ssangyong cement (singapore) limited

SsangYong Cement (Singapore) Limited

contents

01 chairman’s report

03 directors’ profile

04 corporate governance report

09 financial statements

55 shareholding statistics

56 notice of annual general meeting

58 notes to proxy form

59 proxy form

Registered Office29 International Business Park,#08-05/06 Acer Building Tower B,Singapore 609923

RegistrarLim Associates Pte Ltd10 Collyer Quay #19-08Ocean BuildingSingapore 049315

AuditorKPMGCertified Public AccountantsPhuoc TranPartner-in-Charge since year 200116 Raffles Quay#22-00 Hong Leong BuildingSingapore 048581

SsangYong Cement (Singapore) Limited annual report 2002 01

As the year 2002 draws to a close, the Companymarks the beginning of a new chapter, witnessedby the ending of the Singapore-Korea partnershipover the Company’s 30-year history.

In line with the transformation of the Singaporeeconomy, the Company’s cement business hashad to adjust to the ever-changing businessenvironment. Changes in the share ownership ofthe Company arising from the General Offer byAfro-Asia International Enterprises Pte Ltd willbring about a new corporate identity and a revisedbusiness focus.

SsangYong Cement (Singapore) Limited annual report 200202

FINANCIAL RESULTSThe year 2002 produced the most disappointingresults ever experienced by the Company as itweathered the economic malaise resulting from the confluence of domestic recession and globalslow down.

Group turnover dropped by 21% due to thecontinued contraction in the construction andbuilding materials industry in Singapore and theregion. Severe price competition due to oversupplywithin the industry compounded the effects oflower sales volume, resulting in narrow or negative margins.

In Singapore, the clinker and slag grindingoperations ceased in the last quarter of 2002 whenthe bulk terminal at Pulau Damar Laut commencedoperations. As part of a rationalization program, slag-grinding has been relocated overseas. Twoslag grinding joint ventures were formed; one inSeoul, Korea and one in Tangshan, China duringthe third quarter of 2002.

The ready-mix concrete operations in Singaporecontinue to suffer from severe over-capacitywhereas our China associates are able to registercontinuous profits. Against the backdrop of thehighly competitive building materials market, theCompany continues its consolidation of threemanufacturing operations to its Tuas facility for the Smart brand products.

Pace of our investments in venture capital (“VC”)funds slowed down further in 2002. The ripple effects of the US dotcom bust, followed by thetelecommunication industry meltdown, corporatefinancial scandals, threat of terrorism and the war in Iraq have dealt a severe blow to the stockmarkets and enterprise spending in the US. Thishas affected the performance of the VC industryglobally, resulting in further valuation declines inour VC funds and direct investment portfolios.Provisions of S$20 million were made in 2002 toreflect the current uncertainty and turbulence inthe US technology sector. The VC industry,however, is a cyclical business and technologyinnovation moves on relentlessly. We believe thatthe VC industry is in the process of bottoming outand expect it to recover from 2005 onwards.

Our entry into specialty chemicals business, thoughonly into its second year, has shown encouragingresults. Moving forward, while we expect to take bolder steps through acquisitions or joint ventures

as the specialty chemicals business is expected toshow a steady growth, we are highly conscious thatany such moves must be able to ride through thecurrent macroeconomic environment.

Our property investment in the Parliament Viewproject in London continued to show satisfactoryresults. Our associate company is constantly on the lookout for property development opportunitiesoverseas.

PROSPECTSAs the construction industry in Singapore isexpected to remain weak in 2003, we expect thecement and building materials division to continueto suffer losses, albeit of a lesser magnitude, as the new bulk terminal operation will account forimproved efficiency and lower operating costs.

The Group will step up its efforts to expand itsspecialty cement operations overseas to tap on new market opportunities in North Asia.

DIVIDENDSIn view of the Group’s past performance and takinginto account our shareholders’ interest, werecommend a final dividend of 10% (or 5 cents perordinary share) for shareholders’ approval at theupcoming Annual General Meeting.

APPRECIATIONI wish to thank Messrs Lim Yong Wah, Arfat Selvamand Kang Bok-Soo for their contributions to theGroup during the year. Resulting from thecompletion of the General Offer by Afro AsiaInternational Enterprises Pte. Ltd., Mr Lim KimQuee, Mr Myung Ho-Keun, Mr Lee In Young and Mr Lee Yoon Ho have also resigned from the Boardand the Board takes this opportunity to extend theappreciation for their guidance given over the years.

I would like to take this opportunity to welcome Mr Ng Tat Pun, Mr Soh Kim Soon, Mr Chua ThianPoh and Dr Tan Choo Suan to the Board.

On behalf of the Board, I thank our employees whohave continued to demonstrate the professionalismnecessary to operate in a difficult environment;your commitment and effort are much appreciated.

Lastly, I would like to thank all our customers,business partners and shareholders for theircontinuing support.


TAN CHENG GAYChairmanMr Tan has been with SsangYong Cement since theinception of the company’s operations. He wasappointed as director in 1973 and has since served as the executive director of the Company.

TAN YOK KOON DirectorMr Tan was first appointed as director in 1974 and is a non-independent non-executive director. He also serves as a member of the Audit Committee,Nominating Committee and RemunerationCommittee. He is related to Mr Tan Cheng Gay.

TAN CHOO SUAN DirectorDr Tan was appointed in 2003 and is a non-independent non-executive director. Following acareer in academia and The World Bank, Dr Tanstarted Advanced Strategies Consultancy Ltd inHong Kong in 1993 to participate more directly in Asia’s economic growth and development.

CHUA THIAN POH DirectorMr Chua was appointed in 2003 and is a non-independent non-executive director. He is thefounder and owner of Ho Bee Group and iscurrently the Chairman and Chief Executive Officer of Ho Bee Investment Ltd.

TAN KENG BOON DirectorMr Tan was appointed as director in 1997 and is anindependent non-executive director. He serves asChairman of the Remuneration Committee and is a member of the Audit Committee. Mr Tan is theChief Executive of Seavi Advent Venture ManagementPte Ltd and also serves on the boards of otherprivate and publicly listed companies, includingAmtek Engineering Ltd, Ho Bee Investment Ltd and DBS Thai Danu Bank Public Co Ltd.

SOH KIM SOON DirectorMr Soh was appointed as director in 2002 and is anindependent non-executive director. He serves asChairman of the Nominating Committee and is amember of the Remuneration Committee. Mr Soh is currently the Chairman of ORIX Investment AndManagement Private Limited. He also serves on theboard of ORIX Leasing Singapore Limited, NationalHealthcare Group Private Limited, Juniper CapitalVentures (Pte) Ltd, and Singamas ContainerHoldings Ltd. He was previously Senior ManagingDirector of DBS Bank where he worked for morethan 29 years.

NG TAT PUN DirectorMr Ng was appointed in 2002 and is an independentnon-executive director. He serves as Chairman ofthe Audit Committee and is a member of theNominating Committee. Mr Ng has 32 years ofexperience in the Banking and Finance industry,having served in senior positions with both foreignand local banks. He is presently a ManagingDirector of UBS, AG. Mr Ng also serves asChairman of the Audit Committees of Tuas PowerLtd and Singpu Chemicals Pte Ltd.


SsangYong Cement (Singapore) Limited (the“Company”) is committed to maintaining a highstandard of corporate governance within theCompany and its subsidiaries (the “Group”). Goodcorporate governance establishes and maintains an ethical environment in the Group, which strivesto enhance the interests of the shareholders of the Company (the “Shareholders”). This Reportdescribes the Company’s corporate governanceprocesses and activities with specific reference to the Code of Corporate Governance (the “Code”).For ease of reference, the relevant provisions of the Code under discussion are in bold.

1 BOARD OF DIRECTORS (THE “BOARD”)1.1 The Board’s conduct of its affairs

As at 31 December 2002, the Boardcomprised of nine directors, two of whomwere executive directors, three of whom wereindependent and non-executive directors andfour of whom were non-executive directors.

The executive directors were Mr Tan ChengGay and Mr Lee In-Young. The independentand non-executive directors were Mr Ng TatPun, Mr Tan Keng Boon and Mr Soh KimSoon. The non-executive directors were MrMyung Ho-Keun (Chairman of the Board), MrLim Kim Quee, Mr Tan Yok Koon and Mr LeeYoon Ho.

During the financial year ended 31 December2002, Mr Lim Yong Wah and Mrs Arfat Selvamresigned as independent directors of theCompany. Mr Ng Tat Pun and Mr Soh KimSoon were appointed as independentdirectors of the Company with effect from 1 July 2002 and 19 November 2002respectively.

Mr Lim Kim Quee resigned as director of theCompany on 21 February 2003. Mr Lee InYoung, Mr Myung Ho-Keun and Mr Lee YoonHo resigned as directors of the Company on12 March 2003.

Mr Chua Thian Poh and Dr Tan Choo Suanhad been appointed as directors of thecompany with effect from 8 April 2003.

At present, the Board comprises sevendirectors, one of whom is an executivedirector, three of whom are independent andnon executive directors, and three of whomare non-executive directors.

The executive director is Mr Tan Cheng Gay. The independent and non-executive directorsare Mr Ng Tat Pun, Mr Soh Kim Soon and MrTan Keng Boon. The non-executive directorsare Mr Chua Thian Poh, Dr Tan Choo Suanand Mr Tan Yok Koon.

The Board’s principal functions include,among others, supervising the overallmanagement and performance of thebusiness and affairs of the Group andapproving the Group’s corporate andstrategic policies and direction.

Matters which are specifically reserved forthe approval of the Board include, amongothers, any material acquisitions anddisposals of assets, any significant corporatematters and major undertakings (other thanin the ordinary course of business). TheBoard dictates the strategic direction andmanagement of the Company throughquarterly review of the financial performanceof the Company and the Group. In addition toestablishing the limits of the discretionarypowers of the officers and committees, theBoard reviews the adequacy of riskmanagement systems and internal controls.Certain functions have been delegated tovarious board committees, namely, the AuditCommittee (the “AC”), the NominatingCommittee (the “NC”) and the RemunerationCommittee (the “RC”).

The Company’s Articles of Association (the“Articles”) do not allow Board meetings to be conducted by way of tele-conferencing orvideo-conferencing. The Company does notintend to amend the Articles to provide fortelephonic and video conference meetingsbecause the Company anticipates that allBoard meetings would be held in Singapore.

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New directors, upon appointment, are briefedon the business and organization structure ofthe Company. There are update sessions toinform the directors on new legislation and/or regulations that are relevant to the Group.

1.2 Role of the Chairman and Chief Executive Officer (“CEO”)As at 31 December 2002, Mr Myung Ho-Keunwas the chairman of the Board (the“Chairman”). Mr Myung Ho-Keun ceased tobe the Chairman upon his resignation as adirector of the Company on 12 March 2003.

Mr Tan Cheng Gay (“Mr Tan”) currentlyfulfills the role of Chief Executive Officer (the“CEO”) and takes over the role of Chairmanof the Board (the “Chairman”) with effectfrom 14 April 2003.

The Board has not adopted therecommendation of the Code to haveseparate directors appointed as the Chairmanand the CEO. This is because the Board is ofthe view that there is a sufficiently strongindependent element on the Board to enableindependent exercise of objective judgmenton corporate affairs of the Group.

As the Chairman, Mr Tan is responsible for,among others, exercising control over quality,quantity and timeliness of the flow ofinformation between the management of theCompany (the “Management”) and the Board,and assisting in ensuring compliance withthe Company’s guidelines on corporategovernance.

1.3 Access to informationFor FY2002, the members of the Board wereprovided with financial information, as wellas relevant background information anddocuments relating to items of business tobe discussed at a Board meeting before thescheduled meeting.

From FY2003, Management intends toprovide each member of the Board withmanagement accounts, at least on aquarterly basis. This is to ensure that theBoard is able to fulfill its responsibilities andin line with the Company’s intention to adoptthe practice of quarterly reporting with effectfrom FY2003.

Board of Directors Nominating Committee Audit Committee RemunerationCommittee

Number of MeetingsHeld* Attended Held* Attended Held* Attended Held* Attended

DirectorsMyung Ho-Kuen 3 2 – – – – – –Tan Cheng Gay 3 3 – – – – – –Lee In Young 3 3 – – – – – –Lim Yong Wah (1) 1 1 – – 1 1 – –Arfat Selvam (2) 1 1 – – 1 1 – –Lim Kim Quee 3 3 – – – – – –Lee Yoon Ho (3) 2 1 – – – – – –Tan Keng Boon 3 3 – – 4 4 1 1Tan Yok Koon 3 2 1 1 3 3 1 1Ng Tat Pun (4) 2 2 1 1 3 3 – –Soh Kim Soon (5) 0 0 1 1 – – 1 1

Legend:* Reflects the number of meetings held during the time that the Director held office. – Indicates that the director was not a member of that committee during the year.0 Indicates that no meeting was held during the time that the Director was a member.

Notes:1 Mr Lim Yong Wah resigned on 5 June 20022 Mrs Arfat Selvam resigned on 5 June 20023 Mr Lee Yoon Ho was elected to the Board on 28 June 20024 Mr Ng Tat Pun was elected to the Board on 1 July 20025 Mr Soh Kim Soon was elected to the Board on 19 November 2002

The number of Board, NC, AC and RC meetings held in FY2002 and the attendance of each Boardmember at those meetings were as follows:


The Board (whether individually or as agroup) has, in the furtherance of its duties,access to independent professional advice, ifnecessary, at the Company’s expense.

2 NOMINATING COMMITTEE (“NC”)2.1 Board Membership

The NC was set up on 5 November 2002. TheNC comprises three directors, the majority of whom (including the chairman of the NC)are independent. All the members of NC arenon-executive. The chairman of the NC is Mr Soh Kim Soon. The NC has adoptedspecific written terms of reference. The firstNC meeting was held on 27 December 2002.

According to the terms of reference of theNC, the members of the NC are responsiblefor, among others, the appointment and re-nomination of directors having regard to their independence, qualifications,performance and contributions. The NC also ensures that the Board as a whole,possesses the core competencies required by the Code.

The NC adopted the Code’s definition on whatconstitutes an independent director underguidance note 2.1 (a) to (d) of the Code.

For FY2002, the NC is of the view that theCompany is headed and controlled by aneffective Board, as:

(a) three of the Board’s seven non-executivedirectors of the Company are independent(as defined in the Code) and able toexercise objective judgement on corporateaffairs of the Group independently fromManagement;

(b) there is no individual or small group ofindividuals on the Board who dominatethe Board’s decision making process;

(c) the Board as a whole, possesses corecompetencies required for the effectiveconduct of the affairs and operations ofthe Group; and

(d) the current size of the Board is adequatefor the purposes of the Group.

2.2 Board PerformanceAs stated above, one of the terms ofreference of the NC is to review and evaluatethe performance of each director and of theBoard as a whole for each financial year. The review parameters for evaluating eachdirector include, among others, the following:

(a) attendance at board/committee meetings;

(b) participation at meetings;

(c) involvement with management; and

(d) availability for consultation and advice,when required.

For FY2003, the NC would establishindicators to evaluate the performance of the Board and the individual directors.

3 AUDIT COMMITTEE (“AC”)3.1 Audit Committee

The AC currently comprises three members,the majority of whom (including the chairman of the AC) are independent directors. All themembers of AC are non-executive directors.The chairman of the AC is Mr Ng Tat Pun. The AC has adopted specific written terms of reference.

The other AC members are namely, Mr TanKeng Boon and Mr Tan Yok Koon. The ACmembers have many years of experience inaccounting and finance related matters.Therefore, the Board considers that the ACmembers are appropriately qualified todischarge the responsibilities of the AC.

In FY2002, the AC held 4 AC meetings.Details of the members’ attendance at ACmeetings in FY2002 are provided in Section1.1 of this Report. In line with the Company’sintention to adopt the practice for quarterlyreporting with effect from FY2003, the AC willmeet at least four times a year from FY2003.

The AC performed the following functions inrespect of FY2002:


(a) External AuditorsThe AC reviews and evaluates with theexternal auditors the audit plan, system of internal controls, financial results andinterested person transactions of theGroup.

The external auditors provided non-auditservices to the Group in FY2002 and the ACis satisfied that such services do not impairthe independence of the external auditorsin their conduct of the statutory audit.

The AC shall continue to monitor the scopeand results of the external audit, its costeffectiveness and the independence andobjectivity of the external auditors andgive its recommendations to the Boardand the Company regarding theappointment, re-appointment or removalof the external auditors.

(b) Review of financial statementsFor FY2002, the AC reviewed the half-yearly and full year financial statementsof the Company and the Group, includingannouncements relating thereto, toShareholders and the SGX-ST. FromFY2003, the AC shall review the quarterlyand full year financial statements of theCompany and the Group.

(c) Review of interested person transactionsThe AC has reviewed interested persontransactions of the Group for FY2002 andhas reported findings to the Board.

3.2 Internal ControlsBased on its review of internal controls, theAC is of the view that there are adequateinternal controls in the Group.

3.3 Internal AuditThe Company ensures that the Internal Auditfunction (the “IA”) meets Standards for theProfessional Practice of Internal Auditing setby The Institute of Internal Auditors. TheInternal Audit function reports directly to thechairman of the AC on audit matters and tothe CEO on administrative matters.

The AC shall also, among others, review (a)the adequacy of the IA’s activities to ensurethat the IA has adequate resources andappropriate standing within the Company and(b) the internal audit programme and ensureco-ordination between the IA, externalauditors and Management.

4 REMUNERATION COMMITTEE (“RC”)4.1 Procedures for Developing Compensation

PoliciesThe RC comprises three members, themajority of whom (including the chairman of the RC) are independent directors. All themembers of RC are non-executive directors.The chairman of the RC is Mr Tan Keng Boon.The RC has access to outside expert adviseon all remuneration matters at the Company’sexpense.

According to the terms of reference of theRC, the functions of the RC include, amongothers, the setting up and implementation of formal and transparent processes bywhich the remuneration packages of all theexecutive directors (in the form of serviceagreements) are formulated and approved.The RC also administers the Company’sExecutive Share Option Scheme.

No director or member of the RC has beeninvolved in deciding his own remuneration,except for providing information anddocuments specifically requested by the RCto assist it in its deliberations.

4.2 Level and Mix of Remuneration According to the service agreement of theCEO:

(a) the term of service shall continue untilterminated by either party in accordancewith the terms of the agreement;


(b) the remuneration include, among others,a fixed salary and a variable performancebonus, which is designed to align the CEO’sinterests with that of the Shareholders;

(c) there are no onerous compensationcommitments on the part of the Companyin the event of an early termination of theservice of the CEO.

Up till FY2001, the CEO and Mr Lee In Young (an executive director who had resigned on12 March 2003) received directors’ fees. TheCEO and Mr Lee In Young did not receivedirectors’ fees for FY2002. Mr Lee In Youngand the non-executive directors do not haveany service agreements with the Company.Save for directors’ fees, which have to beapproved by the Shareholders at everyannual general meeting (“AGM”), the non-executive directors do not receive anyremuneration from the Company.

4.3 Disclosure on RemunerationThe table below shows a summary of theremuneration of the Directors for the yearended 31 December 2002:

The Board has not included an annualremuneration report in its annual report forFY2002 (as suggested by guidance note 9.1 ofthe Code) as the Board is of the view that thematters which are required to be disclosed inthe annual remuneration report have alreadybeen sufficiently disclosed in this Report and in the financial statements of the Company.

5 COMMUNICATIONS WITH THE SHAREHOLDERS5.1 Accountability

The Company intends to adopt quarterlyreporting of its financial results with effectfrom FY2003. Accordingly, from FY2003,quarterly financial results of the Companywill be published via MASNET. The Companymay also, on an ad hoc basis, hold media andanalysts briefings and publish press releases of its financial results.

5.2 Communications with ShareholdersThe Board is mindful of the obligation toprovide timely and fair disclosure of materialinformation in accordance with the CorporateDisclosure Policy of the SGX-ST.

All Shareholders receive the annual reportand the notice of AGM (the “Notice of AGM”).The Notice of AGM is advertised in thenewspapers and published via MASNET.

5.3 Greater Shareholder ParticipationThe Board welcomes the views ofShareholders on matters affecting theCompany, whether at Shareholders’meetings or on an ad hoc basis. At AGMs,Shareholders are given the opportunity to air their views and to ask the directors andManagement questions regarding the Group.

6 DEALINGS IN SECURITIESThe Company has adopted the SGX-ST BestPractices Guide applicable in relation to dealingsin the Company’s securities by its officers. TheCompany has informed its officers not to deal inthe Company’s shares whilst they are in possessionof unpublished material price sensitive informationand during the period commencing one monthbefore the announcement of the Company’sfinancial results and ending on the date of theannouncement of such financial results.

TAN CHENG GAYChairman/CEO

Remuneration*S$

Non-Executive DirectorsMyung Ho-Keun 22,500Lim Yong Wah 17,500Arfat Selvam 12,500Lim Kim Quee 15,000Tan Keng Boon 35,000Tan Yok Koon 35,000Kang Bok Soo 7,500Ng Tat Pun 20,000Soh Kim Soon 20,000Lee Yoon Ho 7,500Executive DirectorsTan Cheng Gay 340,383Lee In Young 285,694

* Includes salaries, fees, bonuses and the value of benefitsin kind, earned during the year from the Group bydirectors of the Company

financial statements

10 directors’ report

15 statement by directors

16 auditors’ report

17 balance sheet

18 profit and loss accounts

21 consolidated statement of cash flows

23 notes to the financial statements

55 shareholding statistics

56 notice of annual general meeting

58 notes to proxy form

59 proxy form

We are pleased to submit this annual report to the members of the Company together with the audited financial statements forthe financial year ended 31 December 2002.

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

Tan Cheng GayTan Yok KoonTan Keng BoonSoh Kim Soon (Appointed on 19 November 2002)Ng Tat Pun (Appointed on 1 July 2002)Tan Choo Suan (Appointed on 8 April 2003)Chua Thian Poh (Appointed on 8 April 2003)

PRINCIPAL ACTIVITIESThe principal activities of the Company during the financial year have been those relating to the manufacture and sale ofcement and of an investment holding company. The principal activities of the subsidiaries during the financial year are set outin Note 4 to the financial statements. There have been no significant changes in such activities during the financial year.

ACQUISITIONS AND DISPOSALS OF SUBSIDIARIESThere were no acquisition or disposal of any subsidiary during the financial year.

FINANCIAL RESULTSThe results of the Group and of the Company for the financial year were as follows:

The Group The Company$’000 $’000

Loss after taxation (32,847) (50,416)Minority interests 50 –

Loss attributable to members of the Company (32,797) (50,416)

TRANSFERS TO AND FROM RESERVES AND PROVISIONSThe following material transfers to and from reserves were made during the financial year:

The Group The Company$’000 $’000

Accumulated profitsNet loss for the year (32,797) (50.416)Dividends– Final dividend paid of 5 cents per share less tax at 22% in respect of year 2001 (4,466) (4,466)

Currency translation reservesExchange differences on translation of financial statements of foreign subsidiaries

and associated corporations 930 –

Material movements in provisions are as set out in the accompanying financial statements.

ISSUES OF SHARES AND DEBENTURESDuring the financial year, the Company issued 5,000 ordinary shares of $0.50 each at $1.30 per share under the Executives’Share Option Scheme for cash.

Except as discussed above, neither the Company nor its subsidiaries issued any shares or debentures during the year.

pyear ended 31 december 2002



DIRECTORS’ INTERESTSAccording to the register kept by the Company for the purposes of Section 164 of the Companies Act, Chapter 50 (the “Act”),particulars of interests of directors who held office at the end of the financial year in shares, debentures, warrants and shareoptions in the Company and in related corporations (other than wholly-owned subsidiaries) are as follows:

Holdings in the name Other holdings in whichof the director, the director is deemed

spouse or infant children to have an interest

At beginning At end At beginning At endof the year/ of the year of the year/ of the year

date of date ofappointment appointment

The CompanyOrdinary shares of $0.50 each fully paid

Tan Cheng Gay 7,500 7,500 – –Tan Keng Boon 10,000 10,000 – –Lee In Young* 226,000 216,000 – –Tan Yok Koon – – 1,000 –Soh Kim Soon 31,000 31,000 – –

The CompanyShare Options in unissued shares of $0.50 each

Exercise price Exercisable period

Lee In Young* $1.70 29/10/2000 to 28/10/2004 50,000 50,000 – –

* Resigned on 12 March 2003

Except as disclosed in this report, according to the register kept by the Company, no director who held office at the end of thefinancial year had interests in shares, debentures, warrants or share options of the Company or of related corporations eitherat the beginning of the financial year or date of appointment, if later or at the end of the financial year.

There was no change in any of the above mentioned interests between the end of the financial year and 21 January 2003.

Except as disclosed under the “Share Options” section of this report, neither at the end of nor at any time during the financialyear was the Company a party to any arrangement whose objects are, or one of whose objects is, to enable the directors of theCompany to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate.

Since the end of the last the financial year, no director has received or become entitled to receive a benefit by reason of acontract made by the Company or a related corporation with the director or with a firm of which he is a member or with acompany in which he has a substantial financial interest.

DIVIDENDSSince the end of the last financial year, the Company has paid a net final dividend of $4,466,066 in respect of the previous yearas proposed in the directors’ report of that year. The directors now recommend the payment of a net final dividend of $3,012,165in respect of the financial year under review.

BAD AND DOUBTFUL DEBTSBefore the profit and loss account and the balance sheet of the Company were made out, the directors took reasonable steps toascertain what action had been taken in relation to writing off bad debts and providing for doubtful debts of the Company. Thedirectors have satisfied themselves that all known bad debts have been written off and that adequate provision has been madefor doubtful debts.

At the date of this report, the directors are not aware of any circumstances which would render any amounts written off for baddebts or provided for doubtful debts in the Company inadequate to any substantial extent.


CURRENT ASSETSBefore the profit and loss account and the balance sheet of the Company were made out, the directors took reasonable stepsto ascertain that current assets of the Company which were unlikely to realise their book values in the ordinary course ofbusiness have been written down to their estimated realisable values and that adequate provision has been made for thediminution in value of such current assets.

At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this report which wouldrender the values attributable to current assets in the Group misleading.

CHARGES AND CONTINGENT LIABILITIESSince the end of the financial year:

i) no charge on the assets of the Group or of the Company has arisen which secures the liabilities of any other person; and

ii) no contingent liability of the Group or of the Company has arisen.

ABILITY TO MEET OBLIGATIONSNo contingent liability or other liability of the Group or of the Company has become enforceable or is likely to becomeenforceable within the period of twelve months after the end of the financial year which, in the opinion of the directors, will ormay affect the ability of the Group or of the Company to meet their obligations as and when they fall due.

OTHER CIRCUMSTANCES AFFECTING THE FINANCIAL STATEMENTSAt the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this report or the financialstatements which would render misleading any amount stated in the financial statements of the Group or of the Company.

UNUSUAL ITEMSIn the opinion of the directors, no item, transaction or event of a material and unusual nature has substantially affected theresults of the operations of the Group or of the Company during the financial year except as disclosed in the accompanyingfinancial statements.

In the opinion of the directors, no item, transaction or event of a material and unusual nature has arisen in the intervalbetween the end of the financial year and the date of this report which is likely to affect substantially the results of theoperations of the Group or of the Company for the financial year in which this report is made.



SHARE OPTIONSSsangYong Cement Executives’ Share Option Scheme (the “Scheme”)

The Scheme, which was approved by shareholders on 27 June 1990, was described in the Directors’ Report for the year ended31 December 1990. The Scheme expired on 27 June 2000 and was replaced by SsangYong Cement (Singapore) Limited 2000Employees’ Share Option Scheme.

The Scheme was administered by a committee of directors comprising Mr Tan Cheng Gay, Chairman of the Committee, and Mr Lim Kim Quee (resigned on 21 February 2003), both of whom are not participants of the Scheme.

As at the end of the financial year, there were the following unissued shares of the Company under option:Number of

Date of Exercise Option Option Option option holdersgrant of price per outstanding at Option cancelled/ outstanding at at Exerciseoptions share 1/1/2002 exercised lapsed 31/12/2002 31/12/2002 period

4/11/1997 $1.92 51,000 – (51,000) – – 4/11/1998to 3/11/2002

2/11/1998 $1.30 51,000 (5,000) (10,000) 36,000 11 2/11/1999to 1/11/2003

29/10/1999 $1.70 198,000 – (30,000) 168,000 28 29/10/2000to 28/10/2004

300,000 204,000

The unissued ordinary shares under options at 31 December 2002 include:

Aggregate optionsAggregate options exercised/ Aggregate

granted since lapsed since optionscommencement commencement outstanding

Options granted of Scheme to of Scheme to as at theduring the the end of the the end of the end of the

financial year financial year financial year financial yearName of participant under review under review under review under review

Directors of the CompanyLee In Young (resigned on 12 March 2003) – 220,000 170,000 50,000

No options have been granted to controlling shareholders of the Company and their associates under the Scheme.

SsangYong Cement (Singapore) Limited 2000 Employees’ Share Option Scheme (the “2000 Scheme”)By a resolution at the Extraordinary General Meeting of the Company held on 15 January 2002, the 2000 Scheme was approvedand was described in the Directors’ Report of the Company for the year ended 31 December 2000.

During the financial year, there were:

i) no other options granted by the Company or its subsidiaries to any person to take up unissued shares of the Company orits subsidiaries; and

ii) no other shares issued by virtue of any exercise of option to take up unissued shares of subsidiaries.

Pacific Technology Employees’ Share Option Scheme (the “PT Scheme”)The PT Scheme was approved by shareholders of Pacific Technology Pte Ltd on 25 June 1993 and was described in theDirectors’ Report of the Company for the year ended 31 December 1993. No options have been granted in the history of the PTScheme.

During the financial year, there were:

i) no other options granted by the Company or its subsidiaries to any person to take up unissued shares of the Company orits subsidiaries; and

ii) no other shares issued by virtue of any exercise of option to take up unissued shares of subsidiaries.

As at the end of the financial year, there were no other unissued shares of the Company or its subsidiaries under option.



CORPORATE GOVERNANCEThe Company is committed to high standards of corporate governance in conducting its business, and ensures that self-regulatory and monitoring mechanisms exist and are practised. The directors and management fully support and adopt theBest Practices Guide as formulated by the Singapore Exchange Securities Trading Limited (“SGX”).

AUDIT COMMITTEEThe Audit Committee comprises three members, majority of whom are independent directors. The members are:

Ng Tat Pun Chairman, non-executive directorTan Yok Koon non-executive directorTan Keng Boon non-executive director

The Audit Committee performs the functions specified in Section 201B of the Companies Act, the Listing Manual and the BestPractices Guide of the Singapore Exchange.

In performing its functions, the Audit Committee met with the Company’s external and internal auditors to discuss the scope oftheir work, the results of their examination and evaluation of the Company’s internal accounting control system.

The Audit Committee also reviewed the following:

• the effectiveness of the management of financial business risks and the reliability of management reporting;• the effectiveness and efficiency of internal and external audits; • the financial statements of the Group and the Company prior to their submission to the directors of the Company for adoption;• related party transactions;• interested person transactions (as defined in Chapter 9A of the Listing manual of the Singapore Exchange); and• independence of the external auditor.

The Audit Committee has full access to management and is given the resources required for it to discharge its functions. It hasfull authority and discretion to invite any director or executive officer to attend its meetings.

The Audit Committee has recommended to the Board of Directors that the auditors, KPMG, be nominated for re-appointmentas auditors at the forthcoming Annual General Meeting of the Company.

DEALING IN SECURITIESThe Company has issued a Statement of Policy and Guidelines on dealing in shares to employees, setting out the implicationsof insider trading and the recommendations of the Best Practices Guide.

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

On behalf of the Board of Directors

TAN CHENG GAY NG TAT PUNDirector Director

Singapore14 April 2003




We, being directors of the Company, do hereby state that in our opinion:

(a) the financial statements set out on pages 17 to 54 are drawn up so as to give a true and fair view of the state of affairs ofthe Group and of the Company as at 31 December 2002, and of the results of the business and changes in equity of theGroup and of the Company and the cash flows of the Group for the year ended on that date; 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 andwhen they fall due.

The board of directors has, on the date of this statement, authorised these financial statements for issue.

On behalf of the Board of Directors

TAN CHENG GAY NG TAT PUNDirector Director


yyear ended 31 december 2002


We have audited the consolidated financial statements of the Group and the financial statements of the Company for the yearended 31 December 2002 as set out on pages 17 to 54. These financial statements are the responsibility of the Company’sdirectors. Our responsibility is to express an opinion on these financial statements based on our audit.

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

In our opinion:

(a) the financial statements are properly drawn up in accordance with the provisions of the Singapore Companies Act, Chapter50 (the “Act”) and Singapore Statements of Accounting Standard and so as to give a true and fair view of:

i) the state of affairs of the Group and of the Company as at 31 December 2002 and of the results and changes in equityof the Group and of the Company and of the cash flows of the Group for the year ended on that date; and

ii) the other matters required by Section 201 of the Act to be dealt with in the financial statements;

(b) the accounting and other records, and the registers required by the Act to be kept by the Company and by the subsidiariesincorporated in Singapore, have been properly kept in accordance with the provisions of the Act.

We have considered the financial statements and auditors’ reports of the subsidiaries of which we have not acted as auditors,and also considered the financial statements of these subsidiaries, which are not required by the law of their country ofincorporation to be audited, being financial statements that have been included in the consolidated financial statements of theGroup. The names of these subsidiaries are stated in Note 4 to the financial statements.

We are satisfied that the financial statements of the subsidiaries that have been consolidated with the financial statements ofthe Company are in form and content appropriate and proper for the purposes of the preparation of the consolidated financialstatements, and we have received satisfactory information and explanations as required by us for those purposes.

The auditors’ reports on the financial statements of the subsidiaries were not subject to any qualification and in respect ofsubsidiaries incorporated in Singapore, did not include any comment made under Section 207(3) of the Act.

KPMGCertified Public Accountants


pSsangYong Cement (Singapore) Limited

The Group The Company

Note 2002 2001 2002 2001$’000 $’000 $’000 $’000

Non-current assetsProperty, plant and equipment 3 35,648 43,431 30,788 37,427Investments in subsidiaries 4 – – 8,973 38,854Interests in associates 5 21,900 16,077 300 300Other financial assets 6 50,443 61,628 12,624 21,880Other non-current assets 7 453 1,164 55,668 47,701

108,444 122,300 108,353 146,162Current assetsInventories 11 3,916 3,703 2,351 1,981Trade receivables 12 14,773 17,453 8,685 9,541Other financial assets 6 2,059 3,493 – –Other receivables, deposits and prepayments 13 2,350 2,003 993 249Cash and cash equivalents 14 80,491 93,565 67,601 79,840

103,589 120,217 79,630 91,611

Current liabilitiesOther financial liabilities 6 128 585 – –Trade payables 15 8,875 8,158 3,113 2,663Other payables and accruals 16 4,813 4,167 2,161 2,005Provisions 17 – 500 – 500Current portion of interest-

bearing bank loans and borrowings 18 4,491 920 3,696 –Current portion of obligations

under finance lease liabilities 19 182 73 – –Provision for taxation 1,986 2,479 1,822 2,182

20,475 16,882 10,792 7,350

Net current assets 83,114 103,335 68,838 84,261

Non-current liabilitiesInterest-bearing bank loans and borrowings 18 39 – – –Obligations under finance lease liabilities 19 – 182 – –Non-interest bearing loans 20 2,685 – 38,511 36,867Deferred taxation 21 4,072 4,160 3,755 3,756

6,796 4,342 42,266 40,623

184,762 221,293 134,925 189,800Minority interests (164) (369) – –

Net Assets 184,598 220,924 134,925 189,800

Capital and ReservesShare capital 22 38,618 38,615 38,618 38,615Reserves 23 145,980 182,309 96,307 151,185

184,598 220,924 134,925 189,800

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


as at 31 december 2002



Note 2002 2001 2002 2001$’000 $’000 $’000 $’000

Revenue 24 40,113 50,932 17,173 18,564Changes in inventories of finished goods and

work-in-progress 1,423 (634) 1,582 (154)Raw materials and other consumables (27,464) (30,130) (14,751) (13,542)Impairment losses of property, plant and equipment 3 (345) (7,939) – –Depreciation of property, plant and equipment 3 (9,443) (9,524) (8,200) (5,824)Staff costs (10,507) (13,358) (5,415) (7,378)Allowance reversed/(made) for – doubtful receivables 12 (2,090) (1,069) (1,900) (198)– foreseeable losses 17 290 2,531 290 2,531Exchange (loss)/gain (1,299) 3,984 (2,805) 4,942Other operating expenses (7,062) (11,564) 211 (6,454)

Loss from operations (16,384) (16,771) (13,815) (7,513)Finance costs (84) (328) (54) (224)Interest income 2,692 4,445 2,322 3,911Non-operating (expenses)/income 25 (f) (21,882) (432) (38,869) 11,300Share of profits of associates 3,547 16,712 – –

(Loss)/Profit from ordinaryactivities before taxation 25 (32,111) 3,626 (50,416) 7,474Taxation 26 (736) (3,143) – 1,500

(Loss)/Profit from ordinaryactivities after taxation (32,847) 483 (50,416) 8,974Minority interests 50 (270) – –

Net (loss)/profit for the year (32,797) 213 (50,416) 8,974

Basic earnings per share (cents) 27 (42.47) 0.28

Diluted earnings per share (cents) 27 (42.47) 0.28



Currency Accu-Share Share Statutory Capital translation mulated

The Group Note capital premium reserves reserves reserve profits Total$’000 $’000 $’000 $000 $’000 $’000 $’000

At 1 January 2001 38,615 32,355 184 387 594 153,855 225,990Exchange differences on translation

of financial statements of foreign subsidiaries and associated corporations – – – – (52) – (52)

Realisation upon liquidation of subsidiary – – (184) 59 – – (125)Net profit for the year – – – – – 213 213Dividends 30 – – – – – (5,102) (5,102)

At 31 December 2001 38,615 32,355 – 446 542 148,966 220,924

At 1 January 2002 38,615 32,355 – 446 542 148,966 220,924Issue for cash pursuant to the exercise

of options under the Executives’ share option scheme 3 4 – – – – 7

Exchange differences on translation of financial statements of foreign subsidiaries and associated corporations – – – – 930 – 930

Net loss for the year – – – – – (32,797) (32,797)Dividends 30 – – – – – (4,466) (4,466)

At 31 December 2002 38,618 32,359 – 446 1,472 111,703 184,598


g q yyear ended 31 december 2002

Share Share AccumulatedThe Company Note capital premium profits Total

$’000 $’000 $’000 $’000

At 1 January 2001 38,615 32,355 114,958 185,928Net profit for the year – – 8,974 8,974Dividends 30 – – (5,102) (5,102)

At 31 December 2001 38,615 32,355 118,830 189,800

At 1 January 2002 38,615 32,355 118,830 189,800Issue of shares for cash pursuant

to exercise of employees’ share option 3 4 – 7Net loss for the year – – (50,416) (50,416)Dividends 30 – – (4,466) (4,466)

At 31 December 2002 38,618 32,359 63,948 134,925



g q yyear ended 31 december 2002


2002 2001$’000 $’000

Operating Activities(Loss)/Profit from ordinary activities before taxation (32,111) 3,626Adjustments for:

Depreciation and amortisation 9,481 9,623Impairment losses of property, plant and equipment 345 7,939Property, plant and equipment written off 543 140Gain on sale of property, plant and equipment (80) (446)Interest expense 84 328Interest income (2,692) (4,445)Investment income 21,882 432Reversal of provision for roller press and foreseeable losses (290) (2,638)Share of profits of associates (3,547) (16,712)Loss on disposal of subsidiary – 119

Operating loss before working capital changes (6,385) (2,034)Changes in working capital:Inventories (244) 1,742Trade and other receivables 503 12,151Trade and other payables 2,123 (6,186)

(4,003) 5,673Interest paid (84) (328)Income tax paid (383) (163)

Cash (outflow)/inflow from operating activities (4,470) 5,182

Investing ActivitiesMargin deposits placed – 768Purchase of property, plant and equipment (3,445) (3,934)Proceeds from sale of property, plant and equipment 1,149 966Purchase of intangible assets – (39)Loans to associates 3,609 11,411Investment in associates (2,542) –Net cash effect from sale of subsidiaries – (926)Proceeds from sale of investments 93 4,200Proceeds from sale of a former subsidiary – 2,882Purchases of investments (8,525) (16,349)Distribution income from partnership investments received – 3,619Interest received 2,384 5,189

Cash (outflow)/inflow from investing activities (7,277) 7,787

Balance carried forward (11,747) 12,969

year ended 31 december 2002

Note 2002 2001$’000 $’000

Balance carried forward (11,747) 12,969

Financing ActivitiesTerm loans from banks – proceeds/(repayment) 3,022 (3,738)Payment of finance lease (73) (73)Proceeds from share issues 7 –Dividends paid (4,466) (5,102)Cash balances under lien and subject to foreign exchange control 255 (136)

Net cash outflow from financing activities (1,255) (9,049)

Net (decrease)/increase in Cash and Cash Equivalents (13,002) 3,920Cash and Cash Equivalents at beginning of year 92,922 89,161Effects of Exchange Rate Changes on Cash and Cash Equivalents (404) (159)

Cash and Cash Equivalents at end of year 14 79,516 92,922




These notes form an integral part of the financial statements.

The financial statements were authorised for issue by the directors on 14 April 2003.

1 DOMICILE AND ACTIVITIESSsangYong Cement (Singapore) Limited (the “Company”) incorporated in the Republic of Singapore with its registered officeat 29 International Business Park, #08-05/06, Acer Building Tower B, Singapore 609923.

The principal activities of the Company have been those relating to the manufacture and sale of cement and of aninvestment holding company. The principal activities of the subsidiaries are set out in Note 4 to the financial statements.

The consolidated financial statements relate to the Company and its subsidiaries (referred to as the “Group”) and theGroup’s interests in associates.

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of PreparationThe financial statements are prepared in accordance with Singapore Statements of Accounting Standard (“SAS”)including related Interpretations promulgated by the Institute of Certified Public Accountants of Singapore and theapplicable requirements of the Singapore Companies Act, Chapter 50.

The historical cost basis is used. Amounts are expressed in Singapore dollars, unless stated otherwise.

(b) Consolidation

i) SubsidiariesSubsidiaries are those companies controlled by the Company. Control exists when the Company has the power,directly or indirectly, to govern the financial and operating policies of a company so as to obtain benefits from its activities.

The financial statements of subsidiaries are included in the consolidated financial statements from the date thatcontrol commences until the date that control ceases.

ii) AssociatesAssociates are companies in which the Group has significant influence, but not control, over the financial andoperating policies.

The consolidated financial statements include the Group’s share of the total recognised gains and losses ofassociates on an equity accounted basis, from the date that significant influence commences until the date thatsignificant influence ceases. When the Group’s share of losses exceeds the carrying amount of the associate, thecarrying amount is reduced to nil and recognition of further losses is discontinued except to the extent that theGroup has incurred obligations in respect of the associate.

iii) Transactions eliminated on consolidationAll significant intra-group transactions, balances and unrealised gains are eliminated on consolidation. Unrealisedgains resulting from transactions with associates are eliminated to the extent of the Group’s interest in theenterprise. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that thereare no evidence of impairment.

iv) DisposalsOn disposal of a subsidiary or an associate, any attributable amount of purchased goodwill not previouslyamortised through the profit and loss account or which has previously been dealt with as a movement in Groupreserves is included in the calculation of the profit and loss on disposal.

v) GoodwillGoodwill arising on acquisition represents the excess of the cost of acquisition over the fair value of the Group’sshare of the identifiable net assets acquired. Goodwill is stated at cost less accumulated amortisation andimpairment losses. In respect of associates, the carrying amount of goodwill is included in the carrying amount ofthe investment in the associate. Goodwill is amortised from the date of initial recognition over its estimated usefullife of not more than 20 years.

vi) Negative GoodwillNegative goodwill arising on acquisition represents the excess of the fair value of the identifiable net assetsacquired over the cost of acquisition.




2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

vi) Negative Goodwill (continued)To the extent that negative goodwill relates to an expectation of future losses and expenses that are identified inthe plan of acquisition and can be measured reliably, but which have not yet been recognised, it is recognised inthe profit and loss account when the future losses and expenses are recognised. Any remaining negative goodwill,but not exceeding the fair values of the non-monetary assets acquired, is recognised in the profit and loss accountover the weighted average useful life of those assets that are depreciable or amortisable. Negative goodwill inexcess of the fair values of the non-monetary assets acquired is recognised immediately in the profit and loss account.

vii) Accounting Policies of SubsidiariesWhere necessary, accounting policies for subsidiaries and material associates have been changed to be consistentwith the policies adopted by the Group.

(c) Property, Plant and Equipment and Depreciation

i) Owned AssetsProperty, plant and equipment are stated at cost or valuation less accumulated depreciation. The freeholdapartment and certain buildings and civil works are stated at 1982 valuation. There is no fixed policy with regardsto the frequency of revaluation of property, plant and equipment.

Property, plant and equipment costing less than $1,000 are expensed in the year of acquisition.

ii) Subsequent ExpenditureSubsequent expenditure relating to a property, plant and equipment that has already been recognised is added tothe carrying amount of the asset when it is probable that future economic benefits, in excess of the originallyassessed standard of performance of the existing asset, will flow to the enterprise. All other subsequent expenditureis recognised as an expense in the period in which it is incurred.

iii) Leased AssetsAssets acquired on hire purchase arrangements are capitalised in the financial statements and the correspondingobligation treated as a liability. The total interest, being the difference between the total instalments payable andthe capitalised amount is charged to the profit and loss account over the period of such hire purchasearrangements in equal monthly instalments to produce a constant rate of interest on the balance capitalrepayments outstanding.

iv) DepreciationDepreciation is calculated on a straight line basis to write off the cost or valuation of property, plant and equipmentover their estimated useful lives at the following annual rates:

Freehold apartment – 6%Leasehold land – Over period of leaseBuildings and civil works – 6% to 331/3%Air-conditioners and electrical equipment – 71/2% to 20%Plant and machinery, laboratory equipment,

office and household equipment, furniture and fittings – 10% to 331/3%Computers, motor vehicles and transport equipment – 20% to 331/3%

No depreciation is provided on assets under construction.

(d) SubsidiariesInvestment in subsidiaries is stated at cost less impairment losses.

(e) AssociatesInvestments in associates are stated at cost less impairment losses.

The results of the associates are included in the Group’s profit and loss account to the extent of dividends received andreceivable, providing the Group’s right to receive the dividend is established before the balance sheet date.

(f) Financial Assets

i) Non-Current InvestmentsInvestments held on a long-term basis are stated at cost. Provision is made when in the opinion of the directors,there has been a decline, other than temporary, in the value of the investments. Any such provisions are recognisedas an expense in the profit and loss account.

Distributions of cash or quoted equity shares made by investment partnerships are recognised in the financialstatements as and when they are received. Such distributions are initially treated as return of investment and are




(f) Financial Assets (continued)

i) Non-Current Investments (continued)therefore set off against the cost of the investment. Any distributions received in excess of the cost of the investmentare taken to the profit and loss account.

ii) Current InvestmentCurrent investments are stated at the lower of cost and market value on a portfolio basis.

(g) Intangible AssetsIntangible assets, which are acquired by the Group, are stated at cost less accumulated amortisation and impairmentlosses. Expenditure on internally generated goodwill and brands is recognised in the profit and loss account as anexpense as incurred.

i) Subsequent ExpenditureSubsequent expenditure on capitalised intangible assets is capitalised only when it increases the future economicbenefits embodied in the specific asset to which it relates. All other expenditure is expensed as incurred.

ii) AmortisationAmortisation is charged to the profit and loss account on a straight-line basis over the estimated useful lives ofintangible assets. Intangible assets are amortised from the date the asset is available for use. The estimated usefullives are as follows:

Patents and trademarks 10 – 20 years

(h) Derivative Financial InstrumentsThe Group uses derivative financial instruments, including forward foreign exchange contracts, to hedge its exposure toforeign exchange arising from operational, financing and investment activities. In accordance with its treasury policy, theGroup does not hold or issue derivative financial instruments for trading purposes.

Derivative financial instruments used for hedging purposes are accounted for on an equivalent basis to the underlyingassets, liabilities or net positions. Any profit or loss arising is recognised on the same basis as that arising from therelated assets, liabilities or positions.

(i) Income Recognition

i) Sales of GoodsIncome on goods sold is normally recognised upon completion of delivery.

ii) Interest incomeInterest income from bank deposits is accrued on a time-apportioned basis on the principal outstanding and at the rate applicable.

iii) DividendsDividend income from quoted investments is recognised when dividends are received. Dividend income from otherinvestments is recognised when the shareholder’s right to receive payment is established.

(j) InventoriesInventories are stated at the lower of cost and net realisable value. Cost of raw materials is determined on the weightedaverage basis. For work-in-progress and finished goods, cost consists of the cost of raw materials, direct labour and anappropriate proportion of production overheads.

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

When inventories are sold, the carrying amount of those inventories is recognised as an expense in the period in whichthe related revenue is recognised. The amount of any write-down of inventories to net realisable value and all losses ofinventories are recognised as an expense in the period the write-down or loss occurs. The amount of any reversal of anywrite-down of inventories, arising from an increase in net realisable value, is recognised as a reduction in the amount ofinventories recognised as an expense in the period in which the reversal occurs.

(k) Trade and Other ReceivablesTrade and other receivables are stated at cost less allowance for doubtful receivables.




(l) Allowances for Doubtful ReceivablesKnown bad debts are written off and specific provision is made for accounts considered doubtful of collection. Inaddition, a general provision is made to provide for unidentified risks inherent in any portfolio of debtor balances.

(m) Borrowing CostsBorrowing costs are expensed in the profit and loss account in the period in which they are incurred.

(n) ImpairmentThe carrying amounts of the Group’s assets, other than inventories, are reviewed at each balance sheet date todetermine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amountis estimated. For intangible assets that are not yet available for use, the recoverable amount is estimated at eachbalance sheet date.

An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds itsrecoverable amount. An impairment loss in respect of land and buildings or investment property carried at revaluedamount is recognised in the same way as a revaluation decrease. All other impairment losses are recognised in theprofit and loss account.

i) Calculation of Recoverable AmountThe recoverable amount is the greater of the asset’s net selling price and 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 reflectscurrent market assessments of the time value of money and the risks specific to the asset. For an asset that doesnot generate cash inflows largely independent of those from other assets, the recoverable amount is determinedfor the cash-generating unit to which the asset belongs.

ii) Reversal of Impairment LossAn impairment loss is reversed if there has been a change in the estimates used to determine the recoverableamount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed thecarrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss hadbeen recognised. A reversal of an impairment loss in respect of land and buildings or investment property carriedat revalued amount is recognised in the same way as a revaluation increase. All other reversals of impairment arerecognised in the profit and loss account.

An impairment loss in respect of goodwill is not reversed unless the loss was caused by a specific external event ofan exceptional nature that is not expected to recur, and the increase in recoverable amount relates clearly to thereversal of the effect of that specific event.

(o) Trade and Other PayablesTrade and other payables are stated at cost.

(p) Interest-Bearing Loans and BorrowingsInterest-bearing loans and borrowings are recognised at cost.

(q) Employee Benefits

i) Defined Contribution PlansContributions to defined contribution pension plans are recognised as an expense in the profit and loss account as incurred.

ii) Equity and Equity-Related Compensation BenefitsThe stock option programme allows the Group’s employees to acquire shares of the Company. No compensationcost or obligation is recognised. When the options are exercised, equity is increased by the amount of the proceeds received.

(r) ProvisionsA provision is recognised in the balance sheet when the Group has a legal or constructive obligation as a result of apast event, and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effectis material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflectscurrent market assessments of the time value of money and, where appropriate, the risks specific to the liability.

(s) Deferred TaxDeferred tax is provided in full, using the liability method, on temporary differences arising between the tax bases ofassets and liabilities and their carrying amounts in the financial statements. Temporary differences are not recognisedfor goodwill not deductible for tax purposes and the initial recognition of assets or liabilities that affect neither




(s) Deferred Tax (continued)accounting nor taxable profit. The amount of deferred tax provided is based on the expected manner of realisation orsettlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at thebalance sheet date.

A deferred tax asset is recognised to the extent that it is probable that future taxable profit will be available againstwhich the temporary differences can be utilised.

Deferred tax is provided on temporary differences arising on investments in subsidiaries and associates, except wherethe timing of the reversal of the temporary difference can be controlled and it is probable that the temporary differencewill not be reversed in the foreseeable future.

(t) Foreign Currency TranslationMonetary assets and liabilities in foreign currencies, except where held for hedging purposes, are translated intorecording currencies at rates of exchange closely approximate to those ruling at the balance sheet date. Transactionsin foreign currencies are translated at rates ruling on transaction dates. Translation differences are included in theprofit and loss account.

Monetary items in foreign currencies held for hedging purposes are recorded at historical rates.

(u) Cash and Cash EquivalentsCash and cash equivalents comprise cash in hand, bank deposits and short-term, highly liquid investments which arereadily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value. Forthe purpose of the statement of cash flows, cash and cash equivalents are presented net of bank overdrafts which arerepayable on demand and which form an integral part of the Group’s cash management.

(v) Operating LeasesRental payable under operating leases are accounted for in the profit and loss account on a straight-line basis over theperiods of the respective leases.

(w) Segment ReportingA segment is a distinguishable component of the Group that is engaged either in providing products or services(business segment), or in providing products or services within a particular economic environment (geographicalsegment), which is subject to risks and rewards that are different from those of other segments.

Segment information is presented in respect of the Group’s business and geographical segments. The primary format,business segments, is based on the Group’s management and internal reporting structure.

Inter-segment pricing is determined on an arm’s length basis.

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can beallocated on a reasonable basis. Unallocated items mainly comprise income-earning assets and revenue, interest-bearing loans, borrowings and expenses, and corporate assets and expenses.

Segment capital expenditure is the total cost incurred during the period to acquire segment assets that are expected tobe used for more than one period.

i) Business SegmentsThe Group comprises the following business segments: – Cement and building materials

The Group manufactures mainly cement, ready mixed concrete and building materials.

– Information technologyThe Group markets and distributes office automation products.

ii) Geographical SegmentsThe Group’s operations are mainly in Singapore and others comprising mainly Malaysia and China.

In presenting information on the basis of geographical segments, segment revenue is based on the geographicallocation of customers. Segment assets are based on the geographical location of assets.



3 PROPERTY, PLANT AND EQUIPMENT

At valuation At cost

Freehold Building and Leasehold Building and Air Electrical Plant andThe Group apartment civil works land civil works conditioners equipment machinery

$’000 $’000 $’000 $’000 $’000 $’000 $’000

Cost/ValuationAt 1 January 2002 67 15,136 674 13,410 449 2,487 42,612Translation differences on consolidation – – 115 – – – 54Additions – – – 137 – – 26Reclassifications – – – 17,224 109 4,392 7,406Disposals/write offs – – – (2,556) (23) (431) (5,600)

At 31 December 2002 67 15,136 789 28,215 535 6,448 44,498

Depreciation and Impairment LossesAt 1 Janurary 2002 66 15,136 209 10,786 351 2,312 31,765Translation differences on consolidation – – 12 – – – 12Charge for the year – – 14 2,018 61 586 5,617Disposals/write offs – – – (1,985) (21) (377) (5,215)Impairment losses – – – 161 – – 166

At 31 December 2002 66 15,136 235 10,980 391 2,521 32,345

Depreciation charge for 2001 1 – 19 1,505 55 267 5,595

Impairment losses for 2001 – – – 1,826 – – 6,113

Net book value at31 December 2002 1 – 554 17,235 144 3,927 12,153

31 December 2001 1 – 465 2,624 98 175 10,847

At cost

Office andhousehold Motor

equipment, vehicles and AssetsLaboratory furniture transport under

The Group equipment and fittings Computers equipment construction Total$’000 $’000 $’000 $’000 $’000 $’000

Cost/Valuation At 1 January 2002 2,054 2,749 2,403 6,717 27,637 116,395Translation differences on consolidation 1 28 2 24 1,949 224Additions 1 230 38 1,064 2,923 3,445Reclassifications – – – – (29,131) –Disposals/write offs (232) (205) (491) (1,384) (455) (11,377)

At 31 December 2002 1,824 2,802 1,952 6,421 – 108,687

Depreciation and Impairment Losses At 1 Janurary 2002 1,294 2,416 2,109 6,520 – 72,964Translation differences on consolidation 1 15 1 11 – 52Charge for the year 171 301 250 425 – 9,443Disposals/write offs (140) (195) (480) (1,352) – (9,765)Impairment losses 9 5 – 4 – 345

At 31 December 2002 1,335 2,542 1,880 5,608 – 73,039

Depreciation charge for 2001 184 342 517 1,039 – 9,524

Impairment losses for 2001 – – – – – 7,939

Net book value at31 December 2002 489 260 72 813 – 35,648

31 December 2001 760 333 294 197 27,637 43,431


3 PROPERTY, PLANT AND EQUIPMENT (continued)At valuation At cost

Freehold Building and Leasehold Building and Air Electrical Plant andThe Company apartment civil works land civil works conditioners equipment machinery

$’000 $’000 $’000 $’000 $’000 $’000 $’000

2002Cost/ValuationAt 1 January 2002 552 15,136 188 6,544 449 2,449 31,852Additions – 572 – 16,639 109 4,392 7,424Disposals/write offs – – – (2,337) (23) (431) (4,988)

At 31 December 2002 552 15,708 188 20,846 535 6,410 34,288

Accumulated DepreciationAt 1 January 2002 551 15,136 188 5,738 351 2,281 24,288Charge for the year 1 572 – 1,242 61 586 5,086Disposals/write offs – – – (2,001) (22) (377) (4,953)

At 31 December 2002 552 15,708 188 4,979 390 2,490 24,421

Depreciation charge for 2001 1 – 5 423 55 254 3,904

Net book value at31 December 2002 – – – 15,867 145 3,920 9,867

31 December 2001 1 – – 806 98 168 7,564

At cost

Office andhousehold Motor

equipment, vehicles and AssetsLaboratory furniture transport under

The Company equipment and fittings Computers equipment construction Total$’000 $’000 $’000 $’000 $’000 $’000

2002Cost/ValuationAt 1 January 2002 1,886 1,829 2,026 4,513 27,355 94,779Additions – 186 7 15 1,776 31,123Disposals/write offs (32) (1) (379) (153) (29,131) (37,475)

At 31 December 2002 1,854 2,017 1,654 4,375 – 88,427

Accumulated DepreciationAt 1 January 2002 1,265 1,641 1,836 4,077 – 57,352Charge for the year 168 141 173 170 – 8,200Disposals/write offs (27) (1) (379) (153) – (7,913)

At 31 December 2002 1,406 1,781 1,630 4,094 – 57,639

Depreciation charge for 2001 181 166 441 394 – 5,824

Net book value at31 December 2002 448 236 24 281 – 30,788

31 December 2001 621 188 190 436 27,355 37,427



3 PROPERTY, PLANT AND EQUIPMENT (continued)The aggregate net book value of assets acquired under hire purchase agreements are as follows:


2002 2001 2002 2001$’000 $’000 $’000 $’000

Motor vehicles 199 210 – –

At the end of each hire purchase agreement, the Group has an option to purchase the asset at a beneficial price. Leasepayments do not include contingent rent. The leased equipment secures lease obligations.

The leasehold land of a subsidiary with net book value of $ Nil (2001: $16,000) is pledged as security for its bank overdraft facility.

The valuations of the freehold apartment and certain buildings and civil works and leasehold land for the Group are at openmarket values as at December 1982 as determined by independent firms of professional valuers. As described in thesummary of significant accounting policies, the Group does not have a fixed policy with regards to the frequency ofrevaluation of these properties.

4 INVESTMENTS IN SUBSIDIARIES

The Company

Note 2002 2001$’000 $’000

At cost 39,621 39,621Less: Allowance for diminution in value:

At 1 January 767 767Allowance made during the year 25 29,881 –

At 31 December 30,648 767

8,973 38,854




4 INVESTMENTS IN SUBSIDIARIES (continued)Details of the subsidiaries are as follows:

Name of subsidiary Principal activities Equity Cost ofinterest held investment

2002 2001 2002 2001% % $’000 $’000

Held by the CompanyPacific Technology Marketing and 100 100 2,500 2,500Private Limited distribution of office

automation products

S3 Building Services Manufacture and 100 100 8,500 8,500Pte Ltd sale of construction

and building materials

S3 Technologies Pte Ltd Manufacture and 100 100 700 700sale of constructionand building materials

Top Mix Pte Ltd Construction and 100 100 1,500 1,500supply of buildingmaterials

Vermiculite Industries Manufacture and 100 100 834 834(Pte) Ltd sale of vermiculite


(1) CemtecAsia (M) Manufacture and 100 100 119 119Sdn Bhd sale of construction


(1) S3 Technologies Manufacture and 100 100 1,655 1,655Sdn Bhd (formerly sale of building plastersknown as HartaWangsa Sdn Bhd)

(1) CemtecAsia (H.K.) Sale of construction 100 100 –* –*Limited and building materials and

provision of liaison andcoordination services torelated companies

Balance carried forward 15,808 15,808



4 INVESTMENTS IN SUBSIDIARIES (continued)

Name of subsidiary Principal activities Equity Cost ofinterest held investment

2002 2001 2002 2001% % $’000 $’000

Balance brought forward 15,808 15,808

Sancem Investment Investment trading 100 100 1,725 1,725Pte Ltd

SsangYong Cement Investment holding 100 100 100 100Singapore (China)Pte Ltd

SsangYong Digital V Investment holding 100 100 214 214(Singapore) Pte Ltd

SsangYong Digital VIII Investment holding 100 100 845 845(Singapore) Pte Ltd

SsangYong Digital IX Investment holding 100 100 404 404(Singapore) Pte Ltd

SsangYong Digital XII Investmen holding 100 100 362 362(Singapore) Pte Ltd

SsangYong LTI Pte Ltd Investment holding 100 100 –* –*

(1) Shanghai S3 Building Manufacture and 100 100 1,750 1,750Materials Co, Ltd sale of building materials

(1) e-Invest Limited Investment holding 100 100 8,413 8,413

(1) Juniper Capital Investment holding 100 100 10,000 10,000Ventures (Pte) Ltd

Held by subsidiaries(1) MPT Pacific Technology Marketing and 100 100 – –

Sdn Bhd distribution of office automation products




4 INVESTMENTS IN SUBSIDIARIES (continued)Name of subsidiary Principal activities Equity Cost of

interest held investment

2002 2001 2002 2001% % $’000 $’000


Bestmix Pte Ltd Manufacture and sale of 100 100 – –concrete and other buildingmaterials, retrofitting and restoration works to buildingsand construction

Top-Mix Concrete Pte Ltd Manufacture and sale of 100 100 – –concrete and other buildingmaterials, retrofitting and restoration works to buildings and construction

Chinthe Concrete Pte Ltd Production and 662/3 662/3 – –sale of concrete

Aeracon Technologies Dormant Pte Ltd 70 70 – –

# Bestmix Pte Ltd/ Manufacture 661/3 661/3 – –Beng Soon Machinery and sale of readymixedServices (S) Pte Ltd/ concreteTop Mix Pte Ltd Joint Venture

(1) CemtecAsia Dormant 100 100 – –Contract Services(M) Sdn Bhd

39,621 39,621

* Less than $1,000.

Except for the following, all other subsidiaries are audited by KPMG Singapore (1) Audited by other member firms of KPMG International.# Not required to be audited by law in the country of incorporation.

All subsidiaries are incorporated and conduct business in the Republic of Singapore, except for:i) CemtecAsia (M) Sdn Bhd, S3 Technologies Sdn Bhd (formerly known as Harta Wangsa Sdn Bhd), MPT Pacific

Technology Sdn Bhd, and CemtecAsia Contract Services (M) Sdn Bhd which are incorporated and conduct business in Malaysia;

ii) CemtecAsia (H.K.) Limited and e-Invest Limited which are incorporated and conduct business in Hong Kong; and

iii) Shanghai S3 Building Materials Co, Ltd, which is incorporated and conduct business in the People’s Republic of China.



5 INTERESTS IN ASSOCIATES


2002 2001 2002 2001$’000 $’000 $’000 $’000

Unquoted equity shares, at cost 6,182 3,640 300 300Less:

Share of post-acquisition profits 16,168 13,250 – –Currency translation reserve (450) (813) – –

21,900 16,077 300 300

Details of the associates are as follows:

Place ofName of associate Principal activities incorporation/ Effective group

business interest

2002 2001% %

Brani Readymixed Supply of readymixed concrete, labour Singapore 331/3 331/3Pte Ltd and materials for concrete works and

provision of batching services

Beijing Jian Hua Supply of ready mixed concrete China 15 15Brani ConcreteCo, Ltd

Zhejiang Xing Bao Manufacture and sale of cement clinker China 25 25Long BuildingMaterials Co, Ltd*

Shanghai Bao Tai Manufacture and sale of cement products China 30 30Long ConcreteProducts Co, Ltd*

HBS Investments Investment holding of freehold properties Singapore 30 30Pte Ltd

TPT Pacific Technology Provision of networking solutions services Thailand 40 40Co, Ltd

Crescent Concrete Manufacture and sale of readymixed Concrete Malaysia 26 26Sdn Bhd

Changshu Chang Long Manufacture and sale of cement China 40 40Concrete Co, Ltd

Changshu Chang Xing Manufacture and sale of cement China 40 –Ready Mix Concrete Co, Ltd

Resin & Pigment Manufacture thermosetting synthetic resin Singapore 331/3 –Technologies Pte Ltd and plastic materials

* From 1 January 2000, the Group ceased equity accounting for its investments in Zhejiang Xing Bao Long Building Materials Co, Ltd and Shanghai Bao Tai LongConcrete Products Co, Ltd as the Group cannot exercise significant influence over these associated corporations. The investments in these associatedcorporations had been written off.



6 OTHER FINANCIAL ASSETS/(LIABILITIES)


Note 2002 2001 2002 2001$’000 $’000 $’000 $’000

(a) Long-term investments Quoted equityAt cost 7,122 5,926 5,130 5,080Less: Allowance for diminution in value:

At 1 January 896 2,147 896 –Allowance made 25 3,892 896 2,834 896Allowance utilised – (2,147) – –

At 31 December 4,788 896 3,730 896

2,334 5,030 1,400 4,184Quoted non-equityAt cost 11,173 11,173 – –

13,507 16,203 1,400 4,184Unquoted equityAt cost 41,098 41,742 13,540 13,403Less: Allowance for diminution in value:

At 1 January 16,398 12,099 6,457 10,391Allowance made/(reversed) 25 4,605 4,299 2,289 (3,934)Allowance utilised 138 – 138 –

At 31 December 21,141 16,398 8,884 6,457

19,957 25,344 4,656 6,946Investment partnershipsInterest in investment partnerships 32,437 26,271 11,270 11,100Less: Allowance for diminution in value:

At 1 January 6,403 3,257 563 1,525Translation difference 168 118 – –Allowance made/(reversed) 25 9,100 3,028 4,352 (962)

At 31 December 15,671 6,403 4,915 563

50,230 61,415 12,411 21,667Club membershipsAt cost 293 293 293 293Less: Allowance for diminution in value:

At 1 January 80 – 80 –Allowance made 25 – 80 – 80

At 31 December 80 80 80 80

213 213 213 213

Non-current financial assets 50,443 61,628 12,624 21,880

Market value of quoted equity investments 2,334 5,542 1,400 4,181

Market value of quoted non-equity investments 11,173 11,619 – –



6 OTHER FINANCIAL ASSETS/(LIABILITIES) (continued)

The Group

Note 2002 2001$’000 $’000

(b) Short-term investmentsQuoted equity – Long PositionsAt cost 8,694 7,642Less: Allowance for diminution in value:

At 1 January 4,401 7,055Allowance made 25 2,349 759Allowance utilised – (3,413)

At 31 December 6,750 4,401

1,944 3,241 Quoted non-equity – Long PositionsAt cost 283 395Less: Allowance for diminution in value:

At 1 January 143 253Allowance made/(reversed) 25 25 (110)

At 31 December 168 143

115 252

2,059 3,493

Quoted non-equity –Short PositionsAt cost 71 418 Allowance for diminution in value of investments:

At 1 January 167 52Allowance (reversed)/made 25 (110) 115

At 31 December 57 167

128 585

At Market value:Quoted equity investments – long positions 1,944 3,241Quoted non-equity investments – long positions 115 252– short positions 128 585



7 OTHER NON-CURRENT ASSETS


Note 2002 2001 2002 2001$’000 $’000 $’000 $’000

Intangible assets 8 52 90 – –Loans to:– Subsidiaries 9 – – 55,640 46,995– Associates 10 150 1,074 – 706– Others 251 – 28 –

453 1,164 55,668 47,701

The loans to others are unsecured, interest free and have no fixed terms of repayment. The parties involved do not intend forthe amount to be repaid within the next twelve months.

8 INTANGIBLE ASSETS

Pre-operatingThe Group Note Goodwill Patents cost Total

$’000 $’000 $’000 $’000

CostAt beginning and end of the year 256 65 366 687

Amortisation and Impairment Losses

At 1 January 2002 166 65 366 597Amortisation charge for the year 25 38 – – 38

At 31 December 2002 204 65 366 635

Amortisation charge for 2001 25 34 65 – 99

Carrying Amount

31 December 2002 52 – – 52

31 December 2001 90 – – 90

9 LOANS TO SUBSIDIARIES

The Company

Note 2002 2001$’000 $’000

Loans to subsidiaries 56,722 47,069Less: Allowance for doubtful receivables – non-trade:

At 1 January 74 74Allowance made during the year 25 1,008 –

At 31 December 1,082 74

55,640 46,995

Loans to subsidiaries are unsecured, interest-free and have no fixed terms of repayment. The management of the partiesinvolved do not intend for the amounts to be repaid within the next twelve months.


10 LOANS TO ASSOCIATES The Group The Company

2002 2001 2002 2001$’000 $’000 $’000 $’000

Loans to associates 150 1,074 – 706

Loans to associates are unsecured, interest-free and have no fixed terms of repayment. The management of the partiesinvolved do not intend for the amounts to be repaid within the next twelve months.

11 INVENTORIES


Note 2002 2001 2002 2001$’000 $’000 $’000 $’000

Raw materials 1,206 2,498 137 1,349Less: Allowance for inventories obsolescence:

At 1 January 63 101 – –Translation difference 1 3 – –Allowance made 25 27 111 – –Allowance utilised (23) (152) – –

At 31 December 68 63 – –

1,138 2,435 137 1,349Goods in transit 95 – – –Consumable spares 32 49 – –Finished goods 2,651 1,219 2,214 632

3,916 3,703 2,351 1,981

12 TRADE RECEIVABLES


2002 2001 2002 2001Note $’000 $’000 $’000 $’000

Subsidiaries – – 4,409 4,890Associates – 596 – –Affiliated Parties 27 – 27 –Other trade receivables 19,435 21,245 6,004 5,763

19,462 21,841 10,440 10,653Less: Allowance for doubtful receivables:

At 1 January 4,388 4,447 1,112 914Translation difference 57 41 – –Allowance made 25 2,090 1,069 1,900 198Allowance utilised (1,846) (1,169) (1,257) –

At 31 December 4,689 4,388 1,755 1,112

14,773 17,453 8,685 9,541

No portion of the allowance for doubtful receivables relates to amount owing from subsidiaries or associates.



13 OTHER RECEIVABLES, DEPOSITS AND PREPAYMENTS


2002 2001 2002 2001$’000 $’000 $’000 $’000

Advances to equipment suppliers 6 4 – –Deposits 322 236 186 111Interest receivable 307 173 307 77Margin deposits 3 – – –Prepayments 183 81 81 26Other receivables 1,529 1,509 419 35

2,350 2,003 993 249

14 CASH AND CASH EQUIVALENTS


Note 2002 2001 2002 2001$’000 $’000 $’000 $’000

Term deposits 72,398 81,426 67,353 78,384Demand deposits and cash in hand 8,093 12,139 248 1,456

80,491 93,565 67,601 79,840

Bank overdrafts 18 (912) (325) (696) –

79,579 93,240 66,905 79,840

Less:Fixed deposit under lien – 123Cash subject to foreign exchange control 63 195

Cash and cash equivalents for statement of cash flow 79,516 92,922

15 TRADE PAYABLES


2002 2001 2002 2001$’000 $’000 $’000 $’000

Subsidiaries – – 25 147Associates 50 134 – –Other trade payables 8,825 8,024 3,088 2,516

8,875 8,158 3,113 2,663

16 OTHER PAYABLES AND ACCRUALS


2002 2001 2002 2001$’000 $’000 $’000 $’000

Accrued operating expenses 2,060 2,910 998 1,492Advances from customers 1,272 338 706 –Unclaimed dividends – 49 – 49Valued-added tax payable 144 13 – –Amount due to associate companies 34 – – –Others 1,303 857 457 464

4,813 4,167 2,161 2,005



17 PROVISIONS

The Group and The Company

2002 2001Note $’000 $’000

Provision for replacement of roller press:At 1 January – 107Provision made during the year 25 – (107)

At 31 December – –

Provision for foreseeable losses on contracts:At 1 January 500 4,500Provision reversed during the year 25 (290) (2,531)Provision utilised during the year (210) (1,469)

At 31 December – 500

– 500

18 INTEREST-BEARING BANK LOANS AND BORROWINGSThis note provides information about the term of the Group’s interest-bearing loans and overdrafts. For more informationabout the Group’s exposure to interest rate and currency risk, refer to note 31.


2002 2001 2002 2001$’000 $’000 $’000 $’000

Bank overdrafts– unsecured 912 208 696 –– secured – 117 – –

912 325 696 –Short-term bank loans– unsecured 3,579 – 3,000 –– secured – 31 – –Long term bank loan (secured) bear interest at

the rates of 6% (2001:ranging from 4.5% to6.5%) per annum and repayable by 48 monthlyinstalments commencing November 1998 39 564 – –

4,530 920 3,696 –

Due within 1 year– Bank overdrafts 912 325 696 –– Bank loans 3,579 595 3,000 –

4,491 920 3,696 –Due within 2 – 5 years– Bank loans 39 – – –

4,530 920 3,696 –

The bank overdraft facility of a subsidiary is secured on the leasehold land with a net book value of Nil (2001: $16,000). Theamount drawn down as at 31 December 2002 is $92,000 (2001: $117,000).

A long-term loan of $579,000 (2001: $564,000) is secured on a factory with a net book value of Nil (2001: $Nil).




19 OBLIGATIONS UNDER FINANCE LEASE LIABILITIESAt 31 December 2002, the Group had obligations under finance leases that are repayable as follows:

Payable Interest Principal$’000 $’000 $’000

2002Repayable within 1 year 209 27 182Repayable after 1 year but within 5 years – – –

209 27 182

2001Repayable within 1 year 84 11 73Repayable after 1 year but within 5 years 209 27 182

293 38 255

20 NON-INTEREST BEARING LOANS


2002 2001 2002 2001$’000 $’000 $’000 $’000

Loans from subsidiaries – – 35,826 36,867Loans from associates 2,685 – 2,685 –

2,685 – 38,511 36,867

The loans from subsidiaries are unsecured and interest free. The management of the parties involved do not intend for theamounts to be repaid within the next twelve months.

21 DEFERRED TAXATIONMovements in deferred tax assets and liabilities (prior to offsetting of balances) during the year are as follows:

Charged/(credited)to profit and

At loss account AtThe Group 1/1/2002 (note 26) 31/12/2002

$’000 $’000 $’000

Deferred tax liabilitiesProperty, plant and equipment 2,861 (68) 2,793Other items 1,492 (68) 1,424

4,353 (136) 4,217

Deferred tax assetsOther provisions (49) 41 (8)Other items (144) 8 (136)

(193) 49 144

Deferred tax liabilitiesProperty, plant and equipment 2,628 – 2,628Other items 1,127 – 1,127

3,755 – 3,755

Deferred tax liabilities and assets are offset when there is a legally enforceable right to set off current tax assets againstcurrent tax liabilities and when the deferred taxes relate to the same taxation authority. The following amounts, determinedafter appropriate offsetting are as follows:



21 DEFERRED TAXATION (continued)


2002 2001 2002 2001$ $ $ $

Deferred tax liabilities 4,216 4,353 3,755 3,755Deferred tax assets (144) (193) – –

4,072 4,160 3,755 3,755

22 SHARE CAPITAL – THE COMPANY

2002 2001

No. of shares No. of shares(’000) $’000 (’000) $’000

Authorised:Ordinary shares of $0.50 each 100,000 50,000 100,000 50,000

Issued and fully paid:Ordinary shares of $0.50 each:

At 1 January 77,230 38,615 77,230 38,615Issue of shares pursuant to the exercise of optionsunder the Executives’ Share Option Scheme 5 3 – –

At 31 December 77,235 38,618 77,230 38,615

As at the end of the financial year, there were the following unissued shares of the Company under option:

Exercise period Exercise price No. of $0.50 shares

2002 2001

Between 4 November 1998 and 3 November 2002 $1.92 – 51,000Between 2 November 1999 and 1 November 2003 $1.30 36,000 51,000Between 29 October 2000 and 28 October 2004 $1.70 168,000 198,000

204,000 300,000

23 RESERVES


2002 2001 2002 2001$’000 $’000 $’000 $’000

Share premium 32,359 32,355 32,359 32,355Capital reserves 446 446 – –Currency translation reserve 1,472 542 – –Accumulated profits 111,703 148,966 63,948 118,830

145,980 182,309 96,307 151,185

The application of the share premium account is governed by sections 69-69F of the Companies Act, Chapter 50.

The capital reserves represent the excess share of net assets acquired over consideration paid on acquisition of subsidiariesand associates.

Currency translation reserve comprises all foreign exchange differences arising from the translation of financial statementsof foreign operations that are not integral to the operations.


23 RESERVES (continued)

The Group

2002 2001$ $

Profits are retained in:The Company 63,948 118,830Consolidated adjustments 31,730 841

95,678 119,671Subsidiaries (144) 16,045Associates 16,168 13,250

111,702 148,966

24 REVENUERevenue of the Group represents net sales billed to external customers. Transactions within the Group are eliminated.Turnover of the Company represents net sales billed to external customers and related companies.

25 (LOSS)/PROFIT FROM ORDINARY ACTIVITIES BEFORE TAXATION(Loss)/Profit from ordinary activities before taxation includes the following:


2002 2001 2002 2001$’000 $’000 $’000 $’000

(a) Interest incomeInterest income– quoted non-equity 258 280 – –– financial institutions and banks 2,434 4,164 2,322 3,911– others – 1 – –

2,692 4,445 2,322 3,911

(b) Staff costsWages, salaries and related expenses 9,543 11,960 4,846 6,487Contribution to defined contribution plan 838 1,288 460 830Increase in liability for short-term

accumulating compensated absences 126 110 109 61

10,507 13,358 5,415 7,378

Number of employees as at 31 December 223 361 77 112



25 (LOSS)/PROFIT FROM ORDINARY ACTIVITIES BEFORE TAXATION (continued)


Note 2002 2001 2002 2001$’000 $’000 $’000 $’000

(c) Other operating expensesAmortisation of intangible assets 8 38 99 – –Auditors’ remuneration i) audit:

Auditors of the company– Current year 184 147 48 58– Under/(Over) provision in respect of previous year 3 72 – (87)Other auditors – Current year – 1 – 38

ii) non audit services payable to auditors of the Company 45 49 – –

Allowance made for:– loans to subsidiaries 9 – – 1,008 –– Inventories obsolescence 11 27 111 – –– doubtful trade receivables 12 2,090 1,069 1,900 198Loss on disposal of subsidiary – 119 – –Gain from disposal of property,

plant and equipment (80) (446) (36) –Property, plant and equipment written off 543 140 432 140Reversal of provisions for– replacement of roller press 17 – (107) – (107)– foreseeable losses 17 (290) (2,531) (290) (2,531)Trade receivables written off 1,846 – 1,257 1Operating lease expenses 158 447 – 154

(d) Directors’ remunerationDirectors remuneration is recognised as follows:Directors’ remuneration:– Directors of the Company 738 1,746 738 1,746– Other directors 31 190 – –Directors’ fees paid to directors of the Company 51 94 51 94Fees receivable by a firm of which a director is

a member 15 61 15 61

(e) Finance costsInterest expense– hire purchase creditors 11 12 – –– bank borrowings 73 316 54 224

84 328 54 224



25 (LOSS)/PROFIT FROM ORDINARY ACTIVITIES BEFORE TAXATION (continued)


Note 2002 2001 2002 2001$’000 $’000 $’000 $’000

(f) Non-Operating (Expenses)/IncomeDividend income from:– subsidiaries – – 479 –– quoted equity investments 49 61 1 –Profit/(loss) on disposal of:– quoted equity investments (7) 1,006 – 879– unquoted equity investments (1,617) 19 – –– other quoted investments 26 202 7 –– quoted non-equity investments (160) – – –

(1,709) 1,288 487 879Allowance reversed/(made) for diminution

in value of investments:

Short-term investments – quoted equity 6 (2,349) (759) – –– quoted non-equity (long) 6 (25) 110 – –– quoted non-equity (short) 6 110 (115) – –Long-term investments– subsidiaries 4 – – (29,881) –– quoted equity 6 (3,892) (896) (2,834) (896) – unquoted equity 6 (4,605) (4,299) (2,289) 3,934– investment partnerships 6 (9,100) (3,028) (4,352) 962– club memberships 6 – (80) – (80)

(19,861) (9,067) (39,356) 3,920Distribution of income from

investment partnerships (312) 4,465 – 3,619

(21,882) (3,314) (38,869) 8,418

Exceptional ItemsGain on disposal of a former subsidiary – 2,882 – 2,882

(21,882) (432) (38,869) 11,300



26 INCOME TAXES


2002 2001 2002 2001$’000 $’000 $’000 $’000

Current tax expenseCurrent taxation 75 131 – –Overprovision in respect of prior years (188) (277) – –

(113) (146) – –

Deferred tax expenseMovement in temporary difference 18 38 – –Reduction in tax rate (23) – – –Overprovision in respect of prior years (82) (1,545) – (1,500)

(87) (1,507) – (1,500)

Share of associate’s taxation 936 4,796 – –

Income tax expense 736 3,143 – (1,500)

Deferred tax assets have not been recognised in respect of the following items:


2002 2001 2002 2001$’000 $’000 $’000 $’000

Deductible temporary difference 2,731 3,840 – –Tax losses and unabsorbed wear and tear allowances 12,157 6,416 – –

14,888 10,256 – –

Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable profitwill be available against which the subsidiaries can utilise the benefits.

RECONCILIATION OF EFFECTIVE TAX RATE

2002 2001

% $ % $

The Group(Loss)/Profit before tax (32,111) 3,626

Income using Singapore tax rates (22.0) (7,064) 24.5 888Effect of different tax rates in other countries 2.7 866 29.2 1,059Effect of reduction in tax rate (0.1) (25) (4.35) (158)Expenses not deductible for tax purposes 18.6 5,942 43.8 1,591Income not subject to tax (1.5) (467) (54.71) (1,984)Tax deducted at source (0.6) (186) (0.8) (29)Utilisation of previously unrecognised tax losses (0.1) (22) – –Unrecognised deferred tax assets 5.1 1,644 90.6 3,286Overprovision in respect of prior years (0.5) (270) (50.24) (1,822)Others 1.0 318 8.6 312

2.6 736 86.6 3,143




26 INCOME TAXES (continued)RECONCILIATION OF EFFECTIVE TAX RATE (continued)

2002 2001

% $ % $

The Company(Loss)/Profit before tax (50,416) 7,474

Income using Singapore tax rates (22.0) (11,092) 24.5 1,831Effect of reduction in tax rate – – (2.11) (158)Income not subject to tax – – (22.41) (1,675)Expenses not deductible for tax purposes 22.7 11,445 – –Tax exempt revenue (0.8) (354) – –Overprovision in respect of prior years – – (20.0) (1,500)Others 0.1 1 0.02 2

– – (20.0) (1,500)

27 EARNINGS PER SHAREBasic earnings per shareThe calculation of earnings per share is based on the Group’s loss attributable to shareholders of $32,797,000 (2001: Profitof $213,000) and the weighted average number of shares in issue during the year of 77,235,000 (2001: 77,230,000) shares of$0.50 each.

Diluted earnings per shareFor 2002, the potential number of ordinary shares arising from the exercise of the options under the Employees’ ShareOption Scheme, if taken into account, will reduce the basic loss per share of the Group and, as such, no diluted loss pershare has been computed.

In the computation of diluted earnings per share for 2001, the weighted average number of shares is adjusted for the effectof dilutive potential ordinary shares from the Executive Share Options Scheme. The average fair value of one ordinaryshare was $1.29 (2001: $1.48). The weighted average number of ordinary shares adjusted for the issued stock options in2001 was reconciled as follows:

2001

Weighted average number of ordinary shares(used in the calculation of basic earnings per share) 77,230,000

Weighted average number of issued share options 52,707Weighted average number of shares that would have been issued at fair value (46,297)

Weighted average number of ordinary shares (diluted) 77,239,410

28 DIRECTORS’ REMUNERATIONRemuneration, which includes salaries, fees, bonuses and the value of benefits in kind, earned during the year from theGroup by directors of the Company, is summarised below:

Number of Directors

2002 2001

Above $500,000 – 1 $250,000 to $499,999 2 1Below $250,000 9 7

11 9


29 CHANGES IN ACCOUNTING POLICIESFor the year ended 31 December 2002, two new or revised accounting standards were adopted.

The adoption of SAS 12 (revised 2001) – Income Taxes and the limited revision to SAS 17 (2001) – Employee Benefits, didnot give rise to and adjustments to the opening balances of accumulated profits of the prior and current years or tochanges in comparatives.

30 DIVIDENDSAfter the balance sheet date, the Directors proposed the following dividends. The dividends have not been provided for.

The Group andThe Company

2002 2001$’000 $’000

Final dividend proposed of 5 cents (2001: 7.6 cents)per share less tax at 22% (2001: 24.5%) 3,012 4,466

31 FINANCIAL INSTRUMENTS(a) Financial Risk Management Objectives and Policies

Exposure to credit, interest rate and currency risk arises in the normal course of the Group’s business. The Group haswritten risk management policies and guidelines which set out its overall business strategies, its tolerance of risk andits general risk management philosophy and has established processes to monitor and control the hedging oftransactions in a timely and accurate manner. Such written policies are reviewed annually by the Board of Directors,and quarterly reviews are undertaken to ensure that the Group’s policy guidelines are adhered to.

Derivative financial instruments are used to reduce exposure to fluctuations in foreign exchange rates and interestrates. While these are subject to the risk of market rates changing subsequent to acquisition, such changes aregenerally offset by opposite effects on the items being hedged.

The Group’s accounting policies in relation to the derivative financial instruments are set out in note 2(h).

(b) Credit RiskManagement has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Creditevaluations are performed on all customers requiring credit over a certain amount. The Group does not requirecollateral in respect of financial assets.

Investments and transactions involving derivative financial instruments are allowed only with counterparties that are of high credit quality. As such, management does not expect any counterparty to fail to meet their obligations.

At balance sheet date, there were no significant concentrations of credit risk. The maximum exposure to credit risk is represented by the carrying amount of each financial asset, including derivative financial instruments, in the balance sheets.

(c) Interest Rate RiskThe Group’s exposure to market risk for changes in interest rates relates primarily to the Group’s investment portfolioand debt obligations. The Group uses derivative financial instruments to hedge its investment portfolio. The portfolioincludes equity and debt securities with active secondary or resale markets to ensure portfolio liquidity.



31 FINANCIAL INSTRUMENTS (continued)(d) Effective Interest Rates and Repricing Analysis

In respect of interest-earning financial assets and interest-bearing financial liabilities, the following table indicatestheir effective interest rates at balance sheet date and the periods in which they are repriced.

2002

Effective Within 1 to 5 AfterNote interest rate Total 1 year years 5 years

% $’000 $’000 $’000 $’000

The Group

Financial AssetsCash and cash equivalents 14 0.375%–4.25% 80,491 80,491 – –

Financial LiabilitiesLong-term loans 18 5.1%–6% 39 – 39 –Short-term loans 18 1.6%–6% 3,579 3,579 – –Finance lease liabilities 19 3% 182 182 – –Bank overdrafts 18 4.25%–5.25% 912 912 – –

Total 4,712 4,673 39 –

2001

Effective Within 1 to 5 Afterinterest rate Total 1 year years 5 years

% $’000 $’000 $’000 $’000

The Group

Financial AssetsCash and cash equivalents 0.63%–4.73% 93,565 93,565 – –

Financial LiabilitiesLong-term loans – – – – –Short-term loans 3%–5.3% 595 595 – –Finance lease liabilities 3% 255 73 182 –Bank overdrafts 4.5%–5.75% 325 325 – –

Total 1,175 993 182 –



31 FINANCIAL INSTRUMENTS (continued)(d) Effective Interest Rates and Repricing Analysis

2002

Effective Within 1 to 5 AfterNote interest rate Total 1 year years 5 years

% $’000 $’000 $’000 $’000

Company

Financial AssetsCash and cash equivalents 14 0.37%–4% 67,601 67,601 – –

Financial LiabilitiesBank overdrafts 18 4.25% 696 696 – –Bank loans 18 1.6% 3,000 3,000 – –

Total 3,696 3,696 – –

2001

Effective Within 1 to 5 Afterinterest rate Total 1 year years 5 years

% $’000 $’000 $’000 $’000

Company

Financial AssetsCash and cash equivalents 4.73% 79,840 79,840 – –

Financial LiabilitiesBank overdrafts – – – –Bank loans – – – –

Total – – – –

(e) Foreign Currency RiskThe Group incurs foreign currency risk on sales, purchases and borrowings that are denominated in a currency otherthan Singapore dollars. The currencies giving rise to this risk are primarily Pound Sterling, US dollars, Euro dollars andMalaysian Ringgit.

The Group hedges its trade receivables and trade payables denominated in a foreign currency. The Group uses forwardexchange contracts to hedge its foreign currency risk.

In respect of other monetary assets and liabilities held in currencies other than the Singapore dollars, the Groupensures that the net exposure is kept to an acceptable level by buying or selling foreign currencies at spot rates wherenecessary to address short term imbalances



31 FINANCIAL INSTRUMENTS (continued)(f) Fair Values

Recognised financial instrumentsThe aggregate net fair values of financial assets which are not carried at fair value in the balance sheet as at 31December are represented in the following table:

2002 2002 2001 2001Note Carrying Fair Carrying Fair

amount value amount value$’000 $’000 $’000 $’000

GroupFinancial Assets

Quoted equity securities– long-term 6 2,334 2,334 5,030 5,542– short-term 6 1,944 1,944 3,241 3,241Quoted non-equity securities– long-term 6 11,173 11,173 11,173 11,619– short-term 243 243 837 837

15,694 15,694 20,281 21,239

Unrecognised gain – 958

CompanyFinancial Assets

Quoted equity securities– long-term 6 1,400 1,400 4,184 4,184

Unrecognised gain – –

It is not practicable to estimate the fair value of the Group’s long term unquoted equity investments because of the lackof quoted market prices and the inability to estimate fair value without incurring excessive costs. However, managementbelieves that the carrying amounts recorded at balance sheet date reflect the corresponding fair value.

Unrecognised financial instrumentsThe valuation of financial instruments not recognised in the balance sheet reflects amounts which the Group expects topay or receive to terminate the contracts or replace the contracts at their current market rates at the balance sheet date.

The notional amount and net fair value of financial instruments not recognised in the balance sheet as at 31 December are:

2002 2002 2001 2001Notional Fair Notional Fairamount value amount value

$’000 $’000 $’000 $’000

The Group and the CompanyForward foreign exchange contracts 5,300 4,403 15,247 15,067




32 SIGNIFICANT RELATED PARTY TRANSACTIONSIn the normal course of business, the Group purchases raw materials from and sells cement and building materials tovarious companies in which a significant shareholder of the Company has significant interests. These interests includecontrol, significant influence and other forms of interests. Such purchases totaled $1,996,000 (2001: $3,782,000) and suchsales totaled $246,000 (2001: $7,000) during the year.

33 COMMITMENTSAs at the balance sheet date:

(a) the Group and the Company had commitments amounting to $17,500,000 (2001: $24,986,999) and Nil (2001: $385,000)respectively, in respect of additional investment in certain unquoted equity investments and partnership investments;

(b) Capital Expenditure

The Group andThe Company

2002 2001$’000 $’000

Contracted but not provided for – 2,512

(c) the Group and the Company had the following future minimum lease payments under non-cancellable operating leases:


2002 2001 2002 2001$’000 $’000 $’000 $’000

Payable within:– 1 year 750 543 433 381– 2 to 5 years 1,985 959 1,360 756– After 5 years 1,300 1,339 1,300 1,339

4,035 2,841 3,093 2,476

(d) the Company had forward commitments for the purchase of raw materials of $8,822,679 (2001: $8,027,984); and

(e) the Company had outstanding forward foreign exchange commitments of approximately $5,300,000 (2001: $15,247,000),which have been translated at market rates prevailing at the balance sheet date.

34 CONTINGENT LIABILITIESA subsidiary, CemtecAsia (H.K.) Limited (“CAHK”), was sued by a subcontractor for an amount of HK$2.1 million, being thesubcontractor’s fee which the subsidiary refused to pay as management of the subsidiary considers the quality of workperformed by the subcontractor was not up to standard. The subsidiary has filed a counterclaim of an amount of HK$2.3million, being additional costs incurred for having to perform remedial work.

As at 31 December 2002, no provision in respect of the claim has been made in the subsidiary’s financial statementsbecause of uncertainty over the outcome and the difficulty in reliably estimating the amount.



35 SEGMENT INFORMATIONThe Group’s principal activities may be segregated into two industry segments; namely manufacture and sale of cement andbuilding materials and information technology products. The operations of the Group are principally located in Singapore.

(a) Business Segments

Cement andbuilding Information

materials Technology Eliminations Consolidated$’000 $’000 $’000 $’000

Revenue and Expenses2002Total revenue from external customers 36,347 4,376 (610) 40,113

Segment results (14,866) (1,936) – (16,802)

Unallocated expenses 418Financing costs (84)Investment income and interest income (19,190)Share of associates’ results 3,547Taxation (736)Minority interests 50

Net loss for the year (32,797)

2001Total revenue from external customers 45,493 5,692 (253) 50,932

Segment results (11,474) (757) – (12,231)

Unallocated expenses (1,658)Financing costs (328)Investment income and interest income 1,131Share of associates’ results 16,712Taxation (3,143)Minority Interests (270)

Net profit for the year 213

Assets and Liabilities2002Segment assets 65,675 1,295 – 66,970Investment in associates 21,900Unallocated assets 123,163

Total assets 212,033

Segment liabilities 19,464 1,751 – 21,215Unallocated liabilities 6,056

Total liabilities 27,271

2001Segment assets 76,736 2,216 – 78,952Investment in associates 16,077Unallocated assets 147,488

Total assets 242,517

Segment liabilities 13,159 1,243 – 14,402Unallocated liabilities 6,822

Total liabilities 21,224


35 SEGMENT INFORMATION (continued)

Cement andbuilding Information

materials Technology Eliminations Consolidated$’000 $’000 $’000 $’000

Other disclosures2002Capital expenditure 3,415 30 – 3,445

Non-cash expensesDepreciation 9,319 124 – 9,443Write back of provision for:– foreseeable losses 290 – – 290

2001Capital expenditure 3,880 54 – 3,934

Non-cash expensesDepreciation 9,396 128 – 9,524Write back of provision for:– foreseeable losses (2,531) – – (2,531) – replacement of roller press (107) – – (107)

(b) Geographical Segments

Singapore Others Eliminations Consolidated$’000 $’000 $’000 $’000

2002Total revenue from external customers 34,239 5,874 – 40,113

Segment assets 56,990 9,980 – 66,970

Capital expenditure 3,353 92 – 3,445

Depreciation 8,745 698 – 9,443

2001Total revenue from external customers 39,915 11,017 – 50,932

Segment assets 67,405 11,547 – 78,952

Capital expenditure 3,681 253 – 3,934

Depreciation 8,826 698 – 9,524

36 SUBSEQUENT EVENTIn February 2003, following the acceptance of the conditional cash offer from Afro-Asia International Enterprises Pte Ltd(“Afro-Asia”), a company incorporated in Hong Kong, the Company becomes a 62.9% subsidiary of Afro-Asia.




DISTRIBUTION OF SHAREHOLDINGSNo. of

Size of Shareholdings Shareholders % No. of Shares %

1 – 999 121 5.77 45,950 0.061,000 – 10,000 1,667 79.53 5,349,950 6.9310,001 – 1,000,000 301 14.36 14,084,000 18.231,000,001 and above 7 0.34 57,755,100 74.78

Total 2,096 100.00 77,235,000 100.00

TWENTY LARGEST SHAREHOLDERSNo. Name

No. of Shares %

1 Afro-Asia International Enterprises Pte Limited 29,641,700 38.382 UOB Kay Hian Pte Ltd 8,781,000 11.373 Afro Asia Shipping Co Pte Ltd 8,650,000 11.204 DBS Nominees Pte Ltd 4,077,150 5.285 United Overseas Bank Nominees Pte Ltd 3,309,250 4.286 Citibank Nominees Singapore Pte Ltd 2,073,000 2.687 Oversea-Chinese Bank Nominees Pte Ltd 1,223,000 1.588 Tan Choo Suan 946,000 1.229 Zen Property Management Pte Ltd 762,000 0.9910 Performance Investment Pte Ltd 497,000 0.6411 Kim Eng Ong Asia Securities Pte Ltd 346,550 0.4512 Southern Nominees (S) Sdn Bhd 343,000 0.4413 Morph Investments Ltd 299,000 0.3914 G Pannir Selvam 250,000 0.3215 G K Goh Stockbrokers Pte Ltd 244,250 0.3216 Lee In Young 216,000 0.2817 Ng Noi Hinoy 200,000 0.2618 BMT A/c Estate of Tan Tye Deceased 175,000 0.2319 Ma Seng Enterprise Pte Ltd 138,000 0.1820 Tan Kok Oon 135,000 0.17

Total 62,306,900 80.66

LIST OF SUBSTANTIAL SHAREHOLDERSas at 8 April 2003

Name of Substantial Shareholder No. of shares inNo. of shares which the

registered in the Substantialname of the Shareholder isSubstantial deemed to Total Number % of Issued

Shareholders be interested of Shares Share Capital

Tan Choo Suan 946,000 47,656,700 48,602,700 62.93%Chua Thian Poh 110,000 30,403,700 30,513,700 39.51%Ho Bee Holdings (Pte) Ltd – 30,403,700 30,403,700 39.37%Tan Choo Pin 17,000 29,641,700 29,658,700 38.40%Afro-Asia International Enterprises Pte Limited 29,641,700 – 29,641,700 38.38%Afro-Asia Shipping Co (Pte) Ltd 17,350,000 665,000 18,015,000 23.32%

gas at 8 April 2003

NOTICE IS HEREBY GIVEN THAT the Annual General Meeting of SsangYong Cement (Singapore) Limited will be held at 29International Business Park, Acer Building Tower B, 5th Floor, Multi-Function Room 2, Singapore 609923 on Tuesday, 20th day ofMay 2003 at 10.00 a.m. for the following purposes:

AS ORDINARY BUSINESS

1 To receive and, if approved, to adopt the Audited Accounts for the financial year ended 31 December 2002 together with the Directors’ Report and Auditors’ Report thereon Resolution 1

2 To declare a first and final dividend of 5 cents per share less income tax at 22% for the financialyear ended 31 December 2002 as recommended by the Directors Resolution 2

3 To approve Directors’ fees of S$177,500.00 for the financial year ended 31 December 2002 Resolution 3

4 To re-elect Mr Tan Keng Boon who is retiring under Article 87 of the Articles of Association Resolution 4

5 To re-elect Mr Ng Tat Pun who is retiring under Article 94 of the Articles of Association Resolution 5

6 To re-elect Mr Soh Kim Soon who is retiring under Article 94 of the Articles of Association Resolution 6

7 To re-elect Mr Chua Thian Poh who is retiring under Article 94 of the Articles of Association Resolution 7

8 To re-elect Dr Tan Choo Suan who is retiring under Article 94 of the Articles of Association Resolution 8

9 To re-appoint Messrs KPMG, Certified Public Accountants, as auditors of the Company and toauthorise the Directors to fix their remuneration Resolution 9

10 To transact any other ordinary business which may be properly transacted at an Annual General Meeting.

AS SPECIAL BUSINESSTo consider and, if thought fit, to pass the following resolutions (with or without amendments) as Ordinary Resolutions:

11 IT WAS RESOLVED THAT approval be and is hereby given to the Directors to offer and grant options under the SsangYong Cement (Singapore) Limited 2000 Employees’ Share Option Scheme approved by the Company on 15 January 2001 (the “Scheme”) and to allot and issue from time to time such number of shares in the Company as may be required to be issued pursuant to the exercise of options under the Scheme, provided always that the aggregate number of shares to be issued pursuant to the Scheme shall not exceed 15 per cent of the total issued share capital of the Company from time to time Resolution 10

12 IT WAS RESOLVED THAT the Directors be and are hereby authorised pursuant to the provisions of Section 161 of the Companies Act, Cap. 50 to allot and issue such of the unissued shares of the Company on such terms and conditions and with such rights or restrictions as they may deem fit PROVIDED ALWAYS THAT the aggregate number of shares to be issued pursuant to this resolution shall not exceed fifty per cent (50%) of the issued share capital of the Company, of which the aggregate number of shares to be issued other than on a pro rata basis to existing shareholders shall not exceed twenty per cent (20%) of the issued share capital of the Company for the time being and that such authority shall continue in force until the conclusion of the next Annual General Meeting or the expiration of the period within which the next Annual General Meeting of the Company is required by law to be held, whichever is the earlier. For the purposes of this resolution, the percentage of issued share capital shall be based on the Company’s issued share capital at the time this resolution is passed after adjusting for:

(a) new shares arising from the conversion of convertible securities or employee share options on issue when this resolution is passed; and

(b) any subsequent consolidation or subdivision of shares. Resolution 11


g g

NOTICE IS ALSO HEREBY GIVEN THAT the Transfer Book and the Register of Members of the Company will be closed from 09 June 2003 to 13 June 2003 (both dates inclusive) for the purpose of preparing dividend warrants. Duly completed transfersreceived by the Company’s Registrar, Lim Associates (Pte) Ltd of 10 Collyer Quay #19-08, Ocean Building, Singapore 049315, upto 5.00p.m. on 06 June 2003 will be registered to determine shareholders’ entitlement to the proposed dividend. The first andfinal dividend of 5 cents per share less income tax at 22%, if approved at the Annual General Meeting, will be paid on 20 June 2003.

BY ORDER OF THE BOARD

ELAINE BEH PUR-LINCompany Secretary

Singapore20 May 2003

Notes:i) A member entitled to attend and vote at the Meeting is entitled to appoint a proxy to attend and vote in his stead. A member of the Company,

which is a corporation, is entitled to appoint its authorised representative or proxy to vote on its behalf.

A proxy need not be a member of the Company.

The instrument appointing a proxy must be deposited at the Company’s registered office at 29 International Business Park #08-05/06 AcerBuilding Tower B Singapore 609923 at least 48 hours before the time of the Meeting.

ii) If re-elected under Resolution 4, Mr Tan Keng Boon will remain a member of the Audit Committee and will be considered an independentdirector of the Company.

iii) If re-elected under Resolution 5, Mr Ng Tat Pun will remain the Chairman of the Audit Committee and will be considered an independentdirector of the Company.

iv) If re-elected under Resolution 6, Mr Soh Kim Soon will remain a non-executive director and will be considered an independent director of the Company.

v) If re-elected under Resolution 7, Mr Chua Thian Poh will remain a non-executive director of the Company.

vi) If re-elected under Resolution 8, Dr Tan Choo Suan will remain a non-executive director of the Company.

vii) Resolution 10, if passed, will empower the Directors to issue shares pursuant to the Ssangyong Cement (Singapore) Limited 2000 Employees’Share Option Scheme (the “Scheme”), which was approved at the Extraordinary General Meeting of the Company held on 15 January 2001 ofup to an amount not exceeding in total of fifteen per cent (15%) of the issued share capital of the Company for the time being pursuant to theexercise of the options under the Scheme. This authority will, unless revoked or varied at a general meeting, expire at the next Annual GeneralMeeting of the Company.

viii) Resolution 11, if passed, will empower the Directors of the Company from the date of the Meeting until the next Annual General Meeting toissue shares in the Company up to a maximum of fifty per cent (50%) of the issued share capital of the Company for the time being for suchpurposes as they consider would be in the interests of the Company. This authority will continue in force until the next Annual General Meetingof the Company, unless previously revoked or varied at a general meeting.


g g


1 Please insert the total number of shares held by you. If you have shares entered against your name in the DepositoryRegister (as defined in Section 130A of the Companies Act, Chapter 50), you should insert that number of shares. If you haveshares registered in your name in the Register of Members, you should insert that number of shares. If you have sharesentered against your name in the Depository Register and shares registered in your name in the Register of Members, youshould insert the aggregate number of shares entered against your name in the Depository Register and registered in yourname in the Register of Members. If no number is inserted, the instrument appointing a proxy or proxies shall be deemed torelate to all the shares held by you.

2 A member entitled to attend and vote at a meeting of the Company is entitled to appoint not more than two proxies to attendand vote in his stead.

3 Where a member appoints two proxies, he shall specify the percentage of his shares to be represented by each proxy and ifno percentage is specified, the first named proxy shall be deemed to represent 100 per cent of his shareholding and thesecond named proxy shall be deemed to be an alternate to the first named.

4 A proxy need not be a member of the Company.

5 The instrument appointing a proxy or proxies together with the letter of power of attorney, if any, under which it is signed or a duly certified copy thereof, must be deposited at the registered office of the Company at 29 International Business Park, Acer Building Tower B, #08-05/06 Singapore 609923 at least 48 hours before the time appointed for the AnnualGeneral Meeting.

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

7 Please indicate with an “X” in the spaces provided whether you wish your vote(s) to be for or against the Resolutions as setout in the Notice of Annual General Meeting. In the absence of specific directions, the proxy/proxies will vote or abstain ashe/they may think fit, as he/they will on any other matter arising at the Annual General Meeting.

8 The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperlycompleted or illegible or where the true intentions of the appointor are not ascertainable from the instructions of theappointor specified in the instrument appointing a proxy or proxies.

9 In the case of a member whose shares are entered against his name in the Depository Register, the Company may reject any instrument appointing a proxy or proxies lodged if the member, being the appointor, is not shown to have shares enteredagainst his name in the Depository Register as at 48 hours before the time appointed for holding the Annual GeneralMeeting, as certified by The Central Depository (Pte) Limited to the Company.

p y

I / We of being a member/members of the above-mentioned Company, hereby appoint:

NAME ADDRESS NRIC/ PASSPORT PROPORTION OFNUMBER SHAREHOLDINGS(%)

and/or (delete as appropriate)

as my/our proxy/proxies to attend and to vote for me/us on my/our behalf at the Annual General Meeting of the Companyto be held at 29 International Business Park, Acer Building Tower B, 5th Floor, Multi-Function Room 2, Singapore 609923on the 20th day of May 2003 at 10.00a.m. and at any adjournment thereof. I/We direct my/our proxy to vote for or againstthe Resolutions to be proposed at the Meeting as hereunder indicated.

NO. ORDINARY RESOLUTIONS FOR AGAINST

ORDINARY BUSINESS

1 To adopt the Audited Accounts, Directors’ Report and Auditors’ Report

2 To declare a first and final dividend of 5 cents per share [less income tax at 22%]

3 To approve the payment of Directors’ Fees

4 To re-elect Mr Tan Keng Boon as a Director under Article 87

5 To re-elect Mr Ng Tat Pun as a Director under Article 94

6 To re-elect Mr Soh Kim Soon as a Director under Article 94

7 To re-elect Mr Chua Thian Poh as a Director under Article 94

8 To re-elect Dr Tan Choo Suan as a Director under Article 94

9 To re-appoint Auditors and authorise Directors to fix their remuneration

SPECIAL BUSINESS

10 To authorise Directors to allot and issue shares in connection with the exercise of options granted pursuant to SsangYong Cement (Singapore) Limited 2000 Employees’ Share Option Scheme

11 To authorise Directors to allot shares pursuant to Section 161 of the Companies Act, Cap. 50

Dated this day 2003.

Signature(s) of Member(s) or Common Seal No. of shares held

IMPORTANT – Please read notes on page 58

p y g g g pincorporated in the Republic of Singapore

✃

AffixPostageStamp

THE COMPANY SECRETARYSsangYong Cement (Singapore) Limited29 International Business Park#08-05/06 Acer Building Tower BSingapore 609923

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SsangYong Cement (Singapore) Limited,29 International Business Park, #08-05/06 Acer Building Tower B, Singapore 609923Telephone (65) 6561 7978 Facsimile (65) 6561 9770

ssangyong cement (singapore) limited

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