annual report 2013 - ecowise report 2013 ecowise holdings ... manufacturing and tyre retreading...

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13ecoWise Holdings LimitedCo. Reg: 200209835C

17 Kallang Junction #04-03Singapore 339274

Tel: 65 - 6536 2489Fax: 65 - 6536 7672

www.ecowise.com.sg

ANNUAL REPORT

2 0 1 3

CONTENTS02 CORPORATE PROFILE06 CHAIRMAN’S STATEMENT10 FINANCIAL HIGHLIGHTS12 FINANCIAL AND OPERATIONS REVIEW16 BUSINESS OVERVIEW19 CORPORATE SOCIAL RESPONSIBILITY20 BOARD OF DIRECTORS23 MANAGEMENT TEAM25 CORPORATE GOVERNANCE44 FINANCIAL STATEMENTS

CORPORATE INFORMATION

BOARD OF DIRECTORS

Lee Thiam Seng (Executive Chairman)

Low Kian Beng (Executive Director)

Ng Cher Yan (Lead Independent Director)

Ang Mong Seng (Independent Director)

Ong Teck Ghee (Independent Director)

AUDIT COMMITTEE

Ng Cher Yan (Chairman)

Ang Mong Seng

Ong Teck Ghee

NOMINATING COMMITTEE

Ong Teck Ghee (Chairman)

Ang Mong Seng

Ng Cher Yan

REMUNERATION COMMITTEE

Ang Mong Seng (Chairman)

Ng Cher Yan

Ong Teck Ghee

COMPANY SECRETARY

Zhong Xiaowen

AUDITORS

RSM Chio Lim LLP

Public Accountants and

Chartered Accountants

8 Wilkie Road

#03-08 Wilkie Edge

Singapore 228095

Partner-in-charge: Chan Weng Keen

Effective from reporting year ended 31 October 2012

SHARE REGISTRAR

Boardroom Corporate & Advisory Services Pte Ltd

50 Raffles Place

#32-01 Singapore Land Tower

Singapore 048623

PRINCIPAL BANKERS

DBS Bank Ltd

Malayan Banking Berhad

United Overseas Bank Limited

REGISTER OFFICE/CONTACT DETAILS

Co. Registration No.: 200209835C

17 Kallang Junction #04-03

Singapore 339274

Tel: 65 65362489

Fax: 65 65367672

Website: www.ecowise.com.sg

To be the preferred environmental solutions and renewal energy provider with high integrity, corporate social responsibility and to create value for all stakeholders.

To emphasize on research and development to provide environmentally friendly solutions to industrial processes.

To establish successful operations and management of renewable energy projects that contribute to social, economic and environmental benefits to stakeholders.

To establish awareness, propagate, promote and encourage use of environmentally friendly products derived from recycled organic waste.

To establish best practices in the manufacture and distribution of environmentally friendly recycled products that are in harmony with ecological principles.

VISION

MISSION

ecoWise Holdings Limited annual report 2013 01

RESOURCE RECOVERYThe Group owns a leading rubber compound manufacturing and tyre retreading group under Sunrich Integrated Sdn. Bhd and its subsidiaries (“SRIT Group”) based in Malaysia. SRIT Group engages in the manufacturing of technical and custom made rubber compound as well as retread tyres under brand names such as SunTex, Winner, Autoways and Trakar. The Group will be expanding its total tyre management business into Chongqing, China, through a 65% held joint venture company established in December 2012 with Chongqing Municipal Transport Development and Investment (Group) Co., Ltd, which is Chongqing municipal’s largest state owned transport logistic group.

In China, the Group engages in electrical and electronic waste recycling business through a 15% investment in Chongqing Zhongtian Electronic Waste Co., Ltd (“CZEW”) under a joint venture with Zhongtian Environment Protection Industrial Group Co., Ltd. CZEW has an exclusive e-waste license awarded by the local government in the business of collection, recovering, processing and disposal of electrical and electronic waste in Chongqing.

In Singapore, the Group is an appointed term contractor for collection of used copper slag and general waste for certain shipyards and fabrication yards. A large portion of the recycled copper slag is used by ready mix concrete suppliers for the production of eco-concrete.

The Group’s patented composting technology, ecoACTTM, employs the unique in-vessel thermophilic composting technology to manufacture quality organic compost in the shortest possible time. Besides converting horticultural waste into organic compost at the Group’s facility at Sarimbun Recycling Park, the bulk of our horticultural waste are mixed with wood waste and repurposed as feedstock for our biomass co-generation plant in Gardens by the Bay, Singapore.

Founded in 1979, ecoWise Group is a Singapore based resource recovery, renewable energy and integrated environmental solutions provider. The Group was listed on SGX-SESDAQ in 2003 and moved to SGX Mainboard on 9 May 2008.

ecoWise Holdings Limited annual report 201302

CORPORATE PROFILE

RENEWABLE ENERGYIn Singapore, the Group’s first biomass co-generation power plant in Sungei Kadut supplies waste steam for a number of industrial applications. The waste steam application from the plant was the first registered Clean Development Mechanism (“CDM”) project in Singapore.

The Group’s second biomass co-generation power plant in Singapore at the iconic Gardens by the Bay (Marina South) commenced operation in November 2011 for the supply of energy to Gardens by the Bay. The supply of renewable energy to the park’s two conservatories has been steady since January 2012. The biomass co-generation power plant was constructed under a Design, Build and Operate agreement entered with Gardens by the Bay for a fifteen years period.

In China, the Group has two biomass co-generation projects. The Group’s wholly owned subsidiary Hivern Investment Pte Ltd owns a 24MW biomass co-generation power plant situated in the Industrial park in Changyi Binhai (Lower) Economic Development Zone and the Group’s 49% held subsidiary in Wuhan, Wuhan ecoWise Energy Co., Ltd., currently owns a 25MW coal-fired power plant which ceased operation in 2010 pending for the commencement of the process to convert it into a 25MW biomass co-generation power plant.

INTEGRATED ENVIRONMENTAL MANAGEMENT SOLUTIONSThe Group provides resources management and integrated environmental engineering solutions for industrial waste and energy management. The Group focuses on providing ‘low carbon’ environmental solutions. It offers a range of services including process design and optimisation; engineering, procurement, fabrication construction; commissioning, operation and maintenance of the facilities.

The Group also collaborates with government agency in research and development work related to environmental field.


集团简介

绿科集团于1979年在新加坡成立。主营业务包括资源再生、再生能源和提供综合性环境

解决方案。集团于2003年在新加坡交易所创业板挂牌上市，并于2008年5月9日晋升主板

交易。

资源再生绿科集团旗下以马来西亚为基地的日升集团及其子公司在橡胶复合材料制造和轮胎翻

新业务上领先同行业。日升集团从事橡胶复合材料和特制橡胶复合材料的生产，并在

SunTex, Winner, Autoway以及Trakar四大品牌下生产翻新轮胎。集团在2012年12月，

与重庆市最大的国有运输物流企业重庆城市交通开发投资(集团)有限公司设立了合资

企业，重庆绿科开投橡胶科技有限公司，绿科集团控股65%。集团冀望通过此合资企业

在重庆扩展综合轮胎管理业务。

在中国，绿科集团与中天环保产业(集团)有限公司共同设立了合资公司重庆中天电子

废物管理有限公司。合资公司拥有在重庆市的电器、电子产品废弃物再循环的特许经

营权。

在新加坡，绿科集团是新加坡一些修船厂和造船厂废铜渣和其它工业废弃物指定回收

商。大部分的废铜渣在经过处理后成为生产环保水泥的主要材料。

绿科集团的专利堆肥技术，ecoACTTM, 使用独特的仓内高温堆肥技术可以在极短的时间

内生产出高品质的有机肥料。集团在莎琳汶再循环园将一部分的园艺废物再生，生产有

机肥料。大部分的园艺废物在经过处理后，成为集团滨海湾生物质热电厂的燃料。

再生能源绿科集团位于双溪加株的第一座生物质热电厂为一些工业项目提供废蒸汽作为能源。生

物质热电厂的热能应用项目使得公司成为首家成功注册清洁发展机制项目的新加坡注册

公司。

集团坐落在新加坡地标性建筑“滨海湾花园”内的生物质热电厂已在2011年投入生产，

为滨海湾花园的两个冷却温室馆提供再生能源。这是一座以设计、建造及营运为模式的

生物质热电厂，集团拥有这座热电厂自投产日起15年的营运权。

集团在中国拥有两个生物质热电联产项目。集团的全资子公司海闻投资私人有限公司拥

有坐落在山东昌邑市滨海(下营)经济开发区的一座24MW生物质热电厂。在武汉，集团参

股49%的合资企业武汉绿科有限公司，拥有一座25MW的燃煤热电厂。此燃煤热电厂将改

造为25MW的生物质热电厂。

提供综合环境管理方案集团提供“低碳型”环境管理方案。服务范围涵盖工艺流程的设计和优化、工程采购和

建设以及设备安装、调试和维修等多个领域。



CHAIRMAN’S STATEMENT

Dear Shareholders,

On behalf of the Board of Directors, I present to you the performance of the Group for the financial year ended 31 October 2013 (“FY2013”).

Although the Group’s revenue fell by 11.6% to S$80 million, it reported 39% growth in net profit attributable to shareholders of S$1.9 million in FY2013. The lower revenue is attributed to lower sales recorded by our Resource Recovery segment. Our retread tyres and rubber compound

business in Malaysia suffered from weak export demand from the mining sector and lower selling prices due to lower raw material prices. However our Renewable Energy segment registered a growth of 5.8% in FY2013. The Group’s overall growth in net earnings is contributed by higher gross profit margin recorded by both the Renewable Energy and Resource Recovery segments.


In the Resource Recovery segment, groundbreaking work at our Malaysia plant had begun for the construction of another rubber compound mixing facility to enhance technological capability, expand plant capacity and improvement in operational efficiency. The new intermesh mixing facility from Germany will enable the Group to produce specialty rubber compound of high tensile strength while using raw materials which are more cost effective in performance and in its formulation. The capital injection into joint venture company Chongqing eco-CTIG Rubber Technology Co., Ltd is completed and the joint venture is in the midst of establishing its operations, inclusive of tyre retreading facilities and rolling out the appropriate total tyre management system. In Singapore, a new dryer is under installation at our Sungei Kadut plant for the recovery of different types of spent grains and other food waste from Food & Beverage manufacturers. As such, sales for both plants are expected to increase with more technological competitive advantages amidst the ever changing market conditions.

In the Renewable Energy segment, contributions from our biomass co-generation plants at Gardens by The Bay and Sungei Kadut remained stable in FY2013. Moving forward, the Group is poised to capitalize on opportunities for green innovations. It will be in a strong position for the Group to develop as an aggregator in utilities provision from waste management to supplementing energy consumption and to providing heating and cooling systems for established industrial clients. The Group will consolidate and rebalance its portfolio of businesses in China to realize their potential value in FY2014.

In summary, we expect the Group to grow from a position of stability and strength to sustainable growth in businesses. The year ahead will be full of challenges and opportunities alike. I have full confidence in our team in transcending these challenges and capitalize on opportunities for the Group.

REWARDING OUR SHAREHOLDERSOn behalf of the Board, I would like to thank all shareholders for your continued support and confidence in the Group. As a token of appreciation, the Board is recommending a one-tier tax exempt final dividend of 0.05 cent per share for shareholders’ approval at the Annual General Meeting.

ACKNOWLEDGEMENTOn behalf of the Board, I would like to take this opportunity to thank the management and staff for their dedication, hard work and contributions to the Group. I would also like to express my heartfelt appreciation to all our shareholders, business associates, partners and customers for their support and confidence in the Group.

LEE THIAM SENGExecutive Chairman and CEOJanuary 2014


主席致辞

尊敬的股东们：

我谨代表董事会在此荣幸地向您呈上集团截至2013年10月31

日的财政年度报告。

集团在2013年取得了8千万元的营业额，虽然年比降低了

11.6%，净利却上升了39%，达190万元。橡胶价格的下浮

和海外矿厂对橡胶复合材料的需求下降影响了集团的营业

额。

在资源再生业务方面，马来西亚的工厂已破土扩建厂房，

扩大橡胶复合材料的生产。从德国引进的齿合形搅拌机将

可以生产高抗拉强度的特种复合橡胶材料。我们已经完成

了合资公司重庆绿科开投橡胶技术有限公司的注资工作，

目前正在积极筹备公司的运作，如设置轮胎翻新设施和

研发推广适当的综合轮胎管理系统。新加坡双溪加株的工

厂将新添一台烘干机，烘干酒糟和其它食物废渣。技术的

提升和生产率的提升将有望提高两间工厂的产能。2014

年，集团的资源再生业务将在剧烈的市场里以提高竞争优

势取得更大的营利。

再生能源方面，位于滨海湾花园和双溪加株的两座生物质

热电厂在2013年为集团提供了稳定的收入，营业额上升了

5.8%。结合废物处理以及新能源的技术，我们将创造更多

的商机，发展成为一个再生能源的集聚地：从废物管理到

为工业客户提供能源系统管理。集团将在2014年里整合我

们在中国的再生能源业务，实现它们的潜在价值。

综上所述，我们期望集团在良好和稳定的基础上继续发

展。未来的一年将充满挑战，也充满机遇。我有足够的信

心我们的团队将超越挑战，把握商机。

回馈股东

我谨代表董事会，感谢所有股东对集团一直以来的支持和

信心。董事会将在常年股东大会上，提议分发每股0.05分

的免税年终股息，在获得股东批准后发放。

鸣谢

我谨代表董事会，在此衷心地感谢集团所有的管理层和全

体员工，感谢大家对集团的全心奉献和辛勤工作。我也在

此鸣谢所有的股东、业务伙伴和尊敬的客户，谢谢大家对

本集团的不懈支持和坚强信心。

李添胜

执行主席和首席执行官

2014年1月


CHAIRMAN’S STATEMENT


FINANCIAL HIGHLIGHTS

* In calculating return on Equity, Attributable to Owners of the Parent and return on assets, the average basis has been used.

FINANCIAL RESULTS ($’000) FY2013 FY2012 FY2011 FY2010 FY2009

Revenue 80,023 90,521 79,842 37,585 31,235Gross Profit 18,416 17,710 13,635 6,904 5,570Profit/(Loss) Before Income Tax 2,823 3,429 2,273 (1,479) (40)Profit/(Loss) After Income Tax 1,854 1,718 932 (1,978) (589)Non-Controlling Interests (45) 352 370 (630) (668)Profit/(Loss) Attributable to Shareholders 1,899 1,366 562 (1,348) 79

STATEMENT OF FINANCIAL POSITION ($’000) FY2013 FY2012 FY2011 FY2010 FY2009

Property, Plant and Equipment 42,273 29,162 37,743 33,111 14,089Cash and Cash Equivalents 15,271 18,527 12,785 14,956 26,629Current Assets 48,212 50,267 43,822 47,043 34,732Total Assets 120,705 102,966 87,132 86,394 51,779Current Liabilities 47,082 28,405 24,152 25,951 7,215Total Liabilities 60,060 42,484 34,312 33,205 11,998Working Capital 1,130 21,862 19,670 21,092 27,517Equity, Attributable to Owners of the Company 53,510 53,009 40,020 39,831 35,042

RATIOS FY2013 FY2012 FY2011 FY2010 FY2009

Current Ratio (times) 1.02 1.77 1.81 1.81 4.81Return on Equity, Attributable to Owners of the Company (%)* 3.57 2.94 1.41 (3.60) 0.27Return on Assets (%)* 1.70 1.44 0.65 (1.95) 0.19Basic Earnings Per Shares (cents) 0.21 0.15 0.07 (0.16) 0.01Net Assets Value Per Share (cents) 5.77 5.74 4.77 4.79 4.46

REVENUE BY SEGMENTS ($’000) FY2013 FY2012

0.7% 0.3%13.1% 11%

86.2% 88.7%

Resource Recovery 69,014 80,330

Renewable Energy 10,482 9,907

Integrated Environmental 527 284Management Solutions

Total 80,023 90,521

FY2013 FY2012


FINANCIAL HIGHLIGHTS

20132012201120102009

REVENUE ($’000)

90,52180,023

79,84237,585

31,235

20132012201120102009

EQUITY, ATTRIBUTABLE TO OWNERS OF THE COMPANY ($’000)

53,00953,510

40,02039,831

35,042

20132012201120102009

BASIC EARNINGS PER SHARES (cents)

0.150.21

0.07(0.16)

0.01

20132012201120102009

PROFIT/(LOSS) ATTRIBUTABLE TO SHAREHOLDERS ($’000)

1,8991,366

562

20132012201120102009

RETURN ON EQUITY, ATTRIBUTABLE TO OWNERS OF THE COMPANY (%)

3.572.94

1.41(3.60)

0.27

20132012201120102009

NET ASSETS VALUE PER SHARE (cents)

5.775.74

4.774.79

4.46

(1,348)79


FINANCIAL AND OPERATIONS REVIEWFINANCIAL AND OPERATIONS REVIEW

The Group recorded higher earnings of S$1.85 million in FY2013 as compared to S$1.72 million in FY2012. Profit attributable to owners of the Company increased 38.7% to S$1.90 million in FY2013.



STATEMENT OF COMPREHENSIVE INCOMEThe Group’s revenue decreased by 11.6% from S$90.52 million in the financial year ended 31 October 2012 (“FY2012”) to S$80.02 million in the financial year ended 31 October 2013 (“FY2013”). The decrease is mainly due to lower revenue recorded by the Resource Recovery segment.

The Group’s gross profit margin increased from 19.6% in FY2012 to 23.0% in FY2013 mainly due to better margins from Resource Recovery segment from the sales of retreaded tyres and rubber compound.

There is no dividend income in FY2013. Dividend income of S$0.41 million in FY2012 was received from the Group’s 15% investment in the electrical and electronic waste management company in China, Chongqing Zhongtian Electronic Waste Management Co., Ltd..

Other credits decreased by 72.7% to S$0.15 million in FY2013 from S$0.55 million in FY2012 mainly due to due to absence of foreign exchange gain.

Marketing and Distribution expenses decreased by 4.1% to S$3.67 million in FY2013 from S$3.83 million in FY2012 mainly due to lower spending by the Group’s rubber compound manufacturing and tyre retreading businesses.

Administrative expenses increased by 4.4% to S$10.18 million in FY2013 from S$9.75 million in FY2012 mainly due to staff costs (increased by S$0.24 million), legal and professional fees (increased by S$0.16 million), travelling and accommodation expenses (increased by S$0.13 million), other expenses incurred by the Group’s newly acquired subsidiary, Hivern Investments Pte Ltd

(“Hivern Group”), and partially offset by lower operating lease expenses (decreased by S$0.31 million).

Finance costs decreased by 5.8% to S$0.98 million in FY2013 from S$1.04 million in FY2012 mainly due to agreement with a supplier in FY2013 for lower interest to be charged on outstanding balances resulting in a reversal of finance costs of S$0.12 million.

Depreciation of property, plant and equipment decreased marginally by 0.6% to S$3.14 million in FY2013 despite higher carrying amounts of property, plant and equipment mainly due to newly acquired Hivern Group’s property, plant and equipment being treated as “assets under construction” and not subjected to depreciation charges.

Other charges comprised mainly foreign exchange loss, fair value loss on derivative financial instruments and impairment loss on other financial assets maintained at S$0.32 million in FY2013 and FY2012.

Share of losses from associates and jointly-controlled entity increased S$0.30 million in FY2013 mainly due to the share of start-up costs of S$0.31 million incurred by Chongqing eco-CTIG Rubber Technology Co., Ltd.

Profit attributable to owners of the Company increased by 38.7% from S$1.37 million in FY2012 to S$1.90 million in FY2013 mainly due to an increase in the share of earnings of SRIT Group following the Group’s acquisition of the remaining 30% equity interests in Sunrich Integrated Sdn. Bhd. in FY2012 when it became a wholly-owned subsidiary of the Group. Basic earnings per share for FY2013 increased from 0.153 cents in FY2012 to 0.205 cents in FY2013.

Our biomass co-generation plant located at Sungei Kadut Biomass Co-generation plant at Gardens by the Bay


FINANCIAL AND OPERATIONS REVIEW

STATEMENT OF FINANCIAL POSITIONThe Group’s non-current assets as at 31 October 2013 of S$72.49 million were S$19.79 million higher as compared to 31 October 2012 mainly due to the effects of acquisition of Hivern Group. The Group’s property, plant and equipment increased by S$13.11 million to S$42.27 million as at 31 October 2013 was mainly attributed to the effects of acquisition of Hivern Group of S$14.03 million, capital expenditure of S$2.79 million partially offset by foreign exchange translation adjustment of S$0.49 million and depreciation charges of S$3.14 million and disposal amounting to S$0.08 million.

Investments in land use rights increased by S$2.45 million mainly due to acquisition of Hivern Group, whose land use rights have carrying value amounting to S$2.48 million.

Investment in associates and a jointly-controlled entity increased by S$4.49 million mainly attributed to the Group’s investment in 65% equity interests in Chongqing eco-CTIG Rubber Technology Co., Ltd. which was newly incorporated in FY2013.

The Group’s current assets decreased by S$2.06 million to S$48.21 million as at 31 October 2013. The decrease is mainly due to a decrease in inventories by S$0.32 million to S$9.75 million and cash and cash equivalents by S$3.26 million and partially offset by

an increase in other assets by S$1.34 million mainly attributable to deposits placed for the purchases of goods under the Resource Recovery segment. Trade and other receivables had increased marginally by S$0.15 million mainly attributed to slower payments and the effects of the acquisition of Hivern Group amounting to S$0.87 million.

The Group’s non-current liabilities decreased by S$1.10 million mainly due to lower amount of non-current portion of loan and borrowings.

The Group’s current liabilities increased by S$18.68 million to S$47.08 million as at 31 October 2013. This was mainly due to an increase in trade and other payables by S$11.39 million. The increase in trade and other payables is mainly attributable to the effects of acquisition of Hivern Group amounting to S$13.77 million. Other liabilities relate to advance payment of S$5.00 million received from jointly-controlled entity under the Resource Recovery segment.

The Group’s total loans and borrowings increased by S$0.94 million to S$26.77 million as at 31 October 2013 mainly due to repayment of loans and borrowings of S$7.10 million, partially offset by drawing of loans and borrowings of S$4.49 million and effects of acquisition of Hivern Group where liabilities relating loans and borrowings of S$3.80 million are assumed.

Gardens by The Bay - Supertree Grove Biomass fuel unloading area Biomass fuel preparation


STATEMENT OF CASH FLOWSThe Group’s cash and cash equivalents decreased by S$1.88 million in FY2013 mainly due to net cash flows generated from operating activities of S$10.05 million partially offset by cash flows used in investing activities of S$7.57 million and financing activities of S$4.37 million.

Cash flows used in investing activities of S$7.57 million comprised mainly the Group’s investment of S$5.13 million in 65% equity interests in a newly incorporated

jointly-controlled entity, Chongqing eco-CTIG Rubber Technology Co., Ltd. and capital expenditure amounted to S$2.53 million in FY2013 mainly for resource recovery segment.

Cash flows used in financing activities of S$4.37 million comprised mainly dividend payment of S$0.92 million, repayments of loans and borrowings of S$7.10 million and finance costs of S$0.91 million; partially offset by new loans drawn down amounted to S$4.49 million in FY2013.

Tyre retreading business Tyre retreading


BUSINESS OVERVIEW

RESOURCE RECOVERY SEGMENT

The Group has over thirty years of experience in the Resource Recovery business which handles a diverse variety of industrial materials with operations in Singapore, Malaysia and China.

BUSINESS OVERVIEW



RESOURCE RECOVERY SEGMENT

Rubber Compound Manufacturing and Tyre Retreading BusinessThe Group’s rubber compound manufacturing and tyre retreading business are undertaken by wholly owned Sunrich Integrated Sdn. Bhd. and its subsidiaries (“SRIT Group”) based in Malaysia. The principal activities of SRIT Group are as follows:

• Manufacturing of rubber compound and custom made compounds such as precured tread liners, cushion gum, perforated sidewall veneer and masterbatch for tyre retreading, industrial belting and other industries;

• Retreading of tyres and total tyre management services. The Group manufactures retread tyres under brand names such as SunTex, Winner, Autoways and Trakar through its marketing arms; and

• Manufacturing of specialty compounds for the IT, automotive and other industries.

The integrated business model allows operational efficiency and cost savings to be achieved within and across the business units. The Group’s have taken two initiatives to expand the scale of the advantages provided by the integrated model. Firstly, the Group have extend its operations into Chongqing, China, through its Joint Venture with Chongqing Municipal Transport Development and Investment (Group) Co., Ltd, Chongqing municipal’s largest state

owned transport logistic group to provide total tyre management and retread tyres in China. Secondly, SRIT Group had invested in new rubber mixing facilities to enhance its rubber technological capability, increased its plant capacity and improve on operational efficiency in the manufacturing of rubber compound. This will enable SRIT Group to expand its product offering, strengthen its existing market position and enter into new markets regionally.

Used Copper Slag Related BusinessThe Group is a pioneer in repurposing the recycled copper slag as an approved sand alternative used in the construction industry. Geocycle Singapore Pte Ltd (“Geocycle Singapore”), the Group’s joint venture with Holcim Singapore, owns and operates Singapore’s largest waste copper slag processing plant with Holcim Singapore providing offtake of all its products. The main use of washed copper slag after proper processing by Geocycle Singapore is in ready-mix concrete for the production of eco-concreteTM.

Electrical and Electronic Waste ManagementChongqing Zhongtian Electronic Waste Management Co., Ltd, which the Group holds a 15% stake, holds the license to operate an exclusive special business concession as the sole operator to carry out the business of collection, recovery, processing and disposal of electrical and electronic waste in Chongqing, China for a period of 12 years with effect from October 2010.

Specialty Rubber Compound for the automotive, IT and other industries

Custom-made Rubber Masterbatch Curing chamber for Off The Road (“OTR”) redial tyre – designed and built using proprietary knowhow.


BUSINESS OVERVIEW

Organic Materials and ResourcesThe Group’s 15,000 m2 composting facility at Sarimbun Recycling Park is capable of processing more than 24,000 metric tonnes of horticultural waste each year. Using the Group’s proprietary in-vessel technology, ecoWise Active Composting Technology, ecoACTTM, the Group’s wholly owned subsidiary ecoWise Resources Pte Ltd produces compost that can be used as organic fertilizer and conditioner that improves soil-nutrient level.

The Group’s compost has been awarded the Singapore Green Label by the Singapore Environmental Council for “100% Natural Organic Fertilizer”.

The facility at Sarimbun Recycling Park also prepares biomass fuel for the Group’s biomass co-generation plant at Gardens by the Bay, using horticultural waste and wood waste.

RENEWABLE ENERGY SEGMENTThe Group currently has four biomass co-generation projects, two in Singapore and two in China:

Singapore based operationsThe Group’s biomass co-generation plants in Gardens by the Bay (Marina South) and Sungei Kadut continued their stable operations. An additional dryer will be added to the biomass co-generation plant in Sungei Kadut to increase our drying capacity for other food waste from Food & Beverage manufacturers in 2014.

China based operationsThe Group completed the acquisition of Hivern Investments Pte Ltd (“Hivern Group”) in May 2012. Hivern Group wholly owns a 24MW biomass co-generation plant situated in the industrial park in Changyi Binhai (Lower) Economic Development Zone. The rationale of the acquisition are as follow:

• The plant has potential to be a profitable power generation company with positive earnings expected upon steady operation of the biomass co-generation plant with sale of electrical power to the state-owned power grid of Shandong province

and sale of steam to industrial operators at the industrial park in the Changyi Binhai (Lower) Economic Development Zone;

• The Group estimates from general market information that to build and set up a new biomass power plant equivalent in size to the biomass co-generation plant would cost an estimated amount of about RMB200 to 250 million, which is much higher than the cost of the acquisition of the plant through Hivern (taking into consideration potential retrofitting and upgrading costs for the plant); and

• The necessary licenses, rights and contracts to develop and operate the biomass co-generation plant from the relevant PRC authorities are secured. These are not easily obtained, particularly for a wholly foreign-owned entity in the PRC.

The Group’s subsidiary Wuhan ecoWise Energy Co., Ltd had in 2010 closed the operation of its 25MW coal fired co-generation plant in Wuhan, China for conversion into a 25MW biomass co-generation plant. The conversion of the plant has been delayed pending our major local partner in Wuhan deciding on the timing of further capital injection for the conversion of the power plant.

INTEGRATED ENVIRONMENTAL MANAGEMENT SOLUTIONS SEGMENTecoWise Technologists and Engineers Pte Ltd (“eWTE”) provides consultancy services in the field of environmental solutions. eWTE focuses on the development of ‘low carbon’ and eco-friendly projects, technology incubation, technology commercialization and low carbon solutions with an aim to provide a holistic scope of environmental solutions to customers while exploring partnership opportunities in energy and waste management businesses.

The Group also owns a 20% stake in China UK Low Carbon Enterprise Co., Ltd, the technology incubation and venture capital arm of China Energy Conservation and Environmental Protection Group, the largest Chinese State Owned Enterprise focusing in the energy conservation and environmental protection sector.

CORPORATE SOCIAL RESPONSIBILITY (CSR) STATEMENTecoWise Holdings Limited, its subsidiaries and associate companies (the “Group”) view the principles of Corporate Social Responsibility (“CSR”) as an integral part of our business. As a resource recovery, renewable energy and environmental solutions provider, the Group seeks to be a sustainable and profitable organization besides improving the environment and society with like-minded partners.

ECOWORLD. BETTER WORLDThe Group endeavors to contribute to a sustainable and better world by focusing on the environment and the well-being of the community that it serves. CSR is fundamental to ecoWise Holdings Limited’s culture and policies and reflects the corporate social and environmental sustainability commitments we make to our stakeholders such as shareholders, employees and to our communities.

Our business essentially integrates our Corporate Social Responsibility (CSR). The Group recovered around 220,000 tons of waste and converted 170,000 tons of it into ecological products and services per year. Furthermore, the Group’s green industrial processes is capable of reducing total carbon dioxide emission by 84,000 tons per year.

These commitments have enabled us to perform with high standards of good governance and ethics; provide products and services that meet the rising expectation of clients and business partners; attract quality employees; provide meaningful support in our communities; and improve the social and environmental impacts of our business practices.

OUR CSR POLICIES AND COMMITMENTS• Ensure sound corporate governance and

compliance practices, and increase transparency on reporting of those activities;

• Maintain ethical policies and providing training to ensure that all employees perform with high standards of integrity and trust;

• Develop and enhance products and services that provide high degree of socially and environmentally responsible options for our stakeholders;

• Implement and/or expand environmentally sustainable management and business practices; and

• Build relationships with stakeholders whose CSR goals and activities are aligned with our expectations.

The Group endeavors to contribute to a sustainable and better world by focusing on the environment and the well-being of the community that it serves.

CORPORATE SOCIAL RESPONSIBILITY



BOARD OF DIRECTORS

LEE THIAM SENG, 52 Chairman and Chief Executive Officer Executive and Non-Independent Director

Date of first appointment as a director: 12 November 2002Date of last re-election as a director: 28 February 2013Length of service as a director 11 years(as at 31 October 2013):

Board committee(s) served on:Nil

Academic & Professional Qualification(s):Chartered Financial Consultant, American College, USA.Diploma (Merit) in Electrical Engineering, Singapore Polytechnic

Present Directorships (as at 31 October 2013)Other Listed companiesNil

Other Principal CommitmentsNil

Past Directorships in listed companies held over the preceding 3 years (from 1 November 2010 to 31 October 2013)Nil

LOW KIAN BENG, 57 Deputy CEO Executive and Non-Independent Director

Date of first appointment as a director: 1 January 2011Date of last re-election as a director: 28 February 2011Length of service as a directors 2 years 9 months(as at 31 October 2013):

Board committee(s) served on:Nil

Academic & Professional Qualification(s):Master of Business Administration (Distinction), Oklahoma City University, USAB.SC. (Honors) in Engineering, Imperial College of Science and Technology, London

Present Directorships (as at 31 October 2013)Other Listed companiesNil

Other Principal CommitmentsNil

Past Directorships in listed companies held over the preceding 3 years (from 1 November 2010 to 31 October 2013)Nil


NG CHER YAN, 54 Non-Executive and Lead Independent Director

Date of first appointment as a director: 19 November 2004Date of last re-election as a director: 28 February 2013Length of service as a directors 9 years(as at 31 October 2013):

Board committee(s) served on:Audit Committee (Chairman)1

Nominating Committee (Member)2

Remuneration Committee (Member)3

Academic & Professional Qualification(s):Practicing public accountant, fellow member of the Institute of Chartered Accountants of SingaporeMember of the Institute of Chartered Accountants in AustraliaBachelor of Accountancy, National University of Singapore.

Present Directorships (as at 31 October 2013)Other Listed companiesSamko Timber LimitedVicplas International LtdMermaid Maritime Public Company LtdMoneyMax Financial Services Ltd

Other Principal CommitmentsCY Ng & Co., Chartered Accountants PartnerBraddell Heights Citizens’ Consultative ChairmanCommittee

Past Directorships in listed companies held over the preceding 3 years (from 1 November 2010 to 31 October 2013)Serial System LtdKinergy LtdWanxiang International LtdKian Ann Engineering Ltd

Notes: 1 Appointed on 19 November 2004 2 Appointed on 19 November 2004 3 Appointed on 28 December 2012

ANG MONG SENG, 64 Non-Executive and Independent Director

Date of first appointment as a director: 16 February 2004Date of last re-election as a director: 28 February 2012Length of service as a directors 9 years 8 months(as at 31 October 2013):

Board committee(s) served on:Remuneration Committee (Chairman)1

Audit Committee (Member)2

Nominating Committee (Member)3

Academic & Professional Qualification(s):Bachelor of Arts, Nanyang Technological University

Present Directorships (as at 31 October 2013)Other Listed companiesUnited Fiber System LimitedChip Eng Seng Corporation LtdAnnaik LimitedHoe Leong Corporation LtdGaylin Holdings Limited

Other Principal CommitmentsPei Hwa Foundation Ltd DirectorThe Chinese Opera Institute Director

Past Directorships in listed companies held over the preceding 3 years (from 1 November 2010 to 31 October 2013)Vicplas International Ltd

Notes: 1 Appointed on 16 February 2004 2 Appointed on 16 February 2004 3 Appointed on 16 February 2004


BOARD OF DIRECTORS

ONG TECK GHEE, 54 Non-Executive and Independent Director

Date of first appointment as a director: 3 March 2003Date of last re-election as a director: 28 February 2011Length of service as a directors 10 years 7 months(as at 31 October 2013):

Board committee(s) served on:Nominating Committee (Chairman)1

Audit Committee (Member)2

Remuneration Committee (Member)3

Academic & Professional Qualification(s):Bachelor of Laws, National University of Singapore

Present Directorships (as at 31 October 2013)Other Listed companiesMary Chia Holdings Ltd

Other Principal CommitmentsOng & Lau Advocates & Solicitors Commissioner for Oaths, Notaries Public Proprietary Owner

Past Directorships in listed companies held over the preceding 3 years (from 1 November 2010 to 31 October 2013)NIL

Notes: 1 Appointed on 3 March 2003 2 Appointed on 3 March 2003 3 Appointed on 3 March 2003


MANAGEMENT TEAM

LEE THIAM SENGCEO

LOW KIAN BENGDeputy CEO

ALOYSIUS CHAN BUANG HENGFinancial Controller

FONG SEOK PHOYDirector, ecoWise International Pte. Ltd.Head of Commercial, Sunrich Integrated Sdn. Bhd. and subsidiaries

Mr Lee joined the Board in November 2002 and was appointed as Executive Chairman in April 2004 and Chief Executive Officer in March 2007. Mr Lee has more than 20 years’ experience in the fields of waste management and environmental engineering solutions in the region. Mr Lee has been with the Group for more than 11 years and has extensive knowledge and experience in the industries in which the Group operates. Mr Lee is responsible for setting strategic directions, formulating corporate strategies and overall management of the Group’s businesses in the resource recovery, use of sustainable resources and renewable energy segments. He has been instrumental in the growth and diversification of the Group’s business over the years, which has evolved from waste management to biomass energy generation and environmental engineering.

Mr Low was appointed as an Executive Director on 1 January 2011 and Deputy Chief Executive Officer on 1 June 2010. Mr Low is responsible for the overall management of the operations of the Group’s companies, corporate planning as well as charting and implementation of the business strategies of the Group. He is also the Managing Director for the Group’s rubber compound manufacturing and tyre retreading business units under Sunrich Integrated Sdn. Bhd. and its subsidiaries. Mr Low has 23 years of senior management experience, covering various functions and countries in Asia, in the environmental, tyre and rubber, petrochemicals, energy and engineering services industries in the region. Prior to joining the Group, he was the Managing Director and CEO of Envipure Pte Ltd from 2006 till 2010 and SP Corporation Ltd., a SGX listed company, from 2000 to 2006.

Mr Chan joined the Group in January 2005 and is responsible for the administration, accounting and financial management of the Group. He has more than 30 years experience covering auditing, accounting and financial management in the commercial, manufacturing sectors and public accounting. Mr Chan is a fellow member of the Association of Chartered Certified Accountants and a Certified Public Accountant with the Institute of Certified Public Accountants of Singapore. He holds a Master of Business Administration from the University of Hull (UK).

Mr Fong joined the Group in July 2010 and is responsible for international marketing and procurement of products and services that are synergetic to the Group’s companies. He is also the Deputy MD and Head of Commercial for the Group’s rubber compound manufacturing and tyre retreading business. Over his more than 40 years of career he has acquired vast experience in marketing and trading of rubber, chemicals and energy related products. His coverage includes the existing re-purposed environmental products, rubber compounding and tyre retreading business. He has also involved in the development of environmental related and clean technology projects in Malaysia and the region. He holds an honours degree in Chemical and Materials Engineering from University of Auckland, New Zealand under the Colombo Plan scholarship.


MANAGEMENT TEAM

DANIEL LIAO HONG HAIGeneral Manager, China Region

CHIN HON MENGHead of Manufacturing, Sunrich Integrated Sdn. Bhd. and subsidiaries

KENNY HUANG JIANFANGSenior Manager – Group Operations

Mr Liao joined the Group in July 2009 and is responsible for the Group’s business development in the China region. He has more than 20 years’ experience covering project planning and management, international trade and co-operation, international project financing in China. He has extensive experience in the public relationship dealing with the local governmental authorities in China. He holds a diploma in Economics and Trade from the Sichuan International Studies University. He is a state senator of Chongqing Municipality City, the Director of Federation of Returned Overseas Chinese, Vice president of Chongqing Overseas Chinese Chamber of Commerce, the member and senior investment consultant of Chongqing Association of Enterprises with Foreign Investment and Chongqing Investment Promotion Association. He is also the Vice Chairman of Youth Committee of China Federation of Returned Overseas Chinese and Vice president of Singapore Chongqing Chamber of Commerce.

Mr Chin is the Head of Manufacturing for the Group’s rubber compound manufacturing and tyre retreading business. He is responsible for the manufacturing operations of the Group’s subsidiaries under Sunrich Integrated Sdn. Bhd. based in Malaysia. He has more than 22 years’ experience in the manufacturing industry. Mr Chin joined Sun Rubber Industry Sdn. Bhd. as the General Manager of Manufacturing in 2001 and has been in-charge of manufacturing, quality management and research & development activities. He holds a Master of Business Administration from Universiti Malaya; a Bachelor of Science majoring in Chemistry from Universiti Sains Malaysia and a Diploma in Rubber Technology from the Plastics and Rubber Institute of Malaysia.

Mr Huang joined the Group in July 2007 and is responsible for the operations of the biomass co-generation plant at Sungei Kadut, used copper slag and compost activities undertaken by the Group’s subsidiaries including Bee Joo Industries Pte Ltd and Bee Joo Environmental Pte Ltd. He began his career in the waste management business in 2003 on the application of recycle used copper slag for construction aggregate (“Eco-Concrete”) and has more than 12 years’ experience in waste management activities. He holds a Diploma of Business Administration and Marketing from Murdoch University.

The Board of Directors (the “Board”) is committed to maintaining a high standard of corporate governance within ecoWise Holdings Limited and its subsidiaries (the “Group”). The Board recognises the importance of practicing good corporate governance as a fundamental part of its responsibilities to protect and enhance shareholders’ value and the financial performance of the Group.

This Report describes the Group’s ongoing efforts in FY2013 in keeping pace with the evolving corporate governance practices and complying with the revised Code of Corporate Governance 2012 (the “Code”) issued on 2 May 2012. Outlined below are the policies, processes and practices adopted by the Group in compliance with the principles and spirit of the 2012 Code.

BOARD MATTERS

Principle 1: THE BOARD’S CONDUCT OF AFFAIRS

The principal duties of the Board are:

• Setting the strategic directions and long-term goals of the Group and ensuring that adequate resources are available to meet these objectives;

• Reviewing and approving corporate plans, annual budgets, investment and divestment proposals, major funding proposals and financial plans of the Group;

• Monitoring management performance towards achieving set organisational goals;

• Reviewing and evaluating the adequacy and integrity of the Group’s internal controls, risk management and financial reporting systems;

• Ensuring the Group’s compliance with laws, regulations, policies and guidelines;

• Reviewing and approving interested person transactions and material transactions requiring announcement under the Listing Manual of the Singapore Exchange Securities Trading Limited (“SGX-ST”);

• Ensuring accurate and timely reporting in communication with shareholders;

• Determining the Group’s values and standards including ethical standards; and

• Considering sustainability issues including environmental and social factors in the formulation of Group’s strategies.

Delegation of the Board

The Board has delegated specific responsibilities to three committees namely, the Audit Committee (“AC”), the Nominating Committee (“NC”) and the Remuneration Committee (“RC”) to assist in the execution of its responsibilities. Each committee has its own written Terms of Reference, which clearly sets out the objectives, duties, powers, responsibilities as well as qualifications for committee membership. Minutes of all Board Committees have been circulated to the Board so that Directors are aware of and kept updated as to the proceedings and matters discussed during the Committees’ meetings.


CORPORATE GOVERNANCE

Attendance at Board and Board Committee Meetings

The schedule of all Board and Board committees meetings and Annual General Meeting for the next calendar year is planned ahead at the beginning of each financial year, in consultation with the directors. The Board meets at least once every quarter. It also holds ad-hoc meetings as and when circumstances require. Telephonic attendance at Board meetings is allowed under the Company’s Articles of Association. The Board and Board committees may also make decisions by way of circulating resolutions.

The attendance of the Directors at Board and committee meetings during the financial year under review is tabulated below:

Attendance at Meetings

AGM EGM BoardBoard Committees

Audit Nominating Remuneration

Scheduled Ad-hoc Scheduled Scheduled Ad-hoc Scheduled Scheduled Ad-hoc

No. of meetings held 4 4 2 1 1 2

Board Members No. of Meetings Attended

Lee Thiam Seng 1 1 4 4* 2* 1* 1* 2*

Low Kian Beng 1 1 4 4* 2* 1* 1* 2*

Ng Cher Yan 1 1 4 4 2 1 1 2

Ang Mong Seng 1 1 4 4 2 1 1 2

Ong Teck Ghee 1 1 3 3 2 1 1 1

* by invitation

Matters Requiring Board Approval

The Group has adopted and documented internal guidelines setting forth matters that require Board approval. Matters which are specifically reserved for the decision of the full Board include:

• Group strategy, business plan and annual budget;

• material acquisition and disposal of assets;

• capital-related matters including financial re-structure, market fund-raising;

• share issuances, interim dividends and other returns to shareholders; and

• any investment or expenditures exceeding set material limit.

While matters relating to the Group’s objectives, strategies and policies require the Board’s decision and approval, Management is responsible for the day-to-day operation and administration of the Group.



Board Orientation and Training

There was no new director appointed in FY2013. When a new director is to be appointed, a formal letter of appointment shall be provided to the new director. The letter sets out the terms and conditions of his appointment, explains the regulatory requirements that a director has to comply with on appointment, and the on-going obligations of a director under the Singapore Companies Act, Chapter 50, the Listing Manual of the Singapore Exchange Securities Trading Limited (“SGX-ST”) and other regulatory requirements. In addition, the director is also given access to the Board resources, including the Company’s constitutional and governing documents, Board and each committee’s terms of reference, the Group’s policies, Annual Reports, Board meeting papers and other pertinent information for his reference.

In addition, Executive Directors shall conduct an orientation programme for newly appointed directors to familiarize them with the businesses, operations, financial performance and key management staff of the Group. They are also briefed on the governance practice, including Board processes, policies on disclosure of interests in securities, prohibitions on dealings in the Company’s securities and restrictions on disclosure of price-sensitive information.

The orientation programme involves presentation by Executive Directors, briefings by Financial Controller and other heads of departments and on-site visit to the various operational facilities of the Group. These programmes are usually carried out prior to the attendance of the first Board Committee meeting of the new Director. Directors are at liberty to request for any further explanations, briefings or information on any aspect of the Group’s operations or business issues from time to time.

The Directors participate in seminars and discussions to keep themselves updated on the latest changes and developments concerning the Group and keep abreast of the latest regulatory changes. The directors are also provided with updates on the relevant new laws and regulations related to the Group’s operating environment through emails and regular meetings. They also have the opportunity to visit the Group’s operational facilities and meet with management to obtain a better understanding of the business operations. In the case of new investment proposal, where appropriate the Independent Non-Executive Directors are also invited for site visit to the investee company so as to facilitate their evaluation of the proposal.

Briefings and updates provided to the Directors in FY2013

• the AC received risk workshops report by an international accounting firm;

• the external auditors, RSM Chio Lim LLP, briefed the AC members on developments in accounting and governance standards at their attendance in the AC meetings half yearly;

• The NC was briefed on the revised 2012 Code on 28 December 2012;

• Briefing was provided to the Board on the new notification regime for the disclosure of interests by Directors/CEOs and substantial shareholders of listed entities under the Securities and Futures Act on 28 December 2012;

• CEO and Deputy CEO updated the Board at quarterly meetings on strategic and business development of the Group; and



• Deputy CEO and Financial Controller updated the Board at quarterly meetings on the segmental business operation and development of the Group.

The Directors may also attend other appropriate courses, conferences and seminars at the Company’s expenses.

Principle 2: BOARD COMPOSITION AND GUIDANCE

The Board comprises two Executive Directors and three Independent Non-Executive Directors. The Independent Non-Executive Directors making up more than half of the Board.

Name of Directors Board of DirectorsAudit

CommitteeNominating Committee

Remuneration Committee

Lee Thiam Seng Executive Director (Chairman)

Low Kian Beng Executive Director

Ng Cher Yan Independent Director Chairman Member Member

Ang Mong Seng Independent Director Member Member Chairman

Ong Teck Ghee Independent Director Member Chairman Member

Board Independence

The criterion of independence is based on the guidelines provided in the 2012 Code. The Board considers an “independent” director as one who has no relationship with the Company, its related corporations, its 10% shareholders or its officers that could interfere, or be reasonably perceived to interfere, with the exercise of the director’s independent business judgement with a view to the best interests of the Group.

The independence of each Independent Non-Executive Director is assessed at least annually by the NC. Particular scrutiny is applied in assessing the continued independence of Directors having served beyond 9 years from the date of his first appointment, with attention to ensuring their allegiance remains clearly aligned with shareholders’ interest.

In respect of each of the three Non-Executive Directors, namely Mr Ong Teck Ghee, Mr Ang Mong Seng and Mr Ng Cher Yan having served more than 9 years, the Board has considered specifically their length of service and their continued independence. The Board has determined that the Directors concerned remained independent of character and judgement and there were no relationships or circumstances which were likely to affect, or could appear to affect, the Directors’ judgement. The independence of character and judgement of each of the Directors concerned was not in any way affected or impaired by the length of service. The Board has also conducted a review of the performance of each of the three Non-Executive Directors and considers that each of these Directors brings invaluable expertise, experience and knowledge to the Board and that they continue to contribute positively to the Board and Committee deliberation. Therefore, the Board is satisfied as to the performance and continued independence of judgement of each of these directors.



The Board does not consider it to be in the interests of the Company or shareholders to require all Directors who have served for nine years or longer to retire and favours ensuring continuity and stability.

Board Composition and Size

The Board’s composition, size, and balance are reviewed annually by the NC to ensure that the Board has the core competencies for effective functioning and informed decision-making. Board renewal and tenure are considered together and weighed for relevant benefit in the foreseeable circumstances which are appropriate for the size and nature of activities of the Group’s businesses.

The Directors consider the Board’s present size of 5 members and composition appropriate to facilitate effective decision making, taking into account the nature and scope of the Group’s operations, the wide spectrum of skills and knowledge of the Directors.

The Board comprises of high caliber individuals who are suitably qualified with the necessary mix of expertise, experience and knowledge. The biographies of the Directors are set out in this Annual Report.

The Independent Non-Executive Directors participate actively in the Board meetings. With their professional expertise and competency in their respective fields in the legal, finance, accounting, commercial and government sectors, collectively the Independent Non-Executive Directors provide constructive advice and guidance for effective discharge by the Board of its principal functions over the Group’s strategies, businesses and other affairs.

Well equipped with their expertise, experience and knowledge, the Independent Non-Executive Directors constructively challenge and help develop directions on strategy and review the performance of Management in achieving agreed targets and objectives and monitor the reporting of performance.

Where necessary, the Independent Non-Executive Directors meet and discuss on the Group’s affairs without the presence of Management

Principle 3: CHAIRMAN AND CHIEF EXECUTIVE OFFICER

Mr Lee Thiam Seng is currently the Chairman of the Board and the CEO of the Company. Given the scope and nature of business activities of the Group, the Board is of the view that with Mr Lee’s extensive knowledge and experience in the waste management, resource recovery and biomass energy business in the region, it is more effective for him to guide the Board on the discussions on issues and challenges facing the Group and in view of the strong element of independence of the Board, it is not pertinent to separate the functions of the Chairman and CEO.



As Chairman, Mr Lee is responsible for:

• Leading the Board to ensure its effectiveness;

• Managing the Board’s business, including supervising the work of the Board committees;

• Setting the Board agenda and ensuring the information flow and timing are adequate for discussion of all set agenda items, in particular strategic issues;

• Setting the tone of Board discussion to promote open and frank debate and effective decision-making;

• Ensuring effective communication with shareholders;

• Encouraging constructive relations with the Board and between the Board and Management;

• Facilitating the effective contribution of Non-Executive Directors; and

• Continuous pursuance of high standards of corporate governance.

As CEO, Mr Lee is responsible for the Group’s business strategy and direction setting, the implementation of Group’s corporate plans, policies and executive decision-makings.

As recommended by the Code, the Board has appointed Independent Non-Executive Director, Mr Ng Cher Yan, as the Lead Independent Director. Shareholders of the Company with serious concerns that could have a material impact on the Group, for which contact through the normal channels of the Chairman, CEO, Deputy CEO or Financial Controller have failed to resolve or is inappropriate, shall be able to contact Mr Ng Cher Yan or the Audit Committee members of the Group.

Principle 4: BOARD MEMBERSHIP

The NC comprises Mr Ong Teck Ghee as the Chairman, Mr Ang Mong Seng and Mr Ng Cher Yan as members, whom are all Independent Non-Executive Directors. As guided by the 2012 Code, Mr Ng Cher Yan, the Lead Independent Director, was appointed on 28 December 2012 as a member of the NC. The NC shall meet at least once a year.

The Key Terms of Reference:

• Reviewing regularly the composition of the Board and Board committees taking into account of the size and independence requirements, amongst others. Please refer to Principle 2 for details of the Board Independence;

• Reviewing the Board’s succession plans for directors, in particular, the Chairman and the CEO;

• Identifying, reviewing and recommending Board appointments for approval by the Board, taking into account the experience, expertise, knowledge and skills of the candidate and the needs of the Board;

• Reviewing and recommending to the Board the appointment and re-appointment of Directors having regard to their performance, commitment, skill sets and ability to contribute to the Board;

• Assessing annually the performance of the Board, the Board committees and the Directors, and reviewing whether each Director is independent in accordance with the Code; and

• Determining the appropriate training and professional development programs for the Board.



The NC reviews annually the independence declarations made by the Company’s Independent Non-Executive Directors based on the criterion of independence under the guidelines provided in the Code. For the year under review, the NC has ascertained the independence status of all three Independent Non-Executive Directors of the Company. The Board has also reviewed the number of years served by each Independent Non-Executive Director. Having considered their in-depth knowledge of the Group’s business operations, past and continuous contributions at Board level in terms of impartial and constructive advice, the Board is of the view that there is no material conflict between their tenure and their ability to discharge their role as Independent Non-Executive Directors.

Directors’ Time Commitment

As a director’s ability to commit time to the Group’s affairs is essential for his contribution and performance, the NC has determined at its meeting held on 28 December 2012 that the maximum number of listed company board representations which any Director of the Company may hold is six and all Directors have complied.

Selection Criteria and Nomination Process for New Directors

In the selection process for the appointment of new directors, the NC reviews the composition of the Board and identifies the skill sets which will enhance the Board’s overall effectiveness. Potential candidates are identified from various sources. Thereafter, the NC conducts an initial assessment to review a candidate’s qualifications, attributes and past experience followed by interviewing short-listed candidates. The proposed candidates’ independence, expertise, background and right skills will be considered before the NC makes its recommendations to the Board.

Rotation and Re-election of Directors

All Directors shall submit themselves for re-nomination and re-election at regular intervals and at least every 3 years. Article 107 of the Company’s Articles and Association provides that one third of the Board or the number nearest to one third is to retire by rotation at every Annual General Meeting (“AGM”). In addition, Article 117 of the Company’s Articles of Association also provides that newly appointed directors are required to submit themselves for re-nomination and re-election at the next AGM of the Company.

At the forthcoming AGM, Mr Low Kian Beng and Mr Ong Teck Ghee will be retiring by rotation pursuant to Article 107 of the Company’s Articles and Association. Both of them, being eligible for re-election have offered themselves for re-election. The key information on Mr Low Kian Beng and Mr Ong Teck Ghee can be found in the ‘Board of Directors’ section of the Annual Report.

Key Information on Directors

Key information on each Director is set out on pages 20 to 22.



Principle 5: BOARD PERFORMANCE

The NC is responsible for recommending and implementing a process to assess the effectiveness of the Board and the Board committees as well as to assess the contribution by the Chairman and each individual Director to the overall effectiveness of the Board.

Assessment checklists are disseminated to each member of the NC and the Chairman of the Board. The assessment results are discussed and the key areas for improvement and follow-up actions requested are highlighted at the NC meeting.

The Board assessment checklist includes the evaluation factors such as Board structure concerning Board size and strong presence of independent element, the conduct of meetings as to whether decisions are made after due consideration, corporate strategy and planning, risk management and internal control, recruitment, financial reporting and communication with shareholders. The assessment also includes measuring and monitoring performance as to whether objectives and targets set for the year are met. The results of evaluation were presented to the Board.

To keep abreast with the Code 2012, the NC assessed the performance of the Board Committees in FY2013 based on the following criteria:

• Right responsibilities defined in the Terms of Reference;

• Size of the Committee;

• Independence element in the committee;

• Dynamics of interaction among committee members;

• Committee work plan and calendar;

• Adequacy of preparation of meetings;

• Frequency and length of meeting;

• Relationship with Management;

• Candid discussion;

• Sufficient time devoted to agenda items;

• Information transparency;

• Records of minutes;

• Reporting to the Board; and

• Sufficient expertise and recommendation to the Board.



In assessing the performance of the Chairman and Directors, the NC evaluates each of them based on the following review parameters, which among others, include:

• Attendance at board/committee meetings;

• Participation at meetings;

• Involvement in management;

• Availability for consultation and advice, when required;

• Independence of the directors; and

• Appropriate skill, experience and expertise.

The above selected criteria will be changed if it is deemed necessary and be approved by the Board.

As an integral element of the process of appointing new Directors, the Chairman may act on the results of the performance evaluation, and, in consultation with the NC, propose, where appropriate, new members to be appointed to the Board or seek resignation of Directors.

Principle 6: ACCESS TO INFORMATION

Management acknowledges the importance of the complete, adequate and timely supply of information. Agenda, board papers and related materials, background or explanatory information relating to matters to be discussed at the Board meeting and Board committee meetings are distributed to all Directors in advance to allow sufficient time for Directors to prepare for meetings and facilitate the effective discussion during meetings. Any additional materials or information requested by the Directors is promptly furnished.

Management’s proposals submitting to the Board for approval are accompanied with detailed background and explanatory information such as facts, resources requirement, projected outcomes, financial impact, risk analysis, disclosure requirements under the Listing Manual of the SGX-ST, conclusions and recommendations. Any material variance between the actual results and the budgets will be explained to the Board at the relevant time at the Board or Board committee meetings.

Should Directors, whether as a group or individually, require professional advice, the Group, upon direction by the Board, shall appoint a professional advisor selected by the Group or the individual, approved by the Chairman, to render the advice. The cost of such service shall be borne by the Group.

The Company Secretary attends all Board meetings and is responsible to the Board for advising on the implementation of the Group’s compliance requirements pursuant to the relevant statutes and regulations. All Directors have separate and independent access to the advice and services of the Company Secretary. The appointment and removal of the Company Secretary is subject to approval of the Board.



REMUNERATION MATTERS

Principle 7: PROCEDURES FOR DEVELOPING REMUNERATION POLICIES

The remuneration policy of the Group is to provide compensation packages at market rates with the view to attract, retain and motivate managers and Directors.

The RC comprises three Independent Non-Executive Directors, namely, Mr Ang Mong Seng, Mr Ng Cher Yan and Mr Ong Teck Ghee. Mr Ang Mong Seng is the Chairman of the RC.

The Key Terms of reference:

• Recommending to the Board all matters relating to remuneration, including but not limited to Directors’ fees, salaries, allowances, bonuses, share-based incentives and awards and benefits-in-kind, of the Directors and top 5 key management personnel;

• Reviewing and recommending to the Board the terms of the service agreements of the Directors;

• Determining the appropriateness of the remuneration of the Directors;

• Considering the disclosure requirements for Directors’ and top 5 key management personnel remuneration as required by the Code; and

• Administering the ecoWise Performance Share Plan.

Procedure for setting Remuneration

The Executive Directors’ remuneration packages are based on service contracts. These include a profit sharing scheme that is performance related to align their interest with those of the shareholders. Independent Non-Executive Directors are paid yearly directors’ fees of an agreed amount and these fees are subject to shareholders’ approval at AGM. Independent Non-executive Directors are also eligible for share-based incentive awards.

No directors participate in decisions on their own remuneration.

If necessary, the RC would seek professional advice internally and/or externally pertaining to remuneration of all Directors.

Principle 8: LEVEL AND MIX OF REMUNERATION

Remuneration of Executive Directors and Key Management Personnel

The Executive Directors do not receive directors’ fees. The remuneration for the Executive Directors and the top 5 key management personnel comprises of fixed component and variable component. Fixed component is in the form of fixed monthly salary whereas variable component is linked to the performance of the Group and individual. The current service agreements entered with the Executive Directors, Mr Lee Thiam Seng and Mr Low Kian Beng, are on two-year plus one and three-year plus one basis respectively.

In setting remuneration package, the RC ensures the Executive Directors are adequately but not excessively remunerated as compared to the industry and in comparable companies.



Remuneration of Non-Executive Directors

The Independent Non-Executive Directors receive directors’ fees, in accordance with their contributions, taking into account factors such as responsibilities, effort and time spent for serving the Board and Board Committees. For the financial year ended 31 October 2013, directors’ fees of S$140,000 are recommended by the Board and are subject to the approval of shareholders at the Company’s AGM to be held on 28 February 2014.

Principle 9: DISCLOSURE ON REMUNERATION

Details of the remuneration of Executive Directors of the Company and top five key management personnel of the Group for the financial year ended 31 October 2013 are set out below:

Executive DirectorsBase/Fixed

Salary%

Variable or Performance

RelatedIncome/Bonus

%

Benefitsin kind

%

ecoWisePSP(1)

%Total

%Total

S$

Lee Thiam Seng 68.0 30.1 1.9 – 100.0 684,000

Low Kian Beng 60.5 38.0 1.5 – 100.0 542,000

Key Management PersonnelBase/Fixed

Salary%

Variable or Performance

RelatedIncome/Bonus

%

Benefitsin kind

%

ecoWisePSP(1)

%Total

%

$250,000 to $349,999Lilian Tan Yin Yen(2) 73.9 26.1 – – 100.0

Aloysius Chan Buang Heng 81.8 18.2 – – 100.0

Fong Seok Phoy 67.3 32.7 – – 100.0

Below $250,000

Daniel Liao Hong Hai 84.2 15.8 – – 100.0

Chin Hon Meng 47.6 51.0 1.4 – 100.0

(1) Refer to performance shares vested under the PSP during the financial year.(2) Lilian Tan Yin Yen has resigned from the Company on 16 November 2013.

In aggregate, the total remuneration paid to the top five key management personnel in financial year ended 2013 is S$1,272,000.

There is no employee in the Group who is an immediate family member of a director or the CEO, and whose remuneration exceeds S$50,000 during the financial year ended 31 October 2013.



The directors’ fees for Independent Non-Executive Directors for the financial year ended 31 October 2013 are set out below:

Directors’ Fees(S$)

Independent Directors Ng Cher Yan 50,000Ang Mong Seng 45,000Ong Teck Ghee 45,000

140,000

Long Term Incentive Plans

The RC is responsible for administering the Company’s Performance Share Plan (the “PSP”). The Company aspires to foster a greater ownership culture within the Group by aligning the interests of PSP participants with the interests of shareholders. Through the PSP, the Group aims to strengthen its competitiveness in attracting key talents and retaining employees, particularly those with requisite knowledge, skills and experience whom the Group believes could contribute to the development and growth of the Group.

The PSP was approved by the shareholders of the Company at the Extraordinary General Meeting held on 23 March 2007. The PSP shall continue in force at the discretion of the RC, subject to a maximum period of 10 years, i.e. 22 March 2017.

A participant’s award is determined at the discretion of the RC. Awards granted will be principally performance-based, incorporating performance targets for senior executives and key executives aiming at delivering long-term shareholders’ value.

Awards represent the right to receive fully paid shares, their equivalent cash value or a combination thereof, free of charge. Awards will be released to participants when the prescribed performance targets or service conditions have been achieved and within the vesting period.

The maximum number of ordinary shares can be released, when aggregated with the number of new shares issued pursuant to the released of awards shall not exceed fifteen (15%) of the issued share capital of the Company.

During the financial year ended 31 October 2013, the RC has reviewed and approved the vesting and issuance of 2,538,438 performance shares under the Third Grant of ecoWise PSP.



Participant

Balanceas at

1.11.2012

Performance Shares granted during financial

year 2013

Shares lapsed/cancelled

duringfinancial year

Performance Shares vested

duringfinancial year

Balanceas at

31.10.2013

DirectorsLee Thiam Seng 1,096,875 – (548,437) 548,438 –

Low Kian Beng 1,500,000 – (750,000) 750,000 –

Ng Cher Yan 130,000 – (65,000) 65,000 –

Ang Mong Seng 100,000 – (50,000) 50,000 –

Ong Teck Ghee 100,000 – (50,000) 50,000 –

2,926,875 – (1,463,437) 1,463,438 –

Other Staff 2,150,000 – (1,075,000) 1,075,000 –

5,076,875 – (2,538,437) 2,538,438 –

ACCOUNTABILITY AND AUDIT

Principle 10: ACCOUNTABILITY

The Board provides shareholders with financial statements for the first three quarters and full financial year within the timeframe in line with Rule 705 of the Listing Manual of SGX-ST. In presenting the annual and quarterly financial statement to shareholders, the Board aims to provide shareholders with a balanced and clear assessment of the Group’s performance, financial position and prospects.

Management provides the Board with management accounts, operation review and related explanation and any other information as the Board may require together with the financial statements on a quarterly basis. The Audit Committee reviews the financial statements and reports to the Board for approval. The Board authorises the release of the results to the SGX-ST and the public via SGXNET. The quarterly and full year financial results are also timely uploaded in the Group’s own website at www.ecowise.com.sg.

The Board also provides negative assurance confirmation to shareholders for the quarterly financial statements in accordance with Rule 705(5) of the Listing Manual of SGX-ST.

Principle 11: RISK MANAGEMENT AND INTERNAL CONTROLS

Risk Management

As the Group does not have a risk management committee, the Board, AC and Management assume the responsibility of the risk management function. Management reviews regularly the Group’s business and operational activities to identify areas of significant risks as well as appropriate measures to control and mitigate these risks. Management reviews all significant policies and procedures and highlights all significant matters to the Board and the AC.



Internal Controls

During the financial year, the Group’s internal auditors had conducted annual review of the effectiveness of the Group’s internal controls. The Group’s external auditors had also reviewed the internal accounting controls that are relevant to their audit. Any non-compliance and recommendation for improvement were reported to the AC.

In addition to the work carried out by external auditors and internal auditors, the Board also engaged an international accounting firm to document the framework that enables Management to address the financial, operational and compliance risks of the key operating units. The process involved the identification of major risks through workshops conducted for the Group’s rubber compound manufacturing and tyre retreading business units, and the renewable energy and environmental management business units, whereby the business units’ key risks of financial, operational and compliance nature, as well as the countermeasures in place or required to mitigate these risks were summarized for review by the AC and the Board in January 2013. The final documentation provided an overview of the Group’s key risks, how they are managed, the key personnel responsible for each identified risk type and the various assurance mechanisms in place. Management is in the process of implementing the measures to mitigate the key risks identified.

Based on the internal controls established and maintained by the Group, work performed by the internal and external auditors and the documentation on the Group’s key risks referred to above, reviews performed by Management, AC and the Board, the AC and the Board are of the opinion that the Group’s internal controls, addressing financial, operational and compliance risks, were adequate as at 31 October 2013. This is in turn supported by assurance from the CEO, Deputy CEO and the Financial Controller that:

(a) the financial records of the Company have been properly maintained and the financial statements give a true and fair view of the company’s operations and finances and are in accordance with the relevant accounting standards; and

(b) they have evaluated the effectiveness of the Company’s internal controls and have discussed with the Company’s external and internal auditors of their reporting points and note that there have been no significant deficiencies in the design or operation of internal controls which could adversely affect the Company’s ability to record, process, summarise or report financial data.

The Board acknowledges that it is responsible for maintaining a sound system of internal control framework, but recognises that no cost effective internal control system will preclude all errors and irregularities. Internal control can provide only reasonable and not absolute assurance against material misstatement, losses, human errors, fraud or other irregularities.

Whistle-blowing Policy

The Group has revised the whistle-blowing policy in the financial year 2013. The policy aims to provide avenue for anyone to raise concerns about misconducts in the Group and at the same time assure them that they will be protected from victimization for whistle blowing in good faith. Cases that are significant are reviewed by the AC for adequacy and independence of investigation actions and resolutions. The whistle-blowing policy, its procedures and contact details of the AC have been made available in the Company’s website.



Interested Person Transactions

The Group has established procedures to ensure that all transactions with interested persons are reported in a timely manner to the AC for review and the transactions are carried out on normal commercial terms and will not be prejudicial to the interests of the Group and its minority shareholders.

At the Extraordinary General Meeting held on 7 May 2013, the Group has obtained shareholders’ approval to acquire Hivern Investments Pte Ltd from SDPC Private Limited (the “Vendor”) at a total purchase consideration of S$90,001 (the “Acquisition”). The owner of the Vendor, Mr Tan Jin Beng Winston, is the brother-in-law of Mr Lee Thiam Seng, director and controlling shareholder of the Company. Pursuant to Section 3.1, 3.6 and 5.1 of the Company’s circular to shareholders dated 18 April 2013 for the EGM, the Vendor and Mr Tan Jin Beng Winston are deemed associates of Mr Lee Thiam Seng. The Acquisition was therefore deemed an interested person transaction.

Internal Code on Dealings in Securities

The Group has put in place an internal code on dealings with securities (“Internal Code”). This Internal Code has been issued to Directors and officers setting up the implications on insider trading.

The Internal Code prohibits the dealing in securities of the Company by Directors and officers while in possession of price-sensitive information, and during the period commencing two weeks before the announcement of quarterly results and one month before the announcement of full year results, and ending on the date of the announcement. Further, Directors and officers are advised not to deal in the Company’s securities on short-term considerations. Directors are required to notify the Company their securities dealings within two business days of such dealings and the Company shall disseminate the notifications received to the market via SGXNET within one business day of receiving such notifications.

In addition, Directors and officers are cautioned to observe insider trading laws at all times.

Principle 12: AUDIT COMMITTEE

The AC is chaired by Mr Ng Cher Yan and comprises Mr Ang Mong Seng and Mr Ong Teck Ghee as members, all of whom are Independent Non-Executive Directors.

Mr Ng Cher Yan is a practicing public accountant, who has years of extensive experience in accounting, auditing, financial management and corporate governance. The Board is of the view that Mr Ng is well qualified to chair the AC to collectively discharge its responsibilities. The Board is also of the view that the members of the AC are appropriately qualified to discharge their responsibilities and they have the accounting or related financial management expertise or experience, as the Board exercises in its business judgment. Please refer to the section on ‘Board of Directors’ in the Annual Report for detailed information on the AC members, including their academic and professional qualifications.

The AC assists the Board in maintaining a high standard of corporate governance, particularly by providing an independent review of the effectiveness of the financial reporting system, management of financial, operational and compliance risks, and monitoring of the internal control systems.



The AC has specific terms of reference and has met 6 times during the financial year under review.

The duties of the AC include:

• Reviewing the audit plans of the external auditors and ensures the adequacy of the Group’s system of accounting controls;

• Reviewing the internal audit plans of the Group and follow up actions for effective internal control functions of the Group;

• Reviewing the financial statements of the Group before their submission to the Board, and before their announcement;

• Reviewing legal and regulatory matters that may have a material impact on the financial statements, related compliance policies and programs and any reports received from regulators;

• Reviewing the cost effectiveness and the independence and objectivity of the external auditors;

• Reviewing the nature and extent of non-audit services provided by the external auditors;

• Reviewing the assistance given by the Group’s officer to the internal and external auditors;

• Making recommendations to the Board on the appointment, re-appointment and removal of external auditors, and approving the remuneration and terms of engagement of the external auditors;

• Reviewing the Group’s compliance with such functions and duties as may be required under the relevant statutes or the Listing Manual, and by such amendments made thereto from time to time;

• Reviewing interested person transactions in accordance with the requirements of the Listing Manual of the SGX-ST; and

• Reviewing the adequacy of the Group’s internal controls.

The AC has the power to conduct or authorize investigations into any matters within the AC’s scope of responsibility.

For the year ended 31 October 2013, the aggregate amount of fees paid or payable to external auditors of the Group amounted to S$241,300, including audit fees of S$209,800 and non-audit services fees of S$31,500. The AC has reviewed all non-audit services provided by the external auditors and is satisfied that these non-audit services would not affect the independence and objectivity of the external auditors.

The Group has complied with Rule 712 and Rule 715 of the Listing Manual of SGX-ST in the appointment of its auditors. The AC recommends to the Board the reappointment of Messrs RSM Chio Lim LLP as the external auditors of the Group at the forthcoming AGM.



In the course of financial year 2013, the AC carried out the following activities:

• Reviewing quarterly and full year financial statements (audited and unaudited), and recommending to the Board for approval;

• Revising the Group’s Whistle blowing policy;

• Reviewing and approving the interested/related parties transactions;

• Reviewing and approving the annual audit plan of the external auditors;

• Reviewing and approving of internal audit plan and appointment of internal auditors;

• Reviewing the annual re-appointment of the external auditors and determining their remuneration, and making a recommendation for Board approval; and

• Meeting with the external auditor and internal auditors each once without the presence of Management

To keep abreast of the changes in accounting standards and issues which have a direct impact on financial statements, advice is sought from the external auditors when they attend the AC meetings half yearly.

Principle 13: INTERNAL AUDIT

The Board recognizes its responsibilities for maintaining a system of internal control processes to safeguard shareholders’ investments and the Group’s assets and business.

Currently, the Chairman of the AC enquires and relies on reports from Management, internal auditors on any material non-compliance and internal control weaknesses. The AC oversees and monitors the implementation of any improvements thereto. The AC has reviewed with the internal auditors their findings of the existence and adequacy of material internal controls procedures as part of their audit for the financial year under review.

The Group engages external independent audit firms to perform the internal audit function and they report directly to the AC which assists the Board in monitoring and managing risks and internal controls of the Group. The internal audit function primarily focusing on whether the current system of internal control provides reasonable assurance on:

• compliance with applicable laws, regulations, policy and procedures;

• reliability and integrity of information; and

• safeguarding of assets.

On an annual basis, the AC reviews the internal audit program of the Group so as to align it to the changing needs and risk profile of the Group’s activities.



The findings of the internal auditors are discussed in details at the AC meeting including any internal control weaknesses, non-compliance of policy and procedures as well as follow-up actions required to strengthen the internal control system of the Group. A copy of the internal auditors’ findings is disseminated to the relevant business units or departments for implementing follow-up actions and the monitoring of the improvement progress.

For the internal audit works carried out in FY2013, the engaging internal auditors have adopted assessment methodology in accordance with the Internal Control Integrated Framework, issued by the Committee of Sponsoring Organisations (“COSO”) of the Treadway Commission.

Principle 14: SHAREHOLDER RIGHTS AND RESPONSIBILITIES

The Group’s corporate governance culture and awareness promotes fair and equitable treatment of all shareholders. All shareholders enjoy specific rights under the Singapore’s Companies Act, Chapter 50, and Articles of Association of the Company. All shareholders are treated fairly and equitably.

The Group respects the equal information rights of all shareholders and is committed to the practice of fair, transparent and timely disclosure.

Shareholders are given the opportunity to participate effectively and vote at general meetings of the Company, where relevant rules and procedures governing the meetings are clearly communicated.

Principle 15: COMMUNICATION WITH SHAREHOLDERS

The Group believes that prompt disclosure of pertinent information and high standard of disclosure are the keys to raise the level of corporate governance. The Board believes in regular and timely communication with our shareholders. In line with continuous disclosure obligations of the Group pursuant to the Corporate Disclosure Policy of the SGX-ST, the Group’s policy is that all shareholders should be equally and timely informed of all major developments that impact the Group.

Information is communicated to our shareholders on a timely basis and made through:

• Annual reports. The Board makes every effort to ensure that the annual report includes all relevant information about the Group, including future developments, disclosures required by the Singapore Companies Act, Chapter 50, the Listing Manual of SGX-ST and Financial Reporting Standards;

• SGXNET and news releases;

• Press releases on major developments of the Group;

• Disclosures to the SGX-ST; and

• The Group’s website at www.ecowise.com.sg on which shareholders can access information relating to the Group.



Principle 16: CONDUCT OF SHAREHOLDER MEETINGS

All shareholders receive reports or circulars of the Company including notice of general meeting by post within the mandatory period. Notice of general meeting is announced through SGXNET and published in the Business Times within the same period.

All registered shareholders are invited to participate and given the right to vote on resolutions at general meetings. Every matter requiring shareholders’ approval is proposed as a separate resolution. Each item of special business included in the notice of the meeting is accompanied, where appropriate, by an explanation for the proposed resolution. Proxy form is sent with notice of general meeting to all shareholders. A shareholder may appoint up to two proxies to attend and vote on his behalf at the meeting through proxy forms deposited 48 hours before the meeting. As the authentication of shareholder identity information and other related security issues still remain a concern, the Company has decided, for the time being, not to implement voting in absentia by mail, email or fax.

All Directors, Management, Company Secretary, external auditors and legal advisors (if necessary), attend the general meetings. The procedures of general meetings provide shareholders the opportunity to ask questions relating to each resolution tabled for approval and open communication are encouraged by the shareholders with the Director on their views on matters relating to the Company. To enhance shareholder participation, the Group puts all resolutions at general meetings to vote by poll and announces the results by showing the number of votes cast for and against each resolution and the respective percentage to the audience at the general meetings. The polling results are also announced to the SGX-ST and posted on the Company’s website after the meetings.

The Company Secretary prepares minutes of general meetings that include substantial and relevant comments or queries from shareholders relating to the agenda of the meetings, and responses from the Board and Management, and to make these minutes, subsequently approved by the Board, available to shareholders during office hours.



CONTENTS

45 DIRECTORS’ REPORT

52 STATEMENT BY DIRECTORS

53 INDEPENDENT AUDITORS’ REPORT

55 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

56 STATEMENTS OF FINANCIAL POSITION

58 STATEMENTS OF CHANGES IN EQUITY

60 CONSOLIDATED STATEMENT OF CASH FLOWS

62 NOTES TO THE FINANCIAL STATEMENTS

The directors of the Company are pleased to present their report together with the audited financial statements of the Group and of the Company for the reporting year ended 31 October 2013.

1. DIRECTORS

The directors of the Company in office at the date of this report are as follows:

Executive DirectorsLee Thiam SengLow Kian Beng

Independent DirectorsNg Cher YanAng Mong SengOng Teck Ghee

2. ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE BENEFITS BY MEANS OF THE ACQUISITION OF SHARES AND DEBENTURES

Neither at the end of the reporting year nor at any time during the reporting year did there subsist any arrangement whose object is to enable the directors of the Company to acquire benefits by means of the acquisition of shares or debentures in the Company or any other body corporate, except as disclosed in Paragraph 5 in this report.


DIRECTORS’REPORT

3. DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES

According to the register kept by the Company for the purposes of Section 164 of the Singapore Companies Act, Chapter 50 (the “Act”), particulars of interests of directors in office at the end of the reporting year in shares and debentures in the Company and in related corporations (other than wholly-owned subsidiaries) are as follows:

Direct Interests

Name of directors and corporationsin which interests are held

Atbeginning of the reporting year

Atend of the

reporting year

At21 November

2013

The Company – ecoWise Holdings Limited Number of ordinary shares with no par value

Lee Thiam Seng 32,960,950 33,509,388 33,509,388Low Kian Beng 4,500,000 6,250,000 6,250,000Ng Cher Yan 1,166,500 1,231,500 1,231,500Ang Mong Seng 796,950 846,950 846,950Ong Teck Ghee 871,950 171,950 171,950

Number of ecoWise performance shares

Lee Thiam Seng 1,096,875 – –Low Kian Beng 1,500,000 – –Ng Cher Yan 130,000 – –Ang Mong Seng 100,000 – –Ong Teck Ghee 100,000 – –


Lee Thiam Seng 218,229,375 218,229,375 218,229,375

Deemed Interests

Name of directors and corporationsin which interests are held

Atbeginning of the reporting year

Atend of the

reporting year

At21 November

2013


Lee Thiam Seng 218,229,375 218,229,375 218,229,375

By virtue of Section 7 of the Act, Mr. Lee Thiam Seng is deemed to have an interest in all related corporations of the Company.


DIRECTORS’REPORT

4. CONTRACTUAL BENEFITS OF DIRECTORS

Since the beginning of the reporting year, no director of the Company has received or become entitled to receive a benefit which is required to be disclosed under Section 201(8) of the Act by reason of a contract made by the Company or a related corporation with the director or with a firm of which he is a member, or with a company in which he has a substantial financial interest, except as disclosed in this report and Note 3 to the financial statements.

5. SHARE OPTIONS AND SHARE PLAN

Share Option

During the reporting year, no option to take up unissued shares of the Company or any subsidiary was granted and there were no shares of the Company or any subsidiary issued by virtue of the exercise of an option to take up unissued shares.

At the end of the reporting year, there were no unissued shares of the Company or any subsidiary under option.

ecoWise Performance Share Plan

The ecoWise Performance Share Plan (the “Share Plan”) was approved by the members of the Company at an extraordinary general meeting held on 23 March 2007. The Share Plan provides for the grant of ordinary shares of the Company, their equivalent cash value or combinations thereof, to selected employees of the Company and its subsidiaries, including the directors of the Company, and other selected participants. Under the Share Plan, the maximum number of ordinary shares to be awarded to eligible participants shall not exceed 15% of the issued ordinary shares of the Company on the date preceding the grant of the award.

The Share Plan is administered by the Remuneration Committee comprising three independent directors, Mr. Ang Mong Seng, Mr. Ng Cher Yan and Mr. Ong Teck Ghee. Ordinary shares are vested when the Remuneration Committee is satisfied that the prescribed performance target(s) have been achieved and the vesting period (if any) has expired. The vesting periods may be extended beyond the performance achievement periods as set out by the Remuneration Committee.

The lapsing of the award is provided for upon the occurrence of certain events, which include:

(a) the misconduct of an eligible participant;(b) the termination of the employment of an eligible participant;(c) the bankruptcy of an eligible participant;(d) the retirement, ill health, injury, disability or death of an eligible participant; and/or(e) a take-over, amalgamation, winding-up or restructuring of the Company.


DIRECTORS’REPORT

5. SHARE OPTIONS AND SHARE PLAN (CONTINUED)

ecoWise Performance Share Plan (Continued)

The Share Plan shall continue in force at the discretion of the Remuneration Committee, subject to a maximum period of 10 years commencing on 23 March 2007. The Share Plan may continue beyond the above stipulated period with the approval of members of the Company by ordinary resolution in a general meeting and of any relevant authorities which may then be required.

The Company may deliver ordinary shares pursuant to awards granted under the Share Plan by way of:

(a) Issuance of new ordinary shares;(b) Delivery of existing ordinary shares purchased from the market or ordinary shares held in treasury;

and/or(c) Cash in lieu of ordinary shares, based on the aggregate market value of such ordinary shares.

During the reporting year, the number of performance shares granted, vested and cancelled under the Share Plan are as follows:


Date of grant

At1 November

2012 Granted VestedCancelled/

Lapsed

At31 October

2013

21 March 2012 5,076,875 – (2,538,438) (2,538,437) –

Performance shares vested at the vesting date are dependent on the level of achievement against the pre-set performance conditions and targets.

From the commencement date of the Share Plan to 31 October 2013, 43,232,225 performance shares have been granted, of which 40,693,788 performance shares have been vested (after adjustment for rights cum warrants issue on 1 November 2007 and rights issue on 26 September 2008).


DIRECTORS’REPORT

5. SHARE OPTIONS AND SHARE PLAN (CONTINUED)


Details of performance shares granted under the Share Plan to directors and participants who received 5% or more of total performance shares available under the Share Plan are as follows:


Performance shares granted

during reporting year ended31 October

2013

Aggregate performance

shares granted since

commencementof Share Plan to

31 October2013(1)


shares vested since

commencementof Share Plan to

31 October2013(1)


shares outstanding at

31 October2013

Executive directorsLee Thiam Seng – 11,767,825 11,219,388 –Low Kian Beng – 1,500,000 750,000 –

Independent directorsNg Cher Yan – 1,124,250 1,059,250 –Ang Mong Seng – 782,200 732,200 –Ong Teck Ghee – 782,200 732,200 –

Participants who received 5% or more of total performance sharesSunny Ong Keng Hua – 7,845,250 7,845,250 –

(1) After adjustments for rights cum warrants issue on 1 November 2007 and rights issue on 26 September 2008 and net of cancellations.


DIRECTORS’REPORT

6. AUDIT COMMITTEE

The members of the Audit Committee during the reporting year and at the date of this report are as follows:

Ng Cher Yan (Chairman of Audit Committee and Lead Independent Director)Ang Mong Seng (Independent Director)Ong Teck Ghee (Independent Director)

The Audit Committee performs the functions specified by Section 201B (5) of the Act and the Listing Manual of the Singapore Securities Exchange Trading Limited (“SGX-ST”).

Functions of the Audit Committee include the following:

(a) Review with the independent external auditors their audit plan;(b) Review with the independent external auditors their evaluation of the Company’s internal accounting

controls that are relevant to their statutory audit, their report on the financial statements and the assistance given by the Company’s officers to them;

(c) Review with the internal auditors their scope and results of the internal audit procedures;(d) Review the financial statements of the Group and the Company prior to their submission to the

Board of Directors of the Company for adoption; and(e) Review the interested person transactions (as defined in Chapter 9 of the Listing Manual of the

SGX-ST).

Other functions performed by the Audit Committee are disclosed in the report on Corporate Governance included in the Annual Report of the Company. It also includes a description of how auditors’ objectivity and independence is safeguarded, where there are non-audit services provided by the independent external auditors.

The Audit Committee has recommended to the Board of Directors that RSM Chio Lim LLP be nominated for re-appointment as independent external auditors at the next annual general meeting of the Company.

7. INDEPENDENT EXTERNAL AUDITORS

The independent external auditors, RSM Chio Lim LLP, have expressed their willingness to accept re-appointment.


DIRECTORS’REPORT

8. SUBSEQUENT DEVELOPMENTS

There are no significant developments subsequent to the release of the Group’s and the Company’s preliminary financial statements as announced on 27 December 2013, which would materially affect the Group’s and the Company’s operating and financial performance as of the date of this report.

On Behalf of the Board of Directors

........................................................Lee Thiam SengDirector

........................................................Low Kian BengDirector

15 January 2014


DIRECTORS’REPORT

In the opinion of the directors,

(a) the accompanying statements of financial position, consolidated statement of profit or loss and other comprehensive income, statements of changes in equity, consolidated statement of cash flows, and notes thereto are drawn up so as to give a true and fair view of the state of affairs of the Company and of the Group as at 31 October 2013 and of the results and cash flows of the Group and changes in equity of the Company and of the Group for the reporting year then ended in accordance with the provisions of the Singapore Companies Act, Chapter 50 and Singapore Financial Reporting Standards; and

(b) at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they fall due.

On Behalf of the Board of Directors

........................................................Lee Thiam SengDirector

........................................................Low Kian BengDirector

15 January 2014


STATEMENT BY DIRECTORS

REPORT ON THE FINANCIAL STATEMENTS

We have audited the accompanying financial statements of ecoWise Holdings Limited (the “Company”) and its subsidiaries (collectively, the “Group”), which comprise the consolidated statement of financial position of the Group and the statement of financial position of the Company as at 31 October 2013, and the consolidated statement of profit or loss and other comprehensive income, statement of changes in equity and statement of cash flows of the Group, and statement of changes in equity of the Company for the reporting year then ended, and a summary of significant accounting policies and other explanatory information.

MANAGEMENT’S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

Management is responsible for the preparation of the financial statements that give a true and fair view in accordance with the provisions of the Singapore Companies Act, Chapter 50 (the “Act”) and Singapore Financial Reporting Standards, and for devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair statements of profit or loss and other comprehensive income and statements of financial position and to maintain accountability of assets.

AUDITORS’ RESPONSIBILITY

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we 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 the auditors’ judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditors 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 management, 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.

INDEPENDENT AUDITORS’ REPORTto the Members of ECOWISE HOLDINGS LIMITED (Registration No: 200209835C)


OPINION

In our opinion, the consolidated financial statements of the Group and the statement of financial position and statement of changes in equity of the Company are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 October 2013 and of the results, changes in equity and cash flows of the Group and the changes in equity of the Company for the reporting year ended on that date.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

In our opinion, the accounting and other records required by the Act to be kept by the Company and by those subsidiaries incorporated in Singapore of which we are the independent auditors have been properly kept in accordance with the provisions of the Act.

RSM Chio Lim LLPPublic Accountants andChartered AccountantsSingapore

15 January 2014

Partner-in-charge: Chan Weng KeenEffective from reporting year ended 31 October 2012

INDEPENDENT AUDITORS’ REPORTto the Members of ECOWISE HOLDINGS LIMITED (Registration No: 200209835C)


Notes 2013 2012$’000 $’000

Revenue 5 80,023 90,521Cost of Sales (61,607) (72,811)

Gross Profit 18,416 17,710Other Items of IncomeFinance Income 6 44 39Dividend Income 7 – 411Other Credits 8 151 551Other Items of ExpensesMarketing and Distribution Expenses (3,674) (3,831)Administrative Expenses (10,177) (9,746)Finance Costs 9 (975) (1,042)Other Charges 8 (322) (318)Share of Results From Associates and Jointly-Controlled Entity, Net of Tax (640) (345)

Profit Before Income Tax 2,823 3,429Income Tax Expense 12 (969) (1,711)

Profit, Net of Tax 1,854 1,718

Other Comprehensive (Loss)/IncomeItems that may be reclassified subsequently to Profit or Loss:Exchange Differences on Translating Foreign Operations, Net of Tax (728) (588)Effective Portion of Changes in Fair Value of Cash Flow Hedges (39) 19

Other Comprehensive Loss for the Year, Net of Tax (767) (569)

Total Comprehensive Income for the Year 1,087 1,149

Profit, Net of Tax Attributable to: Owners of the Company 1,899 1,366 Non-Controlling Interests (45) 352

1,854 1,718

Total Comprehensive Income/(Loss) Attributable to: Owners of the Company 1,425 840 Non-Controlling Interests (338) 309

1,087 1,149

Earnings Per ShareBasic Earnings Per Share (Cents) 13 0.21 0.15

Diluted Earnings Per Share (Cents) 13 0.21 0.15

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

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOMEREPORTING YEAR ENDED 31 OCTOBER 2013


Group CompanyNotes 2013 2012 2013 2012

$’000 $’000 $’000 $’000

ASSETSNon-Current AssetsProperty, Plant and Equipment 14 42,273 29,162 466 507Intangible Assets 15 1,846 1,980 – –Land Use Rights 16 3,492 1,045 – –Investments in Subsidiaries 17 – – 43,081 25,945Investments in Associates 18 4,675 5,001 – –Investment in Jointly-Controlled Entity 19 4,812 – – –Other Financial Assets 20 1,092 1,180 – –Trade and Other Receivables 21 600 600 – –Finance Lease Receivables 22 13,116 13,731 – –Other Assets 23 269 – – –Deferred Tax Assets 12 318 – – –

Total Non-Current Assets 72,493 52,699 43,547 26,452

Current AssetsInventories 24 9,748 10,064 – –Income Tax Receivables 329 – – –Trade and Other Receivables 21 20,315 20,167 7,375 22,742Finance Lease Receivables 22 544 840 – –Derivative Financial Instruments 25 31 35 – –Other Assets 23 1,974 634 153 85Cash and Cash Equivalents 26 15,271 18,527 1,535 3,356

Total Current Assets 48,212 50,267 9,063 26,183

Total Assets 120,705 102,966 52,610 52,635


STATEMENTS OF FINANCIAL POSITIONAS AT 31 OCTOBER 2013


Group CompanyNotes 2013 2012 2013 2012

$’000 $’000 $’000 $’000

EQUITY AND LIABILITIESEquityShare Capital 27 46,191 45,927 46,191 45,927Retained Earnings 6,622 5,383 2,155 3,438Other Reserves 28 697 1,699 – 528

Equity Attributable to Owners of the Company 53,510 53,009 48,346 49,893Non-Controlling Interests 7,135 7,473 – –

Total Equity 60,645 60,482 48,346 49,893

LIABILITIESNon-Current LiabilitiesProvision for Retirement Benefit Obligations 29 620 584 – –Loans and Borrowings 30 9,748 10,808 81 127Deferred Tax Liabilities 12 2,563 2,622 – –Deferred Income 31 47 65 – –

Total Non-Current Liabilities 12,978 14,079 81 127

Current LiabilitiesIncome Tax Payable 524 335 61 120Trade and Other Payables 32 24,413 13,021 1,064 1,104Other Liabilities 33 5,000 – – –Derivative Financial Instruments 25 103 14 – –Loans and Borrowings 30 17,025 15,027 3,058 1,391Deferred Income 31 17 8 – –

Total Current Liabilities 47,082 28,405 4,183 2,615

Total Liabilities 60,060 42,484 4,264 2,742

Total Equity and Liabilities 120,705 102,966 52,610 52,635


STATEMENTS OF FINANCIAL POSITIONAS AT 31 OCTOBER 2013


Non-Total Controlling Parent Share Retained Other

Equity Interests Sub-Total Capital Earnings ReservesGroup $’000 $’000 $’000 $’000 $’000 $’000

Current Year:At 1 November 2012 60,482 7,473 53,009 45,927 5,383 1,699Movements in Equity:Total Comprehensive Income/(Loss) for the Year 1,087 (338) 1,425 – 1,899 (474)Issue of Ordinary Shares under ecoWise Performance Share Plan (Note 27 and 28A) – – – 264 – (264)Cancellation of ecoWise performance shares (Note 28A) – – – – 264 (264)Dividends Paid to Owners of the Company (924) – (924) – (924) –

163 (338) 501 264 1,239 (1002)At 31 October 2013 60,645 7,135 53,510 46,191 6,622 697

Prior Year:At 1 November 2011 52,820 12,800 40,020 37,050 4,017 (1,047)Movements in Equity:Total Comprehensive Income/(Loss) for the Year 1,149 309 840 – 1,366 (526)Issue of Ordinary Shares (Note 27) 5,250 – 5,250 5,250 – –Share Issue Expenses (Note 27) (48) – (48) (48) – –Capital Contribution From Non-Controlling Interests of a Subsidiary 1,275 1,275 – – – –Equity-Settled Share-Based Expenses (Note 28A) 528 – 528 – – 528Issue of Ordinary Shares as Consideration for Acquisition of Non-Controlling Interests without Change in Control (Note 17B and 27) – (6,419) 6,419 3,675 – 2,744Dividends Paid to Non-Controlling Interests of Subsidiaries (492) (492) – – – –

7,662 (5,327) 12,989 8,877 1,366 2,746At 31 October 2012 60,482 7,473 53,009 45,927 5,383 1,699


STATEMENTS OF CHANGES IN EQUITYREPORTING YEAR ENDED 31 OCTOBER 2013


Total Share Retained OtherEquity Capital Earnings Reserve

Company $’000 $’000 $’000 $’000

Current Year:At 1 November 2012 49,893 45,927 3,438 528

Movements in Equity:Total Comprehensive Loss for the Year (623) – (623) –Issue of Ordinary Shares under ecoWise Performance Share Plan (Note 27 and 28A) – 264 – (264)Cancellation of ecoWise performance shares (Note 28A) – – 264 (264)Dividends Paid to Owners of the Company (924) – (924) –

(1,547) 264 (1,283) (528)

At 31 October 2013 48,346 46,191 2,155 –

Prior Year:At 1 November 2011 39,270 37,050 2,220 –

Movements in Equity:Total Comprehensive Income for the Year 1,218 – 1,218 –Issue of Ordinary Shares (Note 27) 5,250 5,250 – –Share Issue Expenses (Note 27) (48) (48) – –Equity-Settled Share-Based Expenses (Note 28A) 428 – – 428Equity-Settled Share-Based Arrangements with Subsidiaries (Note 28A) 100 – – 100Issue of Ordinary Shares as Consideration for Acquisition of Non-Controlling Interests without Change in Control (Note 17B and 27) 3,675 3,675 – –

10,623 8,877 1,218 528

At 31 October 2012 49,893 45,927 3,438 528


STATEMENTS OF CHANGES IN EQUITYREPORTING YEAR ENDED 31 OCTOBER 2013


2013 2012$’000 $’000

Cash Flows From Operating ActivitiesProfit Before Income Tax 2,823 3,429Depreciation of Property, Plant and Equipment 3,135 3,153Impairment Loss on Property, Plant and Equipment 11 194(Gain)/Loss on Disposal of Property, Plant and Equipment (51) 40Amortisation of Intangible Assets 102 104Amortisation of Land Use Rights 49 23Share of Results of Associates and Jointly-Controlled Entity, Net of Tax 640 345Impairment Loss on Other Financial Assets 86 67Net Fair Value Loss/(Gain) on Derivative Financial Instruments 54 (33)Provision for Retirement Benefit Obligations Expenses, Net 49 34Amortisation of Deferred Income (8) (8)Finance Income (44) (39)Finance Lease Income (1,366) (1,079)Dividend Income – (411)Finance Costs 975 1,042Equity-Settled Share-Based Expenses – 528

Operating Cash Flows Before Changes in Working Capital 6,455 7,389Inventories 224 (539)Trade and Other Receivables 521 (339)Finance Lease Receivables 911 27Other Assets (1,337) 327Trade and Other Payables (2,450) 961Other Liabilities 5,000 –Finance Lease Income Received 1,366 1,079Retirement Benefit Obligations Paid (32) (16)Increase/(Decrease) in Cash Restricted in Use Over 3 Months 902 (902)

Net Cash Flows From Operations Before Income Tax 11,560 7,987Income Tax Paid (1,510) (1,407)

Net Cash Flows From Operating Activities 10,050 6,580


CONSOLIDATED STATEMENT OF CASH FLOWSREPORTING YEAR ENDED 31 OCTOBER 2013


2013 2012$’000 $’000

Cash Flows From Investing ActivitiesAcquisition of a Subsidiary, Net of Cash (Note 17A) (86) 2Acquisition of an Associate – (3,994)Acquisition of a Jointly-Controlled Entity (5,126) –Acquisition of Property, Plant and Equipment (Note 26B) (2,528) (8,125)Increase in Investment in Other Financial Assets – (835)Dividend Income Received – 411Interest Income Received 44 39Proceeds From Disposal of Other Financial Assets – 7Proceeds From Disposal of Property, Plant and Equipment 130 161Proceeds From Government Grant to Acquire Property, Plant and Equipment – 9

Net Cash Flows Used in Investing Activities (7,566) (12,325)

Cash Flows From Financing ActivitiesCapital Contribution From Non-Controlling Interests of a Subsidiary – 1,275Dividends Paid to Owners of the Company (924) –Dividends Paid to Non-Controlling Interests of Subsidiaries – (492)Increase/(Decrease) in Cash Restricted in Use Over 3 Months 72 (206)Interest Expenses Paid (911) (1,007)Proceeds From Issue of Ordinary Shares – 5,202Proceeds From Loans and Borrowings 4,493 9,324Repayments of Loans and Borrowings (7,097) (2,177)

Net Cash Flows (Used in)/From Financing Activities (4,367) 11,919

Net (Decrease)/Increase in Cash and Cash Equivalents (1,883) 6,174Effect of Exchange Rate Changes on Cash and Cash Equivalents (48) (79)Cash and Cash Equivalents, Consolidated Statement of Cash Flows, Beginning Balance 16,450 10,355

Cash and Cash Equivalents, Consolidated Statement of Cash Flows, Ending Balance (Note 26A) 14,519 16,450


CONSOLIDATED STATEMENT OF CASH FLOWSREPORTING YEAR ENDED 31 OCTOBER 2013


1. GENERAL

ecoWise Holdings Limited (the “Company”) is incorporated in Singapore with limited liability. It is listed on the Singapore Exchange Securities Trading Limited. The registered office and principal place of business of the Company is located at 17 Kallang Junction, #04-03, Singapore 339274.

The financial statements for the reporting year ended 31 October 2013 comprise those of the Company and its subsidiaries (collectively, the “Group”) and the Group’s interests in associates and jointly-controlled entity. All financial information presented in Singapore dollars have been rounded to the nearest thousand (“$’000”), unless otherwise stated.

The financial statements were approved and authorised for issue by the board of directors on the date of statement by directors.

The principal activities of the Company are those of an investment holding company and provision of management services to its subsidiaries. The principal activities of the subsidiaries are disclosed in Note 17 to the financial statements.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Accounting Convention

The financial statements have been prepared in accordance with the Singapore Financial Reporting Standards (“FRS”) and the related Interpretations to FRS (“INT FRS”) as issued by the Singapore Accounting Standards Council and the Singapore Companies Act, Chapter 50. The financial statements are prepared on a going concern basis under the historical cost convention except where a FRS requires an alternative treatment (such as fair values) as disclosed where appropriate in these financial statements. Other comprehensive income comprises items of income and expense (including reclassification adjustments) that are not recognised in the profit or loss, as required or permitted by FRS. Reclassification adjustments are amounts reclassified to profit or loss in the current reporting year that were recognised in other comprehensive income in the current or previous reporting years.

Basis of Preparation of the Financial Statements

The preparation of financial statements in conformity with generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting year. Actual results could differ from those estimates. The estimates and assumptions are reviewed on an ongoing basis.

Apart from those involving estimations, management has made judgements in the process of applying the entity’s accounting policies. The areas requiring management’s subjective or complex judgements, or areas where assumptions and estimates are significant to the financial statements, are disclosed at the end of this note to the financial statements, where applicable.

NOTES TOTHE FINANCIAL STATEMENTS31 OCTOBER 2013


2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Basis of Preparation of the Financial Statements (Continued)

The consolidated financial statements include the financial statements made up to the end of the reporting year of the Company and all of its directly and indirectly controlled subsidiaries. The consolidated financial statements are the financial statements of the Group presented as those of a single economic entity and are prepared using uniform accounting policies for like transactions and other events in similar circumstances. All significant intragroup balances and transactions, including profit or loss and other comprehensive income items and dividends are eliminated on consolidation. The results of any subsidiary acquired or disposed of during the reporting year are accounted for from the respective dates of acquisition or up to the date of disposal, which is the date on which effective control is obtained of the acquired business or when control ceases.

Changes in the Group’s equity interests in a subsidiary that do not result in the loss of control are accounted for within equity as transactions with owners in their capacity as owners. The carrying amounts of the Group’s and non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiary. When the Group loses control of a subsidiary, it derecognises the assets and liabilities and related equity components of the former subsidiary. Any gain or loss is recognised in profit or loss. Any investment retained in the former subsidiary is measured at its fair value at the date when control has ceased and is subsequently accounted for as an associate, a jointly-controlled entity or as financial assets in accordance with FRS 39.

The Company’s financial statements have been prepared on the same basis, and as permitted by the Singapore Companies Act, Chapter 50, no statement of profit or loss and other comprehensive income is presented for the Company.

Foreign Currency Transactions

The functional currency of the Company is the Singapore dollar as it reflects the primary economic environment in which the Company operates in.

Transactions in foreign currencies are recorded in the functional currency at the exchange rates ruling at the dates of the transactions. At the end of each reporting period, recorded monetary balances and balances measured at fair value that are denominated in non-functional currencies are reported at the exchange rates ruling at the end of the reporting period and fair value dates, respectively. All realised and unrealised exchange adjustment gains and losses are dealt with in the profit or loss, except when recognised in other comprehensive income.

The presentation currency is the functional currency.




Translation of Financial Statements of Other Entities

Each entity in the Group determines its appropriate functional currency to reflect the primary economic environment in which the entity operates in. In translating the financial statements of an investee for incorporation in the consolidated financial statements to the presentation currency, the assets and liabilities denominated in other currencies are translated at the exchange rates ruling at the end of the reporting period and the profit or loss items are translated at average exchange rates for the reporting period. The resulting translation adjustments (if any) are recognised in other comprehensive income and accumulated in a separate component of equity until the disposal of that investee.

Segment Reporting

Reportable segments are operating segments or aggregations of operating segments that meet specified criteria. Operating segments are components about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Generally, financial information is reported on the same basis as is used internally for evaluating operating segment performance and deciding how to allocate resources to operating segments.

Revenue Recognition

The revenue amount is the fair value of the consideration received or receivable from the gross inflow of economic benefits during the reporting period arising from the course of the activities of the Group and it is shown net of related sales taxes, estimated returns and rebates.

• Revenue from the sale of goods is recognised when significant risks and rewards of ownership are transferred to the buyer, there is neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold, and the amount of revenue and costs incurred or to be incurred in respect of the transaction can be measured reliably.

• Revenue from services rendered is recognised by reference to the stage of completion of the transaction at the end of the reporting period determined by the proportion of the cost incurred to dates bears to the estimates total cost of the transaction, where the amount of revenue, stage of completion, and the costs incurred for the transaction and the costs to complete the transaction can be measured reliably. Revenue from service income that is of short duration is recognised when the services are completed.

• The finance lease income from finance lease arrangement represents the interest income on the finance lease receivables and is recognised using the effective interest method.




Revenue Recognition (Continued)

• Interest income is recognised using the effective interest method.

• Dividend income from equity instruments is recognised when the Group’s right to receive payment is established.

Employee Benefits

Short-Term Employee Benefits

Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related services are provided.

A liability is recognised for the amount expected to be paid 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.

For employee leave entitlement, the expected cost of short-term employee benefits in the form of compensated absences is recognised in the case of accumulating compensated absences when the employees render service that increases their entitlement to future compensated absences; and in the case of non-accumulating compensated absences, when the absences occur. A liability for bonuses is recognised where the Group is contractually obliged or where there is constructive obligation based on past practice.

Defined Contribution Benefits

Contributions to defined contribution retirement benefit plans are recorded as an expense as they fall due. The Group’s legal or constructive obligation is limited to the amount that it agrees to contribute to an independently administered fund, such as the Central Provident Fund in Singapore and Employees Provident Fund in Malaysia.

Defined Benefit Plan

The Group operates an unfunded defined benefit plan for qualifying employees of its subsidiaries in Malaysia. In accordance with the terms of their employment contracts, the benefits are calculated based on the last drawn salaries, length of services and the rates set out in the employment contracts. The Group’s obligations under the defined benefit plan, calculated using the projected unit credit method, are determined based on actuarial assumptions and computations. Actuarial assumptions are updated for any material transactions and changes in circumstances at the end of each reporting year.




Employee Benefits (Continued)

Share-Based Compensation

Benefits to employees, including the directors, are provided in the form of share-based payment transactions, whereby employees render services in exchange for shares or rights over shares (“equity-settled transactions”). The fair value of the employee services rendered is determined by reference to the fair value of the shares awarded or granted, excluding the impact of any non-market vesting conditions. The fair value is determined by reference to the fair value of the shares awarded or granted on grant date. This fair value amount is charged to the profit or loss over the vesting period of the share-based payment scheme, with the corresponding increase in equity. The value of the charge is adjusted in the profit or loss over the remainder of the vesting period to reflect expected and actual levels of shares vesting, with the corresponding adjustment made in equity. Cancellations of grants of equity instruments during the vesting period (other than a grant cancelled by forfeiture when the vesting conditions are not satisfied) are accounted for as an acceleration of vesting, therefore any amount unrecognised that would otherwise have been charged is recognised immediately in the profit or loss.

Income Tax

Income tax expense comprises current tax and deferred tax. Current and deferred taxes are recognised as an income or an expense in the profit or loss. The income taxes payables are accounted using the asset and liability method that requires the recognition of taxes payable or refundable for the current year and deferred tax liabilities and assets for the future tax consequence of events that have been recognised in the financial statements or tax returns.

The measurements of current and deferred tax liabilities and assets are based on provisions of the enacted or substantially enacted tax laws at the end of each reporting period; the effects of future changes in tax laws or rates are not anticipated.

Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same income tax authority.

A deferred tax asset or liability is recognised for all temporary differences, unless the temporary differences arise from the initial recognition of an asset or liability in a transaction that (i) is not a business combination and (ii) at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss). A deferred tax liability or asset is recognised for all temporary differences associated with investments in subsidiaries and associates, except where the Group is able to control the timing of the reversal of the temporary differences and it is probable that the temporary differences will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at the end of each reporting period and is reduced, if necessary, by the amount of any tax benefits based on available evidence, are not expected to be realised.




Borrowing Costs

Borrowing costs comprise interest expenses on borrowings and unwinding of the discount on provisions and contingent consideration that are recognised in the profit or loss.

Borrowing costs that are interest expenses and other costs incurred in connection with the borrowing of funds that are directly attributable to the acquisition, construction or production of a qualifying asset 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 that asset until substantially all the activities necessary to prepare the qualifying asset for its intended use or sale are completed.

Other borrowing costs are recognised as an expense in the period in which they are incurred.

Interest expenses are calculated using the effective interest method.

Property, Plant and Equipment

Property, plant and equipment are carried at cost on initial recognition and after initial recognition at cost less any accumulated depreciation and accumulated impairment losses.

Cost includes acquisition cost, borrowing cost capitalised and any cost directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management. Subsequent costs are recognised as an asset only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repair and maintenance costs are charged to the profit or loss when they are incurred.

Cost also includes the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which the Group incurs either when the item is acquired or as a consequence of having used the item during a particular period.

Depreciation is provided on a straight-line basis to allocate the gross carrying amounts of the assets less their residual values over their estimated useful lives of each part of an item of these assets as follows:

Leasehold land – Over remaining lease periods of 65 and 68 yearsLeasehold properties and improvements – Over remaining lease periods of 11 and 25 yearsPlant and equipment – 3 to 30 years

Construction-in-progress is not depreciated as these are not available for use.

An asset is depreciated when it is available for use even if during that period the item is idle. Fully depreciated assets still in use are retained in the financial statements.




Property, Plant and Equipment (Continued)

The gain or loss arising from the derecognition of an item of property, plant and equipment is determined as the difference between the net disposal proceeds, if any, and the carrying amount of the item of property, plant and equipment and is recognised in the profit or loss.

The residual value and the useful life of an asset is reviewed at least at the end of each reporting period and, if expectations differ significantly from previous estimates, the changes are accounted for as a change in an accounting estimate and the depreciation charge for the current and future reporting periods are adjusted.

Leases

Whether an arrangement is, or contains, a lease is based on the substance of the arrangement at the inception date, that is, whether (a) fulfilment of the arrangement is dependent on the use of a specific asset or assets (the asset); and (b) the arrangement conveys a right to use the asset.

Leases are classified as finance leases if substantially all the risks and rewards of ownership are transferred to the lessee. All other leases are classified as operating leases.

Finance Leases

Under a finance lease, the lessor recognises a finance lease receivables and the lessee recognises the leased asset and a liability for future lease payments.

(a) When the Group is a lessor:

When the Group is a lessor, it records a finance lease receivables at the amount of the Group’s net investment in the lease, which comprises the present value of the minimum lease payments and any unguaranteed residual value accruing to the Group. The present value is calculated by discounting the minimum lease payments due and any unguaranteed residual value, at the interest rate implicit in the lease.

The Group derecognised the leased assets and recognised the difference between the carrying amount of the leased assets and the finance lease receivables in the profit or loss and recorded as part of revenue under “finance lease income”.

The Group recognises finance lease income on the net investment over the lease term. The receipts under the lease arrangement are allocated between reducing the net investment and recognising finance income, so as to produce a constant rate of return on the net investment.




Leases (Continued)

Finance Leases (Continued)

(b) When the Group is a lessee:

At the commencement of the lease term, a finance lease is recognised as an asset and as a liability in the statement of financial position at amounts equal to the fair value of the leased asset or, if lower, the present value of the minimum lease payments, each determined at the inception of the lease. The discount rate used in calculating the present value of the minimum lease payments is the interest rate implicit in the lease, if this is impracticable to determine, the lessee’s incremental borrowing rate is used.

Any initial direct costs of the lessee are added to the amount recognised as an asset. The excess of the lease payments over the recorded lease liability are treated as finance costs which are allocated to each reporting period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Contingent rents are charged as expenses in the reporting periods in which they are incurred. The assets are depreciated as owned depreciable assets.

Operating Leases

Leases where the lessor effectively retains substantially all the risks and rewards of ownership of the leased assets are classified as operating leases. For operating leases, lease payments are recognised as an expense in the profit or loss on a straight-line basis over the term of the relevant lease unless another systematic basis is representative of the time pattern of the user’s benefit, even if the payments are not on that basis. Lease incentives received are recognised in the profit or loss as an integral part of the total lease expense.

Land Use Rights

Land use rights under operating leases are initially stated at cost. Following initial recognition, land use rights are measured and carried at cost less accumulated amortisation. The land use rights are amortised on a straight-line basis over the lease term of 50 years.

Intangible Assets

An identifiable non-monetary asset without physical substance is recognised as an intangible asset at acquisition cost if it is probable that the expected future economic benefits that are attributable to the asset will flow to the Group and cost of the asset can be measured reliably.




Intangible Assets (Continued)

After initial recognition, an intangible asset with finite useful life is carried at cost less any accumulated amortisation and accumulated impairment losses. An intangible asset with an indefinite useful life is not amortised. An intangible asset is regarded as having an indefinite useful life when, based on an analysis of all of the relevant factors, there is no foreseeable limit to the period over which the asset is expected to generate net cash inflows for the Group.

Identifiable intangible assets acquired as part of a business combination are initially recognised separately from goodwill if the asset’s fair value can be measured reliably, irrespective of whether the asset had been recognised by the acquiree before the business combination. An intangible asset is considered identifiable only if it is separable or if it arises from contractual or other legal rights, regardless of whether those rights are transferable or separable from the Group or from other rights and obligations.

The amortisable amount of an intangible asset with finite useful life is allocated on a systematic basis over the best estimate of its useful life from the point at which the asset is ready for use.

Trademarks

Trademarks acquired in a business combination are recognised at fair value at the acquisition date. Trademarks have a finite useful life and are carried at cost less any accumulated amortisation and accumulated impairment losses. Amortisation is calculated on a straight-line basis over the estimated useful lives of 10 to 25 years.

Customer Relationships

Customer relationships acquired in a business combination are recognised at fair value at the acquisition date. The customer relationships are carried at cost less any accumulated amortisation and accumulated impairment losses. Amortisation is calculated on a straight-line basis over the expected life of the customer relationships of 10 years.

Goodwill

Goodwill is recognised as of the acquisition date measured as the excess of (a) over (b) whereby (a) being the aggregate of (i) the consideration transferred measured at acquisition date fair value; (ii) the amount of any non-controlling interests in the acquiree measured either at fair value or at the non-controlling interests’ proportionate share of the acquiree’s net identifiable assets; and (iii) in a business combination achieved in stages, the acquisition date fair value of the acquirer’s previously held equity interest in the acquiree; and (b) being the net of the identifiable assets acquired and the liabilities assumed measured at acquisition date fair values.




Intangible Assets (Continued)

Goodwill (Continued)

After initial recognition, goodwill acquired in a business combination is measured at cost less any accumulated impairment losses. Goodwill is not amortised. Irrespective of whether there is any indication of impairment, goodwill is tested for impairment at least annually. Impairment on goodwill is not reversed in any circumstances.

For the purpose of impairment testing and since the acquisition date of the business combination, goodwill is allocated to each cash-generating unit, or groups of cash-generating units that are expected to benefit from the synergies of the business combination, irrespective of whether other assets or liabilities of the acquiree were assigned to those units or groups of units. Each unit or group of units to which the goodwill is allocated represents the lowest level within the Group at which the goodwill is monitored for internal management purposes and is not larger than a segment.

Subsidiaries

A subsidiary is an entity including unincorporated and special purpose entity that is controlled by the Group. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities accompanying a shareholding of more than one half of the voting rights or the ability to appoint or remove the majority of the members of the board of directors or to cast the majority of votes at meetings of the board of directors. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity.

In the Company’s own separate financial statements, the investments in subsidiaries are stated at cost less any allowance for impairment in value. Impairment loss recognised in the profit or loss for a subsidiary is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised.

Associates

An associate is an entity including an unincorporated entity in which the Group has a substantial financial interest (usually not less than 20% of the voting power), significant influence and that is neither a subsidiary nor a jointly-controlled entity of the investor. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies.




Associates (Continued)

The investments in associates are accounted for using the equity method of accounting. The investment in associate is carried in the consolidated statement of financial position at cost plus post-acquisition changes in the Group’s share of net assets of the associate less any allowance for impairment in value. The profit or loss reflects the Group’s share of the results of operations of the associate. Losses of the associate in excess of the Group’s interests in the relevant associate are not recognised, except to the extent that the Group has an obligation. Profits and losses resulting from transactions between the Group and the associate are recognised in the financial statements only to the extent of unrelated investors’ interests in the associate. Unrealised losses are eliminated in the consolidated financial statements unless the transaction provides evidence of an impairment of the asset transferred.

Accounting policies of the associate are changed where necessary to ensure consistency with the policies adopted by the Group.

The Group discontinues the use of the equity method of accounting from the date that it ceases to have significant influence over the associate and accounts for the remaining investment as financial assets. Any gain or loss is recognised in the profit or loss. Any investment retained in the former associate is measured at its fair value at the date that it ceases to be an associate.

Jointly-Controlled Entity

A jointly-controlled entity is a contractual arrangement with other parties to undertake an economic activity that is subject to joint control.

The investment in jointly-controlled entity is accounted for using the equity method of accounting. The investment in jointly-controlled entity is carried in the consolidated statement of financial position at cost plus post-acquisition changes in the Group’s share of net assets of the jointly-controlled entity less any allowance for impairment in value. The profit or loss reflects the Group’s share of the results of operations of the jointly-controlled entity. Losses of the jointly-controlled entity in excess of the Group’s interests in the relevant jointly-controlled entity are not recognised, except to the extent that the Group has an obligation. Profits and losses resulting from transactions between the Group and the jointly-controlled entity are recognised in the financial statements only to the extent of unrelated investors’ interests in the jointly-controlled entity. Unrealised losses are eliminated in the consolidated financial statements unless the transaction provides evidence of an impairment of the asset transferred.

Accounting policies of the jointly-controlled entity are changed where necessary to ensure consistency with the policies adopted by the Group.

The Group discontinues the use of the equity method of accounting from the date that it ceases to have significant influence over the jointly-controlled entity and accounts for the remaining investment as financial assets. Any gain or loss is recognised in the profit or loss. Any investment retained in the former jointly-controlled entity is measured at its fair value at the date that it ceases to be a jointly-controlled entity.




Business Combinations

A business combination is a transaction or other event which requires that the assets acquired and liabilities assumed to constitute a business. It is accounted for by using the acquisition method of accounting.

The cost of a business combination includes the fair values of assets given, liabilities incurred or assumed, and equity instruments issued by the acquirer at the acquisition date. The acquisition related costs are expensed in the periods in which the costs are incurred and the services are received, except for any costs incurred to issue debts or equity securities are recognised in accordance with FRS 32 – Financial Instruments: Presentation and FRS 39 – Financial Instruments: Recognition and Measurement.

At acquisition date, the acquirer recognises, separately from goodwill, the identifiable assets acquired, the liabilities assumed and any non-controlling interests in the acquiree measured at acquisition date fair values as defined in and that meet the conditions for recognition under FRS 103 – Business Combinations.

Goodwill is an asset representing the future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognised. If the acquirer has made a gain from a bargain purchase, that gain is recognised in the profit or loss. For gain on bargain purchase, a reassessment is made of the identification and measurement of the acquiree’s identifiable assets, liabilities and contingent liabilities and the measurement of the cost of the business combination and any excess remaining after this reassessment is recognised immediately in the profit or loss.

For business combinations achieved in stages, any equity interest held in the acquiree is remeasured immediately before achieving control at its acquisition date fair value and any resulting gain or loss is recognised in the profit or loss.

Goodwill and fair value adjustments resulting from the application of acquisition method of accounting at the date of acquisition are treated as assets and liabilities of the acquired entity and are recorded at the exchange rates prevailing at the acquisition date and are subsequently translated at the exchange rates ruling at the end of the reporting period.

Where the fair values are estimated on a provisional basis, they are finalised within one year from the acquisition date with consequent retrospective changes to the amounts recognised at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date and, if known, would have affected the measurement of the amounts recognised as of that date.

Non-Controlling Interests

On an acquisition-by-acquisition basis, the Group recognises any non-controlling interests in the acquiree either at fair value or at the non-controlling interests’ proportionate share of the acquiree’s net assets. Where the non-controlling interests are measured at fair value, the valuation techniques and key model inputs used are disclosed in the relevant note. Profit or loss and each component of other comprehensive income are attributed to the owners of the Company and to the non-controlling interests. Total comprehensive income is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.




Non-Controlling Interests (Continued)

The non-controlling interests in the net assets and net results of a consolidated subsidiary are shown separately in the appropriate components of the consolidated financial statements.

The Group treats transactions with non-controlling interests as transactions with equity owners of the Group. For acquisitions of non-controlling interests, the difference between any consideration paid and the relevant share of the carrying amount of net assets of the subsidiary acquired is recorded in equity. Gains or losses on disposals without loss of control are also recorded in equity.

Impairment of Non-Financial Assets

The carrying amounts of non-financial assets are reviewed at the end of each reporting period for indications of impairment.

The impairment loss is the excess of the carrying amount over the recoverable amount and is recognised in the profit or loss. The recoverable amount of an asset or a cash-generating unit is the higher of its fair value less costs to sell and its value in use.

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. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).

At the end of each reporting period, non-financial assets, other than goodwill, with impairment loss recognised in prior previous reporting periods are assessed for possible reversal of the impairment. 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.

Inventories

Inventories are measured at the lower of cost and net realisable value. The costs of raw materials, work-in-progress and finished goods are measured using the first-in-first-out method and the costs of consumables are measured using the weighted average method.

Cost includes all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition.

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. A write down on inventories is made where the cost is not recoverable or if the selling prices have declined.




Non-Derivative Financial Assets

The Group initially recognises loans and receivables and deposits on the date that they are originated. All other financial assets (including assets designated at fair value through profit or loss) are recognised initially on the trade date, which is the date that the Group becomes a party to the contractual provisions of the instrument.

The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows on the financial asset in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred. Any interest in transferred financial assets that is created or retained by the Group is recognised as a separate asset or liability.

Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

The Group’s non-derivative financial assets include financial assets at fair value through profit or loss, loans and receivables and available-for-sale financial assets.

Financial Assets at Fair Value through Profit or Loss

A financial asset is classified at fair value through profit or loss if it is classified as held for trading or is designated as such upon initial recognition. Financial assets are designated at fair value through profit or loss if the Group manages such investments and makes purchase and sale decisions based on their fair value in accordance with the Group’s investment strategy.

Attributable transaction costs are recognised in the profit or loss as incurred. Financial assets at fair value through profit or loss are measured at fair value, and changes therein are recognised in the profit or loss.

Financial assets designated at fair value through profit or loss comprise equity shares that otherwise would have been classified as available-for-sale.

Loans and Receivables

Loans and receivables comprise trade and other receivables, cash and cash equivalents and finance lease receivables.

Loans and receivables are financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, loans and receivables are measured at amortised cost using the effective interest method less any impairment losses.




Non-Derivative Financial Assets (Continued)

Loans and Receivables (Continued)

Cash and cash equivalents comprise cash balances and bank deposits. For the purpose of the consolidated statement of cash flows, cash and cash equivalents exclude short-term deposits which are pledged to the bank as security and cannot be withdrawn on demand. Bank overdrafts that are repayable on demand and form an integral part of the Group’s cash management are included as a component of cash and cash equivalents.

Available-For-Sale Financial Assets

The Group’s investments in certain equity shares are classified as available-for-sale financial assets. Subsequent to initial recognition, they are measured at fair value and changes therein, other than impairment losses, and foreign exchange gains and losses on available-for-sale monetary items, are recognised directly in other comprehensive income. When an investment is derecognised, the cumulative gain or loss in other comprehensive income and presented within equity in other reserves is transferred to the profit or loss.

Non-Derivative Financial Liabilities

The Group’s non-derivative financial liabilities comprise trade and other payables and loans and borrowings.

Financial liabilities (including liabilities designated at fair value through profit or loss) are recognised initially on the trade date at which the Group becomes a party to the contractual provisions of the instrument.

Financial liabilities are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, these financial liabilities are measured at amortised cost using the effective interest method.

Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

Derivative Financial Instruments and Hedge Accounting

Derivatives are recognised initially at fair value and the attributable transaction costs are recognised in the profit or loss as incurred. Subsequent to initial recognition, derivatives are measured and carried at fair value, and changes therein are accounted for as described below.




Derivative Financial Instruments and Hedge Accounting (Continued)

Embedded derivatives are separated from the host contract and accounted for separately if the economic characteristics and risks of the host contract and the embedded derivative are not closely related, a separate instrument with the same terms as the embedded derivative would meet the definition of a derivative, and the combined instrument is not measured at fair value through the profit or loss.

On initial designation of the derivative as the hedging instrument, the Group formally documents the relationship between the hedging instrument and hedged item, including the risk management objectives and strategy in undertaking the hedge transaction and the hedged risk, together with the methods that will be used to assess the effectiveness of the hedging relationship.

The Group makes an assessment, both at the inception of the hedge relationship as well as on an on-going basis, of whether the hedging instruments are expected to be “highly effective” in offsetting the changes in the fair value or cash flows of the respective hedged items attributable to the hedged risk, and whether the actual effectiveness of each hedge are within an acceptable range. Transaction that is highly probable to occur and addresses an exposure to variations in cash flows that could ultimately affect reported profit or loss is accounted for as a cash flow hedge of a forecast transaction.

Cash Flow Hedges

When a derivative is designated as the hedging instrument in a hedge of the variability in cash flows attributable to a particular risk associated with a recognised asset or liability or a highly probable forecast transaction that could affect the profit or loss, the effective portion of changes in the fair value of the derivative is recognised (net of tax) in other comprehensive income and presented in the hedging reserve in equity. Any ineffective portion of changes in the fair value of the derivative is recognised immediately in the profit or loss.

Other Non-Trading Derivatives

When a derivative financial instrument is not designated in a hedge relationship that qualifies for hedge accounting, all changes in its fair value are recognised immediately in the profit or loss.

Financial Guarantee Contracts

Financial guarantee contracts are initially recognised at fair value and are subsequently measured at the greater of (a) the amount determined in accordance with FRS 37 and (b) the amount initially recognised less, where appropriate, cumulative amortisation recognised in accordance with FRS 18. All changes in fair value relating to liabilities at fair value through profit or loss are recognised to profit or loss as incurred.




Fair Value of Financial Instruments

The carrying values of current financial instruments approximate their fair values due to the short-term maturity of these instruments and the disclosures of fair value are not made when the carrying amount of current financial instruments is a reasonable approximation of its fair value. The fair values of non-current financial instruments may not be disclosed separately unless there are significant differences at the end of the reporting period and in the event the fair values are disclosed in the relevant notes.

The fair value of a financial instrument is derived from an active market or by using an acceptable valuation technique. The appropriate quoted market price for an asset held or liability to be issued is usually the current bid price without any deduction for transaction costs that may be incurred on sale or other disposal and, for an asset to be acquired or for liability held, the asking price. If there is no market, or the markets available are not active, the fair value is established by using an acceptable valuation technique.

The fair value measurements are classified using a fair value hierarchy of 3 levels that reflects the significance of the inputs used in making the measurements that is, Level 1 for the use of quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 for the use of inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and Level 3 for the use of inputs for the asset or liability that are not based on observable market data (unobservable inputs). The level is determined on the basis of the lowest level input that is significant to the fair value measurement in its entirety. Where observable inputs require significant adjustment based on unobservable inputs, that measurement is a Level 3 measurement.

Equity

Equity instruments are contracts that give a residual interest in the net assets of the Company. Ordinary shares are classified as equity. Equity instruments are recognised at the amount of proceeds received net of incremental costs directly attributable to the transaction. Dividends on equity are recognised as liabilities when they are declared. Interim dividends are recognised when declared by the directors.

Provisions

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

Provisions are made using best estimates of the amount required in settlement and where the effect of the time value of money is material, the amount recognised is the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation.

The increase in the provision due to passage of time is recognised as interest expense. Changes in estimates are reflected in the profit or loss in the reporting period they occur.




Government Grants

A government grant is recognised at fair value when there is reasonable assurance that the conditions attaching to it will be complied with and that the grant will be received. A grant in recognition of specific expenses is recognised as income in profit or loss over the periods necessary to match them with the related costs that they are intended to compensate, on a systematic basis. A grant related to depreciable assets is allocated to income over the periods in which such assets are used in the project subsidised by the grant. A government grant related to assets, including non-monetary grants at fair value, is presented in the statement of financial position as deferred income.

Critical Judgements, Assumptions and Estimation Uncertainties

The critical judgements made in the process of applying the accounting policies that have the most significant effect on the amounts recognised in the financial statements and the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting year, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities currently or within the next reporting year are discussed below.

These estimates and assumptions are periodically monitored to ensure they incorporate all relevant information available at the date when financial statements are prepared. However, actual figures may differ from these estimates.

Impairment of Property, Plant and Equipment

An assessment is made at the end of each reporting year whether there is any indication that the assets may be impaired. If any such indication exists, an estimate is made of the recoverable amounts of the assets. The recoverable amounts of cash-generating units have been determined based on value in use calculations. These calculations require the use of estimates.

Included in the property, plant and equipment of the Group is a coal-fired power plant with carrying amount of $6,273,000 as at 31 October 2013 (2012: $6,514,000) of a non-wholly owned subsidiary, Wuhan ecoWise Energy Co., Ltd. (“Wuhan ecoWise”). This plant will be converted to a biomass co-generation power plant. The coal-fired power plant has ceased operations and the commencement of plant conversion is subject to Wuhan ecoWise receiving additional capital injection from its shareholders for purposes of securing the bank financing for the conversion.

Subsequent to end of the reporting year, the Group has entered into an Agreement of Share Transfer (“Agreement”) to dispose 20% equity interests in Wuhan ecoWise to its non-controlling interests for cash consideration of approximately $2,949,000. Based on management’s assessment, there is no impairment loss on carrying amounts of Wuhan ecoWise’s property, plant and equipment.

It is impracticable to disclose the extent of the possible effects. It is reasonably possible, based on existing knowledge, that outcomes within the next reporting year that are different from assumptions could require a material adjustment to the carrying amount of the balances affected.




Critical Judgements, Assumptions and Estimation Uncertainties (Continued)

Useful Lives of Property, Plant and Equipment

The estimates for the useful lives and related depreciation charges for property, plant and equipment is based on commercial and production factors which could change significantly as a result of technical innovations and competitors’ actions in response to severe market conditions. When useful lives are less than previously estimated useful lives, depreciation charges are increased or the carrying amounts impaired for technically obsolete or non-strategic assets that have been abandoned. It is impracticable to disclose the extent of the possible effects. It is reasonably possible, based on existing knowledge, that outcomes within the next reporting year that are different from assumptions could require adjustments to the carrying amounts of the property, plant and equipment (Note 14).

Impairment of Subsidiaries, Associates and Jointly-Controlled Entity

When a subsidiary, an associate or a jointly-controlled entity is in net equity deficit and has suffered operating losses, the recoverable amount of the investee is estimated to assess whether the investment in the investee has suffered any impairment. This determination requires significant judgement. An estimate is made of the future profitability of the investee, and the financial health of and near-term business outlook for the investee, including factors such as industry and sector performance and operational and financing cash flows. It is impracticable to disclose the extent of the possible effects. It is reasonably possible, based on existing knowledge, that outcomes within the next reporting year that are different from assumptions could require adjustments to the carrying amounts of the investments in subsidiaries, associates and jointly-controlled entity.

The Company’s specific assets at the end of the reporting year affected by the assumptions, which have carrying amounts of $6,362,000 (2012: $1,450,000) have been impaired to its recoverable amounts.

Net Realisable Value of Inventories

A review is made periodically on inventories for obsolescence and excess inventory and declines in net realisable value below cost and an allowance is recorded against the carrying amounts of inventories for any such obsolescence, excess and declines. These reviews require management to consider the future demands for the inventories. The realisable value represents the best estimate of the recoverable amount and is based on the acceptable evidence available at the end of each reporting year and inherently involves estimates regarding the future expected realisable value. The usual considerations for determining the amount of allowance or write-down include expected usage, ageing analysis, technical assessment and subsequent events. In general, such an evaluation process requires significant judgment and may affect the carrying amount of inventories at the end of each reporting year. Possible changes in these estimates could result in revisions to the carrying amounts of the inventories.

The carrying amount of inventories of the Group at the end of the reporting year was $9,748,000 (2012: $10,064,000).




Critical Judgements, Assumptions and Estimation Uncertainties (Continued)

Allowance for Doubtful Trade Receivables

An allowance is made for doubtful trade receivables for estimated losses resulting from the subsequent inability of the customers to make required payments. If the financial conditions of the customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required in future periods. Management generally analyses trade receivables, historical bad debts, customer concentrations, customer creditworthiness, and changes in customer payment terms when evaluating the adequacy of the allowance for doubtful trade receivables. To the extent that it is feasible, impairment and uncollectibility is determined individually for each specific customer. In cases where that process is not feasible, a collective evaluation of impairment is performed. At the end of the reporting year, the trade receivables carrying amount approximates its fair value and the carrying amount might change within the next reporting year but the change would not arise from assumptions or other sources of estimation uncertainty at the end of the reporting year (Note 21).

Actuarial Assumptions on Retirement Benefit Obligations

Accounting for retirement benefit obligations involves actuarial assumptions required to measure the obligation and the expenses, with the possibility that actual results differ from the assumed results. These differences are known as actuarial gains and losses. Retirement benefit obligations are measured using the projected unit credit method. According to this method, the Group has to make a reliable estimate of the amount of benefits earned in return for services rendered in current and prior periods using actuarial techniques. In addition, in cases where defined benefit plans are funded, the Group has to estimate the fair value of plan assets based on the expected return on plan assets which is computed using the estimated long-term rate of return. The use of the projected unit credit method involves a number of actuarial assumptions. These assumptions include demographic assumptions such as mortality, employee turnover and retirement age, and financial assumptions such as discount rates, salary and benefit levels. Such assumptions are subject to judgements and actual results may develop differently than expected (Note 29).

3. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS

FRS 24 defines a related party as a person or entity that is related to the reporting entity and it includes (a) A person or a close member of that person’s family if that person (i) has control or joint control over the reporting entity; (ii) has significant influence over the reporting entity; or (iii) is a member of the key management personnel of the reporting entity or of a parent of the reporting entity. (b) An entity is related to the reporting entity if any of the following conditions apply: (i) The entity and the reporting entity are members of the same group; (ii) One entity is an associate or jointly-controlled entity of the other entity; (iii) Both entities are jointly-controlled entities of the same third party; (iv) One entity is a jointly-controlled entity of a third entity and the other entity is an associate of the third entity; (v) The entity is a post-employment benefit plan for the benefit of employees of either the reporting entity or an entity related to the reporting entity; (vi) The entity is controlled or jointly-controlled by a person identified in (a); or (vii) A person identified in (a) (i) has significant influence over the entity or is a member of the key management personnel of the entity (or of a parent of the entity).



3. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS (CONTINUED)

3A. Related Parties

There are transactions and arrangements between the Group and related parties and the effects of these on the basis determined between the parties are reflected in these financial statements. Sales with related parties are based on the price lists in force with non-related parties. The current related party balances are unsecured without fixed repayment terms and interest, unless stated otherwise. For non-current balances, if significant, an interest is imputed, unless stated otherwise, based on the prevailing market interest rate for similar debt less the interest rate, if any, provided in the agreement for the balance. For financial guarantees, an amount is imputed and is recognised accordingly if significant where no charge is payable.

Intragroup transactions and balances that have been eliminated in the consolidated financial statements are not disclosed as related party transactions and balances.

In addition to the transactions and balances disclosed elsewhere in the notes to the financial statements, significant related party transactions include the following:

Group2013 2012$’000 $’000

Non-Controlling Interests in SubsidiariesSale of goods (4,646) (6,031)Purchase of goods 3,578 3,799Purchase of services 432 311Operating lease expenses 27 363Purchase of property, plant and equipment 12 3,674

AssociatesManagement fee income (1,774) (1,570)Purchase of services 1,381 1,223

3B. Key Management Compensation

Key management are the directors and those persons having authority and responsibility over the activities of the Group. Key management compensation comprised those of directors and other key management personnel totalling 8 (2012: 9) persons. Key management compensation is included under employee benefits expense.

Group2013 2012$’000 $’000

Salaries and other short-term employee benefits 3,140 2,991Equity-settled share-based expenses – 421



3. RELATED PARTY RELATIONSHIPS AND TRANSACTIONS (CONTINUED)

3B. Key Management Compensation (Continued)

Included in the above amounts are the following items:

Group2013 2012$’000 $’000

Remuneration of directors of the Company 1,226 1,327Remuneration of directors of the subsidiaries 505 363Fees to directors of the Company 140 125Fees to directors of the subsidiaries 155 183Equity-settled share-based expenses to directors of the Company – 304Equity-settled share-based expenses to directors of subsidiaries – 83

Further information about the remuneration of directors of the Company is provided in the report on Corporate Governance.

4. FINANCIAL INFORMATION BY OPERATING SEGMENTS

4A. Information about Operating Segment Profit or Loss, Assets and Liabilities

Disclosure of information about operating segments, products and services, the geographical areas and the major customers is made as required by FRS 108 – Operating Segments. This disclosure standard has no impact on the reported results or financial position of the Group.

For management reporting purposes, the Group has three operating segments, which form the Group’s strategic business units. The strategic business units offer different products and services and are managed separately because they require different technologies and marketing strategies. For each of the strategic business units, management reviews internal management reports on at least a quarterly basis.

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

(a) Renewable Energy – Design, build and operate biomass co-generation systems, generate power for sale and provision of services related to the applications of heat.

(b) Resource Recovery – Process, recycle and repurpose waste and salvageable materials into environmentally friendly products for industrial applications, such as washed copper slag, compost and retreaded tyres.



4. FINANCIAL INFORMATION BY OPERATING SEGMENTS (CONTINUED)

4A. Information about Operating Segment Profit or Loss, Assets and Liabilities (Continued)

(c) Integrated Environmental Management Solutions – Provision of resource management and integrated environmental engineering solutions for industrial waste and energy management, including designing, optimising, engineering, procurement, fabricating, commissioning, managing and maintenance of waste and energy management facilities.

Performance is measured based on segment results before allocation of corporate management fees, share of results from associates and jointly-controlled entity, finance income, dividend income, finance costs and income tax, as included in the internal management reports. Segment results is used to measure performance as management believes that such information is the most relevant in evaluating the results of the operating segments relative to other entities that operate in similar industries.

Inter-segment sales are based on agreed price lists. Internal transfer pricing policies of the Group are as far as practicable based on market prices. The accounting policies of the operating segments are the same as those disclosed in Note 2 to the financial statements.

Major revenue from external customers for products and services or similar group of products or services is as follows:

Group2013 2012$’000 $’000

Revenue from major products and services:Sales of rubberised products 61,537 74,149




4B. Profit or Loss Reconciliation

RenewableEnergy

ResourceRecovery

Integrated Environmental Management

Solutions Elimination Group2013 2012 2013 2012 2013 2012 2013 2012 2013 2012$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

RevenueRevenue from external

customers 10,482 9,907 69,014 80,330 527 284 – – 80,023 90,521Inter-segment revenue 443 459 1,878 1,357 282 270 (2,603) (2,086) – –

Segment revenue 10,925 10,366 70,892 81,687 809 554 (2,603) (2,086) 80,023 90,521

Segment results before allocation of corporate management fees 616 1,957 8,294 7,379 (903) (597) (3,577) (4,258) 4,430 4,481

Allocated corporate management fees (1,721) (2,472) (1,856) (1,786) – – 3,577 4,258 – –

Segment results (1,105) (515) 6,438 5,593 (903) (597) – – 4,430 4,481Share of results from

associates and jointly-controlled entity, allocated to operating segments (124) (85) (516) (260) – – – – (640) (345)

Unallocated corporate results (36) (115)

Profit before finance income, dividend income, finance costs and income tax 3,754 4,021

Finance income 44 39Dividend income – 411Finance costs (975) (1,042)Income tax expense (969) (1,711)

Profit for the reporting year 1,854 1,718




4C. Assets and Liabilities Reconciliation

RenewableEnergy

ResourceRecovery


Solutions Elimination Group2013 2012 2013 2012 2013 2012 2013 2012 2013 2012$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Segment assets 53,583 33,932 70,484 66,152 9,031 7,523 (24,352)(13,590) 108,746 94,017Investments in associates, allocated to operating

segments 3,785 3,909 890 1,092 – – – – 4,675 5,001Investment in jointly-

controlled entity, allocated to operating segments – – 4,812 – – – – – 4,812 –

Deferred tax assets 318 –Unallocated corporate

assets 2,154 3,948

Total assets 120,705 102,966

Segment liabilities 45,453 29,248 28,100 17,251 10,742 9,447 (55,095)(43,297) 29,200 12,649Loans and borrowings– Allocated to operating

segments 12,466 8,828 11,168 15,489 – – – – 23,634 24,317– Unallocated corporate

loans and borrowings 3,139 1,518Income tax payable 524 335Deferred tax liabilities 2,563 2,622Unallocated corporate

liabilities 1,000 1,043

Total liabilities 60,060 42,484

Capital expenditureAllocated to operating

segments– Property, plant and

equipment 578 4,455 2,175 5,333 1 13 – – 2,754 9,801– Other financial assets – – – 835 – – – – – 835Unallocated corporate

capital expenditure on property, plant and equipment 39 86

Total capital expenditure 2,793 10,722




4D. Other Material Items

Renewable Energy

Resource Recovery


Solutions Elimination Group2013 $’000

2012 $’000

2013 $’000

2012 $’000

2013 $’000

2012 $’000

2013 $’000

2012 $’000

2013 $’000

2012 $’000

Depreciation of property, plant and equipment

Allocated to operating segments 1,378 1,330 1,645 1,713 32 30 – – 3,055 3,073

Unallocated corporate depreciation 80 80

Total depreciation of property, plant and equipment 3,135 3,153

Impairment loss on property, plant and equipment – – 11 194 – – – – 11 194

Loss/(gain) on disposal of property, plant and equipment 11 55 (62) (15) – – – – (51) 40

Amortisation of land use rights 49 23 – – – – – – 49 23

Amortisation of intangible assets – – 102 104 – – – – 102 104

Impairment loss on other financial assets – – 86 67 – – – – 86 67

Net fair value loss/(gain) on derivative financial instruments – – 56 (33) – – – – 56 (33)

Provision for retirement benefit obligations expenses (net) – – 49 34 – – – – 49 34

Amortisation of deferred income – – (8) (8) – – – – (8) (8)

Allowance for doubtful receivables – made/(reversed) 7 (264) (22) (249) – – – 530 (15) 17

Allowance for inventory obsolescence – made/(reversed) 134 92 (42) (6) – – – – 92 86




4E. Geographical Information

In presenting information based on geographical segments, segment revenue is based on geographical location of the customers and segment assets are based on geographical location of the assets as follows:

Revenue Non-Current Assets2013 2012 2013 2012

Group $’000 $’000 $’000 $’000

Singapore 18,017 16,071 19,335 21,569Malaysia 44,679 50,547 19,599 19,417Australia 12,328 19,457 – –People’s Republic of China 29 256 33,559 11,713Others 4,970 4,190 – –

80,023 90,521 72,493 52,699

4F. Information about Major Customers

Revenue from one customer of the Group’s resource recovery operating segment contributed approximately $12,328,000 (2012: $19,457,000) of the Group’s revenue.

5. REVENUE

Group2013 2012$’000 $’000

Sale of goods 64,915 77,552Service income 11,134 10,131Management fee income 1,774 1,570Finance lease income 1,366 1,079Others 834 189

80,023 90,521

6. FINANCE INCOME

Group2013 2012$’000 $’000

Interest income from financial institutions 40 39Interest income from others 4 –

44 39



7. DIVIDEND INCOME

Group2013 2012$’000 $’000

Dividend income from unquoted corporation – 411

8. OTHER CREDITS AND (OTHER CHARGES)

Group2013 2012$’000 $’000

Impairment loss on property, plant and equipment (11) (194)Gain/(loss) on disposal of property, plant and equipment 51 (40)Impairment loss on other financial assets (86) (67)Net fair value (loss)/gains on derivative financial instruments (56) 33Foreign exchange transaction (loss)/gains (net) (169) 432Allowance for doubtful receivables – reversed/(made) 15 (17)Government grant income 52 47Others 33 39

Net (171) 233

Presented in profit or loss as: Other Credits 151 551 Other Charges (322) (318)

Net (171) 233

9. FINANCE COSTS

Group2013 2012$’000 $’000

Interest expenses on bank loans, bank overdrafts, bankers’ acceptances and trust receipts 872 916Interest expenses on finance lease liabilities 74 92Interest expenses on retirement benefit obligations 29 34

975 1,042



10. EMPLOYEE BENEFITS EXPENSE

Group2013 2012$’000 $’000

Salaries, bonus and other wages 14,017 13,342Contributions to defined contribution plans 1,109 1,052Provision for retirement benefit obligations expense (net) 49 34Equity-settled share-based expenses – 528Other benefits 1,735 1,078

16,910 16,034

11. ITEMS IN THE STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

In addition to items of profit or loss disclosed elsewhere in the notes to the financial statements, items in the statement of profit or loss and other comprehensive income include the following:

Group2013 2012$’000 $’000

Auditors’ remuneration: Auditor of the Company 210 213 Member firms of the Auditor of the Company 93 97 Other auditors 2 10Non-audit fees paid and payable to: Auditor of the Company 32 93 Member firms of the Auditor of the Company 4 14 Other auditors 8 2

12. INCOME TAX EXPENSE

12A. Components of Income Tax Expense/(Income) Recognised in Profit or Loss

Group2013 2012$’000 $’000

Current tax expenseCurrent tax expense 1,683 1,875Withholding tax expense 67 66Adjustments in respect of prior years (440) (186)

Subtotal 1,310 1,755Deferred tax incomeDeferred tax income (341) (44)

Total income tax expense 969 1,711



12. INCOME TAX EXPENSE (CONTINUED)

12A. Components of Income Tax Expense/(Income) Recognised in Profit or Loss (Continued)

The income tax in profit or loss varied from the amount of income tax expense determined by applying the Singapore’s income tax rate of 17% (2012: 17%) to profit before income tax as a result of the following differences:

Group2013 2012$’000 $’000

Profit before income tax 2,823 3,429Add: Share of results from associates and jointly-controlled entity 640 345

3,463 3,774

Income tax using Singapore’s income tax rate 589 642Effect of different tax rates in foreign jurisdictions 276 572Withholding tax expense 67 66Non-deductible items 339 556Tax exempt income (74) (317)Tax incentives (58) (10)Adjustments to current tax in respect of prior years (440) (186)Deferred tax assets not recognised 107 419Others 163 (31)

Total income tax expense 969 1,711

12B. Movements in Deferred Tax (Liabilities)/Assets in the Statements of Financial Position

At1 November

2011

Recognised in Profitor Loss

Exchange Differences

At31 October

2012

Arising From Acquisition of a Subsidiary (Note 17A)


Exchange Differences

At31 October

2013Group $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Property, plant and equipment (2,489) 65 (242) (2,666) – 257 35 (2,374)

Intangible assets (457) 26 7 (424) – 26 6 (392)Unutilised tax losses 914 201 88 1,203 3,854 345 (14) 5,388Unutilised capital

allowances 1 149 40 190 – (190) – –Other items 332 22 68 422 – 10 (4) 428Deferred tax assets

not recognised (1,001) (419) 73 (1,347) (3,854) (107) 13 (5,295)

(2,700) 44 34 (2,622) – 341 36 (2,245)

Company

At1 November

2011


At 31 October

2012


At 31 October

2013$’000 $’000 $’000 $’000 $’000

Property, plant and equipment (20) 20 – – –



12. INCOME TAX EXPENSE (CONTINUED)

12B. Movements in Deferred Tax (Liabilities)/Assets in the Statements of Financial Position (Continued)

Group2013 2012$’000 $’000

Presented in statements of financial position as: Deferred tax liabilities (2,563) (2,622) Deferred tax assets 318 –

Net (2,245) (2,622)

12C. Unrecognised Deferred Tax Assets

2013 2012Gross

AmountTax

EffectGross

AmountTax

EffectGroup $’000 $’000 $’000 $’000

Unutilised tax losses 21,295 5,063 4,900 1,084Unutilised capital allowances 535 134 760 190Others 579 98 297 73

22,409 5,295 5,957 1,347

No deferred tax asset has been recognised in respect of the above balance as the future profit streams are not probable. Except for unutilised tax losses in subsidiaries operating in People’s Republic of China of approximately $20,078,000 (2012: $3,726,000) which expires between 1 to 5 years (2012: 1 to 5 years), the realisation of the future income tax benefits from these unutilised tax losses is available for an unlimited future period subject to the conditions imposed by laws of the countries in which the entities in the Group operates, including the retention of majority shareholders as defined.

13. EARNINGS PER SHARE

The following table illustrates the numerators and denominators used to calculate basic and diluted earnings per share:

Group2013 2012$’000 $’000

Numerator: EarningsProfit for the reporting year attributable to owners of the Company used in the basic and diluted earnings per share calculation 1,899 1,366



13. EARNINGS PER SHARE (CONTINUED)

GroupWeighted Average

Number ofOrdinary Shares

2013 2012’000 ’000

Denominator: SharesWeighted average number of ordinary shares in issue during the reporting year used in the basic earnings per share calculation 925,738 890,020Effect of dilutive performance shares – 2,538

Weighted average number of ordinary shares in issue during the reporting year used in the diluted earnings per share calculation 925,738 892,558

14. PROPERTY, PLANT AND EQUIPMENT

Construction-in-Progress

LeaseholdLand

Leasehold Properties and Improvements

Plant and Equipment Total

Group $’000 $’000 $’000 $’000 $’000

CostAt 1 November 2011 11,012 536 6,072 33,238 50,858Effects of movements in exchange rates (13) (27) (67) (278) (385)Additions 4,554 1,124 1,900 2,309 9,887Transfers (14,770) – 36 14,734 –Disposals – – – (331) (331)Reclassified to finance lease receivables – – – (14,598) (14,598)

At 31 October 2012 783 1,633 7,941 35,074 45,431Effects of movements in exchange rates (308) (27) (9) (169) (513)Additions 1,705 – 34 1,054 2,793Arising from acquisition of a subsidiary (Note 17A) 13,910 – – 121 14,031Transfers (388) 14 38 336 –Disposals – – – (273) (273)

At 31 October 2013 15,702 1,620 8,004 36,143 61,469



14. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

Construction-in-Progress

LeaseholdLand

Leasehold Properties and Improvements


Group $’000 $’000 $’000 $’000 $’000

Accumulated depreciation and impairment lossesAt 1 November 2011 – 28 2,834 10,253 13,115Effects of movements in exchange rates – (1) (4) (58) (63)Depreciation for the reporting year – 6 192 2,955 3,153Disposals – – – (130) (130)Impairment loss – – – 194 194

At 31 October 2012 – 33 3,022 13,214 16,269Effects of movements in exchange rates – – 8 (33) (25)Depreciation for the reporting year – 25 207 2,903 3,135Disposals – – – (194) (194)Impairment loss – – – 11 11

At 31 October 2013 – 58 3,237 15,901 19,196

Carrying amountsAt 1 November 2011 11,012 508 3,238 22,985 37,743

At 31 October 2012 783 1,600 4,919 21,860 29,162

At 31 October 2013 15,702 1,562 4,767 20,242 42,273




Construction- in-Progress


Company $’000 $’000 $’000

CostAt 1 November 2011 – 777 777Additions 67 19 86Disposals – (11) (11)

At 31 October 2012 67 785 852Additions 36 3 39

At 31 October 2013 103 788 891

Accumulated depreciationAt 1 November 2011 – 276 276Depreciation for the reporting year – 80 80Disposals – (11) (11)

At 31 October 2012 – 345 345Depreciation for the reporting year – 80 80

At 31 October 2013 – 425 425

Carrying amountsAt 1 November 2011 – 501 501

At 31 October 2012 67 440 507

At 31 October 2013 103 363 466

14A. Impairment Loss on Plant and Equipment

Included in the property, plant and equipment of the Group is a coal-fired power plant with carrying amount of $6,273,000 as at 31 October 2013 (2012: $6,514,000) of a non-wholly owned subsidiary, Wuhan ecoWise. This plant will be converted to a biomass co-generation power plant. The coal-fired power plant has ceased operations and the commencement of plant conversion is subject to Wuhan ecoWise receiving additional capital injection from its shareholders for purposes of securing the bank financing for the conversion.

Subsequent to end of the reporting year, the Group has entered into an Agreement of Share Transfer (“Agreement”) to dispose 20% equity interests in Wuhan ecoWise to its non-controlling interests for cash consideration of approximately $2,949,000. Based on management’s assessment, there is no impairment loss on carrying amounts of Wuhan ecoWise’s property, plant and equipment.

As at the end of the reporting year, the Group has also assessed the recoverable amount of certain of its plant and equipment in the resource recovery segment and recorded an impairment loss of $11,000 (2012: $194,000). The Group considered the amount and expected usage of the plant and equipment and assessed the recoverable amount based on its estimated value in use at a pre-tax discount value of 12%. The impairment loss on plant and equipment was recorded under other charges in the profit or loss.




14B. Plant and Equipment Acquired Under Finance Lease Arrangements

The Group and the Company acquired certain plant and equipment under finance lease agreements and the carrying amounts of the plant and equipment are as follows:

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Plant and equipment 1,696 2,116 229 273

14C. Securities Pledged

As at the end of the reporting year, the carrying amounts of the Group’s property, plant and equipment that are pledged as securities to secure loans and borrowings (Notes 30A and 30B) are as follows:

Group2013 2012$’000 $’000

Construction-in-progress 6,109 –Leasehold land 1,561 1,600Leasehold properties and improvements 3,258 3,455Plant and equipment 10,557 11,317

21,485 16,372

15. INTANGIBLE ASSETS

TrademarksCustomer

Relationships Goodwill Total

Group $’000 $’000 $’000 $’000

Cost

At 1 November 2011 1,888 53 282 2,223

Effects of movements in exchange rates (32) (1) (5) (38)

At 31 October 2012 1,856 52 277 2,185

Effects of movements in exchange rates (34) – (4) (38)

At 31 October 2013 1,822 52 273 2,147



15. INTANGIBLE ASSETS (CONTINUED)

TrademarksCustomer

Relationships Goodwill Total

Group $’000 $’000 $’000 $’000

Accumulated amortisation and impairment losses

At 1 November 2011 99 5 – 104

Effects of movements in exchange rates (3) – – (3)

Amortisation for the reporting year 99 5 – 104

At 31 October 2012 195 10 – 205

Effects of movements in exchange rates (6) – – (6)

Amortisation for the reporting year 96 6 – 102

At 31 October 2013 285 16 – 301

Carrying amounts

At 1 November 2011 1,789 48 282 2,119

At 31 October 2012 1,661 42 277 1,980

At 31 October 2013 1,537 36 273 1,846

The amortisation of trademarks and customer relationships were included in marketing and distribution expenses.

15A. Impairment Testing for Cash-Generating Units (“CGUs”) Containing Goodwill

For the purpose of impairment testing, goodwill is allocated to the Group’s CGUs identified through operating subsidiaries as follows:

2013 2012$’000 $’000

Name of subsidiarySunrich Resources Sdn. Bhd. (Resource Recovery Segment) 273 277

The recoverable amount of goodwill allocated to the CGU, Sunrich Resources Sdn. Bhd., was based on its value in use and was determined by discounting the future cash flows to be generated from the continuing use of the CGU. These calculations use cash flow projections based on financial budgets.



15. INTANGIBLE ASSETS (CONTINUED)

15A. Impairment Testing for Cash-Generating Units (“CGUs”) Containing Goodwill (Continued)

Key assumptions used in value in use calculation

2013 2012% %

Growth rate 8% to 15% 5% to 15%Discount rate 12% 12%

The growth rate used is based on management’s expectations on market performance. The discount rate used is pre-tax and reflects specific risks relating to the specific industry in which the entity operates in and cash flows beyond the reporting periods covered by the financial budgets are projected on the assumptions of constant revenue growth and gross margins.

16. LAND USE RIGHTS

Group2013 2012$’000 $’000

CostAt beginning of the reporting year 1,129 1,136Effects of movements in exchange rates 19 (7)Arising from acquisition of a subsidiary (Note 17A) 2,479 –

At end of the reporting year 3,627 1,129

Accumulated amortisation and impairment lossesAt beginning of the reporting year 84 62Effects of movements in exchange rates 2 (1)Amortisation for the reporting year 49 23

At end of the reporting year 135 84

Carrying amountsAt beginning of the reporting year 1,045 1,074


Land use rights relate to two parcels of land located in the People’s Republic of China. The land use rights expire on 14 June 2059 and 11 December 2057 respectively and are non-transferrable. Amortisation of land use rights was included in administrative expenses.



17. INVESTMENTS IN SUBSIDIARIES

Company2013 2012$’000 $’000

Unquoted equity shares, at cost 20,524 19,524Less: Allowance for impairment loss (1,450) (1,450)

19,074 18,074Loans due from subsidiaries 24,867 7,871Less: Allowance for doubtful receivables (860) –

43,081 25,945

Movements in allowance for impairment loss are as follows:At beginning and end of the reporting year 1,450 1,450

Movements in allowance for doubtful receivables are as follows:At beginning of the reporting year – –Allowance for doubtful receivables 860 –

At end of the reporting year 860 –

Loans due from subsidiaries are unsecured and interest-free. The settlement of these amounts is neither planned nor likely to occur in the future. As these amounts are in substance, a part of the Company’s net investments in subsidiaries, they are stated at cost less impairment losses.

The subsidiaries held by the Group and Company are as follows:

Name of Subsidiary

Country of Incorporation/

Place of Operations Principal Activities

EffectiveEquity Interests

Held by the Group2013 2012

% %

Held by the Company

Asia Cleantech Hub Pte. Ltd.(a) Singapore Investment holding 100 100

Bee Joo Environmental Pte. Ltd.(a)

Singapore General waste management services

100 100

Bee Joo Industries Pte. Ltd.(a) Singapore Processing and recycling of used copper slag, horticultural and other waste and operating of biomass co-generation plant

100 100

ecoWise Energy Pte. Ltd.(a) Singapore Renewable energy business 100 100



17. INVESTMENTS IN SUBSIDIARIES (CONTINUED)

Name of Subsidiary





% %

Held by the Company (Continued)

ecoWise International Pte. Ltd.(a)

Singapore International procurement and trading of rubber related goods and research and experimental development on environment and clean technologies

100 100

ecoWise New Energy Pte. Ltd.(a)

(Incorporated on 18 December 2012)

Singapore Investment holding 100 –

ecoWise Resources Pte. Ltd.(a) Singapore Processing and recycling of horticultural and other waste

100 100

ecoWise RubberTech Pte. Ltd.(a) Singapore Processing of rubberised related goods and investment holding

100 100

ecoWise Solutions Pte. Ltd.(a) Singapore Developing and commercialising ecology solutions, research and development of technologies relating to environmental solutions

100 100

ecoWise Ventures Pte. Ltd.(a) Singapore Investment holding 100 100

Sunrich Resources Sdn. Bhd.(a) Malaysia Investment holding 100 100

Held by subsidiaries

ecoWise Technologists and Engineers Pte. Ltd.(a)

Singapore Provision of environmental solutions consultancy services

80 80

ecoWise Marina Power Pte. Ltd.(a)

Singapore Operation and maintenance of biomass co-generation plant

100 100

Hivern Investments Pte. Ltd.(a)

(Acquired on 30 May 2013)Singapore Investment holding 99 –

Chongqing ecoWise Investment Management Co., Ltd.(b)

People’s Republic of

China

Service provider for project and investment consultancy and management

100 100

Changyi Enersave Biomass to Energy Co., Ltd(b)

(Acquired on 30 May 2013)


China

Generation and sale of electricity and heat

99 –

Wuhan ecoWise Energy Co., Ltd.(a)(c)


China

Generation and sale of electricity and steam

49 49




Name of Subsidiary





% %

Held by subsidiaries (Continued)

Sunrich Integrated Sdn. Bhd.(a) Malaysia Investment holding 100 100

Autoways Industries Sdn. Bhd.(a)

Malaysia Trading of retread tyres and related rubberised products

76 76

Ecogreen Products and Services Sdn. Bhd.(a)

Malaysia Production, trading and consultancy services related to biomass products

80 80

Gulf Rubber (M) Sdn. Bhd.(a) Malaysia Retreading of tyres, dealing in rubberised products and investment holding

84 84

Gulf Rubber Suntex Sdn. Bhd.(a) Malaysia Trading of retread tyres and related rubberised products

71 71

Saiko Rubber (Malaysia) Sdn. Bhd.(a)

Malaysia Manufacturing and trading of rubberised products and investment holding

51 51

Sun Rubber Industry Sdn. Bhd.(a)

Malaysia Manufacturing and trading of rubberised products and investment holding

100 100

Sun Rubber Marketing Sdn. Bhd.(a)

Malaysia Dormant 100 100

Sun Tyre & Auto Products Sdn. Bhd.(a)

Malaysia Trading of new and retread tyres and related rubber products

100 100

Sun Tyre Industries Sdn. Bhd.(a) Malaysia Retreading of tyres, dealing in rubberised products and investment holding

100 100

Sunrich Marketing Sdn. Bhd.(a) Malaysia Trading of retread tyres and related rubberised products

100 100

Trakar Suntex Sdn. Bhd.(a)(c) Malaysia Trading of retread tyres and related rubberised products

43 43

Winner Suntex Sdn. Bhd.(a) Malaysia Trading of retread tyres and related rubberised products

75 75

(a) Audited by member firms of RSM International. RSM Chio Lim LLP in Singapore is the auditor for all significant Singapore-incorporated subsidiaries. RSM Robert Teo, Kuan & Co. is the auditor for all Malaysia-incorporated subsidiaries. For the purpose of consolidation, RSM China CPA Firm, Shanghai International Division is the auditor for all significant subsidiaries established in the People’s Republic of China.




(b) For the purpose of consolidation, the unaudited management financial statements at 31 October 2013 have been used. The impact arising from the use of the subsidiaries’ unaudited management financial statements is not expected to be significant to the financial statements of the Group.

(c) This entity is consolidated because the Group is able to govern the financial and operating policies of the entity by virtue of an agreement with other shareholders of the entity although the Group does not own, directly or indirectly through subsidiaries, more than half of the voting power of the entity.

17A. Acquisition of a Subsidiary

On 30 May 2013, the Group through its wholly-owned subsidiary, ecoWise New Energy Pte Ltd (“ecoWise New Energy”), acquired 99% equity interests in Hivern Investments Pte Ltd (“Hivern”) for a consideration of $90,000. An arrangement to procure and transfer the remaining 1% equity interests by ecoWise New Energy at a nominal consideration of $1 is in place.

The principal activity of Hivern is that of an investment holding company. It has a wholly-owned subsidiary in the People’s Republic of China, Changyi Enersave Biomass to Energy Co., Ltd (“CEBEC”), which has a business operation license with validity up to 29 October 2027 to carry out renewable energy electric power and heat generation by using crops straw, forestry wastes and other biomass feedstock.

The fair values of identifiable assets acquired and liabilities assumed from the acquisition of Hivern and its wholly-owned subsidiary (“Hivern Group”) are recorded on a provisional basis and are subject to changes upon completion of the purchase price allocation exercise as required under FRS 103 Business Combinations. The purchase price allocation exercise is expected to be completed not later than 12 months from the date of acquisition.

The non-controlling interests of 1% in Hivern Group was measured based on fair value of $1 on the date of acquisition.

ProvisionalFair Values

Group $’000

Property, plant and equipment 14,031Land use rights 2,479Deferred tax assets –Trade and other receivables 870Other assets 282Inventories 54Cash and cash equivalents 4Income tax payable (57)Trade and other payables (13,774)Loans and borrowings (3,799)

Total identifiable net assets at provisional fair values 90




17A. Acquisition of a Subsidiary (Continued)

The net cash inflows upon acquisition are as follows:

$’000

Cash consideration paid 90Less: Cash and cash equivalents acquired (4)

Net cash inflows upon acquisition 86

During the reporting year, the Group incurred acquisition-related costs of $195,000 (2012: $75,000) related to external legal fees and due diligence costs on acquisition of Hivern Group. Acquisition-related costs were included in administrative expenses.

In the five months to 31 October 2013, Hivern Group contributed no revenue and loss after tax of $650,000 to the Group’s results. If the acquisition had occurred on 1 November 2012, management estimates the consolidated revenue would have been $80,023,000 and consolidated profit after tax would have been $1,164,000.

17B. Acquisition of Non-Controlling Interests without Change in Control

In the previous reporting year, the Company acquired an additional 30% equity interests in Sunrich Integrated Sdn. Bhd. for consideration of $3,675,000 by way of issuance of 35,000,000 new ordinary shares in the capital of the Company at $0.105 per ordinary share. After the acquisition, Sunrich Integrated Sdn. Bhd. became a wholly-owned subsidiary of the Group. The carrying amounts of Sunrich Integrated Sdn. Bhd.’s net assets on the date of acquisition was $22,489,000. The Group recognised a decrease in non-controlling interests of $6,419,000 and an increase in other reserves of $2,744,000.

18. INVESTMENTS IN ASSOCIATES

Group2013 2012$’000 $’000

Unquoted equity shares, at cost 5,187 5,187

Share of profit or loss:At beginning of the reporting year (186) 159Share of loss for the reporting year (326) (345)

At end of the reporting year (512) (186)

Carrying amount of associates 4,675 5,001



18. INVESTMENTS IN ASSOCIATES (CONTINUED)

The significant associates held by the Group are as follows:

Name of Associate





% %

Held by subsidiariesGeocycle Singapore Pte. Ltd. Singapore Management and recycling of

industrial waste materials50 50

China-UK Low Carbon Enterprise Co., Ltd


China

Investment holding 20 20

For the purpose of equity accounting for the associates, the unaudited management financial statements at 31 October 2013 have been used. The impact arising from the use of the associates’ unaudited management financial statements is not expected to be significant to the financial statements of the Group.

The summarised unaudited financial information of the associates, not adjusted for the percentage ownership held by the Group, are as follows:

Group2013 2012$’000 $’000

Assets 24,311 23,000Liabilities (2,959) (1,396)Revenue 2,240 1,904Loss for the reporting year (1,022) (946)

19. INVESTMENT IN JOINTLY-CONTROLLED ENTITY

Group2013 2012$’000 $’000

Unquoted equity shares, at cost 5,126 –

Share of profit or loss:At beginning of the reporting year – –Share of loss for the reporting year (314) –

At end of the reporting year (314) –

Carrying amount of jointly-controlled entity 4,812 –



19. INVESTMENT IN JOINTLY-CONTROLLED ENTITY (CONTINUED)

The jointly-controlled entity held by the Group is as follows:

Name of Jointly-Controlled Entity





% %

Held by a subsidiaryChongqing eco-CTIG Rubber Technology Co., Ltd.


China

Retreading of tyres and dealing in rubberised products

65 –

For the purpose of equity accounting for the jointly-controlled entity, the unaudited management financial statements at 31 October 2013 have been used. The impact arising from the use of the jointly-controlled entity’s unaudited management financial statements is not expected to be significant to the financial statements of the Group.

The entity is not consolidated although the Group own, directly or indirectly through a subsidiary, more than half of the voting power of the entity as the Group does not control the board of directors of the jointly-controlled entity under the terms of the joint venture agreement.

The summarised unaudited financial information of the jointly-controlled entity, not adjusted for the percentage ownership held by the Group, are as follows:

Group2013 2012$’000 $’000

Assets 7,696 –Liabilities (44) –Revenue – –Loss for the reporting year (483) –



20. OTHER FINANCIAL ASSETS

Group2013 2012$’000 $’000

Unquoted equity shares in corporations as available-for-sale financial asset, at cost 1,092 1,180

The fair value of the unquoted investments as available-for-sale financial asset is deemed to be not reliably measurable as the probabilities of the various estimates within the range cannot be reasonably assessed and used in estimating fair value. Consequently, the investment is carried at cost less impairment losses.

21. TRADE AND OTHER RECEIVABLES

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Trade receivablesOutside parties 18,435 19,094 – –Allowance for doubtful receivables (635) (671) – –Factored trade receivables 650 373 – –Related parties 960 119 – –Subsidiaries – – 6,318 10,278Associates 50 65 – –Jointly-controlled entity 35 – – –

19,495 18,980 6,318 10,278



21. TRADE AND OTHER RECEIVABLES (CONTINUED)

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Other receivablesSubsidiaries – – 1,057 12,464Associate 600 600 – –Related parties 203 196 – –Outside parties 640 1,014 – –Allowance for doubtful receivables (23) (23) – –

1,420 1,787 1,057 12,464

Total trade and other receivables 20,915 20,767 7,375 22,742

Presented in statements of financial position as: Non-current 600 600 – – Current 20,315 20,167 7,375 22,742

20,915 20,767 7,375 22,742

Movements in the allowance for trade receivables are as follows:

Group2013 2012$’000 $’000

At beginning of the reporting year 671 665Effects of movements in exchange rates (5) (11)Allowance for doubtful receivables – (reversed)/made (15) 17Bad debts written off (16) –


Movements in the allowance for other receivables are as follows:

Group2013 2012$’000 $’000

At beginning and end of the reporting year 23 23

At the end of the reporting year, factored trade receivables of $650,000 (2012: $373,000) were assigned to a bank. The factoring facility is covered by a corporate guarantee provided by the Company to a subsidiary. Since these receivables did not meet the FRS 39 derecognition requirements, they were recognised as receivables even though they were legally sold without recourse.



21. TRADE AND OTHER RECEIVABLES (CONTINUED)

Other receivables due from subsidiaries are unsecured, bear interest at 2.75% (2012: 2.75%) per annum and have no fixed terms of repayment.

Other receivables due from an associate are unsecured, non-interest bearing and not expected to be repaid within the next 12 months.

Other receivables due from related parties are unsecured, non-interest bearing and have no fixed terms of repayment.

22. FINANCE LEASE RECEIVABLES

The Group entered into a Design, Build and Operate Agreement (“DBO Agreement”) to construct, operate and maintain a biomass co-generation plant to supply electricity and heat to the customer for a term of 15 years up to January 2027.

The Group assessed that the terms and conditions of the DBO Agreement contains a lease arrangement under INT-FRS 104 – Determining whether an Arrangement contains a Lease. The lease is classified as a finance lease as the present value of the minimum lease receivables amount to at least substantially all of the fair value of the biomass co-generation plant at the inception of the lease. Consequently, the Group reclassified its investment in the biomass co-generation plant from plant and equipment to finance lease receivables. The Group continues to be the legal owner of the plant.

Future minimum finance lease receivables under finance leases together with the present value of the net minimum finance lease receivables are as follows:

MinimumFinance Lease

Receivables

UnearnedFinanceIncome

Net FinanceLease

ReceivablesGroup $’000 $’000 $’000

2013Receivable within one year 1,942 (1,398) 544Receivable within 2 to 5 years 7,735 (5,093) 2,642Receivable after 5 years 15,837 (5,363) 10,474

25,514 (11,854) 13,660



22. FINANCE LEASE RECEIVABLES (CONTINUED)

MinimumFinance Lease

Receivables

UnearnedFinanceIncome

Net FinanceLease

ReceivablesGroup $’000 $’000 $’000

2012Receivable within one year 2,287 (1,447) 840Receivable within 2 to 5 years 7,735 (5,240) 2,495Receivable after 5 years 17,880 (6,644) 11,236

27,902 (13,331) 14,571

Group2013 2012$’000 $’000

Presented in statements of financial position as: Non-current 13,116 13,731 Current 544 840

13,660 14,571

The imputed finance income on the finance lease receivables was determined based on the interest rate implicit in the lease. The effective interest rate is 10.2% (2012: 10.2%) per annum.

The finance lease receivables are pledged as security to secure loans and borrowings (Note 30A).

23. OTHER ASSETS

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Non-current:Prepayments 269 – – –

Current:Prepayments 1,722 383 110 42Deposits to secure services 252 251 43 43

1,974 634 153 85



24. INVENTORIES

Group2013 2012$’000 $’000

Raw materials 2,939 3,605Work-in-progress 630 802Finished goods 4,784 4,613Consumables 1,395 1,044

9,748 10,064

Inventories are stated after allowance for inventory obsolescence and the movements in the allowance for inventories obsolescence are as follows:

Group2013 2012$’000 $’000

At beginning of the reporting year 186 102Effects of movements in exchange rates (2) (2)Allowance for inventory obsolescence 92 86


As at the end of the reporting year, the carrying amount of the Group’s inventories pledged as security to secure loans and borrowings (Note 30A) was Nil (2012: $621,000).

Raw materials, consumables and changes in finished goods and work-in-progress recognised as cost of sales during the reporting year amounted to $39,341,000 (2012: $51,859,000).

25. DERIVATIVE FINANCIAL INSTRUMENTS

Group2013 2012$’000 $’000

Current Assets – Derivative financial instruments with positive fair values: Forward foreign exchange contracts – Cash flow hedges 31 35

Current Liabilities – Derivative financial instruments with negative fair values: Forward foreign exchange contracts – Cash flow hedges (103) (14)



25. DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED)

The movements during the reporting year are as follows:

Group2013 2012$’000 $’000

At beginning of the reporting year 21 (31)(Loss)/gains in profit or loss (54) 33(Loss)/gains recognised in other comprehensive income (39) 19

At end of the reporting year (72) 21

Notional Amount

ReferenceCurrency Maturity Fair Value

Group $’000 $’000

2013Forward currency contracts 460 AUD November 2013 (21)Forward currency contracts 1,052 AUD December 2013 (31)Forward currency contracts 1,110 AUD January 2014 2Forward currency contracts 284 AUD February 2014 1Forward currency contracts 284 USD December 2013 (13)Forward currency contracts 1,323 EUR February 2014 (10)

(72)

2012Forward currency contracts 856 AUD November 2012 15Forward currency contracts 1,078 AUD December 2012 12Forward currency contracts 585 AUD January 2013 (4)Forward currency contracts 1,219 USD November 2012 (4)Forward currency contracts 1,100 USD December 2012 2

21

Forward foreign currency contracts are utilised to hedge against significant future transactions and cash flows. They are used where possible to reduce the exposure in the fluctuations of foreign currency rates. The forward foreign currency contracts are primarily denominated in the currencies of the Group’s principal markets. The Group does not enter into derivative contracts for speculative purposes.

The forward foreign currency contracts are not traded in an active market. As a result, their fair values are based on valuation techniques currently consistent with generally accepted valuation methodologies for pricing financial instruments, and incorporate all factors and assumptions that knowledgeable, willing market participants would consider in setting the price. The fair value of forward foreign currency contracts is based on the current value of the difference between the contractual exchange rate and the market rate at the end of the reporting year. The fair value is regarded as a Level 2 fair value measurement for financial instruments (Note 34B2).



26. CASH AND CASH EQUIVALENTS

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Not restricted in use 14,519 16,801 1,535 3,356Restricted in use 752 1,726 – –

15,271 18,527 1,535 3,356

Interest earning balances 2,430 1,855 – 1,000

Details of restricted cash balances are as follows:

Group2013 2012$’000 $’000

Under Financing ActivitiesFixed deposits held by banks as security deposits for loans and borrowings 722 706Fixed deposits held by banks as security deposits for performance bond 30 30Bank balances held by banks as security deposits for foreign currency contract facilities – 88

752 824Under Operating ActivitiesBank balances set aside for payments to specific creditors – 902

752 1,726

Other than the amounts that are restricted in use, cash and cash equivalents represent amounts with less than 90 days maturity.

The rate of interest for the cash on interest earning accounts is between 0.1 % and 3.0% (2012: 0.1% and 0.8%) per annum.

26A. Cash and Cash Equivalents in the Consolidated Statement of Cash Flows

Group2013 2012$’000 $’000

Cash and cash equivalents in the statement of financial position 15,271 18,527Cash and cash equivalents restricted in use (752) (1,726)Bank overdrafts – (351)

Cash and cash equivalents for consolidated statement of cash flows purposes at the end of the reporting year 14,519 16,450



26. CASH AND CASH EQUIVALENTS (CONTINUED)

26B. Non-Cash Transactions

During the reporting year, the Group had the following major non-cash transactions:

Group2013 2012$’000 $’000

Acquisition of plant and equipment under finance lease agreements 265 1,072Issue of ordinary shares as consideration for acquisition of non-controlling interests (Note 17B) – 3,675Issue of ordinary shares for the performance shares vested (Note 27) 264 –

27. SHARE CAPITAL

Number of OrdinaryShares With No Par Value Share Capital

2013 2012 2013 2012Group and Company ’000 ’000 $’000 $’000

At beginning of the reporting year 924,159 839,159 45,927 37,050Issue of ordinary shares under ecoWise Performance Share Plan 2,538 – 264 –Issue of ordinary shares – 85,000 – 8,925Share issue expenses – – – (48)

At end of the reporting year 926,697 924,159 46,191 45,927

Ordinary Shares

The ordinary shares with no par value are fully paid and carry no right to fixed income. The holders of ordinary shares are entitled to receive dividends when declared by the Company. All ordinary shares carry one vote per share without restrictions at meetings of the Company.

Issue of ordinary shares:

During the reporting year, pursuant to the share awards granted on 21 March 2012 of 5,426,875 shares under ecoWise Performance Share Plan, the Company had on 19 March 2013 issued and allotted 2,538,438 ordinary shares in the share capital of the Company to eligible participants in accordance with the vesting criteria. The remaining share awards of 2,888,437 shares had thereof been cancelled and lapsed.



27. SHARE CAPITAL (CONTINUED)

Ordinary Shares (Continued)

In the previous reporting year, the Company issued new ordinary shares as follows:

(a) 50,000,000 new ordinary shares at S$0.105 per ordinary share for cash in pursuant to a Subscription Agreement; and

(b) 35,000,000 new ordinary shares as consideration for the acquisition of the remaining 30% equity interests in Sunrich Integrated Sdn. Bhd. (Note 17B).

Externally Imposed Capital Requirement

The Company is subject to externally imposed capital requirement which is to have share capital with a free float of at least 10% of the shares to maintain its listing on the Singapore Exchange Securities Trading Limited. The Company has met the externally imposed capital requirement. Management receives a report from the share registrars frequently on substantial share interests showing the non-free float to ensure continuing compliance with the 10% limit throughout the reporting year.

Capital Management

The Company is committed to maintain an optimal capital structure to safeguard the Company’s ability to continue as a going concern, to provide returns for owners and benefits for other stakeholders, and to provide an adequate return to owners by pricing products and services commensurately with the level of risk. The management sets the amount of capital in proportion to risk. There were no changes in the approach to capital management during the reporting year.

The management manages the capital structure and makes adjustments to it where necessary or possible in the light of changes in conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the management may adjust the amount of dividends paid to owners, return capital to owners, issue new shares, or sell assets to reduce debts.

The management monitors the capital on the basis of the debt-to-adjusted capital ratio. This ratio is calculated as net debt/adjusted capital. Net debt is calculated as total borrowings less cash and cash equivalents. Adjusted capital comprises all components of equity, that is, its total equity.



27. SHARE CAPITAL (CONTINUED)

The debt-to-adjusted capital ratio is set out below:

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Loans and borrowings 26,773 25,835 3,139 1,518Less: Cash and cash equivalents (15,271) (18,527) (1,535) (3,356)

Net debt 11,502 7,308 1,604 (1,838)

Adjusted capital 60,645 60,482 48,082 49,365

Debt-to-adjusted capital ratio 19.0% 12.1% 3.3% NM

NM: Not meaningful as cash and cash equivalents exceed loans and borrowings.

During the reporting year, debt-to-adjusted capital ratio has increase mainly due to utilisation of the Group’s cash reserves to finance its investing activities and results of acquisition of Hivern Group’s loans and borrowings of $3,799,000.

28. OTHER RESERVES

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Equity-settled share-based compensation reserve (Note 28A) – 528 – 528Foreign currency translation reserve (Note 28B) (1,791) (1,401) – –Hedging reserve (Note 28C) (20) 19 – –Other reserve (Note 28D) 2,508 2,553 – –

697 1,699 – 528

All reserves classified on the face of the statements of financial position as retained earnings represent past accumulated earnings and are distributable. The other reserves are not available for cash dividends unless realised.



28. OTHER RESERVES (CONTINUED)

28A. Equity-Settled Share-Based Compensation Reserve

ecoWise Performance Share Plan

The ecoWise Performance Share Plan (the “Share Plan”) was approved by the members of the Company at an extraordinary general meeting held on 23 March 2007. The Share Plan provides for the grant of ordinary shares of the Company, their equivalent cash value or combinations thereof, to selected employees of the Company and its subsidiaries, including the directors of the Company, and other selected participants. Under the Share Plan, the maximum number of ordinary shares to be awarded to eligible participants shall not exceed 15% of the issued ordinary shares of the Company on the date preceding the grant of the award.

The Share Plan is administered by the Remuneration Committee comprising three independent directors, Mr. Ang Mong Seng, Mr. Ng Cher Yan and Mr. Ong Teck Ghee. Ordinary shares are vested when the Remuneration Committee is satisfied that the prescribed performance target(s) have been achieved and the vesting period (if any) has expired. The vesting periods may be extended beyond the performance achievement periods as set out by the Remuneration Committee.

The lapsing of the award is provided for upon the occurrence of certain events, which includes:

(a) the misconduct of an eligible participant;(b) the termination of the employment of an eligible participant;(c) the bankruptcy of an eligible participant;(d) the retirement, ill health, injury, disability or death of an eligible participant; and/or(e) a take-over, amalgamation, winding-up or restructuring of the Company.

The Share Plan shall continue in force at the discretion of the Remuneration Committee, subject to a maximum period of 10 years commencing on 23 March 2007. The Share Plan may continue beyond the above stipulated period with the approval of members of the Company by ordinary resolution in a general meeting and of any relevant authorities which may then be required.

The Company may deliver ordinary shares pursuant to awards vested under the Share Plan by way of:

(a) Issuance of new ordinary shares;(b) Delivery of existing ordinary shares purchased from the market or ordinary shares held in treasury;

and/or(c) Cash in lieu of ordinary shares, based on the aggregate market value of such ordinary shares.

From the commencement date of the Share Plan to 31 October 2013, 43,232,225 performance shares have been granted (after adjustments for rights cum warrants issue on 1 November 2007 and rights issue on 26 September 2008).




28A. Equity-Settled Share-Based Compensation Reserve (Continued)


At the end of the reporting year, the number of performance shares granted, vested and cancelled under the Share Plan are as follows:


Date of Grant

At1 November

2012 Granted VestedCancelled/

Lapsed

At31 October

2013

21 March 2012 5,076,875 – (2,538,438) (2,538,437) –

The above number of performance shares represents the shares required if participants are awarded at 100% of the grant. However, the performance shares vested at the vesting date are dependent on the level of achievement against the pre-set performance conditions and targets.

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Equity-settled share-based compensation reserveAt beginning of the reporting year 528 – 528 –Equity-settled share-based expenses charged to profit or loss, included in administrative expenses – 528 – 428Equity-settled share-based arrangements with subsidiaries – – – 100Issue of ordinary shares under ecoWise Performance Share Plan (Note 27) (264) – (264) –Cancellation of shares awarded under ecoWise Performance Share Plan (264) – (264) –

At end of the reporting year – 528 – 528

The equity-settled share-based compensation reserve is not available for distribution as cash dividends.




28B. Foreign Currency Translation Reserve

Group2013 2012$’000 $’000

At beginning of the reporting year (1,401) (923)Exchange differences on translating foreign operations (390) (478)

At end of the reporting year (1,791) (1,401)

The foreign currency translation reserve represents exchange differences arising from the translation of the financial statements of foreign operations whose functional currencies are different from the presentation currency of the Group.

28C. Hedging Reserve

The hedging reserve relates to the effective portion of the cumulative net change in the fair value of cash flow hedging instruments related to hedged transactions that have not yet occurred.

28D. Other Reserve

Group2013 2012$’000 $’000

At beginning of the reporting year 2,553 (124)Effects of movements in exchange rates (45) (67)Acquisition of non-controlling interests without change in control – 2,744


Other reserve relates to the difference between the change in non-controlling interests when acquiring additional equity interests in subsidiaries and the fair value of the consideration given for the acquisitions.



29. PROVISION FOR RETIREMENT BENEFIT OBLIGATIONS

Group2013 2012$’000 $’000

Provision for retirement benefit obligations 620 584

The Group operates a defined benefit plan for qualifying employees of its subsidiaries in Malaysia. Under the scheme, the employees are entitled to two weeks of their last drawn salary for every year of employment served having fulfilled certain conditions. No other post-retirement benefits are provided. The scheme is not held separately by an independent administrated fund as the scheme is not a funded arrangement. New employees of the subsidiaries in Malaysia are not entitled to such retirement benefits.

The movements in the provision for retirement benefit obligations and the amounts recognised in the profit or loss during the reporting year are as follows:

Group2013 2012$’000 $’000

At beginning of the reporting year 584 542Effects of movements in exchange rates (10) (10)Current service cost 49 45Interest expenses on retirement benefit obligations 29 34Actuarial gain – (11)Retirement benefit obligations paid (32) (16)


The principal actuarial assumptions used in respect of the Group’s defined benefit plan are as follows:

Group2013 2012

% %

Discount rate 5.0 6.2Expected rate of salaries increase 4.0 4.0

The assumptions relating to longevity used to compute the retirement benefit obligations are based on the published mortality tables commonly used by the actuarial professionals in Malaysia.



30. LOANS AND BORROWINGS

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Non-current liabilitiesSecured bank loans (Note 30A) 9,013 9,862 – –Finance lease liabilities (Note 30B) 735 946 81 127

Sub-total 9,748 10,808 81 127

Current liabilitiesSecured bank loans (Note 30A) 3,448 1,886 – –Unsecured bank loans 3,720 1,345 3,012 1,345Secured bank overdrafts (Note 30A) – 194 – –Unsecured bank overdrafts – 157 – –Secured bankers’ acceptances (Note 30A) 6,279 8,560 – –Secured trust receipts (Note 30A) 1,694 2,360 – –Unsecured director loan (Note 30C) 1,445 – – –Finance lease liabilities (Note 30B) 439 525 46 46

Sub-total 17,025 15,027 3,058 1,391

Total loans and borrowings 26,773 25,835 3,139 1,518

The non-current portion is repayable as follows:

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Due within 2 to 5 years 6,832 6,793 81 123Due after 5 years 2,916 4,015 – 4

Total non-current portion 9,748 10,808 81 127

The range of floating interest rates per annum paid was as follows:

2013 2012 2013 2012Group % % $’000 $’000

Bank loans 2.2% to 9.1% 2.2% to 2.3% 7,764 9,278Bank overdrafts – 6.1% to 8.1% – 194



30. LOANS AND BORROWINGS (CONTINUED)

The range of fixed interest rates per annum paid was as follows:

2013 2012 2013 2012Group % % $’000 $’000

Bank loans 2.8% to 4.6% 5.0% 4,697 3,806Trust receipts 2.6% to 3.0% 2.8% to 6.0% 1,694 2,360Bankers’ acceptances 4.0% to 5.6% 4.0% to 5.5% 6,279 8,560Unsecured director loan – – 1,445 –Finance lease liabilities 2.5% to 8.5% 2.5% to 10.9% 1,174 1,471

30A. Securities on Loans and Borrowings

The details of the securities for loans and borrowings amounting to $21,608,000 (2012: $24,333,000) are as follows:

(a) Loans and borrowings of the Group comprising bank loans of $4,697,000 (2012: $2,462,000), bank overdrafts of Nil (2012: $80,000) and bankers’ acceptances of $5,301,000 (2012: $6,922,000) are secured by a charge over the construction-in-progress $6,109,000 (2012: Nil), leasehold land of $1,561,000 (2012: $1,600,000), leasehold properties and improvements of $3,258,000 (2012: $3,330,000), plant and equipment of $8,861,000 (2012: $7,685,000) of the Group as disclosed in Note 14C.

(b) Loans and borrowings of the Group comprising bank loans of Nil (2012: $634,000) and trust receipts of $1,694,000 (2012: $2,360,000) are secured by pledges of fixed deposits of the Group amounting to $500,000 (2012: $500,000) as disclosed in Note 26. These bank loans and trust receipts are guaranteed by the Company.

(c) Loans and borrowings of the Group comprising bankers’ acceptances of $978,000 (2012: $1,353,000) are secured by pledges of fixed deposits of the Group amounting to $222,000 (2012: $206,000) as disclosed in Note 26.

(d) A bank loan of the Group amounting to $7,764,000 (2012: $8,652,000) is secured by a legal assignment of the DBO Agreement with a customer (Note 22) and a fixed and floating charge over present and future undertakings, property assets, revenue and rights in relation to the biomass co-generation plant of a subsidiary as disclosed in Note 22. This bank loan is guaranteed by the Company.

(e) Loans and borrowings of the Group comprising bankers’ acceptances of Nil (2012: $151,000) and bank overdrafts of Nil (2012: $114,000) are secured by a pledge of inventories of the Group amounting to Nil (2012: $621,000) as disclosed in Note 24.




30A. Securities on Loans and Borrowings (Continued)

(f) Loans and borrowings of the Group comprising bankers’ acceptances of Nil (2012: $134,000) are secured by a charge over leasehold properties and improvements of Nil (2012: $125,000), plant and equipment of Nil (2012: $1,516,000) of the Group as disclosed in Note 14C.

30B. Finance Lease Liabilities

The finance lease liabilities are payable as follows:

Minimum Lease

PaymentsFinance

Costs Principal$’000 $’000 $’000

Group2013Due within one year 494 (55) 439Due within 2 to 5 years 772 (66) 706Due after 5 years 30 (1) 29

1,296 (122) 1,174

2012Due within one year 596 (71) 525Due within 2 to 5 years 1,032 (90) 942Due after 5 years 5 (1) 4

1,633 (162) 1,471

Company2013Due within one year 56 (10) 46Due within 2 to 5 years 105 (24) 81

161 (34) 127

2012Due within one year 56 (10) 46Due within 2 to 5 years 156 (33) 123Due after 5 years 5 (1) 4

217 (44) 173




30B. Finance Lease Liabilities (Continued)

The Group leases certain of its plant and equipment under finance leases. The lease term is between 3 to 10 years. The fixed rate of interest for finance leases is approximately 3.5% to 8.5% (2012: 2.5% to 10.9%) per annum. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments. The obligations under finance leases are secured by the lessors charge over the leased assets (Note 14B and 14C).

30C. Unsecured Director Loan

The loan owing to a director of the Company is unsecured, interest free and repayable on demand.

31. DEFERRED INCOME

Group2013 2012$’000 $’000

Deferred government grant income 64 73

Presented in statements of financial position as: Non-current 47 65 Current 17 8

64 73

32. TRADE AND OTHER PAYABLES

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Trade payablesOutside parties and accrued liabilities 23,004 12,726 997 1,040Related parties 751 19 – –Associates 8 – – –Subsidiaries – – 64 61

Sub-total 23,763 12,745 1,061 1,101Other payablesOutside parties 650 276 3 3

Total trade and other payables 24,413 13,021 1,064 1,104



33. OTHER LIABILITIES

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Advance payment by jointly-controlled entity 5,000 – – –

34. FINANCIAL INSTRUMENTS: INFORMATION ON FINANCIAL RISKS

34A. Classification of Financial Assets and Liabilities

The carrying amounts of financial assets and financial liabilities are as follows:

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Financial assetsLoans and receivables: Trade and other receivables (Note 21) 20,915 20,767 7,375 22,742 Finance lease receivables (Note 22) 13,660 14,571 – – Cash and cash equivalents (Note 26) 15,271 18,527 1,535 3,356Available-for-sale financial assets: Unquoted equity shares (Note 20) 1,092 1,180 – –Derivative financial instruments at fair value (Note 25) 31 35 – –

50,969 55,080 8,910 26,098

Financial liabilitiesFinancial liabilities at amortised cost: Loans and borrowings (Note 30) 26,773 25,835 3,139 1,518 Trade and other payables (Note 32) 24,413 13,021 1,064 1,104 Derivative financial instruments at fair value (Note 25) 103 14 – –

51,289 38,870 4,203 2,622

Further quantitative disclosures are included throughout these financial statements.



34. FINANCIAL INSTRUMENTS: INFORMATION ON FINANCIAL RISKS (CONTINUED)

34B. Fair Values of Financial Instruments

34B1. Fair value of financial instruments stated at amortised cost in the statements of financial position

The carrying amounts of financial assets and financial liabilities at amortised cost are reasonable approximation of their fair values.

34B2. Fair value measurements recognised in the statements of financial position

The fair value measurements are classified using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The levels are (a) Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities; (b) Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and (c) Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The Group recognised derivative financial instruments (assets) of $31,000 (2012: $35,000) and derivative financial instruments (liabilities) of $103,000 (2012: $14,000) at fair values in the consolidated statements of financial position (Note 25). The derivative financial instruments were measured at Level 2 of the fair value hierarchy.

34C. Financial Risk Management

The board of directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. Risk management is carried out under policies approved by the board of directors.

Risks management policies are established to identify and analyse the risks faced by the Group, to set appropriate risks’ limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in the Group’s activities and market conditions.

The Group has exposure to the following financial risks:

• Credit risk;• Liquidity risk;• Interest rate risk; and• Foreign currency risk.

The Group’s overall financial risk management strategy seeks to minimise the potential material adverse effects from these exposures. The information about the Group’s exposure to each of the above risks and the Group’s objectives, policies and processes for measuring and managing risks are presented below.




34D. Credit Risk on Financial Assets

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally from the Group’s receivables, cash and cash equivalents and equity shares. The maximum exposure to credit risk is the total of the fair values of the financial instruments.

Credit risk on cash balances with banks and financial institutions is limited because the counter-parties are entities with acceptable credit ratings.

For credit risk on receivables, an on-going credit evaluation is performed on the financial conditions of the debtors and an impairment loss is recognised in profit or loss. The Group’s exposure to credit risk on trade and finance lease receivables is influenced mainly by the individual characteristics of each customer. Management considers the demographics of the Group’s customer bases, including the default risk of the industry and country which customers operate, as these factors may have an influence on credit risk.

The Group has established a credit policy, whereby each new customer is analysed individually for credit worthiness. Each entity within the Group is responsible for managing and analysing the credit risk of each of its new customers before payment and delivery terms and conditions are offered. For existing customers, an on-going credit evaluation is performed on customers’ financial conditions. The exposure to credit risk is controlled by setting credit limits to individual customers.The credit terms granted to customers are generally between 14 to 90 days (2012: 14 to 90 days).

(a) Ageing analysis of trade receivables that are past due at the end of the reporting year but not impaired is as follows:

Group2013 2012$’000 $’000

Past due less than 60 days 4,170 5,989Past due 61 to 90 days 681 375Past due 91 to 180 days 265 144Past due over 180 days 2,096 726

7,212 7,234

(b) Ageing analysis of trade receivables at the end of the reporting year that are impaired is as follows:

Group2013 2012$’000 $’000

Past due 61 to 90 days – 12Past due 91 to 180 days 19 197Past due over 180 days 616 462

635 671




34D. Credit Risk on Financial Assets (Continued)

The allowance for doubtful trade receivables as disclosed in Note 21 to the financial statements is based on individual accounts totalling $635,000 (2012: $671,000) that are determined to be impaired at the end of the reporting year.

(c) At end of the reporting year, approximately 23% (2012: 23%) of trade receivables are due from three customers as follows:

Group2013 2012$’000 $’000

Top 1 customer 2,711 1,667Top 2 customers 3,705 3,079Top 3 customers 4,478 4,392

Other receivables are normally with no fixed terms and therefore there is no maturity.

Cash and cash equivalents disclosed in Note 26 represent amounts with less than 90-days maturity.

34E. Liquidity Risk

Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.

The following table analyses the financial liabilities by remaining contractual maturity (contractual and undiscounted cash flows) at the end of the reporting year:

Less than 1 year

Due within 2 to 5 years

Due after 5 years Total

$’000 $’000 $’000 $’000

Group2013Loans and borrowings 17,687 7,630 3,015 28,332Trade and other payables 24,413 – – 24,413

42,100 7,630 3,015 52,745




34E. Liquidity Risk (Continued)

Less than 1 year



$’000 $’000 $’000 $’000

Group2012Loans and borrowings 15,390 7,232 4,455 27,077Trade and other payables 13,021 – – 13,021

28,411 7,232 4,455 40,098

Company2013Loans and borrowings 3,109 105 – 3,214Trade and other payables 1,064 – – 1,064

4,173 105 – 4,278

2012Loans and borrowings 1,437 156 5 1,598Trade and other payables 1,104 – – 1,104

2,541 156 5 2,702

The undiscounted amounts on the loans and borrowings with fixed and floating interest rates are determined by reference to the conditions existing at the end of the reporting year.

The average credit period taken to settle trade payables is approximately 72 days (2012: 65 days). The other payables are with short-term durations. In order to meet such cash commitments, the operating activities are expected to generate sufficient cash inflows.

Derivative financial instruments in respect of the Group’s forward foreign currency contracts are net settled and expected to be settled within the next 12 months (Note 25).




34E. Liquidity Risk (Continued)

The following table analyses the financial guarantee contracts based on the earliest dates in which the maximum guaranteed amount could be drawn down:

Less than 1 year



Company $’000 $’000 $’000 $’000

2013Financial guarantee contracts 5,903 4,535 2,363 12,801

2012Financial guarantee contracts 4,118 4,891 3,591 12,600

At the end of the reporting year, no claims on the financial guarantee contracts are expected.

The unutilised borrowing facilities available to the Group for its operating and investing activities are as follows:

Group2013 2012$’000 $’000

Unutilised loans and borrowings 10,538 14,936Unutilised factoring facilities 3,500 3,500

The unutilised borrowing facilities are available for the Group’s operating activities and to settle other commitments. Borrowing facilities are maintained to ensure funds are available for the Group’s operations.

34F. Interest Rate Risk

The Group’s exposure to interest rate risk relates primarily to interest-earning financial assets and interest-bearing financial liabilities. Interest rate risk is managed by the Group on an on-going basis with the primary objective of limiting the extent to which net interest expense could be affected by an adverse movement in interest rates.




34F. Interest Rate Risk (Continued)

The interest rate risk exposure is mainly from changes in fixed and floating interest rates. The breakdown of the significant financial instruments by type of interest rate is as follows:

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Financial assetsFixed rates 16,090 16,606 890 13,464

Financial liabilitiesFloating rates 11,484 14,459 3,012 –Fixed rates 15,289 11,376 127 1,518

26,773 25,835 3,139 1,518

Sensitivity Analysis

For the variable rate financial assets and liabilities, a hypothetical increase of 100 basis points (2012: 100 basis points) in interest rate at the end of the reporting year would increase/(decrease) pre-tax profit for the reporting year by the amounts shown below. A decrease in 100 basis points (2012: 100 basis points) in interest rate would have an equal but opposite effect. This analysis assumes all other variables remain constant.

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Pre-tax profit for the reporting year (115) (145) (30) –

The hypothetical changes in basis points are not based on observable market data (unobservable inputs).

34G. Foreign Currency Risk

The Group has exposure to foreign currency movements on financial assets and financial liabilities denominated in foreign currencies. It also has foreign currency risk on sales and purchases that are denominated in foreign currencies. The currencies giving rise to this risk is primarily the Australian dollar, Chinese renminbi, United States dollar and Japanese yen. The Group hedges its foreign currency exposure should the need arise through the use of forward foreign currency contracts.




34G. Foreign Currency Risk (Continued)

Other than as disclosed elsewhere in the financial statements, the Group’s exposures to foreign currencies are as follows:

Australian Dollar

Chinese Renminbi

Malaysian Ringgit

Singapore Dollar

United States Dollar

Japanese Yen Euro Total

Group $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

2013Financial AssetsCash and cash equivalents 381 1 – 3 587 – – 972Trade and other receivables 5,596 203 – – 1,412 – – 7,211

Total financial assets 5,977 204 – 3 1,999 – – 8,183

Financial LiabilitiesTrade and other payables (2,684) – – (77) – (204) – (2,965)Loans and borrowings – – – – (1,694) – – (1,694)

Total financial liabilities (2,684) – – (77) (1,694) (204) – (4,659)

Net financial assets/ (liabilities) 3,293 204 – (74) 305 (204) – 3,524

2012Financial AssetsCash and cash equivalents 252 1 – 67 699 – 1 1,020Trade and other receivables 5,283 196 – 6 4,437 – – 9,922

Total financial assets 5,535 197 – 73 5,136 – 1 10,942

Financial LiabilitiesTrade and other payables (2,569) – – – (3,975) (443) (668) (7,655)Loans and borrowings – – – – (2,993) – – (2,993)

Total financial liabilities (2,569) – – – (6,968) (443) (668) (10,648)

Net financial assets/ (liabilities) 2,966 197 – 73 (1,832) (443) (667) 294




34G. Foreign Currency Risk (Continued)

Malaysian Ringgit2013 2012$’000 $’000

CompanyFinancial AssetsTrade and other receivables 828 4,401

Sensitivity Analysis

A hypothetical 10% (2012: 10%) strengthening of the above currencies against the functional currency of the respective subsidiaries of the Group at the end of the reporting year would increase/(decrease) pre-tax profit for the reporting year by the amounts shown below. A 10% (2012: 10%) weakening of the above currencies against the functional currency of the respective subsidiaries would have an equal but opposite effect. This analysis has been carried out without taking into consideration of hedged transactions and assumes all other variables remain constant.

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Pre-tax profit for the reporting year 352 29 83 440

The hypothetical sensitivity rate used in the above table is the reasonably possible change in foreign exchange rates.

35. CAPITAL COMMITMENTS

At the end of the reporting year, the Group and the Company had the following capital commitments:

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Acquisition of property, plant and equipmentContracted but not recognised 5,339 237 – –Authorised but not contracted 11,333 – – –

16,672 237 – –



36. OPERATING LEASE COMMITMENTS

The Group leases various offices, land and factory premises, plant and machinery and workers’ quarters under non-cancellable operating lease arrangements. The lease terms are between 1 to 10 years. Majority of the lease arrangements are renewable at the end of the lease periods at market rates.

The future aggregate minimum lease payments under non-cancellable operating leases are as follows:

Group Company2013 2012 2013 2012$’000 $’000 $’000 $’000

Not later than one year 469 540 69 174Later than one year and not later than five years 658 810 16 85Later than five years 459 351 – –

Operating lease expenses for the reporting year 1,148 1,345 174 174

37. SUBSEQUENT EVENTS

(a) Subsequent to end of the reporting year, the Group has entered into an Agreement to dispose 20% equity interests in Wuhan ecoWise to its non-controlling interests for cash consideration of approximately $2,949,000. Upon completion of the Agreement, the Group is deemed to have ceased control of Wuhan ecoWise and the Group’s remaining 29% equity interests will be accounted for as an associate.

(b) The directors propose that a final exempt (one-tier) dividend of 0.05 cents per share with a total of $463,000 be paid to shareholders after the annual general meeting to be held on 28 February 2014. There are no income tax consequences. This dividend is subject to approval by shareholders at the next annual general meeting and has not been included as a liability in these financial statements. The proposed dividend is payable in respect of all ordinary shares in issue at the end of the reporting year and including the new qualifying shares issued up to the date the dividend becomes payable.

38. CHANGES AND ADOPTION OF FINANCIAL REPORTING STANDARDS

For the current reporting year, the following new or revised Singapore Financial Reporting Standards were adopted. The new or revised standards did not require any modification of the measurement methods or the presentation in the financial statements.

FRS No. Title

FRS 1 Amendments to FRS 1 – Presentation of Items of Other Comprehensive Income

FRS 12 Deferred Tax (Amendments to) – Recovery of Underlying Assets

FRS 107 Financial Instruments: Disclosures (Amendments to) – Transfers of Financial Assets(*)

(*) Not relevant to the entity.



39. FUTURE CHANGES IN FINANCIAL REPORTING STANDARDS

The following new or revised Singapore Financial Reporting Standards that have been issued will be effective in future. The transfer to the new or revised standards from the effective dates is not expected to result in material adjustments to the financial position, results of operations, or cash flows for the following reporting year.

FRS No. Title

Effective datefor reporting

periods beginning on or after

FRS 1 Amendment to FRS 1 Presentation of Financial Statements(Annual Improvements)

1 January 2013

FRS 16 Amendment to FRS 16 Property, Plant and Equipment(Annual Improvements)

FRS 19 Employee Benefits (Revised) 1 January 2013FRS 27 Consolidated and Separate Financial Statements (Amendments to) 1 July 2013FRS 27 Separate Financial Statements (Revised) 1 January 2014FRS 28 Investments in Associates and Joint Ventures (Revised) 1 January 2014FRS 32 Amendment to FRS 32 Financial instruments:

Presentation (Annual Improvements)1 January 2013

FRS 107 Amendments to FRS 32 and 107 titled Offsetting Financial Assets and Financial Liabilities

1 January 2013

FRS 110 Consolidated Financial Statements 1 January 2014FRS 111 Joint Arrangements 1 January 2014FRS 112 Disclosure of Interests in Other Entities 1 January 2014FRS 110 Amendments to FRS 110, FRS 111 and FRS 112 (*) 1 January 2014FRS 113 Fair Value Measurements 1 January 2013INT FRS 120 Stripping Costs in the Production Phase of a Surface Mine (*) 1 January 2013

(*) Not relevant to the entity.



SHARE CAPITAL

Number of shares : 926,697,315Class of shares : Ordinary sharesVoting rights : One vote per share

DISTRIBUTION OF SHAREHOLDINGS

Range of ShareholdingsNo. of

Shareholders % No. of Shares %

1 – 999 16 0.66 7,160 0.001,000 – 10,000 383 15.90 2,619,425 0.2810,001 – 1,000,000 1,938 80.45 223,589,960 24.131,000,001 and above 72 2.99 700,480,770 75.59

2,409 100.00 926,697,315 100.00

SHAREHOLDING HELD BY THE PUBLIC

Based on the information available to the Company as at 16 January 2014, approximately 62.42% of the issued ordinary shares of the Company is held by the public. Accordingly Rule 723 of the Listing Manual of Singapore Exchange Securities Trading Limited has been complied with.

TOP TWENTY SHAREHOLDERS

No. Name No. of Shares %

1 Ecohub Pte. Ltd. 128,229,375 13.842 Ma Ong Kee 63,000,000 6.803 SBS Nominees Private Limited 62,415,000 6.744 Hong Leong Finance Nominees Pte Ltd 45,200,000 4.885 OCBC Securities Private Limited 32,952,250 3.566 Maybank Nominees (S) Pte Ltd 30,095,900 3.257 Bank of Singapore Nominees Pte. Ltd. 26,711,512 2.888 Ong Keng Hua Sunny 25,042,125 2.709 Tan Jin Beng Winston 22,987,533 2.4810 Ong King Sun 16,959,375 1.8311 Phillip Securities Pte Ltd 16,565,190 1.7912 Citibank Nominees Singapore Pte Ltd 13,967,000 1.5113 Maybank Kim Eng Securities Pte. Ltd. 13,662,862 1.4714 UOB Kay Hian Private Limited 13,227,000 1.4315 DBS Nominees (Private) Limited 10,846,850 1.1716 United Overseas Bank Nominees (Pte) Ltd 9,525,423 1.0317 Lau Hong Keong 8,833,000 0.9518 CIMB Securities (Singapore) Pte. Ltd. 8,234,000 0.8919 Chan Buang Heng 8,119,850 0.8820 Lee Thiam Seng 8,009,388 0.86

564,583,633 60.94

SHAREHOLDINGS STATISTICSAS AT 16 JANUARY 2014


SUBSTANTIAL SHAREHOLDERS AS AT 16 JANUARY 2014

No. Name of ShareholdersDirect InterestNo. of Shares

% ofShares

Deemed InterestNo. of Share

% ofShares

1 ecoHub Pte. Ltd. 218,229,375 23.55 – –2 Ma Ong Kee 88,000,0001 9.50 – –3 Lee Thiam Seng 33,509,3882 3.62 218,229,3753 23.55

Notes:

1 25,000,000 shares of which are held through Maybank Nominees (S) Pte Ltd.

2 25,500,000 Shares of which are held through Bank of Singapore Nominees Pte Ltd.

3 Lee Thiam Seng is the sole shareholder of ecoHub Pte. Ltd. which in turn holds 218,229,375 shares (of which 45,000,000 are held through Hong Leong Finance Nominees Pte Ltd and 45,000,000 are held through SBS Nominees Pte Ltd), representing 23.55% of the issued share capital of the Company. Accordingly, Lee Thiam Seng has a deemed interest in the 218,229,375 shares held by ecoHub Pte. Ltd.

SHAREHOLDINGS STATISTICSAS AT 16 JANUARY 2014


NOTICE IS HEREBY GIVEN that the 2014 Annual General Meeting of the shareholders of the Company will be held at 17 Kallang Junction #04-03 Singapore 339274 on Friday, 28 February 2014 at 10.30 a.m. to transact the following businesses:

ORDINARY BUSINESS

1. To receive and consider the Audited Financial Statements of the Company and the reports of the Directors and Auditors for the year ended 31 October 2013.

Resolution 1

2. To declare a final dividend of 0.05 cent per ordinary share (one-tier tax exempt) for the year ended 31 October 2013.

Resolution 2

3. To re-elect the following Directors retiring pursuant to the Company’s Articles of Association:–

(a) Mr Low Kian Beng (Article 107) Resolution 3

(b) Mr Ong Teck Ghee (Article 107) Resolution 4

Key information on Mr Low and Mr Ong can be found on page 20 and 22 respectively of the Annual Report 2013.

Mr Ong Teck Ghee shall, upon re-election as Director of the Company, remain as Chairman of the Nominating Committee and as a member of the Audit Committee and Remuneration Committee and shall be considered independent for the purpose of Rule 704(8) of the Listing Manual of the Singapore Exchange Securities Trading Limited.

4. To approve the Directors’ fees of SGD 140,000/- for the year ended 31 October 2013. Resolution 5

5. To re-appoint Messrs RSM Chio Lim LLP as Auditors and to authorise the Directors to fix their remuneration.

Resolution 6


ANNUAL GENERAL MEETING

SPECIAL BUSINESS

To consider and, if thought fit, to pass the following Resolutions as Ordinary Resolutions, with or without amendments:

6. Authority to Allot and Issue Shares Resolution 7

That pursuant to Section 161 of the Companies Act, Cap. 50 and in accordance with Rule 806 of the Listing Manual of the Singapore Exchange Securities Trading Limited (“SGX-ST”), authority be and is hereby given to the Directors to issue:–

(i) shares in the capital of the Company (whether by way of rights, bonus or otherwise); or

(ii) convertible securities; or

(iii) additional convertible securities arising from adjustments made to the number of convertible securities previously issued in the event of rights, bonus or capitalisation issues; or

(iv) shares arising from the conversion of convertible securities,

at any time and upon such terms and conditions and for such purposes as the Directors may in their absolute discretion deem fit provided that:–

(1) the aggregate number of shares and convertible securities that may be issued shall not exceed 50% of the total number of issued shares (excluding treasury shares) in the capital of the Company, of which the aggregate number of shares and convertible securities to be issued other than on a pro rata basis to all shareholders of the Company shall not exceed 20% of the total number of issued shares (excluding treasury shares) in the capital of the Company.

(2) for the purpose of determining the aggregate number of shares that may be issued under sub-paragraph (1) above, the total number of issued shares (excluding treasury shares) shall be calculated based on the total number of issued shares (excluding treasury shares) in the capital of the Company as at the time of the passing of this Resolution after adjusting for:–

(a) new shares arising from the conversion or exercise of convertible securities;

(b) new shares arising from exercising share options or vesting of share awards outstanding or subsisting at the time of the passing of this Resolution; and

(c) any subsequent bonus issue, consolidation or subdivision of shares.



(3) in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of the Listing Manual of the SGX-ST for the time being in force (unless such compliance has been waived by the SGX-ST) and the Articles of Association of the Company; and

(4) unless revoked or varied by the Company in general meeting, such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company is required by law to be held, whichever is earlier.

[see Explanatory Note(i)]

7. Authority to grant Awards in accordance with ecoWise Performance Share Plan Resolution 8

That approval be and is hereby given to the Directors to grant awards in accordance with the provisions of the ecoWise Performance Share Plan (“Share Plan”) and to allot and issue or deliver from time to time such number of fully paid-up Shares as may be required to be issued pursuant to the vesting of Awards under the Share Plan, provided that the aggregate number of Shares to be allotted and issued pursuant to the Share Plan shall not exceed 15% of the total number of issued shares of the Company from time to time.

[See Explanatory Note (ii)]

8. And to transact any other business which may be properly transacted at an Annual General Meeting.

BY ORDER OF THE BOARD

Zhong XiaowenCompany SecretarySingapore

12 February 2014



Explanatory Notes:

(i) The Ordinary Resolution proposed in Resolution 7 above, if passed, will empower the Directors of the Company, effective until the conclusion of the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of the Company is required by law to be held or such authority is varied or revoked by the Company in a general meeting, whichever is earlier, to issue shares and convertible securities in the Company up to a number not exceeding, in total, 50% of the total number of issued shares (excluding treasury shares) in the capital of the Company, of which not exceeding 20% may be issued other than on a pro rata basis to existing shareholders.

For determining the aggregate number of shares that may be issued, the total number of issued shares (excluding treasury shares) will be calculated based on the total number of issued shares (excluding treasury shares) in the capital of the Company at the time this Resolution is passed after adjusting for new shares arising from the conversion or exercise of convertible securities or share options or vesting of share awards which are outstanding or subsisting at the time when this Resolution is passed and any subsequent bonus issue, consolidation or subdivision of shares.

(ii) The proposed Resolution 8 above, if passed, will empower the Directors of the Company to offer and grant awards, and to allot and issue new ordinary shares in the capital of the Company, pursuant to the Share Plan (which was approved by shareholders at the Extraordinary General Meeting held on 23 March 2007) as may be modified by the Remuneration Committee from time to time, provided that the aggregate number of Shares to be allotted and issued pursuant to the Share Plan shall not exceed 15% of the total number of issued ordinary shares of the Company from time to time.

Proxies:

1. A member of the Company is entitled to attend and vote at the above Meeting and may appoint not more than two proxies to attend and vote instead of him.

2. Where a member appoints two proxies, he shall specify the proportion of his shareholding to be represented by each proxy in the instrument appointing the proxies. A proxy need not be a member of the Company.

3. If the member is a corporation, the instrument appointing the proxy must be under seal of the hand of an officer or attorney duly authorised.

4. The instrument appointing a proxy must be deposited at the Registered Office of the Company at 17 Kallang Junction #04-03 Singapore 339274 not less than 48 hours before the time appointed for holding the above Meeting.



PROXY FORM

I/We

of being a member(s) of ecoWise Holdings Limited (the “Company”), hereby appoint:

Name AddressNRIC/Passport

NumberProportion of

Shareholdings

and/or (delete as appropriate)

Name AddressNRIC/Passport

NumberProportion of

Shareholdings

as *my/our *proxy/proxies to vote for *me/us on *my/our behalf at the 2014 Annual General Meeting of the Company to be held 17 Kallang Junction #04-03 Singapore 339274 on Friday, 28 February 2014 at 10.30 a.m. and at any adjournment thereof.

(Please indicate with an “X” in the spaces provided whether you wish your vote(s) to be cast for or against the resolutions as set out in the notice of Annual General Meeting. In the absence of specific directions, the proxy/proxies will vote or abstain as he/they may think fit, as he/they will on any other matter arising at the Annual General Meeting.)

No. Resolutions For Against

1 Audited Financial Statements for the year ended 31 October 2013 together with the reports of Directors and Auditors

2 Declaration of proposed Final Dividend

3 Re-election of Mr Low Kian Beng as Director

4 Re-election of Mr Ong Teck Ghee as Director

5 Approval of Directors’ fees for the year ended 31 October 2013

6 Re-appointment of Messrs RSM Chio Lim LLP as Auditors

7 Authority to allot and issue shares pursuant to Section 161 of the Companies Act, Chapter 50 and Rule 806 of the Listing Manual of the Singapore Exchange Securities Trading Limited

8 Approval of Awards in accordance with ecoWise Performance Share Plan

Signed this day of 2014

Total number of shares held

Signature or Common Seal of shareholder

IMPORTANT1. For investors who have used their CPF monies to buy

the Company’s shares, this Annual Report is forwarded to them at the request of their CPF Approved Nominees and is sent solely FOR INFORMATION ONLY.

2. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents and purposes if used or purported to be used by them.

NOTES:

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

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

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

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

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

6. The instrument appointing a proxy or proxies, together with the power of attorney or other authority (if any) under which it is signed, or notarially certified copy thereof, must be deposited at the registered office of the Company at 17 Kallang Junction #04-03 Singapore 339274 not later than 48 hours before the time appointed for the Annual General Meeting.

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

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CONTENTS02 CORPORATE PROFILE06 CHAIRMAN’S STATEMENT10 FINANCIAL HIGHLIGHTS12 FINANCIAL AND OPERATIONS REVIEW16 BUSINESS OVERVIEW19 CORPORATE SOCIAL RESPONSIBILITY20 BOARD OF DIRECTORS23 MANAGEMENT TEAM25 CORPORATE GOVERNANCE44 FINANCIAL STATEMENTS

CORPORATE INFORMATION

BOARD OF DIRECTORS

Lee Thiam Seng (Executive Chairman)

Low Kian Beng (Executive Director)

Ng Cher Yan (Lead Independent Director)

Ang Mong Seng (Independent Director)

Ong Teck Ghee (Independent Director)

AUDIT COMMITTEE

Ng Cher Yan (Chairman)

Ang Mong Seng

Ong Teck Ghee

NOMINATING COMMITTEE

Ong Teck Ghee (Chairman)

Ang Mong Seng

Ng Cher Yan

REMUNERATION COMMITTEE

Ang Mong Seng (Chairman)

Ng Cher Yan

Ong Teck Ghee

COMPANY SECRETARY

Zhong Xiaowen

AUDITORS

RSM Chio Lim LLP

Public Accountants and

Chartered Accountants

8 Wilkie Road

#03-08 Wilkie Edge

Singapore 228095

Partner-in-charge: Chan Weng Keen

Effective from reporting year ended 31 October 2012

SHARE REGISTRAR

Boardroom Corporate & Advisory Services Pte Ltd

50 Raffles Place

#32-01 Singapore Land Tower

Singapore 048623

PRINCIPAL BANKERS

DBS Bank Ltd

Malayan Banking Berhad

United Overseas Bank Limited

REGISTER OFFICE/CONTACT DETAILS

Co. Registration No.: 200209835C

17 Kallang Junction #04-03

Singapore 339274

Tel: 65 65362489

Fax: 65 65367672

Website: www.ecowise.com.sg

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13ecoWise Holdings LimitedCo. Reg: 200209835C

17 Kallang Junction #04-03Singapore 339274

Tel: 65 - 6536 2489Fax: 65 - 6536 7672

www.ecowise.com.sg

ANNUAL REPORT

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