 - 49,437 Past due more than 120 days 23,458 (1,687) 21,771 209,850 (1,687) 208,163

31 December 2012 Not past due 93,274 - 93,274 Past due 1-30 days 35,851 - 35,851 Past due 31-120 days 53,278 - 53,278 Past due more than 120 days 4,163 (1,895) 2,268 186,566 (1,895) 184,671

Company 31 December 2013 Not past due 796 - 796

The movements in the allowance for impairment losses of trade receivables during the financial year were :

Group 2013 2012 RM’000 RM’000 At 1 January 1,895 2,229 Reversal of impairment loss (208) - Impairment loss written off - (334)

At 31 December 1,687 1,895

The allowance account in respect of trade receivables is used to record impairment losses. Unless the Group is satisfied that recovery of the amount is possible, the amount considered irrecoverable is written off against the receivable directly.





26.4 Credit risk (continued)

Financial guarantees

Risk management objectives, policies and processes for managing the risk

The Company provides unsecured financial guarantees to banks in respect of banking facilities granted to certain subsidiaries. The Company monitors on an ongoing basis the results of the subsidiaries and repayments made by the subsidiaries.

Exposure to credit risk, credit quality and collateral

The maximum exposure to credit risk amounts to RM190 million (2012 : RM215 million) representing the outstanding banking facilities of the subsidiaries as at the end of the reporting period.

As at the end of the reporting period, there was no indication that any subsidiary would default on repayment.

The financial guarantees have not been recognised since the fair value on initial recognition was not material.

Inter company balances


The Company provides advances to subsidiaries. The Company monitors the results of the related companies regularly.

Exposure to credit risk, credit quality and collateral

As at the end of the reporting period, the maximum exposure to credit risk is represented by their carrying amounts in the statement of financial position.

Advances are only provided to subsidiaries of the Company.

As at the end of the reporting period, there was no indication that the advances to subsidiaries are not recoverable. The Company does not specifically monitor the ageing of current advances to the subsidiaries. Nevertheless, these advances are not considered to be overdue and are repayable on demand.

26.5 LIQUIDITY RISK

Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s exposure to liquidity risk arises principally from its various payables, loans and borrowings.

The Group maintains a level of cash and cash equivalents and bank facilities deemed adequate by the management to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they fall due.

It is not expected that the cash flows included in the maturity analysis could occur significantly earlier, or at significantly different amounts.



26.5 Liquidity risk (continued)

Maturity analysis The table below summarises the maturity profile of the Group’s and the Company’s financial liabilities as at the

end of the reporting period based on undiscounted contractual payments:

Carrying Contractual Contractual Under 1 - 2 2 - 5 More than amount interest rate cash flows 1 year years years 5 years RM’000 % RM’000 RM’000 RM’000 RM’000 RM’000

Group

31 December 2013 Non-derivative financial liabilities Secured term loans 271,990 4.57 - 7.35 337,482 19,170 47,847 122,467 147,998 Unsecured term loans 48,268 3.05 - 7.50 53,267 18,560 15,443 19,264 - Finance lease liabilities 2,463 1.88 - 3.36 2,664 1,185 672 807 - Bankers’ acceptances 2,763 3.55 - 3.90 2,763 2,763 - - - Foreign currency trade loans 73,519 0.87 - 1.82 73,519 73,519 - - - Revolving credits 6,000 4.70 - 4.72 6,000 6,000 - - - Trade and other payables 106,919 - 106,919 106,919 - - - Bills receivable refinancing 25,180 - 25,180 25,180 - - - 537,102 607,794 253,296 63,962 142,538 147,998

Derivative financial (assets)/liabilities Forward exchange contracts (gross settled) : Outflow 16 - 588 588 - - - Inflow - - (572) (572) - - - 537,118 607,810 253,312 63,962 142,538 147,998

31 December 2012 Non-derivative financial liabilities Secured term loans 275,925 4.57 - 7.35 350,749 25,008 29,949 102,290 193,502 Unsecured term loans 55,846 3.05 - 7.50 62,856 17,759 16,777 28,258 62 Finance lease liabilities 3,325 2.30 - 3.90 3,496 2,229 868 399 - Bankers’ acceptances 2,222 3.80 - 3.90 2,222 2,222 - - - Foreign currency trade loans 107,346 1.00 - 3.54 107,346 107,346 - - - Revolving credits 10,000 4.41 - 4.75 10,000 10,000 - - - Trade and other payables 95,947 - 95,947 95,947 - - - 550,611 632,616 260,511 47,594 130,947 193,564 Derivative financial (assets)/liabilities Forward exchange contracts (gross settled) : Outflow - - 14,242 14,242 - - - Inflow (6) - (14,248) (14,248) - - - 550,605 632,610 260,505 47,594 130,947 193,564





26.5 Liquidity risk (continued)

Maturity analysis (continued) Carrying Contractual Contractual Under 1 - 2 2 - 5 More than amount interest rate cash flows 1 year years years 5 years RM’000 % RM’000 RM’000 RM’000 RM’000 RM’000

Company 31 December 2013 Non-derivative financial liabilities Secured term loans 241,117 4.90 300,654 11,815 41,509 110,584 136,746 Trade and other payables 478 - 478 478 - - - 241,595 301,132 12,293 41,509 110,584 136,746

31 December 2012 Non-derivative financial liabilities Secured term loans 241,117 5.20 308,567 17,360 22,947 88,630 179,630 Trade and other payables 462 - 462 462 - - - 241,579 309,029 17,822 22,947 88,630 179,630

26.6 Market risk

Market risk is the risk that changes in market prices, such as foreign exchange rates and interest rates will affect the Group’s financial position or cash flows.

26.6.1 Currency risk

The Group is exposed to foreign currency risk on sales, purchases and borrowings that are denominated in a currency other than the respective functional currencies of Group entities. The currencies giving rise to this risk are primarily U.S. Dollar (USD) and Singapore Dollar (SGD).


The Group’s uses forward exchange contracts to hedge its foreign currency risk. Most of the forward exchange contracts have maturities of less than one year after the end of the reporting period. Where necessary, the forward exchange contracts are rolled over at maturity.



26.6 Market risk (continued) 26.6.1 Currency risk (continued)

Exposure to foreign currency risk

The Group’s exposure to foreign currency (a currency which is other than the currency of the Group entities) risk, based on carrying amounts as at the end of the reporting period was:

Denominated in SGD USD RM’000 RM’000 Group 31 December 2013 Trade receivables 965 104,336 Cash and bank balances 355 17,047 Trade payables (11) (33,062) Foreign currency loans - (73,518) Net exposure 1,309 14,803

31 December 2012 Trade receivables 1,301 148,047 Cash and bank balances 147 27,619 Trade payables (2) (85,667) Foreign currency loans - (107,164) Net exposure 1,446 (17,165)

Currency risk sensitivity analysis A 10% strengthening of the Ringgit Malaysia (RM) against the following currencies at the end of the reporting

period would have increased/(decreased) post-tax profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remained constant and ignores any impact of forecasted sales and purchases.

Profit or loss RM’000 Group 31 December 2013 SGD (98) USD (1,110) 31 December 2012 SGD (108) USD 1,287

A 10% weakening of RM against the above currencies at the end of the reporting period would have had equal but opposite effect on the above currencies to the amounts shown above, on the basis that all other variables remained constant.





26.6 Market risk (continued) 26.6.2 Interest rate risk

The Group’s fixed rate borrowings are exposed to a risk of change in their fair value due to changes in interest rates. The Group’s variable rate borrowings are exposed to a risk of change in cash flows due to changes in interest rates. Short term receivables and payables are not significantly exposed to interest rate risk.


The Group is exposed to interest rate risk through the impact of rate changes on interest bearing loans and borrowings and interest earning deposits. The Group’s policy is to borrow principally on the floating basis but to retain a proportion of fixed rate debt. The objectives for the mix between fixed and floating rate loans and borrowings are set to reduce the impact of an upward change in interest rates while enabling benefits to be enjoyed if interest rates fall.

Exposure to interest rate risk

The interest rate profile of the Group’s significant interest earning and interest-bearing financial instruments, based on carrying amounts as at the end of the reporting period was :

2013 2012 RM’000 RM’000 Group Fixed rate instruments Financial assets 6,400 12,450 Financial liabilities (128,229) (137,417) (121,829) (124,967)

Floating rate instruments Financial liabilities (301,954) (317,247)

Company Fixed rate instruments Financial assets 6,400 7,225

Floating rate instruments Financial assets 241,117 241,117 Financial liabilities (241,117) (241,117) - -

Interest rate risk sensitivity analysis

(a) Fair value sensitivity analysis for fixed rate instruments

The Group does not account for any fixed rate financial assets and liabilities at fair value through profit or loss, and the Group does not designate derivatives as hedging instruments under a fair value hedged accounting model. Therefore, a change in interest rates at the end of the reporting period would not affect profit or loss.



26.6 Market risk (continued)

26.6.2 Interest rate risk (continued)

Interest rate risk sensitivity analysis (continued)

(b) Cash flow sensitivity analysis for variable rate instruments

A change of 100 basis points (bp) in interest rates at the end of the reporting period would have increased/(decreased) post-tax profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remained constant.

Group Company Profit or loss Profit or loss 100 bp 100 bp 100 bp 100 bp Increase Decrease Increase Decrease RM’000 RM’000 RM’000 RM’000 31 December 2013 Floating rate instruments (2,265) 2,265 - -

31 December 2012 Floating rate instruments (2,379) 2,379 - -

26.7 Fair value of financial instruments

The carrying amounts of cash and cash equivalents, short term receivables and payables and short term borrowings approximate fair values due to the relatively short term nature of these financial instruments.

The table below analyses financial instruments carried at fair value and those not carried at fair value for which fair value is disclosed, together with their fair values and carrying amounts shown in the statement of financial position.





26.7 Fair value of financial instruments (continued)

Fair value of financial instruments Fair value of financial instruments Total fair Carrying carried at fair value not carried at fair value value amount Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 2013 Group Financial liabilities Forward exchange contracts - (16) - (16) - - - - (16) (16) Term loans - - - - - - (328,269) (328,269) (328,269) (320,258) Finance lease liabilities - - - - - - (2,580) (2,580) (2,580) (2,463) - (16) - (16) - - (330,849) (330,849) (330,865) (322,737)

Company Financial liabilities Term loans - - - - - - (246,185) (246,185) (246,185) (241,117)

Fair value of financial instruments not carried Fair value of financial instruments carried at fair Total fair Carrying at fair value value* value amount Level 1 Level 2 Level 3 Total Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 2012

Group Financial assets Forward exchange contracts - 6 - 6 - 6 6 - 6 - 6 - 6 6 Financial liabilities Term loans - - - - (337,849) (337,849) (331,771) Finance lease liabilities - - - - (3,445) (3,445) (3,325) - - - - (341,294) (341,294) (335,096)

Company Financial liabilities Term loans - - - - (243,430) (243,430) (241,117)

* Comparative figures have not been analysed by levels, by virtue of transitional provision given in Appendix C2 of MFRS 13.



26.7 Fair value of financial instruments (continued)

Policy on transfer between levels

The fair value of an asset to be transferred between levels is determined as of the date of the event or change in circumstances that caused the transfer.

Level 1 fair value

Level 1 fair value is derived from quoted price (unadjusted) in active markets for identical financial assets or liabilities that the entity can access at the measurement date.

Level 2 fair value

Level 2 fair value is estimated using inputs other than quoted prices included within Level 1 that are observable for the financial assets or liabilities, either directly or indirectly.

Derivatives

The fair value of forward exchange contracts is estimated by discounting the difference between the contractual forward price and the current forward price for the residual maturity of the contract using a risk-free interest rate (based on government bonds).

Non-derivative financial liabilities

Fair value which is determined for disclosure purposes, is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the end of the reporting period. In respect of the liability component of convertible notes, the market rate of interest is determined by reference to similar liabilities that do not have a conversion option. For other borrowings, the market rate of interest is determined by reference to similar borrowing arrangements.

Transfers between Level 1 and Level 2 fair values

There has been no transfer between Level 1 and 2 fair values during the financial year. (2012 : no transfer in either directions).

Level 3 fair value

Level 3 fair value is estimated using unobservable inputs for the financial assets and liabilities.

The fair value of term loans and finance lease liabilities are calculated using discounted cash flows.




27. CAPITAL MANAGEMENT

The Group’s objectives when managing capital is to maintain a strong capital base and safeguard the Group’s ability to continue as a going concern, so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Directors monitor and determine to maintain an optimal debt-to-equity ratio that complies with debt covenants and regulatory requirements.

During 2013, the Group’s strategy which was unchanged from 2012, was to maintain the debt-to-equity ratio at below 1.5 : 1. The debt-to-equity ratios at 31 December 2013 and 31 December 2012 were as follows:

Group 2013 2012 RM’000 RM’000 Total borrowings (Note 14) 430,183 454,664 Less : Cash and cash equivalents (Note 10) (38,021) (52,354) Net debt 392,162 402,310

Total equity 482,524 411,287

Debt-to-equity ratio 0.81 0.98

There were no changes in the Group’s approach to capital management during the financial year.

28. CAPITAL AND OTHER COMMITMENTS - GROUP

2013 2012 RM’000 RM’000 Property, plant and equipment Contracted but not provided for 6,979 6,491

29. CONTINGENT LIABILITIES - COMPANY

Corporate guarantees

The Company has provided corporate guarantees amounting to RM972,100,000 (2012 : RM881,106,000) to secure banking facilities granted to certain subsidiaries. As at 31 December 2013, the amount of facilities utilised amounted to RM190,457,000 (2012 : RM214,757,000).

Continuing financial support

The Company has undertaken to provide continuing financial support to certain subsidiaries to enable them to meet their financial obligations as and when they fall due.


30. RELATED PARTIES

For the purposes of these financial statements, parties are considered to be related to the Group or the Company if the Group or the Company has the ability, directly or indirectly, to control or jointly control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group or the Company and the party are subject to common control. Related parties may be individuals or other entities.

Related parties also include key management personnel defined as those persons having authority and responsibility for planning, directing and controlling the activities of the Group either directly or indirectly. The key management personnel include Directors and certain members of senior management of the Group.

The Group has related party relationship with its significant investors, subsidiaries, associate and key management personnel.

Related party transactions have been entered into the normal course of business under normal trade terms. The significant related party transactions of the Group and of the Company, other than key management personnel compensation as disclosed in the Note 20 to the financial statements, are as follows :

2013 2012 RM’000 RM’000 Group Sales to associate 229 - Purchases from associate 2,659 - Dividend income from associate 18,266 18,266 Company Management fee from subsidiaries 796 - Interest income from a subsidiary 11,782 11,160 Dividend income from a subsidiary 10,500 16,000

Non-trade balances with subsidiaries are disclosed in Note 8 and Note 16. All outstanding balances are to be settled in cash.

31. MATERIAL LITIGATION

a) On 23 March 2009, Can-One International Sdn. Bhd. (“CISB”) together with 4 other defendants were served a Writ of Summons and a Statement of Claim pertaining to the acquisition of 32.9% equity interest in Kian Joo Can Factory Berhad (“Acquisition”).

The plaintiffs are claiming:

i) against the other 4 defendants and CISB damages amounting to RM55,000,000 for alleged fraud and interest at rate of 8% per annum on the said sum, cost of action on a full indemnity basis and such further or any other reliefs as the Court may deemed fit and proper to grant,

ii) an interim order restraining the defendants and each of them whether by themselves, their directors, their servants, or agents or otherwise howsoever from proceeding with the implementation of the Acquisition until the final hearing and disposal of the action,

iii) a declaration that the award of the bid in the public tender exercise to CISB for the Acquisition is illegal, null and void.




31. MATERIAL LITIGATION (continued)

CISB applied to the High Court to set aside and/or strike out the plaintiffs’ writ and Statement of Claim. On 6 June 2013, the High Court was informed that the plaintiffs would like to discontinue the above matter with no order as to costs. On 20 June 2013, the said Judge struck out the plaintiffs’ Writ and Statement of Claim and CISB’s application to strike out the plaintiffs’ Statement of Claim save and except for the issue of costs. On 11 July 2013, the Company announced that the above matter has been discontinued with no order as to costs.

b) In May 2011, CISB served a Writ of Summons and a Statement of Claim on Kian Joo Can Factory Berhad (“KJCFB”) and 4 other defendants to claim the following:

i) a declaration that the proposed bonus issue of 222,083,893 new ordinary shares of RM0.25 each in KJCFB (“Bonus Shares”) to be credited as fully paid-up on the basis of one Bonus Share for every two shares in KJCFB (“KJCFB Shares”) held (“Proposed Bonus Issue”) and the proposed renounceable rights issue of 166,562,919 five-year warrants 2011/2016 on the basis of 1 warrant for every four KJCFB Shares held after the Proposed Bonus Issue at an issue price of RM0.01 per warrant (“Proposed Renounceable Rights Issue”) by KJCFB are in breach of the rights and interests of CISB under the Shares Sale Agreement dated 23 March 2009 and in breach of the Order of the Court of Appeal dated 25 August 2010 and the Order of the Federal Court dated 21 February 2011;

ii) a declaration that the other 4 Defendants, as the shareholders or contributories of Kian Joo Holdings Sdn. Bhd. (In Liquidation) (“KJHSB”) and as directors of KJCFB, are in breach of the Order of the Court of Appeal dated 25 August 2010 and the Order of the Federal Court dated 21 February 2011;

iii) a declaration that the Defendants by their respective acts and involvement in the Proposed Bonus Issue and the

Proposed Renounceable Rights Issue are in contempt of the Court of Appeal and the Federal Court;

iv) a declaration that the Proposed Bonus Issue and the Proposed Renounceable Rights Issue and all shares issued in pursuance thereof are null and void;

v) an injunction that the Defendants be restrained whether by themselves, their servants, agents or otherwise howsoever until such further Order from convening any directors’ meetings or any ordinary or extraordinary general meetings of KJCFB for purposes of approving or for any purposes incidental to the Proposed Bonus Issue and the Proposed Renounceable Rights Issue by KJCFB;

vi) an injunction that the Defendants be restrained whether by themselves, their servants, agents or otherwise howsoever until such further Order from acting, implementing or continuing to act on or implement the Proposed Bonus Issue and the Proposed Renounceable Rights Issue by KJCFB or on any of the resolutions passed at any directors’ meetings and general meetings of KJCFB or on any approval of the regulatory authorities, incidental to the Proposed Bonus Issue and the Proposed Renounceable Rights Issue;

vii) an injunction that the Defendants be restrained whether by themselves, their servants, agents or otherwise howsoever until such further Order from taking, continuing and directing any steps or actions to be taken with a view to passing, effecting or enforcing any decisions or resolutions, whether incidental to the Proposed Bonus Issue and the Proposed Renounceable Rights Issue or any other corporate exercise, including declaring any benefits or dividends or causing any dispositions, which may have the effect of diluting the share capital or assets of KJCFB and/or affect or prejudice the rights and interests of CISB under the Shares Sale Agerement dated 23 March 2009 (“SSA”) and/or the said shares thereunder;

viii) an inquiry into the damages suffered by CISB by reason of the Defendants’ breach of the rights and interests of CISB under the SSA;

ix) such further and/or other requisite accounts, inquiries, directions or reliefs as may be appropriate to safeguard the rights and interests of CISB under the SSA; and

x) costs.



On 4 July 2011, the High Court dismissed CISB’s application for the said injunction.

On 8 July 2011, CISB filed the Notices of Appeal to the Court of Appeal against the decisions of the High Court. The Court of Appeal had on 8 November 2011:

i) allowed CISB’s Appeal against the decision of the High Court given on 4 July 2011 in allowing CISB’s suit to be struck out (“CISB’s Appeal”); and

ii) dismissed CISB’s Appeal against the decision of the High Court given on 4 July 2011 in refusing CISB’s application for an injunction restraining the implementation the Proposed Bonus Issue and the Proposed Renounceable Rights Issue pending the hearing of the suit of CISB.

In respect of CISB’s Appeal, the High Court had struck out the said matter with no order as to cost.

CISB had applied for leave to appeal to the Federal Court against the Court of Appeal’s decision in dismissing CISB’s Appeal on the injunction. On 6 June 2013, the Federal Court was informed that the parties to the above case would like to discontinue the said matter with no order as to costs. On 10 July 2013, the Company announced that the above matter has been discontinued.

c) The Federal Court on 5 January 2012, allowed the appeals of the Liquidators of Kian Joo Holdings Sdn Bhd – In Liquidation (“KJHSB”), including the Liquidators’ Appeals to proceed with the completion of the sale of 146,131,500 KJCFB shares held by KJHSB to CISB at a total consideration of RM241,116,975 (“FC Judgement”). CISB had on 25 January 2012 completed the acquisition of the said KJCFB shares.

CISB received two (2) Notice of Motions and Affidavits in Support filed by Dato’ See Teow Chuan and 13 others on 14 February 2012 (“First Applicants”) followed by another two (2) Motions and Affidavits in Support filed by See Tiau Kee and 10 others on 24 February 2012 (“Second Applicants”).

They have applied for the following orders:

i) The Grounds of the Federal Court’s Judgement and the consequent Orders of the Federal Court dated 5 January 2012 be reviewed and set aside pursuant to Rule 137 of the Rules of the Federal Court, 1995 and/or the inherent jurisdiction of the Federal Court;

ii) The said Appeals be re-heard by the Federal Court consisting of Judges of the Federal Court other than those who heard and decided upon the said Appeals on 5 January 2012;

iii) The Liquidators of KJHSB, Ooi Woon Chee and Ng Kim Tuck be restrained from distributing the said proceeds of

RM241,116,975 from the sale of the 146,131,500 shares of KJCFB to CISB and the said proceeds be retained in a monthly fixed deposit account in a local bank pending the hearing and final disposal of this Application and in the event the reliefs in paragraphs (i) and (ii) above are granted by the Federal Court, until the said Appeals are re-heard and finally disposed of by the Federal Court;

iv) CISB be restrained from selling and/or in any way disposing of the whole or any part of the 146,131,500 of KJCFB shares purchased from KJHSB pending the hearing and final disposal of this Application and in the event the reliefs in paragraphs (i) and (ii) above are granted by the Federal Court, until the said Appeals are re-heard and finally disposed of by the Federal Court;

v) CISB be restrained from exercising any of its rights attached to or arising from the purchase of the 146,131,500 of KJCFB shares by CISB from KJHSB pending the hearing and final disposal of this Application and in the event the reliefs in paragraphs (i) and (ii) above are granted by the Federal Court, until the said Appeals are re-heard and finally disposed of by the Federal Court;





vi) Costs of this Application be costs in the cause; and

vii) Any other or further reliefs that the Federal Court deems fit and proper to grant in the circumstances (collectively “Review Applications”).

The Federal Court on 22 May 2013 unanimously dismissed the Review Applications filed by both the First Applicants and the second Applicants and in addition, awarded the costs in favour of (i) the Liquidators in the sum of RM100,000 (ii) in favour of CISB in the sum of RM75,000, for each of the above matters.

32. COMPARATIVE FIGURES

Certain comparative figures have been restated to conform to current year’s presentation as follows :

2012 As previously As restated presented RM’000 RM’000 Revenue 789,815 780,040 Cost of sales (682,443) (668,918) Administrative expenses (18,585) (22,335)

33. SIGNIFICANT EVENTS

On 26 November 2013, the associated company, KJCFB received a letter of offer from Aspire Insight Sdn Bhd (“Aspire”) to acquire the entire business and undertaking including all of the assets and liabilities of KJCFB (“Offer”) for a cash consideration of approximately RM1.466 billion subject to adjustments after due diligence, terms of the definitive agreement or with respect to excluded liabilities. In the letter of offer, Aspire proposed, for the consideration of KJCFB’s Board of Directors and shareholders, the distribution of cash proceeds to be carried out from KJCFB capital repayment after the expiry of the warranty period and having taken into account excluded liabilities. On 10 December 2013, KJCFB, via its advisor, MIDF Amanah Investment Bank Berhad (“Advisor”) announced that Aspire agreed to KJCFB’s request for an extension of time until 20 January 2014 to consider the Offer. On 10 January 2014, the Board of Directors of KJCFB, via its Advisor announced that it has deliberated and agreed to accept Aspire’s Offer.

On 29 January 2014, KJCFB received a letter of request for an extension of time from Aspire for the completion of the ongoing due diligence exercise and the signing of the definitive agreement in relation to the Offer. In response, KJCFB agreed on the extension of time from 31 January 2014 to 14 March 2014.


34. SUPPLEMENTARY INFORMATION ON THE BREAKDOWN OF REALISED AND UNREALISED PROFITS OR LOSSES

The breakdown of the retained earnings of the Group and of the Company as at 31 December, into realised and unrealised profits, pursuant to Paragraphs 2.06 and 2.23 of Bursa Malaysia Main Market Listing Requirements, are as follows :

Group Company 2013 2012 2013 2012 RM’000 RM’000 RM’000 RM’000 Total retained earnings of the Company and its subsidiaries : - Realised 326,362 271,792 33,289 30,604 - Unrealised (15,119) (12,716) - - 311,243 259,076 33,289 30,604

Total retained earnings of associate : - Realised 53,155 20,993 - - - Unrealised 120,841 113,987 - - 485,239 394,056 33,289 30,604

Less: Consolidation adjustments (111,627) (84,017) - - Total retained earnings 373,612 310,039 33,289 30,604

The determination of realised and unrealised profits is based on the Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, issued by Malaysian Institute of Accountants on 20 December 2010.



LIST OF PROPERTIES

Location Tenure Area Description and Approximate Net Book Year of Last (Square Existing Use Age of Value as at Revaluation/ metres) Buildings 31.12.2013 Acquisition (Years) (RM’000) 4829, Tingkat Mak Mandin 5 99 years Land Office and Factory Office Block 4,143 2011 Mak Mandin Industrial Estate leasehold 6,380.40 Buildings/Industrial - 47 13400 Butterworth expiring on Pulau Pinang 23.9.2070 Built-up Factory Malaysia 3,001.70 - 25

4821, Tingkat Mak Mandin 5 99 years Land Office and Factory 43 3,034 2011 Mak Mandin Industrial Estate leasehold 4,269.27 Buildings/Industrial 13400 Butterworth expiring on Pulau Pinang 11.12.2066 Built-up Malaysia 2,161.85

4822, Tingkat Mak Mandin 5 99 years Land Office and Factory 43 2,127 2011 Mak Mandin Industrial Estate leasehold 2,905.36 Buildings/Industrial 13400 Butterworth expiring on Pulau Pinang 29.9.2071 Built-up Malaysia 3,372.38

5888, Lorong Mak Mandin 7 99 years Land Factory 43 3,105 2011 Mak Mandin Industrial Estate leasehold 4,990.57 Building/Industrial 13400 Butterworth expiring on Pulau Pinang 28.8.2067 Built-up Malaysia 3,260 LotNo.1983,Mukim14 60years Land VacantLand NotApplicable 1,444 2011 Seberang Prai Utara leasehold 5,128.81 Mak Mandin Industrial Estate expiring on 13400 Butterworth 3.6.2051 Pulau Pinang Malaysia 5102, Jalan Permatang Pauh 99 years Land Office and Factory 43 5,737 2011 Mak Mandin Industrial Estate leasehold 9,100.32 Buildings/Industrial 13400 Butterworth expiring on Pulau Pinang 6.12.2069 Built-up Malaysia 5,372.49

Lot 2244, Jalan Rajawali Freehold Land Office and Factory 16 13,701 2011 Batu 9, Kampung Kebun Baru 16,199.60 Buildings/Industrial 42500 Teluk Panglima Garang Kuala Langat Built-up Selangor Darul Ehsan 11,020.07 Malaysia Lot 2243, Jalan Rajawali Freehold Land Factory 2 19,565 2011 Batu 9, Kampung Kebun Baru 17,830.97 Buildings/Industrial 42500 Teluk Panglima Garang Kuala Langat Build-up Selangor Darul Ehsan 9,471 Malaysia


LIST OF PROPERTIES

Location Tenure Area Description and Approximate Net Book Year of Last (Square Existing Use Age of Value as at Revaluation/ metres) Buildings 31.12.2013 Acquisition (Years) (RM’000) Lot 2234, Jalan Rajawali Freehold Land Office and Factory Office Block 13,656 2011 Batu 9, Kampung Kebun Baru 16,313.60 Buildings/Industrial and Factory 42500 Teluk Panglima Garang - 17 Kuala Langat Built-up Selangor Darul Ehsan 7,158.37 New Factory Malaysia - 6

Lot 2223 Jalan Rajawali Freehold Land Factory buildings 4 13,905 2011 Batu 9, Kampung Kebun Baru 16,313.96 42500 Teluk Panglima Garang Kuala Langat Built-up Selangor Darul Ehsan 9,731.13 Malaysia

Lot 1, Persiaran Raja Lumu Land under Built-up Office and Factory 18 1,928 2011 Pandamaran Industrial Estate tenancy with 1,858.06 Buildings/Industrial 42000 Port Klang renewable Selangor Darul Ehsan option Malaysia

Lot 8985 99 years Land Office and Factory 6 14,469 2011 Off Jalan Ikan Bawal leasehold 13,715 Buildings/Industrial Telok Gong expiring on 42000 Port Klang 16.10.2068 Built-up Selangor Darul Ehsan 7,394.34 Malaysia PLO 718, Jalan Keluli 8 60 years Land Office and Factory Factory 1 - 8 18,084 2011 Kawasan Perindustrian leasehold 28,779.41 Buildings/Industrial Factory 2 – 3 Pasir Gudang expiring on 81700 Pasir Gudang 19.3.2067 Built-up Johor Darul Takzim 13,121.16 Malaysia

Lot2042,Mukim Freehold Land VacantLand NotApplicable 2,500 2013 Teluk Panglima Garang 20,234 Daerah Kuala Langat Selangor Darul Ehsan Malaysia

PLO 324, Jalan Suasa 60 years Land Office and Factory Office Block 3,644 2011 Kawasan Perindustrian leasehold 8,093.71 Buildings/Industrial and Factory – Pasir Gudang expiring on approximately 81700 Pasir Gudang 30.9.2045 Built-up 21 Johor Darul Takzim 6,537.03 Malaysia Factory 2 - approximately 18 Factory 3 - approximately 10


ANALYSIS OF SHAREHOLDINGSAS AT 28 FEBRUARY 2014

Authorised share capital : RM100,000,000Issued and fully paid-up share capital : RM76,200,000Class of shares : Ordinary shares of RM0.50 eachVotingrights : One(1)voteperordinaryshareheldNo. of shareholders : 1,706

ANALYSIS BY SIZE OF SHAREHOLDINGS Size of shareholdings No. of shareholders % of shareholders No. of shares held % of issued shares

Less than 100 shares 10 0.59 160 *100 to 1,000 shares 319 18.70 262,910 0.171,001 to 10,000 shares 887 51.99 4,363,030 2.8610,001 to 100,000 shares 379 22.22 12,896,100 8.47100,001 to 7,619,999 shares 110 6.45 89,720,519 58.877,620,000 shares and above 1 0.06 45,157,281 29.63

Total 1,706 100.00 152,400,000 100.00

* Negligible

SUBSTANTIAL SHAREHOLDERS(According to the Register of Substantial Shareholders)

Direct Indirect Total No. of % of No. of % of No. of % of Name shares held issued shares shares held issued shares shares held issued shares

Eller Axis Sdn Bhd 45,157,281 29.63 - - 45,157,281 29.63 (“EASB”) Yeoh Jin Hoe 6,690,000 4.39 45,157,281 (a) 29.63 (a) 51,847,281 34.02

Notes:

(a) Deemed interest by virtue that he has more than 15% voting shares in EASB

DIRECTORS’ SHAREHOLDINGS(According to the Register of Directors’ Shareholdings)

Direct Indirect Total No. of % of No. of % of No. of % of Name shares held issued shares shares held issued shares shares held issued shares

William Maurice Samson 80,000 0.05 - - 80,000 0.05Marc Francis Yeoh 343,100 0.23 - - 343,100 0.23 Min Chang Tan Beng Wah 2,000 * - - 2,000 *Yeoh Jin Hoe 6,690,000 4.39 45,157,281 (a) 29.63 (a) 51,847,281 34.02Razmi Bin Alias - - 911,119 (b) 0.60 (b) 911,119 0.60Yeoh Jin Beng 300,000 0.20 - - 300,000 0.20 Notes:

(a) Deemed interest by virtue that he has more than 15% voting shares in EASB(b) Deemed interest by virtue that he has more than 15% voting shares in Iska Tenaga Sdn Bhd* Negligible


ANALYSIS OF SHAREHOLDINGSAS AT 28 FEBRUARY 2014

LIST OF THIRTY (30) LARGEST SHAREHOLDERS (According to the Record of Depositors) No. of % of issued No. Name shares held shares held 1. Eller Axis Sdn Bhd 45,157,281 29.63

2. Sanwoi (Malaysia) Sdn Bhd 7,590,000 4.98

3. Agnes Goh Cheng Suan 5,000,000 3.28

4. Scott Sebastian Yeoh Min Hsing 4,500,000 2.95

5. HSBC Nominees (Asing) Sdn Bhd 4,457,500 2.92 - Exempt An for JPMorgan Chase Bank, National Association (Norges BK)

6. HLIB Nominees (Tempatan) Sdn Bhd 4,390,000 2.88 - Pledged Securities Account for Yeoh Jin Hoe (MG0183-199)

7. Koperasi Permodalan Felda Malaysia Berhad 4,000,000 2.62

8. Winchem (Malaysia) Sdn Bhd 3,710,000 2.43

9. Citigroup Nominees (Tempatan) Sdn Bhd 3,697,400 2.43 - Employees Provident Fund Board (CIMB PRIN)

10. HLIB Nominees (Tempatan) Sdn Bhd 2,532,300 1.66 - Pledged Securities Account for Taipanmatics Sdn Bhd

11. HSBC Nominees (Tempatan) Sdn Bhd 2,253,800 1.48 - HSBC (M) Trustee Bhd for MAAKL Al-Fauzan (5170)

12. See Seok Yong 2,200,000 1.44

13. HSBC Nominees (Tempatan) Sdn Bhd 2,068,900 1.36 - HSBC (M) Trustee Bhd for RHB-OSK Equity Trust (3175)

14. EB Nominees (Tempatan) Sendirian Berhad 2,000,000 1.31 - Pledged Securities Account for Patricia Woon Lai Ching @ Lee Yah Seng (SFC)

15. Yeoh Jin Aik 2,000,000 1.31

16. Yeoh Jin Hoe 2,000,000 1.31

17. HSBC Nominees (Asing) Sdn Bhd 1,845,700 1.21 - Exempt An for Credit Suisse (SG BR-TST-ASING) 18. HSBC Nominees (Tempatan) Sdn Bhd 1,664,300 1.09 - HSBC (M) Trustee Bhd for RHB-OSK Growth and Income Focus Trust (4892)

19. Citigroup Nominees (Tempatan) Sdn Bhd 1,646,600 1.08 - Kumpulan Wang Persaraan (Diperbadankan) (CIMB Equities)

20. Citigroup Nominees (Asing) Sdn Bhd 1,559,400 1.02 - CIPLCforPHIEMSICAV-SIF

21. Low Kam Fatt 1,432,600 0.94

22. HSBC Nominees (Tempatan) Sdn Bhd 1,250,000 0.82 - HSBC (M) Trustee Bhd for RHB-OSK Dana Kidsave

23. UOBM Nominees (Tempatan) Sdn Bhd 1,240,400 0.81 - UOB Asset Management (Malaysia) Berhad for Uni.Asia Life Assurance Berhad (Par Fund)

24. HSBC Nominees (Tempatan) Sdn Bhd 1,125,200 0.74 - HSBC (M) Trustee Bhd for MAAKL Progress Fund (4082)

25. HLIB Nominees (Tempatan) Sdn Bhd 1,077,200 0.71 - Pledged Securities Account for Exosoft Sdn Bhd (MG171-199)

26. Zainuddin Bin Din 1,000,000 0.66

27. Iska Tenaga Sdn Bhd 911,119 0.60

28. Chee Khay Leong 870,000 0.57

29 Patricia Woon Lai Ching @ Lee Yah Seng 815,700 0.54

30. HSBC Nominees (Tempatan) Sdn Bhd 682,000 0.48 - HSBC (M) Trustee Bhd for RHB-OSK Small Cap Opportunity Unit Trust (3548)

Total 114,677,400 75.26


NOTICE OF ANNUAL GENERAL MEETING

Resolution 1

Resolution 2

Resolution 3Resolution 4Resolution 5

Resolution 6

Resolution 7

Resolution 8

NOTICE IS HEREBY GIVEN THAT the Tenth Annual General Meeting (“AGM”) of Can-One Berhad (“Can-One” or “the Company”) will be held at Greens III (Sport Wing), Tropicana Golf & Country Resort Club, Jalan Kelab Tropicana, 47410 Petaling Jaya, Selangor Darul Ehsan, Malaysia on Thursday, 24 April 2014 at 10.00 a.m. for the following purposes:

AS ORDINARY BUSINESS

1. To receive the audited Financial Statements of the Group and of the Company for the financial year ended 31 December 2013 and the Reports of the Directors and Auditors thereon.

2. To declare a first and final tax exempt dividend of 10% (5 sen per share) for the financial year ended 31 December 2013.

3. To re-elect the following Directors of the Company who retire pursuant to Article 97 of the Company’s

Articles of Association: (i) Yeoh Jin Hoe (ii) Yeoh Jin Beng (iii) Razmi Bin Alias

William Maurice Samson who is over the age of seventy (70) years will vacate office as Independent Non-Executive Director at the conclusion of the Tenth AGM of the Company in accordance with Section 129(2) of the Companies Act, 1965. He will not seek re-appointment in line with Recommendation No. 3.2 of the Malaysian Code on Corporate Governance 2012 on the nine (9)-year term limit applicable to Independent Directors.

4. To approve the payment of Directors’ Fees amounting to RM320,000.00 in respect of the financial year

ended 31 December 2013. 5. To re-appoint Messrs KPMG as Auditors of the Company and to authorise the Directors to fix their

remuneration. AS SPECIAL BUSINESS

6. To consider and, if thought fit, to pass the following resolution as an Ordinary Resolution:

Authority to Directors to issue shares pursuant to Section 132D of the Companies Act, 1965

“THAT subject to the Companies Act, 1965, the Articles of Association of the Company and the approvals of the relevant governmental and/or regulatory authorities, if applicable, the Directors of the Company be and are hereby empowered pursuant to Section 132D of the Companies Act, 1965, to issue shares in the Company at any time at such price, upon such terms and conditions, for such purposes and to such person or persons whomsoever as the Directors may in their absolute discretion deem fit, provided that the aggregate number of shares issued pursuant to this resolution does not exceed ten per centum (10%) of the total issued share capital of the Company for the time being;

AND THAT such authority shall continue to be in force until:

(a) the conclusion of the next Annual General Meeting (“AGM”) of the Company, at which time it shall lapse, unless by ordinary resolution passed at that meeting, the authority is renewed, either unconditionally or subject to conditions; or

(b) the expiration of the period within which the next AGM of the Company is required by law to be

held; or

AGENDA



Resolution 9

Resolution 10

(c) revoked or varied by ordinary resolution passed by the shareholders of the Company at a general meeting,

whichever occurs first.

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 on Bursa Malaysia Securities Berhad.”


Proposed renewal of authority for the Company to purchase its own shares

“THAT subject to compliance with the Companies Act, 1965, the Companies Regulations 1966, the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (“Bursa Securities”), provisions of the Company’s Memorandum and Articles of Association and all other applicable laws, guidelines, rules and regulations, the Company be and is hereby authorised to purchase such number of ordinary shares of RM0.50 each in the Company as may be determined by the Directors of the Company from time to time through Bursa Securities upon such terms and conditions as the Directors may deem fit and expedient in the interest of the Company, provided that:

(i) the aggregate number of shares to be purchased pursuant to this resolution shall not exceed ten per

centum (10%) of the total issued and paid-up share capital of the Company as at the date of the share buy-back;

(ii) an aggregate amount of the funds not exceeding the retained profits and share premium reserve of the Company as at the date of the share buy-back, be utilised by the Company for the purchase of its own shares; and

(iii) the shares of the Company to be purchased may be cancelled, retained as treasury shares, distributed as dividends or resold on Bursa Securities, or a combination of any of the above, at the absolute discretion of the Directors;

AND THAT the authority conferred by this resolution will commence immediately upon the passing of this

resolution and will continue to be in force until:

(i) the conclusion of the next Annual General Meeting (“AGM”) of the Company, at which time it shall lapse, unless by ordinary resolution passed at that meeting, the authority is renewed, either unconditionally or subject to conditions; or

(ii) the expiration of the period within which the next AGM of the Company is required by law to be held; or

(iii) revoked or varied by ordinary resolution passed by the shareholders of the Company at a general meeting,

whichever occurs first but not so as to prejudice the completion of purchase(s) by the Company before

the aforesaid expiry date and, in any event, in accordance with the provisions of the Main Market Listing Requirements of Bursa Securities or any other relevant authorities;

AND FURTHER THAT the Directors of the Company be and are hereby authorised to do all such acts and things and to take all such steps as they deem fit, necessary, expedient and/or appropriate in order to complete and give full effect to the purchase by the Company of its own shares with full powers to assent to any condition, modification, variation and/or amendment as may be required or imposed by the relevant authorities.”


Proposed renewal of shareholders’ mandate for the Company and its subsidiaries to enter into recurrent related party transactions of a revenue or trading nature

“THAT subject always to the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, approval be and is hereby given for the Company and its subsidiaries to enter into the recurrent related party transactions of a revenue or trading nature as set out in Section 2.4 of the Company’s Circular to Shareholders dated 2 April 2014, provided that:



(i) such transactions are necessary for the day-to-day operations of the Company and/or its subsidiaries and are carried out in the ordinary course of business on normal commercial terms and on terms not more favourable to the parties with which such recurrent transactions are to be entered into than those generally available to the public and are not to the detriment of the minority shareholders of the Company; and

(ii) the shareholders’ mandate is subject to annual renewal and disclosure is made in the Annual Report of the aggregate value of transactions conducted pursuant to the shareholders’ mandate during the financial year;

AND THAT the mandate conferred by this resolution shall continue to be in force until:

(i) the conclusion of the next Annual General Meeting (“AGM”) of the Company, at which time it will lapse, unless by a resolution passed at the meeting, the authority is renewed; or

(ii) the expiration of the period within which the next AGM of the Company after the date it is required to be held pursuant to Section 143(1) of the Companies Act, 1965 (“the Act”) (but shall not extend to such extension as may be allowed pursuant to Section 143(2) of the Act); or

(iii) revoked or varied by odinary resolution passed by the shareholders of the Company at a general meeting;

whichever is earlier. AND THAT the Directors of the Company be and are hereby authorised to complete and to do all such acts

and things (including executing all such documents as may be required) as they may consider expedient or necessary to give effect to the transactions contemplated and/or authorised by this resolution.”

9. To transact any other business of which due notice shall have been given in accordance with the Company’s

Articles of Association and/or the Companies Act, 1965.

NOTICE OF DIVIDEND PAYMENT AND DIVIDEND ENTITLEMENT DATE

NOTICE IS HEREBY GIVEN THAT the first and final tax exempt dividend of 10% (5 sen per share) in respect of the financial year ended 31 December 2013 (“Dividend”), if approved by shareholders at the Tenth Annual General Meeting of the Company, will be paid to shareholders on 30 May 2014. The entitlement date for the Dividend shall be 21 May 2014.

Shareholders will be entitled to the Dividend only in respect of:

(a) shares transferred into their Securities Account before 4.00 p.m. on 21 May 2014, for transfers; and

(b) shares bought on Bursa Malaysia Securities Berhad on a cum entitlement basis according to the Rules of Bursa Malaysia Securities Berhad.

By Order of the Board

TAN BEE KENG (MAICSA 0856474)KWONG SHUK FONG (MAICSA 7032330)Company Secretaries

Petaling Jaya2 April 2014



Notes:

(A) GENERAL MEETING RECORD OF DEPOSITORS

Only members whose name appears in the General Meeting Record of Depositors as at 17 April 2014 shall be entitled to attend this Meeting or appoint proxy to attend and vote in his stead.

(B) PROXY

(i) A member of the Company entitled to attend and vote at this Meeting is entitled to appoint not more than two (2) proxies of his own choice to attend and vote in his stead. A proxy may but need not be a member of the Company and a member may appoint any person to be his proxy without limitation and the provisions of Section 149(1)(a) and (b) of the Companies Act, 1965 shall not apply to the Company.

Where a member appoints two (2) proxies, the member must specify the proportion of his shareholding to be represented by each proxy, failing which, the appointment shall be invalid.

(ii) Where a Member of the Company is an Authorised Nominee, it may appoint at least one (1) proxy but not more than two (2) proxies in respect of each Securities Account it holds with ordinary shares of the Company standing to the credit of the said Securities Account. Where a Member of the Company is an Exempt Authorised Nominee (“EAN”) which holds ordinary shares in the Company for multiple beneficial owners in one (1) securities account (“omnibus account”), there is no limit to the number of proxies which the EAN may appoint in respect of each omnibus account it holds.

Where an Authorised Nominee appoints two (2) proxies, or where an EAN appoints two (2) or more proxies, the appointment shall be invalid unless the proportion of shareholdings to be represented by each proxy are specified in the instrument appointing the proxies.

(iii) The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in writing or if the appointor is a corporation, under its common seal or under the hand of an officer or its attorney duly authorised in that behalf.

(iv) To be valid, the instrument appointing a proxy must be completed and deposited at the Registered Office of the Company at 2B-4, Level 4, Jalan SS 6/6, Kelana Jaya, 47301 Petaling Jaya, Selangor Darul Ehsan, Malaysia, not less than forty-eight (48) hours before the time appointed for the holding of the Meeting or adjourned Meeting (or in the case of a poll, not less than twenty-four (24) hours before the time appointed for the taking of the poll).

(v) Any alteration in the form of proxy must be initialled.

(C) EXPLANATORY NOTES ON SPECIAL BUSINESS

Resolution 8 - Authority to Directors to issue shares pursuant to Section 132D of the Companies Act, 1965

The Company had, at the Ninth AGM held on 19 June 2013, obtained its shareholders’ mandate for issuance of shares pursuant to Section 132D of the Companies Act, 1965 (“the Act”). The Company did not issue any new shares since obtaining the mandate up to the date of this notice and accordingly, no proceeds were raised.

The Ordinary Resolution proposed is a renewal of the general mandate for issuance of shares by the Company under Section 132D of the Act. The Ordinary Resolution proposed, if passed, will empower the Directors of the Company, from the date of the forthcoming Tenth AGM, to issue and allot ordinary shares from unissued share capital of the Company up to an aggregate amount not exceeding ten per centum (10%) of the total issued share capital of the Company for such purposes as the Directors in their absolute discretion consider to be in the interest of the Company, without having to convene a general meeting. The renewed authority from the shareholders will be effective immediately upon passing of the Ordinary Resolution and shall continue to be in force until:

(a) the conclusion of the next AGM; or

(b) the expiration of the period within which the next AGM of the Company is required by law to be held; or

(c) revoked or varied by ordinary resolution passed by the shareholders of the Company at a general meeting,


The renewed general mandate will provide flexibility to the Company to raise capital for purpose of funding future investment, working capital and/or acquisitions.



Resolution 9 - Proposed renewal of authority for the Company to purchase its own shares

The Ordinary Resolution proposed, if passed, will renew the authority for the Company to purchase through Bursa Malaysia Securities Berhad such number of ordinary shares in the Company up to an aggregate amount not exceeding ten per centum (10%) of the total issued and paid-up share capital of the Company. The renewed authority from the shareholders will be effective immediately upon passing of the Ordinary Resolution and shall continue to be in force until:

(i) the conclusion of the next AGM; or

(ii) the expiration of the period within which the next AGM of the Company is required by law to be held; or

(iii) revoked or varied by ordinary resolution passed by the shareholders of the Company at a general meeting,


For further information, please refer to the Share Buy-Back Statement dated 2 April 2014 which is despatched together with the Company’s Annual Report 2013.

Resolution 10 - Proposed renewal of shareholders’ mandate for the Company and its subsidiaries to enter into recurrent related party transactions of a revenue or trading nature

The Ordinary Resolution proposed, if passed, will renew the mandate for the Company and its subsidiary companies to enter into the recurrent related party transactions of a revenue or trading nature with Box-Pak (Malaysia) Berhad group of companies and Kian Joo Can Factory Berhad group of companies, as set out in Section 2.4 of the Circular to Shareholders dated 2 April 2014 (“the Mandate”).

The Mandate from shareholders is on an annual basis and subject to renewal at the next AGM.

For further information pertaining thereto, please refer to the Circular to Shareholders dated 2 April 2014 which is despatched together with the Company’s Annual Report 2013.


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I/We …………………………………………..…………………..........................(NRIC/Company No. ...………………………………….………) (Full Name in Block Letters)

of ……………………………………………………………………..………………….....................………Tel No. ……………......……………… (Address)

being a member/members of Can-One Berhad hereby appoint:

or failing him/her, the Chairman of the meeting as my/our proxy to vote for me/us on my/our behalf at the Tenth Annual General Meeting of the Company to be held at Greens III (Sport Wing), Tropicana Golf & Country Resort Club, Jalan Kelab Tropicana, 47410 Petaling Jaya, Selangor Darul Ehsan, Malaysia on Thursday, 24 April 2014 at 10.00 a.m. and at any adjournment thereof.

My/our proxy/proxies will vote on the resolutions as indicated by an ‘X’ in the spaces provided below. In the absence of specific direction as to voting, my/our proxy/proxies will vote or abstain from voting at his/their discretion.

Full Name (in Block Letters) NRIC/Passport No. No. of Shares % of Shareholdings

Full Name (in Block Letters) NRIC/Passport No. No. of Shares % of Shareholdings

CDS Account No. No. of Shares Held

FORM OF PROXY

RESOLUTION ORDINARY BUSINESS FOR AGAINST

1 To receive the audited Financial Statements of the Group and of the Company for the financial year ended 31 December 2013 and the Report of the Directors and Auditors thereon.

2 To declare a first and final tax exempt dividend of 10% (5 sen per share) for the financial year ended 31 December 2013.

3 To re-elect as Director, Yeoh Jin Hoe who retires pursuant to Article 97 of the Company’s Articles of Association.

4 To re-elect as Director, Yeoh Jin Beng who retires pursuant to Article 97 of the Company’s Articles of Association.

5 To re-elect as Director, Razmi Bin Alias who retires pursuant to Article 97 of the Company’s Articles of Association.

6 To approve the payment of Directors’ Fees amounting to RM320,000.00 in respect of the financial year ended 31 December 2013.

7 To re-appoint Messrs KPMG as Auditors of the Company and to authorise the Directors to fix their remuneration.

SPECIAL BUSINESS

8 Authority to Directors to issue shares pursuant to Section 132D of the Companies Act, 1965.

9 Proposed renewal of authority for the Company to purchase its own shares.

10 Proposed renewal of shareholders’ mandate for the Company and its subsidiaries to enter into recurrent related party transactions of a revenue or trading nature.

*and/or (*delete if not applicable)

(638899-K)

ANNUAL REPORT 2013

Dated this ……………….. day of ……………………… 2014.

---------------------------------------Signature/Seal of Shareholders Notes:

(i) Only members whose names appear in the General Meeting Record of Depositors as at 17 April 2014 shall be entitled to attend this meeting or appoint proxy to attend and vote in his stead.

(ii) A member of the Company entitled to attend and vote at this Meeting is entitled to appoint not more than two (2) proxies of his own choice to attend and vote in his stead. A proxy may but need not be a member of the Company and a member may appoint any person to be his proxy without limitation and the provisions of Section 149(1)(a) and (b) of the Companies Act, 1965 shall not apply to the Company.

(iii) Where a member appoints two (2) proxies, the member must specify the proportion of his shareholding to be represented by each proxy, failing which, the appointment shall be invalid.

(iv) Where a Member of the Company is an Authorised Nominee, it may appoint at least one (1) proxy but not more than two (2) proxies in respect of each Securities Account it holds with ordinary shares of the Company standing to the credit of the said Securities Account. Where a Member of the Company is an Exempt Authorised Nominee (“EAN”) which holds ordinary shares in the Company for multiple beneficial owners in one (1) securities account (“omnibus account”), there is no limit to the number of proxies which the EAN may appoint in respect of each omnibus account it holds. Where an Authorised Nominee appoints two (2) proxies, or where an EAN appoints two (2) or more proxies, the appointment shall be invalid unless the proportion of shareholdings to be represented by each proxy are specified in the instrument appointing the proxies.

(v) The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in writing or if the appointor is a corporation, under its common seal or under the hand of an officer or its attorney duly authorised in that behalf.

(vi) To be valid, the instrument appointing a proxy must be completed and deposited at the Registered Office of the Company at 2B-4, Level 4, Jalan SS 6/6, Kelana Jaya, 47301 Petaling Jaya, Selangor Darul Ehsan, Malaysia, not less than forty-eight (48) hours before the time appointed for the holding of the Meeting or adjourned Meeting (or in the case of a poll, not less than twenty-four (24) hours before the time appointed for the taking of the poll).

(vii) Any alteration in this form must be initialled.

The Company SecretaryCAN-ONE BERHAD2B-4, Level 4 Jalan SS 6/6, Kelana Jaya47301 Petaling JayaSelangor Darul EhsanMalaysia

AFFIXSTAMPHERE

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