delivering performance and growth - morningstar, inc

a n n u a l r e p o r t 2 0 0 9

Delivering Performance and Growth

>> Table of

Contents

Corporate Profile 01

Chairman’s Message 02

Board of Directors 06

Key Executives 08

Corporate Information 10

Group Structure 13

Operations Review 14

Financial Highlights 20

Corporate Governance Report 21

Report of the Directors and Financial Statements 26

Statistics of Shareholdings 100

Notice of Annual General Meeting 101

Proxy Form

1 Annual Report 2009 >>

SMB United Limited is a leader in providing quality products and solutions for the switchgear, electrical, utilities, power quality, energy monitoring and building services markets.

Headquartered in Singapore with a strong regional presence, our Group

manufactures and distributes switchgear, EDMI electronic revenue meters,

our own widely-recognised RudolfTM brand of controllers, instrumentation

and power quality systems.

In Singapore, our Group has a dominant market share in the switchgear

arena. We provide comprehensive sales support and professional expertise

for our diverse range of products to customers around the world. In EDMI,

we also engage in the design, manufacture and sale of electronic revenue

meters for use principally by utility companies involved in the generation,

distribution and supply of electricity.

Today, we have an array of products to provide electrical efficiency and

energy management solutions. We are also a key provider of high-tech

building automation and control systems. Over the years, our Group has

established a strong multiple-sector clientele base comprising a balanced

mix of institutional, commercial and industrial customers.

>> Corporate

Profile

2 >> SMB United Limited

Dear Shareholders,

It gives me great pleasure to close the twelve months

ended December 31, 2009 (“FY2009”) with this letter

to cap off another milestone year that the Group

has reached. Record growth was achieved in line

with the economic upturn since the second quarter

of 2009 and the Group emerged unscathed from

the recession that shook the financial markets and

economies around the world. Riding on the excellent

growth achieved in FY2008, the Group turned in a

better than expected performance for FY2009.

The economic rebound triggered renewed confidence

in the economy as businesses started to re-stock

inventory and manufacturing activities in Singapore

started to pick up speed. Asian banks restarted

lending activities and this led to credit availability

in Singapore and the region. This positive business

environment benefited SMB and its subsidiaries,

which contributed to the Group achieving its best-ever

performance in terms of top and bottom lines.

We started the year with an increase in our stake

of our SGX-ST Mainboard listed subsidiary EDMI

Limited (“EDMI”) by 3.1% to 59.3% as the purchase

price was less than the value of net assets acquired.

The Group is pleased to have recorded a gain of $0.6

million from this acquisition. EDMI also subsequently

completed the acquisition of a 100% equity stake

in EDMI Gas Pty Ltd for a total consideration of

$4.3 million at the end of August 2009 in order to

penetrate the gas metering market.

Our Building Services Division also made us proud

by clinching the International Quality Crown – Gold

Award which recognised the prestige of outstanding

companies, organisations and businessmen in the

business world. Having our subsidiary recognised by

an international selection committee demonstrates

its outstanding performance in the area of quality

management.

For the year in review, we had continuously explored

ways to reduce operating expenses such as

streamlining of manufacturing activities and other

cost-cutting measures. We took the necessary

steps to remain competitive in the midst of all the

uncertainties in the financial markets.

As a responsible corporate citizen, we played

host to students from both local and overseas

technical institutes by conducting single-day tours

and lectures within our manufacturing plants. This

allowed students the opportunity to learn and

experience first-hand, the manufacturing processes

and products which were closely linked to what was

taught to them in school.

Highest ever turnover and profitThe Group achieved record sales turnover of $226.5

million in FY2009, a 6.2% increase from $213.3

million in FY2008. This is the second consecutive

year in which Group revenue exceeded the $200

million mark and it indicates the sustainability of the

Group’s businesses. This is also the sixth consecutive

year of revenue growth dating from FY2004. Strong

showings by both our Switchgear and Power &

Technology Divisions contributed to the revenue

increase for FY2009.

Profit attributable to shareholders reached an all-time

high of $21.2 million, up 56.5% from $13.6 million in

FY2008. Net profit margins inched up from 7.0% to

10.6%. Earnings per share on a fully diluted basis

increased from 2.83 cents in FY2008 to 4.42 cents

in FY2009. Net asset value per ordinary share stands

at 28.2 cents as of December 31, 2009.

The bulk of the Group’s turnover came from the

Singapore market with a 3.2% rise in revenue to

$116.2 million due to higher switchgear sales. While

higher deliveries of electronic meters led to improved

sales in the Oceania market which increased by

>> Chairman’s

Message


“...Group achieving its best-ever performance in terms of top and bottom lines.”


>>A Year Of Delivery……


32.5% to $50.3 million, lower sales were experienced

by both our Switchgear and Power & Technology

Divisions in Malaysia. This dip is more than offset by

a significant increase in sales to other markets such

as Europe and Africa with an 84.6% increase in sales

revenue to $27.1 million.

The Jobs Credit Scheme which was introduced by

the Singapore Government to encourage businesses

to preserve jobs during the downturn helped to

mitigate our staff costs for FY2009. We received a

cash grant based on the employee CPF contributions,

thus providing the Group with the incentive to retain

existing workers. This scheme will be stepped down

in 2010 due to the economic upturn.

Other gains and losses were lower for FY2009 due to

the booking of foreign exchange gains as compared

to foreign exchange losses recorded in FY2008.

The appreciation of the Australian and New Zealand

dollars led to the foreign exchange gains.

Looking ahead into FY2010In the long run, there is no fundamental change to

our direction of growing the switchgear markets

in Singapore and the region. We had invested a

couple of years to improve and refine the M-Cube

range of switchgear and we have just re-launched

the M-Cube into the market. We are now in a good

position to capitalise on any opportunities arising

from the economic recovery.

The Building and Construction Authority of Singapore

(“BCA”) forecasts that construction demand for 2010

is expected to reach between $21 billion to $27 billion,

which is similar to the $21 billion worth of contracts

awarded in 2009. The bulk of construction demand

for 2010 will come from the public sector, which is

about 65% of the total construction demand.^

The outlook for our Power & Technology Division

looks promising with the growing adoption of

energy-saving smart meters for use in smart grids

especially in Europe. The Division benefits from the

European-led efforts towards ‘Green Technology’

which reduces utility bills and eliminates energy

wastage and indirectly meeting carbon reduction

commitments.

The Group will cautiously seek business opportunities

in order to boost growth as the switchgear market in

Singapore is at a mature stage. This is possible only

because of the healthy cash position that the Group

has amassed over the years. Nevertheless, we will

continue to prudently manage our cash resources.

The general economic landscape is still uncertain with

the risk of sovereign bankruptcies and debt defaults

of certain nations in Europe that can trigger ripples of

economic instability in countries elsewhere. As such,

the Singapore economy may not be entirely out of

the woods and we expect FY2010 to be a tough year

given the current economic landscape.

Rewarding our shareholdersWe are pleased to propose a final dividend of 1.5

cents per ordinary share for FY2009 to reward all

our shareholders who have stood by us and believed

in SMB during this period of uncertain economic

climate. This dividend payout amounts to $7.2 million

and is to be approved at the forthcoming AGM on

April 30, 2010. Payment shall be made on May 21,

2010 upon approval by shareholders.

Appreciation from our heartsWe thank you for your continued confidence in the

Group and its management. We also wish to thank

all of our customers and business associates for

their ongoing patronage and support. We also like

to record our appreciation to all of our employees for

their determination, diligence and individual personal

sacrifices in helping the Group to achieve another

record performance in FY2009.

Lee Phuan Weng

Executive Chairman / CEO

^ BCA Media Release, “Public Sector Projects Boost Construction Demand Outlook in 2010”, Jan 13, 2010.


Mr. Lee Phuan Weng (Executive Chairman and Chief Executive Officer)

Mr. Lee Phuan Weng, currently the Chairman and CEO of the Company, is responsible

for the business strategic direction as well as the overall management of the Group.

He has been a member of the Board since the company was listed in 1996. Mr. Lee is

one of the co-founders of the Group and has been with the Group since 1973. He has

more than 35 years of experience in the manufacturing and construction industries.

Mr. Lee is also a member of the Nominating Committee as well as the Chairman of our

listed subsidiary, EDMI Limited, where he leads the EDMI Board in charting its overall

business strategy. He was last re-elected to the Board in 2009.

Mr. Goh Ban Kin (Executive Direrctor)

Mr. Goh Ban Kin is an Executive Director of the Company. He currently heads the

Switchgear operations in Australia where he is responsible for its overall management,

direction and development plans. Mr. Goh has been a member of the Board since

the company was listed in 1996. He is the other co-founder of the Group and has

been with the Group since 1973. Mr. Goh has more than 35 years of experience in

switchgear and switchgear related products. He was last re-elected to the Board in

2008 and will be seeking for re-election to the Board at this forthcoming AGM.

Mr. Lee Yong Heng (Executive Direrctor)

Mr. Lee Yong Heng is an Executive Director of the Company and currently

heads the Switchgear operations in Singapore, Malaysia and Vietnam, where he

provides overall direction and supervision. Mr. Lee has been a member of the

Board since the company was listed in 1996 and has been with the Group since

1978. He has more than 30 years of experience in switchgear and switchgear

related products. Mr. Lee was last re-elected to the Board in 2009.

Mr. Lee Kwang Mong (Non - Executive Direrctor)

Mr. Lee Kwang Mong is currently a Non-Executive Director of the Company and has

been a member of the Board since 1999. He is also the Managing Director of our listed

subsidiary, EDMI Limited, where he is responsible for the overall management and

direction of EDMI Group. Mr. Lee has many years of working experience as President

or CEO of several companies in the United States of America and the Philippines.

He was a Columbo Plan Scholar and holds a Bachelor of Science in Mechanical

Engineering (Honours) from University of Surrey, United Kingdom. Mr. Lee was last

re-elected to the Board in 2008 and will be seeking for re-election to the Board at this

forthcoming AGM.

>> Board of

Directors


Mr. Henry Hoe Leong Seng (Independent Director)

Mr. Henry Hoe Leong Seng is an Independent Director of the Company and has

been a member of the Board since the company was listed in 1996. He is the

Chairman of the Audit Committee and also a member of the Nominating and

Remuneration Committees. Mr. Henry Hoe has been an advocate and solicitor

since January 1978 and is currently a partner of A.Ang, Seah & Hoe. Mr. Hoe

was last re-elected to the Board in 2007 and will be seeking for re-election to

the Board at this forthcoming AGM.

Mr. Koh Ah Huat (Independent Director) Mr. Koh Ah Huat is an Independent Director of the Company and has been a

member of the Board since 1998. He is the Chairman of both the Nominating and

Remuneration Committees and a member of the Audit Committee. Mr. Koh has

more than 30 years of financial experience in the Petroleum and Pharmaceutical

industries. He was a Finance Director of a multinational pharmaceutical company.

Mr. Koh was last re-elected to the Board in 2008.

Dr. Tay Teng Tiow (Independent Director) Dr. Tay Teng Tiow is an Independent Director of the Company. He has been a

member of the Board since 2002 and is a member of the Audit, Nominating and

Remuneration Committees. Dr. Tay holds a doctorate in System Engineering

and is currently an Associate Professor in the National University of Singapore.

Dr. Tay was last re-elected to the Board in 2009.

DELIVERING performance


SMB UNITED LIMITEDMr. Tan Ngiap Hong is the Chief Corporate

Officer of the Company and his role is to oversee

and supervise the business development, investor

relations, finance as well as group corporate affairs

of the company. He joined the company in 1995 as

the Group Financial Controller and played a key role

in the listing of the company. Mr. Tan has more than

30 years of experience in the field of accountancy

and finance where he had held the position of

Financial Controller in several organisations during

his career, with the last 18 years being in public listed

companies. He is a fellow member of the Institute of

Certified Public Accountants of Singapore and holds

an MBA from the University Dubuque, Iowa, USA.

Mr. Toh Kian Poh is the Group Financial Controller

and is responsible for the accounting and financial

management of the Group. He has been with the

Group since 2001 and has more than 13 years of

accounting and finance related experience. Prior

to joining the Group, he has worked in a leading

audit firm as well as a public listed company. An

accountancy graduate from Nanyang Technological

University, Singapore, Mr. Toh is a member of the

Institute of Certified Public Accountants of Singapore

as well as a CFA charterholder.

BRIDEX HARWAL PTE LTDMr. Lawrence Lee Wee Hian is the Managing

Director of Bridex Harwal Pte Ltd and is responsible

for its overall management as well as setting its

business growth strategies. He has been with the

Group since 1997 and was in charge of most of the

Group’s research and development activities. Prior to

his appointment in Bridex Harwal Pte Ltd, Mr. Lee was

the Executive Vice President of our listed subsidiary,

EDMI Limited, where he was responsible for the

direction of EDMI Group’s technological, engineering

and development activities. Mr. Lee holds a Degree in

Electrical and Electronics Engineering from Nanyang

Technological University, Singapore.

>> Key

ExecutivesSMB ELECTRIC INDUSTRIES PTE LTDMr. Tang Yoon Pheng is the Managing Director of

SMB Electric Industries Pte Ltd and is responsible

for its overall management as well as its business

directions. He joined the Group in 1993 and was

actively involved in various departments such as

project coordination, engineering and sales. Prior to

his appointment in SMB Electric Industries Pte Ltd,

Mr. Tang played a pivotal role in the management

of key functional areas in SMB Electric Pte Ltd

which included operations, sales and marketing,

administration and production. He holds a diploma

in Electrical Engineering from Singapore Polytechnic

as well as a Bachelor in Business Administration

from Macquaire University of Sydney.

Mr. Tang Chuan Meng is the Vice President of

SMB Electric Industries Pte Ltd and is in charge of

business development and sales and marketing for

the company. He has also been tasked to oversee

our switchgear operations in Vietnam. Mr. Tang has

been with the Group since 2000 and has more than

20 years of experience in the switchgear industry.

Prior to joining the Group, he has experience

working in the oil & gas processing industries, sales

and marketing of flow control and instrumentation

systems, as well as dealing with animals feed

milling and processing equipment. Mr. Tang holds

a Diploma in Electrical Engineering from Singapore

Polytechnic.

SMB ELECTRIC SYSTEMS PTE LTDMr. Ng Kin Ming is the Managing Director of

SMB Electric Systems Pte Ltd and is responsible

for its overall management as well as its business

directions. He has been with the Group since 2000

and was in charge of the Group’s switchgear sales

and marketing activities prior to his appointment in

SMB Electric Systems Pte Ltd. Mr. Ng also has more

than 8 years of electrical engineering experience with

Power Supply Ltd during which he was responsible

for testing and commissioning of consumers’

electrical installation. He is an active technical


INVESTING in our futurecommittee member with SPRING Singapore since

1997 and currently sits on the Electrical & Electronics

Standards Committee. Mr. Ng holds a Degree in

Electrical & Electronics Engineering (Honours) from

Nanyang Technological University, Singapore.

Mr. Albert Chow Peng Meng is an Executive Director

of SMB Electric Systems Pte Ltd and is responsible

for its operational, financial and business development

activities. Prior to joining the Group in 1997, he held

managerial appointments in various MNCs and has

more than 15 years’ experience in switchgear and

switchgear related products. Mr. Chow graduated from

RMIT University, Melbourne, Australia with a distinction

in Bachelor of Business Administration.

SMB HARWAL ELECTRIC PTY LIMITEDMr. Kuan Yeh Sheng is an Executive Director of

SMB Harwal Electric Pty Ltd and is responsible for

its business directions and growth strategies in the

Australasia region. He joined the company since 2004

to spearhead the company’s expansion plans into

the region. He has held various management roles

in several energy, oil & gas and heavy engineering

related companies prior to joining the company.

Mr. Kuan holds a Degree in Civil Engineering from

National University of Singapore and a Master in

Business Administration (International Business) from

the Nanyang Technological University, Singapore.

Mr. Terry Schweickle is the General Manager

of SMB Harwal Electric Pty Ltd since 2005. He is

responsible for operational management and takes

a lead role in the company’s sales, marketing,

engineering and product development. He has 34

years of experience in the manufacture, design &

testing of electrical switchboards. Starting as an

apprentice, he worked his way through the ranks,

having at various times held many of the positions

within the company. He has had previous senior

management roles in several other electrical

switchboard companies in Australia.

EDMI LIMITEDMr. Jimmy Chin Jin Meng is an Executive

Director of our listed subsidiary, EDMI Limited. He

plays a key role in the management and decision

making of key functional areas of EDMI Group.

Prior to joining the Group in 1995, Mr. Chin has

more than 7 years of experience in auditing and

accountancy with Teo, Foong + Wong, Deloitte &

Touche and Soh, Wong & Partners during which

time he was responsible for audits, which included

listed companies, investigations, review of internal

controls and management reviews. He is a fellow of

the Association of Chartered Certified Accountants

and a member of the Institute of Certified Public

Accountants of Singapore.

BRIDEX SINGAPORE PTE LTDMs. Terri Lee Hwee Choo is the Managing Director

of Bridex Singapore Pte Ltd. She is in charge of

the Group’s Trading & Distribution Division and is

responsible for its overall management and business

development activities. Ms. Lee has been with the

Group since 1992 and holds a Bachelor of Arts

Degree from the University of Toronto and a Master

Degree in International Marketing from the University

of Technology, Sydney.

QUANTUM AUTOMATION PTE LTDMr. Jimmy Chua Yiat Hin is the Managing Director

of Quantum Automation Pte Ltd and its subsidiaries.

He is responsible for developing its business strategy

as well as the overall management. Mr. Chua has

been with the Group since 2000 and has more than

20 years’ experience in the building control industry.

His broad experience stretches from marketing,

sales, project operations and overall management.

Prior to his appointment with Quantum Automation

Pte Ltd, Mr. Chua was the division manager for

Honeywell South East Asia Ltd. He holds a MBA from

the University of Leicester, United Kingdom.


Board Of Directors Mr. Lee Phuan Weng (Executive Chairman/CEO)

Mr. Goh Ban Kin (Executive Director)

Mr. Lee Yong Heng (Executive Director)

Mr. Lee Kwang Mong (Non-Executive Director)

Mr. Henry Hoe Leong Seng (Independent Director)

Mr. Koh Ah Huat (Independent Director)

Dr. Tay Teng Tiow (Independent Director)

Audit Committee Mr. Henry Hoe Leong Seng (Chairman)

Mr. Koh Ah Huat

Dr. Tay Teng Tiow

Remuneration Committee Mr. Koh Ah Huat (Chairman)

Mr. Henry Hoe Leong Seng

Dr. Tay Teng Tiow

Nominating Committee Mr. Koh Ah Huat (Chairman)

Mr. Henry Hoe Leong Seng

Mr. Lee Phuan Weng

Dr. Tay Teng Tiow

Company Secretaries Mr. Tan Ngiap Hong

Ms. Elizabeth Krishnan

Registered Office 9 Senoko Drive, Singapore 758197

T (65) 6756 0188 • F (65) 6755 4889

E [email protected] • W www.smbunited.com

Share Registrars Boardroom Corporate & Advisory Services Pte Ltd

50 Raffles Place, #32-01 Singapore Land Tower, Singapore 048623

T (65) 6536 5355 • F (65) 6536 1360

Auditors Deloitte & Touche LLP

Certified Public Accountants

6 Shenton Way, #32-00 DBS Building Tower Two, Singapore 068809

Partner in-charge: Ms. Wong-Yeo Siew Eng

Appointed in 2009

>> Corporate

Information


9 Senoko Drive, Singapore

Malaysia Australia China Vietnam

15 Senoko Way, Singapore15, 17 Senoko Avenue, Singapore


Bridex Australia Pty Ltd (100%)

SMB United Industries Sdn Bhd (100%)

EDMI Pty Ltd(100%)

SMB Electric Pte Ltd (100%)

SMB Electric Systems Pte Ltd (100%)

SMB Electric Industries Pte Ltd (100%)

Bridex Harwal Pte Ltd (100%)

SMB Harwal ElectricPty Limited (100%)

Bridex Singapore Pte Ltd (100%)

Quantum Automation Pte Ltd (52%)

EDMI Limited(59%)

EDMI Meters Sdn Bhd (100%)

EDMI GasPty Ltd (100%)

EDMI International Trading (Shanghai) Co., Ltd (100%)

EDMI Vietnam Company Limited (51%)

EDMI Philippines Inc(100%)

SMB United Limited & its significant subsidiaries, as at December 31, 2009

>> Group

Structure

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SMB Electric Vietnam Co.,Ltd. (100%)

SMB Electric (Xiamen) Co.,Ltd. (100%)

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SMB Switchgear & EngineeringSdn Bhd (100%)

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Brighten Switchboard Builders (M) Sdn Bhd (100%)

SMB Brighten Switchboard Engineering Sdn Bhd (100%)

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>> Operations

ReviewSWITCHGEAR DIVISIONThe Switchgear Division accounted for 53.7% of total

Group revenue. Revenue climbed 4.3% from $116.7

million in FY2008 to $121.7 million in FY2009. Profit

before interest and tax rose 34.2% from $12.1 million

to $16.2 million respectively. The improvement

to both top and bottom lines is a continuation of

FY2008’s diversified strategy that targeted different

market segments in Singapore and the region.

The bulk of our switchgear revenue came from the

delivery of Low Voltage (LV) main switchboards,

Motor Control Centers (MCC) panels, fit-out panels,

transformers, IMS and busway systems to data centre

projects in FY2009. This is followed by the supply of

LV main switchboards and MCC switchboard panels

to the offshore & marine and the oil & gas industries.

We also completed projects in specialised industries

such as solar fabrication & semiconductor wafer

fabrication plants, and pharmaceutical bioscience

laboratories. Other projects include office fit-out

works for banks & commercial buildings and UPS fit-

out works for telecommunication companies. We will

keep seeking opportunities in other sectors such as

government projects & public tenders, A&A jobs and

commercial & residential projects. We will also work

on further penetration into the oil & gas and offshore

& marine market segments in Malaysia.

The key challenges facing the switchgear operations

in Singapore for FY2010 will be its ability to build on

its order-books by looking beyond the local market

to penetrate overseas markets such as China, Hong

Kong, Malaysia and the Middle East. The Division

is looking at reinventing and positioning itself in the

global arena to provide a technological edge over

competitors and meeting customer expectations by

raising its levels of service standards. The Division

has to move beyond its traditional role as a pure

switchgear manufacturer to that of a value-added

role as a system integrator and provider, and aim to

impress upon customers its drive for excellence and

integrity.

As with FY2008, our overseas subsidiaries reported

a mixed set of results.

Our Malaysia operations experienced lower growth in

2009 because of less contracts secured compared

to the year before as we faced competitive pricing

from other switchboard manufacturers. Key projects

currently being undertaken since 2009 include

switchgear contracts delivered to semiconductor

industries and mixed development commercial

buildings. With the smooth development and progress

of the Iskandar Development Region in Nusajaya,

Johor, the Division will seek out opportunities to

increase market share.

SMB Harwal Electric Pty Ltd, our subsidiary leading

the switchgear operations in the Australian market

is continuing to build on its reputation as a capable,

credible and reliable switchboard & distribution

board manufacturer and supplier for large switchgear

projects in Australia. Our switchgear is well-accepted

by many consultants and end-users in Australia,

especially in New South Wales. We have completed

prestigious switchgear projects for data centres,

shopping centres and building refurbishments in

Canberra and Sydney. However, we are limited by

capacity constraints and we are currently seeking

suitable acquisition and business opportunities

in order to allow this subsidiary room for further

growth.

The successful completion and deliveries of the

various projects in Vietnam in FY2009 has elevated

the market presence of SMB Electric Vietnam Co.,

Ltd. Our strategy now is to work on further improving

its brand name, reputation and success rate in the

belief that it would attract invitations to bid for projects

with prestige. We will pursue premium projects that

require type-tested switchboards and also explore

opportunities in the oil & gas industry in which we

have the niche expertise.


DELIVERING growthBusiness conditions remain tough in China but

the Middle East and Africa markets bring exciting

prospects and we continue to leverage on the

marketing network of our subsidiaries to explore

further growth.

Looking ahead, the market for FY2010 is expected

to be even more competitive as we see lower profit

margins. Nevertheless, the Switchgear Division

strives to improve on last year’s performance and

look beyond Singapore’s shores for further growth.

In addition, we completed the type-testing of the

whole range of M-Cube switchgear in 2009 and we

will increase efforts to market the M-Cube switchgear

to both the local and overseas markets.


POWER & TECHNOLOGY DIVISIONThe external revenue contribution from our Power &

Technology Division increased 23.4% to $69.3 million

in FY2009. This is equivalent to 30.6% of overall Group

revenue. The superior performance is due to improved

meter sales which contributed to a 210.6% surge in

profit before interest and tax to $8.5 million.

The sales strategy for the Power and Technology

Division is to export meters to overseas markets and

the division had shipped out 246,000 meters in FY2009

compared to 208,000 meters in FY2008.

The bulk of revenue achieved for this division came

from the Australasia market, which was boosted by

full scale deliveries of meters under our contract with

NGC. This is followed by the sale of meters to the

United Kingdom which saw an increased take-up due

to regulatory requirements to install smart meters for

gas and electricity in all households within the next

10 years. Unfortunately, the sale of meters to the

ASEAN segment declined due to lower sales after the

completion of the Advanced Metering Readers (“AMR”)

project in Thailand. Following initial market penetration

to new markets such as Africa and the Middle East in

FY2008, we have seen improved sales in FY2009 and

the outlook of meter sales looks promising for FY2010.

In 2009, the Division benefited from the appreciation

of the Australian and New Zealand dollars which led

to a foreign exchange gain of $3.1 million in FY2009

compared to a loss of $2.3 million in FY2008, when we

started pricing our contracts in local currencies. Our

division’s available-for-sale investments in BGlobal Plc

which is listed on the AIM market of the London Stock

Exchange, recovered from a write-down in FY2008 due

to improved market conditions.

In a bid to improve operational efficiency, our operations

in Singapore have gone SAP in August by adopting a

business software that comprises enterprise resource

planning and related applications such as supply chain

management, customer relationship management,

product life cycle management and supplier

management. We believe that this is the first step in the

right direction to take the Division closer to world class

operating standards.

We are now actively expanding our market reach and

have participated in the prestigious Metering Europe

Exhibition in Barcelona, Spain in October 2009 in

order to boost brand awareness and generate further

interest in our metering products. To keep in line with

the greater marketing efforts, the Division has also

revamped and relaunched the company website

www.edmi-meters.com to feature the latest and up-

to-date products and solutions on offer, including the

latest news about the activities within the company.

Following completion of the acquisition of Atlas

Measurement Pty Ltd (“Atlas”) in May 2009 to its name

change to EDMI Gas Pty Ltd and its subsequent launch

at the end of October 2009 in Victoria, Australia, we

have now gained an established foothold into the gas

metering market segment in the Australia market. We

have since started manufacturing and marketing the

U8 and U10 gas meters and introduced the TR143 and

TR200 Gas Regulators, which were recently added into

our growing metering portfolio.

Looking forward, we are expecting the momentum

towards the adoption of Advanced Metering

Infrastructure (“AMI”) and AMR to accelerate and

we are targeting upcoming project opportunities in

Australia, Europe, Thailand and Malaysia. We see

growth opportunities for this division as smart metering

solutions are now at the forefront of a global revolution

towards smart grids. We hope to seize on opportunities

presented by the EU-wide target for 80% of electricity

users in Europe to have smart meters installed by

2020^. Not one to rest on our laurels, we will continue to

invest into research and development for the AMI, AMR

and the technologies associated with the Smart Grid.

Our strategy is to participate in test-bedding projects

overseas with the aim of establishing a base that leads

to eventual market penetration in the long term.

^ “Smart Metering in Western Europe”, Tobias Ryberg, Berg Insight.

DELIVERING to our customers



TRADING AND DISTRIBUTION DIVISIONOur Trading and Distribution Division reported

a 4.1% dip in external revenue to $15.0 million in

FY2009. Due to the higher margins obtained from

our overseas sales, profit before interest and tax

jumped 83.2% to $3.8 million for the year.

Most of the major projects delivered in FY2009

arose from exporting our product range to overseas

markets such as Malaysia, Indonesia and Vietnam

and also to the East African nations. We experienced

growth in overseas sales compared to FY2008

with the bulk of contributions from East Africa and

Vietnam. Product sales in Singapore weakened due

to suppliers cutting back on their budget in the wake

of the financial crisis experienced at the beginning

of 2009.

The Division’s strategy for expansion is to ride on

the growth of the switchgear industry to market the

existing agency lines and focus on strengthening

the branding of our RudolfTM range of controllers and

meters to both local and overseas markets through

our reliable channel distributors. We continue to

focus on volume generation per customer count as

compared to project count and double our efforts on

retrofit and AA (Additions and Alterations) projects

where there is still good demand.

Moving forward, we see FY2010 as another

challenging and competitive year for the Singapore

market due to uncertainties with the pace of the

economic recovery. As with FY2009, we see

tremendous potential in the international markets

and we are looking to explore overseas opportunities

and further penetrate into the regional new and

untapped markets in Cambodia and Laos. We are

on the lookout for any overseas tenders in which we

can showcase our product range.

We will continue to build on our partnership with

Socomec involving the Green Mark Scheme initiative

that was started in 2008 and we are looking to partner

with them again to launch another awareness event

to promote this scheme for new buildings to be Green

Mark certified through the use of our sub-meters

in monitoring energy consumption of key building

services and end-user / tenant energy usage.

Trading & Distribution Products


Innovative products and servicesBUILDING SERVICES DIVISIONWe recorded external revenue of $20.5 million in

FY2009 for our Building Services Division, which fell

17.7% from the previous financial year partly due to

lesser projects secured in FY2009, led by the slow

down in project development caused by the time

lag in the global financial recovery. Correspondingly,

profit before interest and taxation for this segment

decreased 34.6% to $0.8 million.

Our Division experienced a busy year in 2009. We

managed to keep the Special OEM Master Distributor

Status which was awarded by Echelon, USA in

recognition of our expertise as a provider of building

automation controls and services. We also achieved

the UL-certification for our controllers in 2009.

In Singapore, our Building Services Division

completed the Duke-NUS Vivarium Laboratories

with satisfaction expressed by our customers. We

completed the Zero Energy Building (“ZEB”) for BCA

Singapore which is a flagship R&D project under the

Green Building Masterplan to reduce the carbon

footprint in Singapore. In conjunction with its launch,

we set up an exhibition booth to introduce our

controllers and systems used in the ZEB.

Key overseas achievements in 2009 for this Division

included the successful penetration into the Middle

East markets. We secured the most advanced IP-

based Integrated Building Management Systems

project in Jeddah, Saudi Arabia, and also worked on

the first laboratory project in the Middle East for Abu

Dhabi National Oil Corp.

We have achieved market penetration into the USA

where our US partner has installed our products

into two building projects, namely the Denver Dry

Goods Building and the Severance Mid School. Our

products are now ready and able to meet the local

requirements there.

We sold our controllers to large and mixed

development (hotels, office buildings and malls)

projects in Guiyang and Hefei in China.

Going forward, we will continue to sell our existing

product lines and seek to improve from FY2009’s

performance. We aim to create a niche market

business in which to differentiate from other

competitors and maintain the Building Management

System leadership in Singapore for the commercial

sector. Our team will also continue to explore

opportunities in the Laboratory Control business and

target to ride on the projects secured in the Middle

East and set up more distributor offices to boost

growth. Greater focus will be placed on developing

the business and further penetrating into the USA

market. We will continue to focus on the strategy

of growing the services business which generates

recurring income streams and carry on with our

marketing efforts by participating in road-shows and

exhibitions.

The most advanced, Fully IP-Based IBMS System at 10 King Rd Tower in Jeddah, Saudi Arabia

2005

20052005

(cents)

($million)

(cents)

($million)

2005148.5

1.041.45

6.7

168.4

1.481.65

7.7

191.6

2.704.11

19.6

213.3

1.002.83

13.6

226.5

1.504.42

21.2

2006

20062006

2006

2007

20072007

2007

2008

20082008

2008

2009

20092009

2009

0

00 1 2 3 4 5

0100

1

5 10200

2

15300

3

20 25


Revenue

Basic Earnings Per Share

Profit Attributable to Owners of the Company

Net Dividend Per Share

>> Financial

Highlights

>> Corporate Governance Report


The SMB Board is committed to high standards of corporate governance and has adopted the principles of the Code of Corporate Governance where practicable to enhance transparency and the protection of shareholders’ interests. In areas where the principles of the Code of Corporate Governance are not adhered to, explanation for the deviations is provided below.

BOARD MATTERS

The Board’s conduct of affairsThe Board oversees the business management of the Group by providing entrepreneurial leadership; setting aims, values, standards and risk management framework; and reviewing management performance. This also includes approval on major corporate strategies and initiatives, major investment and divestment proposals, board appointments, interested party transactions, dividend payments and financial results for release to SGX-ST.

The Board has established the following Board Committees which function within clearly defined terms of reference and operating procedures:

• AuditCommittee• NominatingCommittee• RemunerationCommittee

In order to assist the Board in carrying out its responsibilities, training is provided when the need arises. Orientation programme is also given to new directors in order to allow them to familiarise with the Group’s businesses and governance practices.

When a decision has to be made before a Board meeting is convened, a Directors’ Resolution in writing is circulated in accordance with the Articles of Association of the Company and the directors are provided with all relevant information to allow them to make informed decisions.

Board composition and guidanceThe Board comprises seven members, three of whom are executive directors, one is a non-executive director and three are independent directors. The Company is led by the collective diverse experience of the directors whose profiles are found on pages 6 to 7 of this report. The Board held four meetings in 2009 chaired by Mr. Lee Phuan Weng.

The Board deems that its current size is adequate and its directors possess the necessary competencies to develop and review SMB’s strategies, goals and objectives effectively.

Chairman and Chief Executive OfficerThe Chairman manages the business of the Board and the Board committees. He controls the quality, adequacy and timeliness of the flow of information between the management and the Board including the scheduling and setting of the agenda for Board meetings. As there is adequate representation of independent directors on the Board, further reinforcement of board independence via the separation of the roles of Chairman and the CEO is deemed to be unnecessary.



Board membership TheNominatingCommittee(“NC”) istaskedwiththeresponsibilityofmakingrecommendationstotheBoardonallboardappointments.TheNCcomprisesfourmembers,threeofwhomareindependentdirectors.Itheldone meeting in 2009 chaired by Mr. Koh Ah Huat.

NewdirectorsareselectedandrecommendedtotheBoardbasedontheindividual’scompetency,professionalqualifications and how his knowledge and experience will complement the other existing directors in order to formaneffectiveBoard.Otherdutiesof theNC include the re-nominationofdirectors, thedeterminationofdirectors’ independence annually, ability of directors to handle multiple board representations and effectiveness of the Board including board size and composition.

TheNCisoftheviewthatthecurrentboardsizeandcompositionisappropriateaftertakingintoconsiderationthe nature and scope of the Group’s operations.

Board performanceThe criteria for assessing the effectiveness of individual board members include the attendance record at Board and Board Committee meetings, contributions by members during such meetings and the individual expertise that they bring to the Board. The effectiveness of the Board as a whole is determined based on its ability to set andsteertheGrouptowardsitsstrategicbusinessobjectives.A“BoardPerformanceEvaluation”assessmentiscompletedannuallybytheNCaspartoftheprocesstodeterminetheeffectivenessoftheBoard.

Access to informationThe Board has full access to the management team and the company secretaries. At least one of the company secretaries attends Board and Board Committee meetings. The company secretaries are responsible for ensuring that the procedures of Board and Board Committee meetings are complied with.

Any Board member can seek independent professional advice at the Company’s expense in furtherance of his duties and in the event that circumstances warrant it.

Directors’ Attendance at Board and Board Committee Meetings

Attendance

Name BoardAudit

CommitteeNominatingCommittee

RemunerationCommittee

Executive DirectorsLee Phuan WengGoh Ban Kin Lee Yong Heng

424

***

1**

***

Non-Executive DirectorLee Kwang Mong 2 * * *

Independent DirectorsHenry Hoe Leong SengKoh Ah HuatTay Teng Tiow

344

455

011

011

No.ofmeetingsheldin2009 4 5 1 1

*Notapplicable



REMUNERATION MATTERS

Procedures for developing remuneration policiesTheRemunerationCommittee(“RC”)comprisesthreememberswhoareallindependentdirectors.Itheldonemeeting in 2009 chaired by Mr. Koh Ah Huat.

The main duties of the RC include the recommendation of a remuneration framework to the Board, approval of directors’ remuneration and their service contracts, approval of senior executives’ remuneration as well as those employees related to the executive directors and controlling shareholders of the Company, and the administration of the performance-based compensation schemes. The RC also has access to expert advice on remuneration matters when the need arises.

Level and mix of remunerationThe remuneration policy of the Group is determined based on its ability to be competitive and sufficient to attract, retain and motivate directors and employees. Components of our remuneration include a base salary, annual wage supplement, fixed allowances and variable performance bonus. The Company recognises the contributions of employees and directors made to the growth and performance of the Group and rewards and retains key employees and directors with performance-based compensation schemes.

Disclosure on remunerationDetails of the remuneration of the directors and top key executives are as follows:

Directors’ Remuneration

Remuneration Band Salary%

Bonus #%

Directors’ Fees

%

Others ##%

Total%

$750,000 to below $1,000,000- Lee Phuan Weng- Goh Ban Kin- Lee Yong Heng

323333

575958

633

556

100100100

$500,000 to below $750,000- Lee Kwang Mong 46 40 9 5 100

Below $250,000- Henry Hoe Leong Seng - Koh Ah Huat- Tay Teng Tiow

---

---

100100100

---

100100100

# Includes performance-related bonus pegged to the results of the Group.## Includes share options expense. Details of share options granted to directors are disclosed in the Report of the Directors.



Top 7 Key Executives’ Remuneration Band

Remuneration BandSalary

%Bonus

%Others

%Total

%

$250,000 to below $500,000- Chin Jin Meng Jimmy- Chua Yiat Hin Jimmy- Douglas David Ross- Lee Hwee Choo Terri-TanNgiapHong- Tang Yoon Pheng

437863537241

431020

38*21

52*

141217977

100100100100100100

Below $250,000- Lee Wee Hian Lawrence 65 24* 11 100

*Excludes accrued performance bonus that will be finalised after FY2011.

Employees whose remuneration exceed $150,000 and are immediate family members of a Director or the CEO

No. of Employees Related to

2Lee Phuan Weng(DirectorandCEO)

ACCOUNTABILITY AND AUDIT

AccountabilityTheBoardprovidesshareholderswithquarterlyfinancialresultsannouncementviaSGXNET.Inpresentingsuchfinancial reports to shareholders, the Board aims to provide shareholders with a balanced and clear assessment of SMB’s position and prospects.

The management also provides financial reports to the Board on a monthly basis.

Audit CommitteeCurrently,theAuditCommittee(“AC”)comprisesthreemembers,allofwhomareindependentdirectors.Therewere five meetings in 2009, out of which four meetings were chaired by Mr. Henry Hoe Leong Seng and one meeting was chaired by Mr. Koh Ah Huat.

The duties of the AC include the review of financial results for release to SGX-ST, significant financial reporting issues and judgements to ensure the integrity of the financial reports, the effectiveness of the Company’s material internal controls, scope and results of the external audit and its cost effectiveness, and independence and objectivity of the external auditors with regards to their non-audit services. It also recommends to the Board on the nomination of the external auditors and their compensation. The AC has explicit authority to investigate any matters within its terms of reference and possess reasonable resources to discharge its functions properly.

The AC meets with the external auditors at least once a year without the presence of the management. It had undertaken a review of all non-audit services provided by the auditors and was of the opinion that the provision



of such services would not affect the independence of the auditors. The AC recommends the re-appointment of the external auditors, Deloitte and Touche LLP, as the company’s auditors at the forthcoming AGM.

SMB has also put in place a whistle-blowing framework where employees of the Group can contact the AC Chairman, Mr. Henry Hoe Leong Seng, to raise concerns about improprieties directly. Contact details of Mr. Henry Hoe have been made available to all employees.

NointerestedpersontransactionswerenotedbytheACfor2009.

Internal controls and internal auditThe key features of the control environment include the terms of reference for the Board and each of its committees, a clear organisation structure and methods of assigning authority and responsibility, the management’s internal control system, and defined procedures for the approval of major transactions.

The Group’s internal control process is anchored by the Group’s corporate office. It assists the Board in monitoring the compliance of key internal controls procedures as well as the plan and performance of its subsidiaries, which is reported internally on a monthly basis. The Board will consider expanding its internal audit resources as and when the need arises.

Executive directors also exercise control and supervision through regular communication and presentations made by each principal operating unit on its respective business, finance and operational developments.

The management of all forms of business risk continues to be an integral part in ensuring that the Group creates andprotectsvalueforitsshareholders.ThefinancialandcapitalrisksfacedbytheGrouparedisclosedinNote4 of the notes to financial statements.

COMMUNICATION WITH SHAREHOLDERS

TheCompanyengages in regular,effective, timelyand faircommunicationwithshareholdersvia itsSGXNETannouncements, corporate website, news releases, annual report and/or circulars to shareholders. This includes the announcement of our results which provides shareholders with an assessment of the Company’s performance, financial position and prospects on a quarterly basis. The Company does not practice selective disclosure and price sensitive informationwill be publicly released throughSGXNET as andwhen the needarises.

Shareholders’ participation is encouraged at the Company’s annual general meeting. The Board including thechairpersonof theAudit,NominatingandRemunerationCommittees,aswellaskeymanagementof theCompany, are present and available to address questions of the shareholders with the assistance of the external auditors, when necessary.

OTHERS

Dealing in Company’s securitiesThe Company has adopted an internal code pursuant to the best practices on dealings in securities issued by the SGX-ST, applicable to all the officers of the Company and its subsidiaries with regards to dealings in the Company’s securities.

Dealings in the Company’s securities are prohibited two weeks prior to the release of the quarterly results and one month prior to the release of full year results.


Contents

27 Report of the Directors

32 Statement of Directors

33 Independent Auditors’ Report

34 Statements of Financial Position

35 Consolidated Statement of Comprehensive Income

36 Statements of Changes in Equity

38 Consolidated Statement of Cash Flows

40 Notes to Financial Statements

Report of the Directors and Financial Statements

Annual Report 2009 >> 27

>> Report of the Directors

The directors present their report together with the audited consolidated financial statements of the group and statement of financial position and statement of changes in equity of the company for the financial year ended December 31, 2009.

1 DIRECTORS

The directors of the company in office at the date of this report are:

Lee Phuan Weng Goh Ban Kin Lee Yong Heng Lee Kwang Mong Henry Hoe Leong Seng Koh Ah Huat Tay Teng Tiow

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

Neither at the end of the financial year nor at any time during the financial year did there subsist any arrangement whose object is to enable the directors of the company to acquire benefits by means of the acquisition of shares or debentures in the company or any other body corporate except for the options mentioned in paragraphs 3 and 5 of the Report of the Directors.

3 DIRECTORS’ INTERESTS IN SHARES AND DEBENTURES

The directors of the company holding office at the end of the financial year had no interest in the share capital of the company and related corporations as recorded in the register of directors’ shareholdings kept by the company under Section 164 of the Singapore Companies Act except as follows:

Shareholdings Shareholdings registered in in which directors are name of director deemed to have an interest At At Name of directors and companies beginning At end beginning At end in which interests are held of year of year of year of year

The company - SMB United Limited (Ordinary shares)

Lee Phuan Weng 35,688,544 35,688,544 7,761,248 7,761,248 Goh Ban Kin 22,632,514 22,632,514 10,045,000 10,045,000 Lee Yong Heng 46,170,923 46,170,923 - - Lee Kwang Mong 2,082,000 2,082,000 - - Henry Hoe Leong Seng 336,000 336,000 - - Koh Ah Huat 168,000 168,000 - - Tay Teng Tiow 60,000 60,000 20,000 20,000

Subsidiary - EDMI Limited (Ordinary shares)

Lee Phuan Weng - 1,000,000 130,000 130,000 Lee Yong Heng 650,000 650,000 - - Lee Kwang Mong 1,900,000 3,800,000 - - Tay Teng Tiow 100,000 100,000 - -

The share options of a subsidiary, EDMI Limited, held by a director of the company are disclosed in paragraph 5(b).

The directors’ interests in the shares and options of the company at January 21, 2010 were the same at December 31, 2009.


4 DIRECTORS’ RECEIPT AND ENTITLEMENT TO CONTRACTUAL BENEFITS

Since the beginning of the financial year, no director has received or become entitled to receive a benefit which is required to be disclosed under Section 201(8) of the Singapore Companies Act, by reason of a contract made by the company or a related corporation with the director or with a firm of which he is a member, or with a company in which he has a substantial financial interest except for salaries, bonuses and other benefits as disclosed in the financial statements and in the following paragraphs. Certain directors have received remuneration from related corporations in their capacity as directors and/or executives of those related corporations.

5 SHARE OPTIONS AND SHARE PLAN

(a) Options to take up unissued shares

During the financial year, no option to take up unissued shares of the company or any corporation in the group was granted.

(b) Unissued shares under option and options exercised

SMB Performance Share Plan (the “Plan”)

The Plan was approved by the shareholders of the company at an Extraordinary General Meeting held on April 30, 2009. Awards granted under the Plan are principally performance-based with performance targets to be set over a multi-year performance period. Performance targets set are intended to be based on medium-term corporate objectives covering market competitiveness, quality of returns, business growth and productivity growth. The performance targets are stretched targets aimed at sustaining long term growth.

The committee administering this scheme comprises independent directors: Koh Ah Huat (Chairman), Henry Hoe Leong Seng and Tay Teng Tiow.

The Committee shall decide, in relation to each Award to be granted to a Participant:

i) the Award date;

ii) the number of shares comprised under an Award or their equivalent in cash (based on the aggregate market value of the shares which are the subject of the Award) or if a combination of both, the proportion between the shares and the cash which are the subject of the Award;

iii) the performance target(s) (if any), the performance period during which such performance target(s) are to be satisfied, if any; and

iv) any other condition which the Committee may determine in relation to that Award.

The total number of new shares which may be issued pursuant to Awards granted under the proposed Plan, when added to the number of new shares issued and issuable in respect of all Awards granted thereunder, shall not exceed 15% of the issued share capital of the company on the day preceding the relevant date of Award.

No Awards under the plan have been granted since the commencement of the plan.

SMB Share Option Scheme 2001

This scheme was approved by the shareholders on September 7, 2001. As at the beginning of the year, there were no unissued shares under option under this scheme. During the financial year, the SMB Share Option Scheme 2001 was terminated.



5 SHARE OPTIONS AND SHARE PLAN (CONT’D)

(b) Unissued shares under option and options exercised (cont’d)

EDMI Share Option Scheme 2003

This scheme was approved by the shareholders on September 10, 2003 and remains in force at the discretion of the committee administering the scheme, subject to a maximum period of 10 years.

No. of options to subscribe for ordinary shares Balance Balance at at Exercise Type of January 1, Cancelled/ December 31, price share options Date of grant 2009 Exercised Lapsed 2009 per share Expiry date

’000 ’000 ’000 ’000

Executive February 7, September 9, (Directors 2005 8,875 (1,400) (500) 6,975 $0.13 2013 and March 13, September 9, employees) 2007 2,690 - - 2,690 $0.32 2013

Non-Executive (Independent February 7, February 6, directors) 2005 400 - - 400 $0.13 2010

11,965 (1,400) (500) 10,065

Each share option entitles the directors (excluding executive directors who are substantial shareholders)

and employees (excluding employees who are also controlling shareholders and their associates) of EDMI Limited group to subscribe for one new ordinary share in EDMI Limited at an exercise price determined at the average price of EDMI Limited’s share traded in the Singapore Exchange Securities Trading Limited for the three consecutive trading days immediately preceding the offer date of that option, rounded up to the nearest whole cent in the event of fractional prices.

The aggregate nominal amount of shares that the committee may grant options, when added to the

aggregate nominal amount of shares issued and issuable under the EDMI Share Option Scheme 2003 shall not exceed 15% of the issued share capital of EDMI Limited on the date immediately preceding the offer date of the option.

To qualify for the EDMI Share Option Scheme 2003, eligible employees must be in full time service of EDMI Limited group for at least one year on or prior to the relevant offer date. However, the committee administering the scheme may at its discretion abridge the one-year service requirement in respect of any employee.

The options are granted for a consideration of $1.00 for all the shares in respect of which the options are granted. The options may be exercised after one year from the date of the grant subject to the condition that up to 25%, 50% and 75% of the options may be exercised prior to the second, third and fourth anniversary of the offer date of options respectively. The shares under option may be exercised in full or in multiples of 1,000 shares on payment of the exercise price. Options granted will be cancelled upon the occurrence of certain events such as cessation of employment.

The committee administering the scheme may extend but not abridge the vesting periods.

\ Executive Options shall be exercised before the tenth anniversary of the relevant offer date and Non-Executive Options shall be exercised before the fifth anniversary of the relevant offer date, or such earlier date as may be determined by the committee, failing which all unexercised options shall immediately lapse and become null and void and a participant shall have no claim against EDMI Limited.



5 SHARE OPTIONS AND SHARE PLAN (CONT’D)

(b) Unissued shares under option and options exercised (cont’d)

EDMI Share Option Scheme 2003 (cont’d)

The information on directors of the company participating in the scheme is as follows:

Aggregate Aggregate Aggregate options options options granted since exercised since lapsed since Aggregate Options commencement commencement commencement options granted of the scheme of the scheme of the scheme outstanding as during the to the end of to the end of to the end of at the end of Name of director financial year financial year financial year financial year financial year ’000 ’000 ’000 ’000 ’000

Lee Kwang Mong - direct - 2,800 2,800 - -

With the exception of Lee Kwang Mong and Chin Jin Meng (a director of EDMI Limited) who each received approximately 8.8% of the total share options available under the scheme, none of the employees received 5% or more of the total share options available under this scheme.

The committee administering this scheme comprises Lee Kwang Mong and two independent directors of EDMI Limited, Yeo Jeu Nam (Chairman) and Lim Tat.

None of the directors in the committee participated in any deliberation or decision in respect of options granted to himself.

6 AUDIT COMMITTEE

The Audit Committee comprises three members namely:

Henry Hoe Leong Seng (Chairman) Koh Ah Huat Tay Teng Tiow

All the members of the Audit Committee are independent directors.

The Audit Committee met 5 times since the last Annual General Meeting (“AGM”) and reviewed the following, where relevant, with the executive directors and the external auditors of the company:

i) the audit plans of the external auditors in relation to the group’s financial and operating results;

ii) the group’s financial and operating results and accounting policies;

iii) the financial statements of the company and the consolidated financial statements of the group before their submission to the directors of the company and the external auditors’ report on those financial statements;

iv) the quarterly, half-yearly and annual announcements on the results of the group and financial position of the company and of the group;

v) the co-operation and assistance given by the management to the external auditors;

vi) the re-appointment of the external auditors of the group; and

vii) interested person transactions.



6 AUDIT COMMITTEE (CONT’D)

The Audit Committee has full access to and co-operation of the management and has been given the resources required for it to discharge its function properly. It also has full discretion to invite any director and executive officer to attend its meetings. The external auditors have unrestricted access to the Audit Committee.

The Audit Committee has recommended to the Board of Directors the nomination of Deloitte & Touche LLP as auditors of the group at the forthcoming AGM.

7 AUDITORS

The auditors, Deloitte & Touche LLP, have expressed their willingness to accept re-appointment.

ON BEHALF OF THE DIRECTORS

Lee Phuan Weng

Goh Ban Kin

March 24, 2010



>> Statement of Directors

In the opinion of the directors, the consolidated financial statements of the group and the statement of financial position and statement of changes in equity of the company as set out on pages 34 to 99 are drawn up so as to give a true and fair view of the state of affairs of the group and of the company as at December 31, 2009 and of the results, changes in equity and cash flows of the group and changes in equity of the company for the financial year then ended and at the date of this statement, there are reasonable grounds to believe that the company will be able to pay its debts when they fall due.

ON BEHALF OF THE DIRECTORS

Lee Phuan Weng

Goh Ban Kin

March 24, 2010


>> Independent Auditors’ Reportto the Members of SMB United Limited

We have audited the accompanying financial statements of SMB United Limited (the company) and its subsidiaries (the group) which comprise the statements of financial position of the group and the company as at December 31, 2009, and the statement of comprehensive income, statement of changes in equity and statement of cash flows of the group and the statement of changes in equity of the company for the year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on pages 34 to 99.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with the provisions of the Singapore Companies Act, Cap. 50 (the “Act”) and Singapore Financial Reporting Standards. This responsibility includes: devising and maintaining a system of internal accounting controls sufficient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair profit and loss account and balance sheets and to maintain accountability of assets; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditors’ Responsibility

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

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

Opinion

In our opinion,

(a) the consolidated financial statements of the group and the statement of financial position and statement of changes in equity of the company are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as to give a true and fair view of the state of affairs of the group and of the company as at December 31, 2009 and of the results, changes in equity and cash flows of the group and changes in equity of the company for the year ended on that date; and

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

Deloitte & Touche LLPPublic Accountants andCertified Public AccountantsSingapore

March 24, 2010


>> Statements of Financial PositionDecember 31, 2009

Group Company Note 2009 2008 2009 2008 $’000 $’000 $’000 $’000

ASSETS

Current assetsCash and bank balances 6 59,545 44,422 9,797 1,998Trade receivables 7 75,812 59,010 - - Other receivables and prepayments 8 3,591 3,363 16,629 14,840Inventories 9 46,707 44,706 - - Contract work-in-progress 10 2,756 1,818 - -

Total current assets 188,411 153,319 26,426 16,838

Non-current assetsProperty, plant and equipment 11 36,568 35,868 580 652Assets on lease 12 210 - - - Subsidiaries 13 - - 66,140 66,021Associates 14 820 1,013 - - Joint ventures 15 511 280 - - Available-for-sale investments 16 587 845 57 32Intangible assets 17 5,025 217 - - Other receivables 18 - 499 - - Deferred tax assets 19 1,019 868 - -

Total non-current assets 44,740 39,590 66,777 66,705

Total assets 233,151 192,909 93,203 83,543

LIABILITIES AND EQUITY

Current liabilitiesBank borrowings 20 6,926 7,566 - - Trade payables 21 34,684 29,126 - - Other payables 22 13,322 9,471 2,614 1,483Derivative financial instruments 23 60 - - - Contract work-in-progress 10 2,217 632 - - Current portion of finance leases 24 499 450 94 94Income tax payable 4,985 3,201 51 137

Total current liabilities 62,693 50,446 2,759 1,714

Non-current liabilitiesOther payables 22 3,403 310 937 55Finance leases 24 870 841 94 189Long-term loans 20 4,537 1,560 - - Deferred tax liabilities 25 1,600 1,481 3 2Financial guarantee contracts - - 366 413

Total non-current liabilities 10,410 4,192 1,400 659

Capital, reserves and minority interestsShare capital 27 75,113 75,113 75,113 75,113Reserves 60,381 41,691 13,931 6,057

Equity attributable to owners of the company 135,494 116,804 89,044 81,170Minority interests 24,554 21,467 - -

Total equity 160,048 138,271 89,044 81,170

Total liabilities and equity 233,151 192,909 93,203 83,543

See accompanying notes to financial statements.


>> Consolidated Statement of Comprehensive IncomeYear ended December 31, 2009

Group Note 2009 2008 $’000 $’000

Revenue 29 226,508 213,347

Cost of sales (162,132) (154,371)

Gross profit 64,376 58,976Other operating income 30 3,676 921Selling expenses (3,151) (3,385)General and administrative expenses (36,202) (30,531)Other operating expenses (3,808) (3,473)Other gains and (losses) 31 5,336 (3,269)Share of losses of associates 14 (361) (222)Share of losses of joint ventures 15 (156) (283)Finance cost (454) (553)

Profit before tax 29,256 18,181Income tax expense 32 (5,278) (3,168)

Profit for the year 33 23,978 15,013

Other comprehensive income:Exchange differences arising on translating foreign operations 1,468 (983)Available-for-sale financial assets: Gain (Loss) arising during the year 425 (1,969) Release of fair value reserve on disposal of available-for-sale investments 1,844 -

Other comprehensive income for the period, net of tax 3,737 (2,952)

Total comprehensive income for the period 27,715 12,061

Profit attributable to: Owners of the company 21,221 13,563 Minority interests 2,757 1,450

23,978 15,013

Total comprehensive income attributable to: Owners of the company 23,372 11,793 Minority interests 4,343 268

27,715 12,061

Basic earnings per share (cents) 34 4.42 2.83

Diluted earnings per share (cents) 34 4.42 2.83



>> Statements of Changes in EquityYear ended December 31, 2009

Attributable Share Investment Currency to owners Share option revaluation translation Retained of the Minority Note capital reserve reserve reserve earnings company interests Total

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

Balance at January 1, 2008 75,113 285 (260) (1,146) 37,604 111,596 21,229 132,825

Total comprehensive income and loss for the year - - (1,060) (710) 13,563 11,793 268 12,061Dividends 38 - - - - (6,716) (6,716) (281) (6,997)Recognition of share-based payments 26 - 131 - - - 131 101 232Exercise of a subsidiary’s employee share options - - - - - - 103 103Equity contributed by minority shareholders - - - - - - 96 96Equity acquired from minority shareholders - - - - - - (49) (49)

Balance at December 31, 2008 75,113 416 (1,320) (1,856) 44,451 116,804 21,467 138,271

Total comprehensive income and loss for the year - - 1,285 866 21,221 23,372 4,343 27,715Dividends 38 - - - - (4,798) (4,798) (230) (5,028)Recognition of share-based payments 26 - 116 - - - 116 82 198Exercise of a subsidiary’s employee share options - - - - - - 261 261Equity acquired from minority shareholders - - - - - - (1,369) (1,369)

Balance at December 31, 2009 75,113 532 (35) (990) 60,874 135,494 24,554 160,048


Investment Share revaluation Retained Note capital reserve earnings Total $’000 $’000 $’000 $’000

Company

Balance at January 1, 2008 75,113 (190) 5,709 80,632

Total comprehensive income for the year - 105 7,149 7,254Dividends 38 - - (6,716) (6,716)

Balance at December 31, 2008 75,113 (85) 6,142 81,170

Total comprehensive income for the year - 25 12,647 12,672Dividends 38 - - (4,798) (4,798)

Balance at December 31, 2009 75,113 (60) 13,991 89,044

>> Statements of Changes in EquityYear ended December 31, 2009



>> Consolidated Statement of Cash FlowsYear ended December 31, 2009

Group Note 2009 2008 $’000 $’000

Operating activities

Profit before income tax 29,256 18,181

Adjustments for: Share of losses of associates 361 222 Share of losses of joint ventures 156 283 Depreciation of property, plant and equipment 3,220 3,054 Depreciation of assets on lease 44 - Dividend income (3) (7) Interest expense 454 553 Amortisation of intangible assets - 219 Allowance for doubtful trade receivables 476 149 Allowance for doubtful non-trade receivables - 141 Allowance (Reversal of allowance) for inventories 2,486 (66) Allowance for foreseeable losses on contracts 836 831 Gain on disposal of property, plant and equipment (36) (119) Intangible assets written off - 23 Interest income (185) (357) Loss on dilution of shareholding interest in a subsidiary 79 26 Gain on dilution of shareholding interest in an associate (73) - Gain on disposal of a subsidiary (277) - Gain on acquisition of shareholding interest in a subsidiary (643) - Release of fair value reserve on disposal of available-for-sale investments 1,844 - Gain on disposal of available-for-sale investments (2,263) - Impairment loss on available-for-sale investments - 190 Changes in fair value of financial derivative instruments 60 - Share option expense 198 232

Operating cash flows before movements in working capital 35,990 23,555

Trade receivables (17,872) 13,765Other receivables and prepayments (516) (155)Inventories (4,249) (375)Contract work-in-progress (215) 572Trade payables 6,074 (3,588)Other payables 7,300 (615)

Cash generated from operations 26,512 33,159

Income tax paid (3,289) (2,240)Interest paid (454) (553)

Net cash from operating activities 22,769 30,366


Group Note 2009 2008 $’000 $’000

Investing activities

Interest received 185 357Purchase of property, plant and equipment A (2,499) (6,344)Proceeds on disposal of property, plant and equipment 423 922Proceeds on disposal of available-for-sale investments 2,946 - Acquisition of investment in associates (105) - Acquisition of investment in joint venture (50) (523)Acquisition of equity in a subsidiary from minority shareholders (726) (49)Acquisition of business 40 (3,903) - Proceeds from disposal of a subsidiary 39 96 - Expenditure on product development (151) - Loan to proposed acquisition company - (653)Loan to joint venture (325) - Dividends received 3 7

Net cash used in investing activities (4,106) (6,283)

Financing activities

Repayment of finance leases (602) (526)Repayment of bank loans (1,793) (5,251)New bank loan raised 4,046 2,017Net proceeds from trust receipts and banker’s acceptance 554 72Increase in cash deposits pledged to bank 6 818 (14)Dividends paid to equity holders of the company (4,798) (6,716)Dividends paid to minority shareholders of subsidiaries (230) (281)Capital contribution from minority shareholders - 96Proceeds from exercise of employee share options of a subsidiary 182 77

Net cash used in financing activities (1,823) (10,526)

Net increase in cash and cash equivalents 16,840 13,557Cash and cash equivalents at beginning of the year 40,602 27,136Effect of foreign exchange rate changes (16) (91)

Cash and cash equivalents at end of the year 57,426 40,602

Cash and cash equivalents consist of:

Cash at bank 6 47,652 39,512Fixed deposits 6 11,372 3,571Bank overdrafts 20 (1,598) (2,481)

57,426 40,602

Note ADuring the financial year, the group acquired property, plant and equipment with an aggregate cost of $3,139,000 (2008 : $7,275,000) of which $640,000 (2008 : $931,000) was acquired under finance lease agreement. Cash payments of $2,499,000 (2008 : $6,344,000) was made to purchase property, plant and equipment.

>> Consolidated Statement of Cash FlowsYear ended December 31, 2009



>> Notes to Financial StatementsDecember 31, 2009

1 GENERAL

The company (Registration No. 199506364D) is incorporated in Singapore with its principal place of business and registered office at 9 Senoko Drive, Singapore 758197. The company is listed on the mainboard of the Singapore Exchange Securities Trading Limited. The financial statements are expressed in Singapore dollars.

The principal activity of the company is that of an investment holding company.

The principal activities of the subsidiaries, associates and joint ventures are disclosed in Notes 13, 14 and 15 to the financial statements.

The consolidated financial statements of the group and statement of financial position and statement of changes of equity of the company for the year ended December 31, 2009 were authorised for issue by the Board of Directors on March 24, 2010.

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF ACCOUNTING

The financial statements are prepared in accordance with the historical cost convention except as disclosed in the accounting policies below, and are drawn up in accordance with the provisions of the Singapore Companies Act and Singapore Financial Reporting Standards (“FRS”).

ADOPTION OF NEW AND REVISED STANDARDS

In the current financial year, the group has adopted all the new and revised FRSs and Interpretations of FRS (“INT FRS”) that are relevant to its operations and effective for annual periods beginning on or after January 1, 2009. The adoption of these new/revised FRSs and INT FRSs does not result in changes to the group’s and company’s accounting policies and has no material effect on the amounts reported for the current or prior years except as disclosed below:

FRS 1 – Presentation of Financial Statements (Revised)

FRS 1 (2008) has introduced terminology changes (including revised titles for the financial statements) and changes in the format and content of the financial statements. In addition, the revised Standard requires the presentation of a third statement of financial position at the beginning of the earliest comparative period presented if the entity applies new accounting policies retrospectively or makes retrospective restatements or reclassifies items in the financial statements.

Amendments to FRS 107 Financial Instruments : Disclosures – Improving Disclosures about Financial Instruments

The amendments to FRS 107 expand the disclosures required in respect of fair value measurements and liquidity risk.

FRS 108 – Operating Segments

The group adopted FRS 108 with effect from January 1, 2009. FRS 108 requires operating segments to be identified on the basis of internal reports about components of the group that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segment and to assess its performance. In contrast, the predecessor Standard (FRS 14 Segment Reporting) required an entity to identify two sets of segments (Business and Geographical), using a risks and rewards approach, with the entity’s system of internal financial reporting to key management personnel’ serving only as the starting point for the identification of such segments. Following the adoption of FRS 108, the identification of the group’s reportable segments remain unchanged (Note 37).

At the date of authorisation of these financial statements, the following FRSs, INT FRSs and amendments to FRS that are relevant to the group and the company were issued but not effective:

• AmendmentstoFRS7Statement of Cash Flows

• AmendmenttoFRS39 Financial Instruments: Recognition and Measurement-Eligible Hedged Items



2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

ADOPTION OF NEW AND REVISED STANDARDS (CONT’D)

• Amendment to FRS 39 Financial Instruments: Recognition and Measurement and INT FRS 109 Reassessment of Embedded Derivatives – Amendments relating to Embedded Derivatives

• INTFRS117Distribution of Non-cash Assets to Owners

• FRS24(Revised)Related Party Disclosures

• FRS27(Revised)Consolidated and Separate Financial Statements

• FRS28(Revised)Investment in Associates

• FRS103(Revised)Business Combinations

• ImprovementstoFinancialReportingStandards(issuedinJune2009).

Consequential amendments were also made to various standards as a result of these new/revised standards.

The management anticipates that the adoption of these FRSs, INT FRSs and amendments to FRS that were issued but not yet effective until future periods will have no material impact on the financial statements of the group and of the company in the period of their initial adoption, except for the following:

FRS 27 (Revised) Consolidated and Separate Financial Statements; and FRS 103 (Revised) Business Combinations

FRS 27 (Revised) is effective for annual periods beginning on or after July 1, 2009. FRS 103 (Revised) is effective for business combinations for which the acquisition date is on or after the beginning of the annual reporting period beginning on or after July 1, 2009.

Apart from matters of presentation, the principal amendments to FRS 27 that will impact the group concern the accounting treatment for transactions that result in changes in a parent’s interest in a subsidiary. It is likely that these amendments will significantly affect the accounting for such transactions in future accounting periods, but the extent of such impact will depend on the detail of the transactions, which cannot be anticipated. The changes will be adopted prospectively for transactions after the date of adoption of the revised Standard and, therefore, no restatements will be required in respect of transactions prior to the date of adoption.

Similarly, FRS 103 relates to accounting for business combination transactions. The changes to the Standard are significant, but their impact can only be determined once the details of future business combination transactions is known. The amendments to FRS 103 will be adopted prospectively for transactions after the date of adoption of the revised Standard and, therefore, no restatements will be required in respect of transactions prior to the date of adoption.

FRS 28 (Revised) Investments in Associates

In FRS 28 (Revised), the principle adopted under FRS 27 (Revised) (see above) that a loss of control is recognised as a disposal and re-acquisition of any retained interest at fair value is extended by consequential amendment to FRS 28 (Revised); therefore, when significant influence is lost, the investor measures any investment retained in the former associate at fair value, with any consequential gain or loss recognised in profit or loss.

FRS 28 (Revised) will be adopted for periods beginning on or after July 1, 2009 and will be applied prospectively in accordance with the relevant transitional provisions and, therefore, no restatements will be required in respect of transactions prior to the date of adoption.

Amendments to FRS 7 Statement of Cash Flows

The amendments (part of Improvements to FRSs issued in June 2009) specify that only expenditures that result in a recognised asset in the statement of financial position can be classified as investing activities in the statement of cash flows. Consequently, cash flows in respect of development costs that do not meet the criteria in FRS 38 Intangible Assets for capitalisation as part of an internally generated intangible asset (and, therefore, are recognised in profit or loss as incurred) will be reclassified from investing to operating activities in the statement of cash flows. The amendments to FRS 7 will be adopted for periods beginning on or after January 1, 2010.




BASIS OF CONSOLIDATION

The consolidated financial statements incorporate the financial statements of the company and entities controlled by the company (its subsidiaries). Control is achieved where the company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

The results of subsidiaries acquired or disposed of during the year are included in the consolidated profit and loss statement from the effective date of acquisition or up to the effective date of disposal, as appropriate.

Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies in line with those used by other members of the group.

All intra-group transactions, balances, income and expenses are eliminated on consolidation.

Minority interests in the net assets of consolidated subsidiaries are identified separately from the group’s equity therein. Minority interests consist of the amount of those interests at the date of the original business combination (see below) and the minority’s share of changes in equity since the date of the combination. Losses applicable to the minority in excess of the minority’s interest in the subsidiary’s equity are allocated against the interests of the group except to the extent that the minority has a binding obligation and is able to make an additional investment to cover its share of those losses.

In the company’s financial statements, investments in subsidiaries, associates and joint ventures are carried at cost less any impairment in net recoverable value that has been recognised in the profit and loss statement.

BUSINESS COMBINATIONS

The acquisition of subsidiaries is accounted for using the purchase method. The cost of the acquisition is measured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued by the group in exchange for control of the acquiree, plus any costs directly attributable to the business combination. The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under FRS 103 Business Combinations are recognised at their fair values at the acquisition date, except for non-current assets (or disposal groups) that are classified as held for sale in accordance with FRS 105 Non-Current Assets Held for Sale and Discontinued Operations, which are recognised and measured at fair value less costs to sell.

Goodwill arising on acquisition is recognised as an asset and initially measured at cost, being the excess of the cost of the business combination over the group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised. If, after reassessment, the group’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities exceeds the cost of the business combination, the excess is recognised immediately in the consolidated profit and loss statement.

The interest of minority shareholders in the acquiree is initially measured at the minority’s proportion of the net fair value of the assets, liabilities and contingent liabilities recognised.

FINANCIAL INSTRUMENTS

Financial assets and financial liabilities are recognised on the group’s statement of financial position when the group becomes a party to the contractual provisions of the instrument.

Effective interest method

The effective interest method is a method of calculating the amortised cost of a financial instrument and of allocating interest income or expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts or payments (including all fees on points paid or received that form an integral part of the effective interest rate, transactions costs and other premiums or discounts) through the expected life of the financial instrument or where appropriate, a shorter period. Income and expense is recognised on an effective interest basis for debt instruments.



FINANCIAL INSTRUMENTS (CONT’D)

Financial assets

Financial assets comprise “available-for-sale” financial assets, “trade and other receivables” and “cash and cash equivalents”. The classification depends on the nature and purpose of financial assets and is determined at the time of initial recognition.

Available-for-sale financial assets

Investments are recognised and derecognised on a trade date where the purchase or sale of an investment is under a contract whose terms require delivery of the investment within the time frame established by the market concerned, and are initially measured at fair value plus transaction costs.

Certain shares held by the group are classified as available-for-sale and are stated at fair value. Fair value is determined in the manner described in Note 4b(vi). Gains and losses arising from changes in fair value are recognised in other comprehensive income with the exception of impairment losses, interest calculated using the effective interest method and foreign exchange gains and losses on monetary assets which are recognised directly in profit or loss. Where the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously recognised in other comprehensive income and accumulated in revaluation reserve is reclassified to profit or loss. Dividends on available-for-sale equity instruments are recognised in profit or loss when the group’s right to receive payments is established. The fair value of available-for-sale monetary assets denominated in a foreign currency is determined in that foreign currency and translated at the spot rate at the end of the reporting period. The change in fair value attributable to translation differences that result from a change in amortised cost of the asset is recognised in profit or loss, and other changes are recognised in other comprehensive income.

Trade and other receivables

Receivables are measured at initial recognition at fair value and are subsequently measured at amortised cost using the effective interest method less impairment. Interest is recognised by applying the effective interest rate method, except for short-term receivables where the recognition of interest would be immaterial.

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and demand deposits and bank overdrafts that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value.

Impairment of financial assets

Financial assets are assessed for indicators of impairment at the end of each reporting period. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the financial asset have been impacted.

For available-for-sale equity instruments, a significant or prolonged decline in the fair value of the investment below its cost is considered to be objective evidence of impairment.

For all other financial assets, objective evidence of impairment could include:

• significantfinancialdifficultyoftheissuerorcounterparty;or

• defaultordelinquencyininterestorprincipalpayments;or

• itbecomingprobablethattheborrowerwillenterbankruptcyorfinancialre-organisation





Financial assets (cont’d)

Impairment of financial assets (cont’d)

For certain categories of financial assets, such as trade receivables, assets that are assessed not to be impaired individually are, in addition, assessed for impairment on a collective basis. Objective evidence of impairment for a portfolio of receivables could include the group’s past experience of collecting payments, an increase in the number of delayed payments in the portfolio past the credit period of 30 to 120 days, as well as observable changes in national or local economic conditions that correlate with default on receivables.

For financial assets carried at amortised cost, the amount of the impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate.

The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables where the carrying amount is reduced through the use of an allowance account. When a receivable is uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in profit or loss.

When an available-for-sale financial asset is considered to be impaired, cumulative gains or losses previously recognised in other comprehensive income are reclassified to profit or loss.

With the exception of available-for-sale equity instruments, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment loss was recognised, the previously recognised impairment loss is reversed through profit or loss to the extent that the carrying amount of the financial asset at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised.

In respect of available-for-sale equity instruments, impairment losses previously recognised in profit or loss

are not reversed through profit or loss. Any subsequent increase in fair value after an impairment loss, is recognised in other comprehensive income.

Derecognition of financial assets

The group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire, or it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the group recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the group retains substantially all the risks and rewards of ownership of a transferred financial asset, the group continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received.

Financial liabilities and equity instruments

Classification as debt or equity

Financial liabilities and equity instruments issued by the group are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability and an equity instrument.

Equity instruments

An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities. Equity instruments are recorded at the proceeds received, net of direct issue costs.





Financial liabilities and equity instruments (cont’d)

Other financial liabilities

Trade and other payables are initially measured at fair value, net of transaction costs, and are subsequently measured at amortised cost, using the effective interest rate method, with interest expense recognised on an effective yield basis, except for short-term payables where the recognition of interest would be immaterial.

Interest-bearing bank loans and overdrafts are initially measured at fair value, and are subsequently measured at amortised cost, using the effective interest rate method. Any difference between the proceeds (net of transaction costs) and the settlement or redemption of borrowings is recognised over the term of the borrowings in accordance with the group’s accounting policy for borrowing costs.

Financial guarantee contract liabilities are measured initially at their fair values and subsequently at the higher of the amount of obligation under the contract recognised as a provision in accordance with FRS 37 Provision, Contingent Liabilities and Contingent Assets and the amount initially recognised less cumulative amortisation in accordance with FRS 18 Revenue.

Finance lease obligations are recognised in accordance with the accounting policy denoted below.

Derecognition of financial liabilities

The group derecognises financial liabilities when, and only when, the group’s obligations are discharged, cancelled or they expire.

Derivative financial instruments and hedge accounting

The group’s activities expose it primarily to the financial risks of changes in foreign exchange rates.

Derivative financial instruments are initially measured at fair value at the date a derivative contract is entered into and are subsequently remeasured to fair value at each balance sheet date.

Changes in the fair value of derivative financial instruments are recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.

A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the instrument is more than 12 months and it is not expected to be realised or settled within 12 months. Other derivatives are presented as current assets or current liabilities.

INVENTORIES

Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. Net realisable value represents the estimated selling price less all estimated costs to completion and costs to be incurred in marketing, selling and distribution.

Cost of inventories is determined as follows:

Raw materials - first-in, first-out method Work-in-progress - standard cost which approximates actual average cost Finished goods - first-in, first-out method




CONTRACT WORK-IN-PROGRESS

Where the outcome of a contract work-in-progress can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the balance sheet date. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.

Where the outcome of a contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred that it is probable will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred.

When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately.

PROPERTY, PLANT AND EQUIPMENT / ASSETS ON LEASE

These assets are carried at cost, less accumulated depreciation and any accumulated impairment losses.

Depreciation is charged so as to write off the cost of assets, over their estimated useful lives, using the straight-line method and on the following bases:

Leasehold land and buildings - 1.69% to 3.85% (over the term of lease) Plant and equipment - 10% to 331/3% Motor vehicles - 10% to 20% Meters - 20%

The estimated useful lives, residual values and depreciation method are reviewed at each year end, with the effect of any changes in estimate accounted for on a prospective basis.

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

Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, if there is no certainty that the lessee will obtain ownership by the end of the lease term, the asset shall be fully depreciated over the shorter of the lease term and its useful life.

Assets held under operating lease relate to utility meters leased out to customers under operating lease agreements. These assets are being depreciated over their expected useful lives and the asset shall be fully depreciated over the shorter of the operating lease term and its estimated useful life not exceeding five years.

The gain or loss arising on disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amounts of the asset and is recognised in the profit and loss statement.




GOODWILL

Goodwill arising on the acquisition of a business, subsidiary or a jointly controlled entity represents the excess of the cost of acquisition over the group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the business, subsidiary or jointly controlled entity recognised at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less any accumulated impairment losses.

For the purpose of impairment testing, goodwill is allocated to each of the group’s cash-generating units expected to benefit from the synergies of the combination. Cash-generating units to which goodwill has been allocated are tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. An impairment loss recognised for goodwill is not reversed in a subsequent period.

On disposal of a business, subsidiary or a jointly controlled entity, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

INTANGIBLE ASSETS

Internally-generated intangible assets - research and development expenditure

Expenditure on research activities is recognised as an expense in the period in which it is incurred.

An internally-generated intangible asset arising from development of identifiable and unique software/products that are controlled by the group and have probable economic benefit exceeding the costs beyond one year is recognised if, and only if, all of the following have been demonstrated:

• thetechnicalfeasibilityofcompletingtheintangibleassetsothatitwillbeavailableforuseorsale;

• theintentiontocompletetheintangibleassetforuseorsale;

• theabilitytouseorselltheintangibleasset;

• howtheintangibleassetwillgenerateprobablefutureeconomicbenefits;

• theavailabilityofadequatetechnical,financialandotherresourcestocompletethedevelopmentandto use or sell the intangible asset; and

• the ability to measure reliably the expenditure attributable to the intangible asset during itsdevelopment.

The amount initially recognised for internally-generated intangible assets is the sum of the expenditure incurred from the date when the intangible asset first meets the recognition criteria listed above. Costs include the staff costs of the software/product development team and an appropriate portion of direct overheads. Costs that enhance or extend performance of computer software program/product beyond their original specifications are capitalised and added to the original cost of the software/product. Where no internally-generated intangible asset can be recognised, development expenditure is charged to profit or loss in the period in which it is incurred.

Subsequent to initial recognition, internally-generated intangible assets are reported at cost less accumulated amortisation and accumulated impairment losses.

Computer software/product development costs that are capitalised are amortised using the straight-line method over their estimated useful lives of 3 years.

The estimated useful lives and amortisation method are reviewed at the end of each annual reporting period with the effect of any changes in estimate accounted for on a prospective basis.




INTANGIBLE ASSETS (CONT’D)

Intangible assets acquired in a business combination

Intangible assets acquired in a business combination are identified and recognised separately from goodwill where they satisfy the definition of an intangible asset and their fair values can be measured reliably. The cost of such intangible assets is their fair value at the acquisition date.

Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost less accumulated amortisation and accumulated impairment losses, on the same basis as internally generated intangible assets.

Patents, trademarks and licenses are amortised on a straight-line basis over the period of expected benefits not exceeding 3 years. The estimated useful lives and amortisation method are reviewed on the same basis as internally generated assets.

IMPAIRMENT OF TANGIBLE AND INTANGIBLE ASSETS EXCLUDING GOODWILL

At the end of each reporting period, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Where a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified.

Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment annually, and whenever there is an indication that the asset may be impaired.

Recoverable amount is the higher of fair value less costs to sell 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 reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in the profit and loss statement.

Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in the profit and loss statement.

ASSOCIATES

An associate is an entity over which the group has significant influence and that is neither a subsidiary nor an interest in a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies.

The results and assets and liabilities of associates are incorporated in these financial statements using the equity method of accounting, except when the investment is classified as held for sale, in which case it is accounted for under FRS 105 Non-current Assets Held for Sale and Discontinued Operations. Under the equity method, investments in associates are carried in the consolidated statement of financial position at cost as adjusted for post-acquisition changes in the group’s share of the net assets of the associate, less any impairment in the value of individual investments. Losses of an associate in excess of the group’s interest in that associate (which includes any long-term interests that, in substance, form part of the group’s net investment in the associate) are not recognised, unless the group has incurred legal or constructive obligations or made payments on behalf of the associate.




ASSOCIATES (CONT’D)

Any excess of the cost of acquisition over the group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities of the associate recognised at the date of acquisition is recognised as goodwill. The goodwill is included within the carrying amount of the investment and is assessed for impairment as part of the investment. Any excess of the group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition, after reassessment, is recognised immediately in the consolidated profit and loss statement.

Where a group entity transacts with an associate of the group, unrealised profits and losses are eliminated to the extent of the group’s interest in the relevant associate.

INTERESTS IN JOINT VENTURES A joint venture is a contractual arrangement whereby the group and other parties undertake an economic

activity that is subject to joint control, that is when the strategic financial and operating policy decisions relating to the activities require the unanimous consent of the parties sharing control.

The results and assets and liabilities of joint ventures are incorporated in these financial statements using the equity method of accounting, except when the investment is classified as held for sale, in which case it is accounted for under FRS 105 Non-current Assets Held for Sale and Discontinued Operations. Under the equity method, investments in joint ventures are carried in the consolidated statement of financial position at cost as adjusted for post-acquisition changes in the group’s share of the net assets of the joint venture, less any impairment in the value of individual investments. Losses of a joint venture in excess of the group’s interest in that joint venture (which includes any long-term interests that, in substance, form part of the group’s net investment in the joint venture) are not recognised, unless the group has incurred legal or constructive obligations or made payments on behalf of the joint venture.

Any excess of the cost of acquisition over the group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities of the joint venture recognised at the date of acquisition is recognised as goodwill. The goodwill is included within the carrying amount of the investment and is assessed for impairment as part of the investment. Any excess of the group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition, after reassessment, is recognised immediately in the consolidated profit and loss statement.

Where a group entity transacts with its joint ventures, unrealised profits and losses are eliminated to the extent of the group’s interest in the joint venture.

PROVISIONS

Provisions are recognised when the group has a present obligation (legal or constructive) as a result of a past event, it is probable that the group will be required to settle that obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the balance sheet date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, the receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.

Warranties

Warranty cost is provided for the estimated liability to repair or replace products under warranty at the balance sheet date. This warranty cost is determined based on assessment of each batch of production and the directors’ best estimate of the expenditure required to settle the group’s obligation.

Provision for warranty cost is made where there are indicators of defects which may result in material repair or replacement costs.




SHARE-BASED PAYMENTS

The group issues equity-settled share-based payments to certain employees. Equity-settled share-based payments are measured at fair value of the equity instruments (excluding the effect of non market-based vesting conditions) at the date of grant. Details regarding the determination of the fair value of equity-settled share-based transactions are set out in Note 26. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the group’s estimate of the number of equity instruments that will eventually vest and adjusted for the effect of non market-based vesting conditions.

At the end of each reporting period, the group revises the estimate of the number of equity instruments expected to vest. The impact of the revision of the original estimates, if any, is recognised in profit or loss such that the cumulative expense reflects the revised estimate, with a corresponding adjustment to the equity-settled employee benefits reserve.

The policy described above is applied to all equity-settled share-based payments that were granted after November 22, 2002 and vested after January 1, 2005.

GOVERNMENT GRANTS

Government grants relating to expenditures which are not capitalised are credited to the profit and loss statement as and when the underlying expenses are included and taken to the profit and loss statement to match such related expenditure and at such time when the amount of grant can be reliably established and there is reasonable assurance that the group can comply with the conditions attaching to them and the grants will be received.

LEASES

Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.

The group as lessor

Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease unless another systematic basis is more representative of the time pattern in which use benefit derived from the leased asset is diminished. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.

The group as lessee

Assets held under finance leases are recognised as assets of the group at their fair value at the inception of the lease, or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation. Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged directly to profit or loss, unless they are directly attributable to qualifying assets, in which case they are capitalised in accordance with the group’s general policy on borrowing costs. Contingent rentals are recognised as expenses in the periods in which they are incurred.

Rentals payable under operating leases are charged to profit and loss on a straight-line basis over the term of the relevant lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred.

In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.




REVENUE RECOGNITION

Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for estimated custom returns, rebates and other similar allowances.

1) Revenue from the sale of goods is recognised when all the following conditions are satisfied:

• thegrouphastransferredtothebuyerthesignificantrisksandrewardsofownershipofthegoods;

• thegroupretainsneithercontinuingmanagerialinvolvementtothedegreeusuallyassociatedwith ownership nor effective control over the goods sold;

• theamountofrevenuecanbemeasuredreliably;

• itisprobablethattheeconomicbenefitsassociatedwiththetransactionwillflowtothegroup;and

• thecostsincurredortobeincurredinrespectofthetransactioncanbemeasuredreliably.

2) Revenue from contracts that are of short duration is recognised when the contracts are completed. Revenue from long-term contracts is recognised by reference to the stage of completion of the contract at the end of the reporting period. When losses are expected, after taking into consideration estimated cost to complete, such losses are recorded immediately.

3) Revenue from rendering of services that are of a short duration is recognised when the services are completed.

4) Income from providing financial guarantees is recognised in profit and loss over the guarantee period on a straight-line basis.

5) Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount.

6) Dividend income from investments is recognised when the shareholders’ rights to receive payment have been established.

BORROWING COSTS

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.

All other borrowing costs are recognised in the profit and loss statement in the period in which they are incurred.

RETIREMENT BENEFIT COSTS

Payments to defined contribution retirement benefit plans are charged as an expense as they fall due. Payments made to state-managed retirement benefit schemes, such as the Singapore Central Provident Fund, are dealt with as payments to defined contribution plans where the group’s obligations under the plans are equivalent to those arising in a defined contribution retirement benefit plan.




EMPLOYEE LEAVE ENTITLEMENT

Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for the estimated liability for annual leave as a result of services rendered by employees up to the end of the reporting period.

INCOME TAX

Income tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the profit and loss statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are not taxable or tax deductible. The group’s liability for current tax is calculated using tax rates (and tax laws) that have been enacted or substantively enacted in countries where the company and subsidiaries operate by the end of the reporting period.

Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates, and interests in joint ventures, except where the group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only recognised to the extent that it is probable that there will be sufficient taxable profits against which to utilise the benefits of the temporary differences and they are expected to reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at end of the reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset realised based on the tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the group intends to settle its current tax assets and liabilities on a net basis.

Current and deferred tax are recognised as an expense or income in profit or loss, except when they relate to items credited or debited outside profit or loss (either in other comprehensive income or directly in equity), in which case the tax is also recognised directly outside profit or loss (either in other comprehensive income or directly in equity, respectively), or where they arise from the initial accounting for a business combination. In the case of a business combination, the tax effect is taken into account in calculating goodwill or determining the excess of the acquirer’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities over cost.




FOREIGN CURRENCY TRANSACTIONS AND TRANSLATION

The individual financial statements of each group entity are measured and presented in the currency of the primary economic environment in which the entity operates (its functional currency). The consolidated financial statements of the group and the statement of financial position of the company are presented in Singapore dollars, which is the functional currency of the company and the presentation currency for the consolidated financial statements.

In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s functional currency are recorded at the rates of exchange prevailing on the date of the transaction. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at the end of the reporting period. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

Exchange differences arising on the settlement of monetary items, and on retranslation of monetary items are included in profit or loss for the period. Exchange differences arising on the retranslation of non-monetary items carried at fair value are included in profit or loss for the period except for differences arising on the retranslation of non-monetary items in respect of which gains and losses are recognised directly in equity. For such non-monetary items, any exchange component of that gain or loss is also recognised in other comprehensive income.

For the purpose of presenting consolidated financial statements, the assets and liabilities of the group’s foreign operations (including comparatives) are expressed in Singapore dollars using exchange rates prevailing at the end of the reporting period. Income and expense items (including comparatives) are translated at the average exchange rates for the period, unless exchange rates fluctuated significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognised in other comprehensive income and accumulated in a separate component of equity. On the disposal of a foreign operation, the cumulative amount of the exchange differences relating to that foreign operation accumulated in a separate component of equity, shall be reclassified from equity to profit or loss (as a reclassification adjustment) when the gain or loss on disposal is recognised.

Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the closing rate.

3 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

In the application of the group’s accounting policies, which are described in Note 2, management is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

(a) Critical judgements in applying the group’s accounting policies

Management did not make any material judgements that have significant effect on the amounts recognised in the financial statements, except for those affecting accounting estimation as disclosed in Note 3(b).



3 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY (CONT’D)

(b) Key sources of estimation uncertainty

The key assumptions concerning the future, and other key sources of estimation uncertainty at the balance sheet date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussed below:

(i) Allowances for doubtful receivables (Note 7 and Note 8)

An allowance is made for estimated irrecoverable amounts of receivables. Management analyses age of accounts receivables, historical payment trends, customer credit worthiness and results of recovery efforts when making a judgement over the adequacy of the allowances for receivables.

At December 31, 2009, trade and other receivables were stated net of allowances of $3,112,000 (2008 : $2,696,000) and $238,000 (2008 : $412,000) respectively.

(ii) Allowance for inventory obsolescence (Note 9)

The policy for allowance for inventories of the group is based on the aging analysis of inventories, historical sales and utilisation and on management’s judgement regarding sale prospects. Management estimated an allowance for inventory obsolescence of $3,300,000 at December 31, 2009 (2008 : $814,000).

At December 31, 2009, the inventories of EDMI Limited (a subsidiary) include certain meters of $1,111,000 (2008 : $1,734,000) which were returned by a customer in Australia in 2005 and 2006. Management has assessed the recoverable amounts of these meters based on the current market demand and has made an allowance for inventory obsolescence of $588,000 (2008 : $Nil).

(iii) Recoverability of contract work-in-progress (Note 10)

In estimating foreseeable losses on contract work-in-progress, management evaluates the status of each project and estimates the cost required to complete the work and recoverable amounts.

(iv) Property, plant and equipment (Note 11)

Property, plant and equipment are depreciated on a straight-line basis over their estimated useful lives as disclosed in Note 2. Changes in the expected useful lives, including terms of leases, could impact future depreciation charges.

(v) Recoverable of investments in subsidiaries (Note 13)

Where there are indicators of potential impairment of investment in subsidiaries, management projects the cash flows of these subsidiaries and estimates the recoverable amount by discounting the projected cash flows and terminal value to present value. Any change in such projections and estimates can result in changes to the allowances for impairment loss in future periods.

At December 31, 2009, the impairment loss allowance for subsidiaries made by the company was $1,000,000 (2008 : $2,506,000).

(vi) Recoverability of goodwill (Note 17) Determining whether goodwill on acquisition of business is impaired requires an estimation

of the value in use of the cash-generating units to which goodwill has been allocated. The value in use calculation requires the entity to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. The carrying amount of goodwill at the end of the financial year was $4,861,000 (2008 : $217,000). Management considers the goodwill to be recoverable from future cash flows and has concluded that there is no impairment loss in 2008 and 2009. Information relating to the discount rates are found in Note 17.



4 FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT

(a) Categories of financial instruments

The following table sets out the financial instruments as at the balance sheet date.

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Financial assets Loan and receivables (including cash and cash equivalents) 138,309 106,542 26,426 16,838 Available-for-sale financial assets 587 845 57 32

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Financial liabilities Derivative financial instruments in designated hedge accounting relationship 60 - - - Amortised cost 64,241 49,324 3,692 1,774 Financial guarantee contracts - - 413 460

(b) Financial risk management strategies and objectives

The Board of Directors reviews the overall financial risk management on specific areas, such as market risk (including foreign exchange risk, interest rate risk, equity price risk), credit risk, liquidity risk, use of derivative financial instruments and investing excess cash. The group’s overall financial risk management strategy is to minimise potential adverse effects of these on the financial performance of the group. These are reviewed quarterly by the Board of Directors. Risk management is monitored by the Corporate Office.

The group may use derivative financial instruments to manage its exposure to foreign currency risk, including forward exchange contracts to hedge the exchange rate risks arising from trade receivables and trade payables, and firm commitments to buy or sell goods.

The group does not hold or issue derivative financial instruments for speculative purposes.

There has been no change to the group’s exposure to these financial risks or the manner in which it manages and measures the risk. Market risk exposures are measured using sensitivity analysis indicated below.

i) Credit risk management

Credit risk refers to the risk that a customer may default on its payment resulting in financial loss to the group. The group has adopted a policy of gradually extending credit to customers who are creditworthy and obtaining sufficient collateral where appropriate, as a means of mitigating the risk of financial loss from non-payment. Trade receivables consist of a large number of customers, spread across diverse industries and geographical areas. Ongoing credit evaluation is performed and where appropriate, credit guarantee insurance cover is purchased. Credit exposure is controlled by using customer credit limits that are reviewed and approved by the management regularly.

The carrying amount of financial assets recorded in the financial statements, grossed up for allowances for losses, represents the group’s maximum exposure to credit risk without taking into account the value of any collateral obtained.

Further details relating to trade and other receivables are disclosed in Note 7 and 8.



4 FINANCIAL RISKS AND CAPITAL RISKS MANAGEMENT (CONT’D)

(b) Financial risk management strategies and objectives (cont’d)

ii) Interest rate risk management

The group is exposed to interest rate risk through the impact of interest rate changes on interest-bearing debts and interest-earning fixed deposits.

The interest rates and terms of repayment for bank loans and finance leases of the group are disclosed in Notes 20 and 24 to the financial statements respectively.

The interest rates and repricing period for fixed deposits are disclosed in Note 6.

Quantitative data of the group’s interest-bearing financial instruments are provided in section (iv) of this note.

Interest rate sensitivity

The sensitivity analysis below has been determined based on the exposure to interest rates for non-derivative instruments at the balance sheet date and the stipulated change taking place at the beginning of the financial year and held constant throughout the reporting period in the case of instruments that have floating rates. A 100 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the reasonably possible change in interest rates that impacts borrowings.

If interest rates had been 100 basis points higher or lower for borrowings and all other variables were held constant, the group’s profit for the year ended December 31, 2009 would decrease/increase by $115,000 (2008 : decrease/increase by $91,000).

No sensitivity analysis is prepared for fixed deposits as any reasonably possible change in interest rate on fixed deposits would have insignificant impact to the group’s profit.

iii) Foreign exchange risk management

The group transacts business in various currencies and therefore is exposed to foreign exchange risk. The significant carrying amounts of monetary assets (including intra-group receivables) and monetary liabilities (including intra-group payables) denominated in currencies other than the respective group entities’ functional currencies at the end of the reporting period are as follows:

Group Company Liabilities Assets Liabilities Assets 2009 2008 2009 2008 2009 2008 2009 2008 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Singapore dollar 8,759 12,376 5,617 7,168 - - - - United States dollar 12,381 11,739 24,547 19,905 - - - - Australian dollar 359 215 8,228 5,555 - - - - New Zealand dollar 283 124 5,840 1,221 - - - -

Companies in the group may use forward contracts to hedge their exposure to foreign currency risk.

Foreign currency sensitivity

The following table details the sensitivity to a 10% increase and decrease in the major relevant foreign currencies against the functional currency of each group entity. 10% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 10% change in foreign currency rates. The sensitivity analysis includes external loans as well as loans to foreign operations within the group where the denomination of the loan is in a currency other than the currency of the lender or the borrower.





iii) Foreign exchange risk management (cont’d)

Foreign currency sensitivity (cont’d)

If the major relevant foreign currencies strengthen by 10% against the functional currency of each group entity, profit for the year will (decrease) increase by:

Singapore United States Australian New Zealand Dollar Impact Dollar Impact Dollar Impact Dollar Impact 2009 2008 2009 2008 2009 2008 2009 2008 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Group

Profit for the year (314) (521) 1,217 817 785 534 556 122

If the major relevant foreign currencies weakens by 10% against the functional currency of each group entity, profit for the year will increase (decrease) by:

Singapore United States Australian New Zealand Dollar Impact Dollar Impact Dollar Impact Dollar Impact 2009 2008 2009 2008 2009 2008 2009 2008 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Group

Profit for the year 314 521 (1,217) (817) (785) (534) (556) (122)

If the relevant foreign currency strengthens by 10% against the functional currency of each group entity, revaluation reserve in equity will increase by:

British pound impact 2009 2008 $’000 $’000

Group

Revaluation reserve 53 81

If the relevant foreign currency weakens by 10% against the functional currency of each group entity, there will be an equal and opposite effect on revaluation reserve in equity.

The group also has a number of investments in foreign subsidiaries, whose net assets are exposed to currency translation risk. The group does not hedge its investments that are denominated in foreign currencies.

iv) Liquidity risk management

The group has sufficient funds and credit lines to finance its working capital requirements.

Liquidity and interest rate risk analysis

Non-derivative financial liabilities

The following tables detail the remaining contractual maturity for non-derivative financial liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the group and company can be required to pay. The table includes both interest and principal cash flows. The adjustment column represents the possible future cash flows attributable to the instrument included in the maturity analysis which is not included in the carrying amount of the financial liability on the statement of financial position.





iv) Liquidity risk management (cont’d)

Liquidity and interest rate risk analysis (cont’d)

Non-derivative financial liabilities (cont’d)

Weighted average On effective demand Within interest rate or within 2 to After per annum 1 year 5 years 5 years Adjustment Total % $’000 $’000 $’000 $’000 $’000 Group

2009 Non-interest bearing - 48,006 3,403 - - 51,409 Finance lease liability (fixed rate) 6.0 576 924 32 (163) 1,369 Variable interest rate instruments 3.2 7,143 3,912 770 (362) 11,463

55,725 8,239 802 (525) 64,241

2008 Non-interest bearing - 38,597 310 - - 38,907 Finance lease liability (fixed rate) 6.0 524 940 - (173) 1,291 Variable interest rate instruments 4.7 7,927 1,103 1,341 (1,245) 9,126

47,048 2,353 1,341 (1,418) 49,324

Company

2009 Non-interest bearing - 2,567 937 - - 3,504 Finance lease liability (fixed rate) 5.6 108 108 - (28) 188

2,675 1,045 - (28) 3,692

2008 Non-interest bearing - 1,436 55 - - 1,491 Finance lease liability (fixed rate) 5.6 108 216 - (41) 283

1,544 271 - (41) 1,774

In addition to the above, the company has provided corporate guarantees to banks for credit facilities given by these banks to subsidiaries. At December 31, 2009, the subsidiaries have borrowings from these banks totalling $6,342,000 (2008 : $9,126,000). The earliest period that the guarantees can be called upon is one year. Management considers that it is more likely than not that no amount will be payable by the company under these financial guarantee contracts.





iv) Liquidity risk management (cont’d)

Liquidity and interest rate risk analysis (cont’d)

Non-derivative financial assets

The following table details the expected maturity for non-derivative financial assets. The inclusion of information on non-derivative financial assets is necessary in order to understand the group’s liquidity risk management as the group’s liquidity risk is managed on a net asset and liability basis.

The tables below have been drawn up based on the undiscounted contractual maturities of the financial assets including interest that will be earned on those assets except where the group and the company anticipates that the cash flow will occur in a different period.

Weighted average On effective demand Within interest rate or within 2 to per annum 1 year 5 years Total % $’000 $’000 $’000 Group

2009 Non-interest bearing - 126,148 912 127,060 Fixed interest rate instruments 0.8 11,836 - 11,836

137,984 912 138,896

2008 Non-interest bearing - 101,191 1,344 102,535 Fixed interest rate instruments 2.4 4,852 - 4,852

106,043 1,344 107,387

Company

2009 Non-interest bearing - 22,921 57 22,978 Fixed interest rate instrument 0.1 3,505 - 3,505

26,426 57 26,483

2008 Non-interest bearing - 15,835 32 15,867 Fixed interest rate instrument 1.2 1,003 - 1,003

16,838 32 16,870

v) Equity price risk management

The group and company is exposed to equity risks arising from equity investments classified as available-for-sale. The group does not actively trade available-for-sale investments.

Further details of these equity investments can be found in Note 16 to the financial statements.





v) Equity price risk management (cont’d)

Equity price sensitivity

The sensitivity analysis below have been determined based on the exposure to equity price risks at the reporting date.

In respect of available-for-sale equity investments, if the closing market prices on the last market day of the financial year had been 10% higher/lower while all other variables were held constant:

• thegroup’s net profit for the year endedDecember31, 2009and2008would havebeen unaffected as the equity investments are classified as available-for-sale; and

• the group’s asset revaluation reserveswould increase/decrease by $59,000 (2008 :increase/decrease by $85,000).

The group’s sensitivity to equity prices has not changed significantly from the prior year.

vi) Fair value of financial assets and financial liabilities

The carrying amounts of cash and cash equivalents, trade and other current receivables and payables approximate their respective fair values due to the relatively short-term maturity of these financial instruments. The fair value of other classes of financial assets and liabilities are disclosed in the respective notes to financial statements.

The fair values of financial assets and financial liabilities are determined as follows:

a) the fair value of financial assets and financial liabilities with standard terms and conditions and traded on active liquid markets are determined with reference to quoted market prices;

b) the fair value of other financial assets and financial liabilities (excluding derivative instruments) are determined in accordance with generally accepted pricing models based on discounted cash flow analysis using prices from observable current market transactions and dealer quotes for similar instruments; and

c) the fair value of derivative instruments are calculated using quoted prices. Where such prices are not available, discounted cash flow analysis is used, based on the applicable yield curve of the duration of the instruments for non-optional derivatives, and option pricing models for optional derivatives.

Management considers that the carrying amounts of all financial assets and financial liabilities recorded at amortised cost in the financial statements approximate their fair values.

The group classifies fair value measurements using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The fair value hierarchy has the following levels:

a) quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);

b) inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices) (Level 2); and

c) inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).





vi) Fair value of financial assets and financial liabilities (cont’d)

Financial instruments measured at fair value

Total Level 1 Level 2 Level 3 $’000 $’000 $’000 $’000 Financial Assets Group

2009 Available-for-sale investments: - Quoted equities 587 587 - -


Company



The group and the company had no financial liabilities carried at fair value in 2009 and 2008.

(c) Capital risk management policies and objectives

The group manages its capital to ensure that entities in the group will be able to continue as a going concern while maximising the return to stakeholders through the optimisation of the debt and equity balance.

The capital structure of the group comprises share capital, reserves, retained earnings and debt, which includes the borrowings disclosed in Notes 20 and 24.

The group reviews its capital structure and periodically ensures compliance with the loan covenant imposed by the bank. It balances its overall capital structure through the payment of dividends and new share issues as well as the issue of new debt or the redemption of existing debt.

The group’s overall strategy remains unchanged from 2008.

The company is in compliance with externally imposed capital requirements for the financial years ended December 31, 2009 and 2008.



5 RELATED PARTY TRANSACTIONS

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

Some of the group’s transactions and arrangements are with related parties and the effect of these on the basis determined between the parties is reflected in these financial statements. The balances are unsecured, interest-free and repayable on demand unless otherwise stated.

Group 2009 2008 $’000 $’000

Sale of goods to associate (1,223) (2,561) Sales of goods to joint venture (80) (336) Sales of goods to related party - (75) Purchase of goods from associate - 1,133 Purchase of goods from related party - 27 Other income from related party - (242) Other expense to related party - 245

At December 31, 2008, certain bank overdraft and trust receipts (Note 20) were secured by a personal guarantee of a director for $1,500,000 (2009 : Nil).

Compensation of directors and key management personnel

The remuneration of directors and other members of key management during the year were as follows:

Group 2009 2008 $’000 $’000

Short-term benefits 7,019 6,116 Post-employment benefits 239 218 Long-term employment benefits 3,403 310 Share-based payments 63 87

10,724 6,731

The remuneration of directors and key management of the group is determined by the remuneration committee having regard to the performance of individuals and market trends.

Long-term employment benefits represent key management personnel’s remuneration under a Performance Bonus Scheme (Note 22).



6 CASH AND BANK BALANCES

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Cash at bank 47,652 39,512 6,292 995 Fixed deposits 11,372 3,571 3,505 1,003 Deposits under pledge 521 1,339 - - Total 59,545 44,422 9,797 1,998

Cash and bank balances comprise cash held by the group and company and short-term bank deposits with an original maturity of twelve months or less. The carrying amounts of these assets approximate their fair values.

The weighted average interest rate for fixed deposits is approximately 0.8% (2008 : 2.4%) per annum and for a tenure of approximately 7 to 360 days (2008 : 7 to 360 days). The fixed deposits can be withdrawn without having to incur significant costs.

Deposits amounting to $521,000 (2008 : $1,339,000) of the group are pledged to banks as security for credit facilities, including those disclosed in Note 35.

The group’s and company’s cash and bank balances that are not denominated in the functional currencies of the respective entities are as follows:

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Singapore dollar 1,562 72 - - United States dollar 8,219 6,290 - - Euro 310 207 - - Australian dollar 910 2,060 - - Vietnamese dong 116 116 - - New Zealand dollar 3,238 - - - British pound 146 95 - -

7 TRADE RECEIVABLES

Group 2009 2008 $’000 $’000

Outside parties 75,505 59,266 Less: Allowance for doubtful trade receivables (3,112) (2,696) 72,393 56,570 Associates (Note 14) 3,299 2,114 Joint venture (Note 15) - 246 Related party (Note 5) 120 80 75,812 59,010

The credit period on sale of goods is generally 30 to 120 days (2008 : 30 to 120 days). No interest is charged on overdue trade receivables.

Allowance for doubtful trade receivables is made taking into account the factors set out in Note 3(b)(i). In determining the recoverability of a trade receivable, management also considers any change in the credit quality of the trade receivable from the date credit was initially granted up to the reporting date.

Before accepting any new customer, the management assesses the potential customer’s credit quality and determines the credit terms for each customer. Limits attributed to customers are reviewed periodically. At December 31, 2009, a customer accounts for $15,840,000 or 20.9% of total outstanding trade receivables. No other individual customer accounts for 10% or more of the total outstanding receivables at December 31, 2009. At December 31, 2008, there was no individual customer accounting for 10% or more of the total outstanding balance.



7 TRADE RECEIVABLES (CONT’D)

The table below is an analysis of trade receivables as at December 31:

Group 2009 2008 $’000 $’000

Not past due and not impaired 54,585 38,208 Past due but not impaired (i) 21,080 20,496

75,665 58,704

Impaired receivables - individually assessed (ii), (iii) - customer placed under liquidation/judicial management 690 689 - past due and no response to repayment demands 2,192 1,524 - others 377 789 Less: Allowance for doubtful trade receivables (3,112) (2,696)

147 306

Total trade receivables, net 75,812 59,010

(i) Aging of receivables that are past due but not impaired (iv): < 6 months 13,553 12,516 6 months to 9 months 1,707 2,320 9 months to 12 months 1,039 2,655 >12 months 4,781 3,005

21,080 20,496

(ii) These amounts are stated before any deduction for impairment losses.

(iii) These receivables are not secured by any collateral or credit enhancements.

(iv) These receivables are from customers with no past credit default and for which there is no clear indication of deterioration on credit quality.

Movement in the allowance for doubtful trade receivables:

Group 2009 2008 $’000 $’000

Balance at beginning of the year 2,696 3,386 Exchange differences 33 (80) Amounts written off during the year (10) (759) Increase in allowance recognised in profit or loss 476 149 Disposal of a subsidiary (83) -

Balance at end of the year 3,112 2,696

At December 31, 2009, retention sums held by customers amounting to $10,785,000 (2008 : $2,327,000) are classified as current because they are expected to be realised in the normal operating cycle.



7 TRADE RECEIVABLES (CONT’D)

The group’s trade receivables that are not denominated in the functional currencies of the respective entities are as follows:

Group 2009 2008 $’000 $’000

United States dollar 11,585 9,820 British pound 500 1,053 Euro 1,648 658 Thai baht 2,555 1,492 New Zealand dollar 2,378 1,221 Chinese renminbi 9 220 Malaysian ringgit 1 505 Others 70 55

8 OTHER RECEIVABLES AND PREPAYMENTS

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Staff loans 503 453 135 141 Deposits 894 772 - - Prepayments 639 752 - - Income tax recoverable 200 9 - - Other receivables 1,164 1,407 109 25

3,400 3,393 244 166 Less: Allowance for doubtful non-trade receivables (238) (388) - -

3,162 3,005 244 166 Subsidiaries (Note 13) - - 16,385 14,720 Associates (Note 14) 429 172 - - Joint ventures (Note 15) - 48 - - Related parties (Note 5) - 162 - - Less: Allowance for doubtful non-trade receivables - (24) - (46)

3,591 3,363 16,629 14,840

Amounts due from subsidiaries, associates, joint ventures and related parties are unsecured, interest-free and repayable on demand.

Movement in the allowance for doubtful non-trade receivables:

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Balance at beginning of the year 412 273 46 46 Exchange differences (1) (2) - - Increase in allowance recognised in profit or loss - 141 - - Amount written off (41) - (46) - Disposal of a subsidiary (132) - - -

238 412 - 46



8 OTHER RECEIVABLES AND PREPAYMENTS (CONT’D)

The group’s and company’s other receivables that are not denominated in the functional currencies of the respective entities are as follows:

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000 United States dollar 76 666 - - Australian dollar 189 69 - - British pound 22 20 - - Thai baht 257 - - - Vietnamese dong 188 - - - Others - - 14 7

9 INVENTORIES

Group 2009 2008 $’000 $’000

Raw materials 25,526 22,088 Work-in-progress 5,773 6,553 Finished goods 15,408 16,065

46,707 44,706

The group recognised $2,486,000 as part of allowance for inventory in profit or loss for the financial year ended December 31, 2009.

In 2008, due to the increase in demand and usage of certain goods in the financial year, the group reversed $66,000, being part of allowance for inventory in 2007, to the prior year profit or loss.

10 CONTRACT WORK-IN-PROGRESS

Group 2009 2008 $’000 $’000

Contract costs incurred plus recognised profits 49,789 17,178 Less: Progress billings (45,206) (14,044) Provision for foreseeable losses (1,827) (1,316)

Included in current assets 2,756 1,818

Progress billings 26,818 16,985 Provision for foreseeable losses 98 20 Less: Contract costs incurred plus recognised profits (24,699) (16,373)

Included in current liabilities 2,217 632



11 PROPERTY, PLANT AND EQUIPMENT

Leasehold land Plant and Motor and buildings equipment vehicles Total $’000 $’000 $’000 $’000 Group

Cost: At January 1, 2008 29,841 23,632 2,520 55,993 Exchange differences (178) (733) (74) (985) Additions 2,600 4,575 100 7,275 Disposals (556) (3,030) (222) (3,808)

At December 31, 2008 31,707 24,444 2,324 58,475 Exchange differences (45) 634 72 661 Additions 21 2,700 418 3,139 Disposals - (1,406) (402) (1,808) Acquired on acquisition of a subsidiary (Note 40) - 795 37 832 Disposal of a subsidiary - (38) (151) (189)

At December 31, 2009 31,683 27,129 2,298 61,110

Accumulated depreciation: At January 1, 2008 6,026 15,688 1,308 23,022 Exchange differences (40) (374) (50) (464) Depreciation 680 2,106 268 3,054 Eliminated on disposals (55) (2,732) (218) (3,005)

At December 31, 2008 6,611 14,688 1,308 22,607 Exchange differences (11) 248 39 276 Depreciation 682 2,267 271 3,220 Eliminated on disposals - (1,031) (390) (1,421) Disposal of a subsidiary - (33) (107) (140)

At December 31, 2009 7,282 16,139 1,121 24,542

Carrying amount: At December 31, 2009 24,401 10,990 1,177 36,568

At December 31, 2008 25,096 9,756 1,016 35,868

Plant and Motor equipment vehicles Total $’000 $’000 $’000 Company

Cost: At January 1, 2008 309 798 1,107 Additions 12 - 12

At December 31, 2008 321 798 1,119 Additions 12 - 12 Disposals (15) - (15)

At December 31, 2009 318 798 1,116



11 PROPERTY, PLANT AND EQUIPMENT (CONT’D)

Plant and Motor equipment vehicles Total $’000 $’000 $’000 Company

Accumulated depreciation: At January 1, 2008 281 80 361 Depreciation 27 79 106

At December 31, 2008 308 159 467 Depreciation 4 80 84 Eliminated on disposals (15) - (15)

At December 31, 2009 297 239 536

Carrying amount: At December 31, 2009 21 559 580

At December 31, 2008 13 639 652

The group and company have motor vehicles and equipment with carrying amounts of $2,216,000 (2008 : $2,263,000) and $559,000 (2008 : $639,000) respectively which are under finance leases.

The group has pledged certain land and buildings which have aggregate carrying amount of $7,575,000 (2008 : $7,737,000) to obtain bank loans and credit facilities.

Particulars of major properties are as follows:

Location Description Tenure

9 Senoko Drive Part single-storey and 60-year lease from November Singapore 758197 part 2-storey factory and office 1992

15 Senoko Way Part single-storey and 30-year lease from February Singapore 758036 part 2-storey factory and office 1991

15 Senoko Avenue Part single-storey and 25-year lease from March 1998 Singapore 758305 part 3-storey factory and office

17 Senoko Avenue Part single-storey and 30-year lease from September Singapore 758307 part 2-storey factory and office 1990, with an option to extend another 30 years subject to certain conditions

PLO 131, 133, 134, 2-storey factory 60-year lease from December Jalan Cyber 5 1996 Kawasan Perindustrian Senai 3, 81400 Senai Johor, Malaysia

47 Yishun Industrial 4-storey factory and office 30-year lease from January Park A 1992 Singapore 768724

18 Kaki Bukit Road 3 3 office units 60-year lease from January #04-01/02/03 1995 Entrepreneur Business Centre Singapore 415978



12 ASSETS ON LEASE

This pertains to meters under operating lease arrangement.

Meters

$’000

Cost: At January 1, 2008 and December 31, 2008 - Transfer from inventory 254 At December 31, 2009 254

Accumulated depreciation: At January 1, 2008 and December 31, 2008 - Depreciation 44 At December 31, 2009 44

Carrying amount: At December 31, 2009 210

At December 31, 2008 -

13 SUBSIDIARIES

Company 2009 2008 $’000 $’000

Unquoted equity shares, at cost 55,944 57,450 Impairment loss (1,000) (2,506) 54,944 54,944 Recognition of share-based payment 42 42 Advances to subsidiaries 5,670 5,452 Interest imputation on advances to subsidiaries 2,238 2,238 Deemed investment arising from corporate guarantees provided to financial institutions who have granted credit facilities to subsidiaries 3,246 3,345 66,140 66,021

Advances to subsidiaries are unsecured and interest-free. Advances to subsidiaries are measured at amortised cost using the effective interest method. The advances to subsidiaries are expected to be repaid over 10 years from January 1, 2005.

Company 2009 2008 $’000 $’000

Nominal value of advances to subsidiaries 6,898 10,839 Amount recognised as additional investment in subsidiaries (2,238) (3,184) Fair value at inception date of advances 4,660 7,655 Deemed interest income recognised 1,010 911 Amortised cost balance at end of year 5,670 8,566 Less: Allowance for advances - (3,114) Carrying amount at end of year 5,670 5,452

The interest income imputed is calculated by applying an effective interest rate of 4% (2008 : 4%) per annum. The advances to subsidiaries are denominated in Singapore dollar, which is the functional currency of the company.



13 SUBSIDIARIES (CONT’D)

Deemed investment of $42,000 (2008 : $42,000) in subsidiaries relate to share option granted under the SMB Share Option Scheme 2001 by the company to an employee of a subsidiary.

The deemed investment in subsidiaries arising from financial guarantees provided by the company is as follows:

Company 2009 2008 $’000 $’000

At beginning of year 3,345 2,658 Additions during the year 832 687 Repayment of term loan during the year (931) -

At end of year 3,246 3,345

All the additional deemed investment in subsidiaries of $832,000 (2008 : $687,000) was recognised as financial guarantee income in the company’s profit and loss statement.

Details of the company’s significant subsidiaries at December 31, 2009 are as follows:

Effective proportion Country of of ownership incorporation interests and

Name of subsidiary and operation voting power held Principal activities 2009 2008 % %

Bridex Singapore Singapore 100 100 Import, export and Pte Ltd (1) supply of transformers and electrical products and investment holding.

Bridex Harwal Pte Ltd (1) Singapore 100 100 Manufacture and supply of electrical switchgear.

Quantum Automation Singapore 52 52 Design, installation and Pte Ltd (1) maintenance of computerised automation and control systems.

SMB Electric Pte Ltd (1) Singapore 100 100 Manufacture and supply of electrical switchgear.

SMB Electric Industries Singapore 100 100 Manufacture and supply Pte Ltd (1) of electrical switchgear.

SMB Electric Systems Singapore 100 100 Manufacture and supply Pte Ltd (1) of electrical switchgear.

SMB Harwal Electric Australia 100 100 Manufacture and supply Pty Limited (3) of electrical switchgear.

SMB United Industries Malaysia 100 100 Investment holding. Sdn Bhd (2)

MW Dynamics Pte Ltd (1)(10) Singapore - 50 Plumbing and electrical contracting and trading and installation of sanitary and bathroom accessories.






Subsidiaries of Bridex Singapore Pte Ltd

Bridex Australia Pty Australia 100 100 Distribution of electrical Limited (7) and electronic products.

Bridex Electric Philippines 100 100 Distribution of electrical Philippines, Inc. (4) and electronic products.

EDMI Limited (1) Singapore 59 56 Manufacture and distribution of electronic revenue meters.

Subsidiaries of SMB United Industries Sdn Bhd

Brighten Switchboard Malaysia 100 100 Manufacture, dealing, Builders (M) Sdn Bhd (2) installation and repair of electrical switchboards and appliances.

SMB Switchgear & Malaysia 100 100 Manufacture and sale of Engineering Sdn Bhd (2) metal in-housing for electrical switchboards.

Subsidiary of Brighten Switchboard Builders (M) Sdn Bhd

SMB Brighten Malaysia 100 100 Dealing, installation and Switchboard repair of electrical Engineering Sdn Bhd (2) switchboards and appliances.

Subsidiaries of EDMI Limited

EDMI International People’s 59 56 Provision of services and Trading (Shanghai) Republic of trading of electronic Co., Ltd (5) China equipment.

EDMI Meters Sdn Bhd (6) Malaysia 59 56 Provision of services and after sales support for electronic revenue meters and supply of electronic components.

EDMI Pty Ltd (7) Australia 59 56 Design and distribution of electronic revenue meters.






EDMI Philippines Inc (4) Philippines 59 56 Sale of electronics revenue meters, supply of electronic components and provision of service and after sale support.

EDMI Gas Pty Ltd Australia 59 - Sale and manufacture (Formerly known as Atlas of mechanical gas Measurement Pty Ltd) (7) (11) measuring components.

Subsidiaries of Quantum Automation Pte Ltd

eSwitch Engineering Singapore 31 31 Trading, general importers Pte Ltd (1) and exporters, engineering and electrical works.

Quantum Automation Singapore 52 52 General trading, sales and (Asia) Pte Ltd (1) distribution of automation products.

Quantum Automation People’s 52 52 Design, installation and Systems (Shanghai) Republic maintenance of Co., Ltd (8) of China computerised automation and control systems.

QA Systems Integration Malaysia 52 52 Supply, contract, design (M) Sdn Bhd (2) and install, commission and maintenance of advanced computerised automation and control systems for building, industrial and commercial application, and dealing in engineering products.

Subsidiary of SMB Electric Pte Ltd

SMB Electric (Xiamen) People’s 100 100 Manufacture and supply Co., Ltd (9) Republic of electrical switchgears of China and components.




(1) Audited by Deloitte & Touche LLP, Singapore. (2) Audited by overseas practices of Deloitte Touche Tohmatsu.

(3) Audited by RSM Bird Cameron, Australia.

(4) Audited by Ramon F. Garcia & Company, CPA, Philippines.

(5) Audited by Shanghai Zhong Hui Certified Public Accountants, People’s Republic of China.

(6) Audited by Crowe Horwath, Kuala Lumpur. (7) Audited by WHK Horwath, Australia.

(8) Audited by Shanghai Zhonghua Huyin Certified Public Accountants, People’s Republic of China. (9) Audited by Xiamen Hong Zheng Certified Public Accountants, People’s Republic of China. (10) In 2008, this was deemed to be a subsidiary of the company as the company exercises control over

the entity. In 2009, this subsidiary was disposed to a non-related party (Note 39). (11) The entity was acquired on April 1, 2009 (Note 40).

14 ASSOCIATES

Group 2009 2008 $’000 $’000

Cost of investment in associates 1,213 1,108 Share of post-acquisition reserve (298) 39 Adjustments on unrealised gain on transactions with a related party (95) (134)

Carrying amount 820 1,013

Details of the group’s associates at December 31, 2009 are as follows:

Country of Proportion of incorporation ownership interests Name of associate and operation and voting power held Principal activities 2009 2008 % % Associate of SMB Electric Xiamen Co., Ltd

Yang Zhou Long Tai People’s 30 40 Manufacturing and supply (Formerly known as Republic of electrical switchgear and Baoying Yanlord SMB of China components. Electric Co., Ltd) (3)

Associate of EDMI Limited

Power House Technology Thailand 29 28 Manufacturing and sale of Company Limited (1) (2) electronic revenue meters.

(1) Audited by V.R. Accounting Solution Co., Ltd., Thailand.

(2) The associate is 49% held by a subsidiary, EDMI Limited. EDMI Limited is 59% (2008 : 56%) held by the company, resulting in an effective interest of approximately 29% (2008 : 28%) held by the group.

(3) Audited by Bao Ying Ren Yang, Certified Public Accountants, People’s Republic of China.



14 ASSOCIATES (CONT’D)

Summarised financial information in respect of the group’s associates is set out below:

Group 2009 2008 $’000 $’000

Total assets 10,196 6,467 Total liabilities (7,268) (3,719)

2,928 2,748

Group’s share of associates’ net assets 915 1,147 Adjustment on unrealised gain on transactions with a related party (95) (134)

Net group’s share of associates’ net assets 820 1,013

Revenue 8,757 7,718

Losses for the year (862) (525)

Group’s share of associates’ losses for the year (361) (222)

15 JOINT VENTURES Group 2009 2008 $’000 $’000 Capital contribution to joint venture (a) 657 608 Share of post acquisition reserve (b) (471) (328)

186 280 Additional fund provided to joint venture 325 -

511 280 The additional fund provided to the joint venture is interest-free. It has been provided to the joint venture as

additional capital for its operating needs. (a) The capital contribution comprises contribution to Wallaby Metering Systems Private Limited of

$657,000 (2008 : $607,000). (b) In 2008, the unrecognised share of loss for the joint ventures was approximately $3,000 as the group

considers the amount to be immaterial.




15 JOINT VENTURES (CONT’D)

Details of the joint ventures of the group at December 31, 2009 are as follows:

Country of Proportion of incorporation ownership interests Name of joint venture and operation and voting power held Principal activities 2009 2008 % % Joint ventures of EDMI Limited

Wallaby Metering Systems India 30 28 Design, manufacture and Private Limited (1) marketing of electronic energy meters and systems for automatic energy reading management.

Advanced Meter Software Singapore - 28 Dormant since 2006. Pte Ltd Striked off and ceased to exist in 2009.

(1) The entity is incorporated on July 20, 2007 and is insignificant to the results of the group as at year end.

Summarised financial information in respect of the group’s joint ventures is set out below:

Group 2009 2008 $’000 $’000

Total assets 750 706 Total liabilities (378) (199)

372 507

Revenue 97 37

Loss for the year (312) (540)


16 AVAILABLE-FOR-SALE INVESTMENTS

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Quoted equity shares, at fair value 587 845 57 32

The investments in quoted equity securities offer the group the opportunity for returns through dividend income and fair value gains.

The fair value of these securities are based on the quoted closing market prices on the last market day of the financial year.

The group’s and company’s available-for-sale investments that are not denominated in the functional currencies of the respective entities are as follows:

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

British pound 530 813 - -

17 INTANGIBLE ASSETS

Goodwill Patents, Software Product on acquisition trademarks development development of business and licenses costs costs Total $’000 $’000 $’000 $’000 $’000 Group

Cost: At January 1, 2008 293 377 520 911 2,101 Exchange differences (76) (80) - - (156) Amount written off - - (520) (467) (987)

At December 31, 2008 217 297 - 444 958 Exchange differences 808 78 - 13 899 Arising from acquisition of a subsidiary (Note 40) 3,836 - - - 3,836 Additions - - - 151 151

At December 31, 2009 4,861 375 - 608 5,844



17 INTANGIBLE ASSETS (CONT’D)

Goodwill Patents, Software Product on acquisition trademarks development development of business and licenses costs costs Total $’000 $’000 $’000 $’000 $’000 Group

Amortisation: At January 1, 2008 - 339 478 677 1,494 Exchange differences - (78) - - (78) Amortisation for the year - 36 29 154 219 Amount written off - - (507) (387) (894)

At December 31, 2008 - 297 - 444 741 Exchange differences - 78 - - 78

At December 31, 2009 - 375 - 444 819

Impairment: At January 1, 2008 - - - 70 70

Eliminated on write off - - - (70) (70)

At December 31, 2008 and 2009 - - - - -

Carrying amount: At December 31, 2009 4,861 - - 164 5,025

At December 31, 2008 217 - - - 217

Goodwill acquired in a business combination is allocated, at acquisition, to the cash-generating units (CGUs) that are expected to benefit from that business combination.

The carrying amount of goodwill, net of exchange differences, had been allocated to CGUs which are based on the subsidiaries’ operating divisions as follows:

Group 2009 2008 $’000 $’000

Manufacturing division of SMB Harwal Electric Pty Limited 77 61 Wholesale division of Bridex Australia Pty Limited 214 156 Wholesale division of EDMI Gas Pty Ltd 4,570 - 4,861 217

The group tests goodwill annually for impairment, or more frequently if there are indications that goodwill might be impaired.

The recoverable amounts of CGUs are determined from value in use calculations. The key assumptions for the value in use calculations are those regarding the discount rates, growth rates and expected changes to selling prices and direct costs during the period. Management estimates discount rates using pre-tax rates that reflect current market assessments of the time value of money and risks specific to the CGUs. Changes in selling prices and direct costs are based on past practices and expectations of future changes in the market.

The group prepares cash flow forecasts derived from the most recent financial budgets approved by management and extrapolates cash flows for the following four years based on an estimated growth rate of 1% to 10% (2008 : 5% to 10%) per annum. This rate does not exceed the average long-term growth rate for the relevant markets.

The rate used to discount the forecast cash flows from the above operating divisions ranges from 12.9% to 19.6% (2008 : 13.9%) per annum.

As at December 31, 2009, any reasonably possible change to the key assumptions applied is not likely to cause the recoverable amounts to be below the carrying amounts of the CGUs.



18 OTHER RECEIVABLES

Group 2009 2008 $’000 $’000

Loan to outside party - 499

During the year, the interest-free loan to outside party was applied towards the consideration payable for the acquisition of EDMI Gas Pty Ltd (Note 40).

The group’s long term receivables that are not denominated in the functional currencies of the respective entities are as follows:

Group 2009 2008 $’000 $’000

Australian dollar - 499

19 DEFERRED TAX ASSETS

Group 2009 2008 $’000 $’000

At beginning of year 868 1,027 Exchange differences 161 (151) Credit to profit and loss 311 4 Over provision in prior year (1) - Arising from acquisition of a subsidiary (Note 40) 109 - Reclassification (Note 25) (429) (12)

At end of year 1,019 868

The following are the major deferred tax assets recognised by the group and movements thereon during the current and prior reporting periods:

Accelerated Provisions and Tax tax depreciation allowances losses Others Total $’000 $’000 $’000 $’000 $’000 Group

At January 1, 2008 (21) 548 248 252 1,027 Exchange differences - (135) (14) (2) (151) Credit (Charge) to profit and loss 12 327 (220) (115) 4 Reclassification - - - (12) (12)

At December 31, 2008 (9) 740 14 123 868 Exchange differences - 160 (1) 2 161 (Charge) Credit to profit and loss (9) 157 61 102 311 Over provision in prior year - (1) - - (1) Arising from acquisition of a subsidiary - 109 - - 109 Reclassification - (429) - - (429)

At December 31, 2009 (18) 736 74 227 1,019



20 BANK BORROWINGS

Group 2009 2008 $’000 $’000

Bank overdraft A 1,598 1,778 Bank overdraft B - 703

1,598 2,481

Trust receipts A 49 959 Trust receipts B 1,752 - Trust receipts C - 225 Banker’s acceptance 112 175

1,913 1,359

Short term bank loan A 3,000 3,000 Short term bank loan B - 449

3,000 3,449

Bank loan A 828 864 Bank loan B 201 213 Bank loan C 544 760 Bank loan D 379 - Bank loan E 3,000 -

4,952 1,837

Total 11,463 9,126

The borrowings are repayable as follows:

On demand or within one year 6,926 7,566 In the second to fifth year inclusive 3,806 780 After five years 731 780

11,463 9,126 Less: Amount due for settlement within 12 months (shown under current liabilities) (6,926) (7,566)

Amount due for settlement after 12 months 4,537 1,560

Bank overdraft A is repayable on demand. The average effective interest rate approximated 5.3% (2008 : 5.3%) per annum during the year and is determined based on prime lending rate.



20 BANK BORROWINGS (CONT’D)

In 2008, bank overdraft B was repayable on demand. The average effective interest rate approximated Nil% (2008 : 5.9%) per annum and was determined based on 1% plus prime rate.

Trust receipts A have a repayment term of 90 to 180 days (2008 : 90 to 180 days). The average effective interest rate approximated 6.4% (2008 : 5.6%) per annum during the year and is based on 1% to 1.5% (2008 : 1% to 1.5%) plus prime rate.

Trust receipts B have a repayment term of 60 to 90 days (2008 : Nil). The average effective interest rate approximated 1.9% (2008 : Nil%) per annum during the year.

In 2008, trust receipts C have a repayment term 150 days. The average effective interest rate approximated 6% per annum year and was determined based on 1% plus prime rate.

Banker’s acceptance have a repayment term of 133 days (2008 : 150 days). The average effective interest rate approximated 3.8% (2008 : 5.3%) per annum during the year. It is covered by a corporate guarantee by the company of $943,000 (2008 : $955,000).

Short term bank loan A is a short-term revolving loan which is repayable on demand. The average effective interest rate approximated 2.4% per annum (2008 : 3.4%) which is determined based on 0.85% above cost of fund. The loan is renewed every month.

In 2008, short term bank loan B had a tenure of 6 months. The average effective interest rate approximated 8.8% per annum which was determined based on 1.5% above the bank lending rate. It was covered by a corporate guarantee by the company of $499,000.

Bank loan A bears fixed interest at 2.65% and 3% per annum, for the first year (2004) and second year respectively; 1.37% per annum below prevailing board rates for the third and fourth years; and 1.25% per annum prevailing board rates for subsequent years. It is repayable in 240 monthly instalments effective from November 2004.

Bank loan B bears fixed interest at 4.5% and 5% per annum for the first year (2006) and second year respectively; and 0.75% per annum above the bank’s commercial financing rate for subsequent years. It is repayable in 180 monthly instalments from September 2006.

Bank loan C bears fixed interest rate at 4.25% per annum for the first year of drawn down, 4.75% per annum for second year of drawndown and at 0.5% bank’s commercial financing rate for subsequent years. It is repayable in 60 monthly instalments from May 2007.

Bank loan D is unsecured and bears fixed interest rate of 5% per annum. This loan was raised on January 22, 2009. Repayments commenced in November 2009 and will continue until October 2012.

Bank loan E is unsecured and bears interest rate of 1.75% per annum over Singapore Interbank Offered Rate (“SIBOR”). This loan was raised on January 30, 2009. Repayments will commence in January 2011 and continue until December 2015.

Bank overdraft A, trust receipts A and bank loan A and B are secured by a legal mortage on a subsidiary’s leasehold property and a corporate guarantee of $5,105,000 (2008 : $5,105,000) provided by the

company.

In 2008, bank overdraft B and trust receipts C are covered by corporate guarantee from the company of $1,500,000 and personal guarantee by a director of $1,500,000. In 2009, the amounts were fully repaid.

Bank loan C and short term bank loan A are secured by a legal mortgage on subsidiary’s leasehold property and a corporate guarantee of $20,013,000 (2008 : $20,013,000) by the company.

Trust receipts and bank loans are mainly arranged at floating rates thus exposing the group to cash flow interest rate risk.

The group’s borrowings are denominated in the functional currencies of the respective borrowing entities.



21 TRADE PAYABLES

Group 2009 2008 $’000 $’000

Outside parties 34,435 28,918 Associates (Note 14) 249 179 Related parties (Note 5) - 29

34,684 29,126

At December 31, 2009, the group has $26,000 (2008 : $157,000) of trade payables arising from contract work which are due for settlement after more than 12 months. These amounts have been classified as current because they are expected to be realised in the normal operating cycle.

The credit period on purchases of goods is generally 30 to 120 days (2008 : 30 to 120 days). No interest is charged on outstanding trade payables.

The group’s trade payables that are not denominated in the functional currencies of the respective entities are as follows:

Group 2009 2008 $’000 $’000

Singapore dollar 34 64 United States dollar 10,519 9,622 Euro 619 760 British pound 156 91 Others 55 70

22 OTHER PAYABLES

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Subsidiaries (Note 13) - - 316 212 Associates (Note 14) 1 - - - Related parties (Note 5) - 216 - - Amounts owing to directors 1,907 951 1,888 951 Salary-related accruals 9,909 3,581 1,120 98 Sundry creditors 1,564 2,260 1 40 Accrued expenses 2,462 2,385 179 190 Advances from customers 882 388 - - Financial guarantee contracts - - 47 47

16,725 9,781 3,551 1,538 Less: Non-current portion of salary-related accruals (3,403) (310) (937) (55)

13,322 9,471 2,614 1,483

The amounts owing to directors are unsecured, interest-free and repayable on demand. They comprise accrued fees and performance bonus.

The company has provided financial guarantees to banks in respect of loans and credit facilities extended to certain subsidiaries.



22 OTHER PAYABLES (CONT’D)

Salary-related accruals include an amount of $3,403,000 (2008 : $310,000) in respect of key management personnel’s remuneration under a Performance Bonus Scheme (the “Scheme”), which is payable after 2011 (Note 5). Certain key management personnel of the Group’s subsidiaries are remunerated under this Scheme.

Persuant to this Scheme, these key management personnel are entitled to bonus payout calculated at certain percentage of profits in excess of the financial targets set out under this Scheme. The Scheme covers the financial year ended December 31, 2008 to financial year ended December 31, 2011. Movement in the provision for directors’ performance bonus is as follows:

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Balance at beginning of the year 310 - 55 - Payment during the year (310) - (55) - Charge to profit or loss (Note 5) 3,403 310 937 55

Balance at end of the year 3,403 310 937 55

The group’s and company’s other payables that are not denominated in the functional currencies of the respective entities are as follows:

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

United States dollar 89 324 - - Euro 220 68 - - British pound 74 33 - - Others 17 - - -

23 DERIVATIVE FINANCIAL INSTRUMENTS

Group 2009 2008 Liabilities Liabilities $’000 $’000

Forward foreign exchange contract 60 -

The forward foreign exchange contract has a maturity date within 1 month from the end of the financial year.

At the end of the reporting period, the total notional amount of outstanding forward foreign exchange contract to which the group is committed is as follows:

Average Foreign Contract Fair exchange rate currency value value 2009 2008 2009 2008 2009 2008 2009 2008 NZ$’000 NZ$’000 $’000 $’000 $’000 $’000 Outstanding contract

Sell New Zealand dollars in exchange for Singapore dollars 1.02 - 300 - 306 - 60 -

The fair value of forward foreign exchange contract is estimated based on quoted forward exchange rates and yield curves derived from quoted interest rates matching maturity of the contracts. Changes in the fair value of the forward foreign exchange contract are recorded in profit or loss.



24 FINANCE LEASES

Present value Minimum of minimum lease payments lease payments 2009 2008 2009 2008 $’000 $’000 $’000 $’000 Group

Amounts payable under finance leases:

Within one year 576 524 499 450 In the second to fifth year inclusive 924 940 838 841 After five years 32 - 32 -

1,532 1,464 1,369 1,291 Less: Future finance charges (163) (173) NA NA

Present value of lease obligations 1,369 1,291 1,369 1,291

Less: Amount due for settlement within 12 months (shown under current liabilities) (499) (450)

Amount due for settlement after 12 months 870 841

Company

Amounts payable under finance leases:

Within one year 108 108 94 94 In the second to fifth year inclusive 108 216 94 189

216 324 188 283 Less: Future finance charges (28) (41) NA NA

Present value of lease obligations 188 283 188 283

Less: Amount due for settlement within 12 months (shown under current liabilities) (94) (94)

Amount due for settlement after 12 months 94 189

The term of finance leases entered into is between 3 to 7 years (2008 : 3 to 7 years).

For the year ended December 31, 2009, the weighted average effective borrowing rates for the group is 6% (2008 : 6%) per annum. The effective borrowing rate for the company was 5.6% (2008 : 5.6%) per annum. Interest rates are fixed at the contract date, and thus expose the group and company to fair value interest rate risk. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.

All lease obligations are denominated in the functional currency of the respective entities.

The fair value of the group’s lease obligations approximate their carrying amounts.

The group’s and company’s obligation under finance leases are secured by the leased assets.



25 DEFERRED TAX LIABILITIES

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

At beginning of year 1,481 1,324 2 5 Exchange differences 38 (13) - - Charge (Credit) to profit and loss 564 193 - (3) (Over) Under provision in prior years (12) (11) 1 - Effect of change in tax rate (41) - - - Disposal of a subsidiary (Note 39) (1) - - - Reclassification (Note 19) (429) (12) - -

At end of year 1,600 1,481 3 2

The following are the major deferred tax liabilities (assets) recognised by the company and the group and movements thereon during the year:

Accelerated Allowance tax for doubtful Tax depreciation receivables losses Others Total $’000 $’000 $’000 $’000 $’000 Group

At January 1, 2008 1,283 - - 41 1,324 Exchange differences (9) - - (4) (13) Charge to profit and loss 183 - - 10 193 (Over) Under provision in prior years (13) - - 2 (11) Reclassification - - - (12) (12)

At December 31, 2008 1,444 - - 37 1,481 Exchange differences (3) 20 - 21 38 Charge to profit and loss 123 225 (16) 232 564 (Over) Under provision in prior years (9) - - (3) (12) Effect of change in tax rate (41) - - - (41) Disposal of a subsidiary (1) - - - (1) Reclassification - (429) - - (429)

At December 31, 2009 1,513 (184) (16) 287 1,600

Accelerated tax depreciation Company $’000

At January 1, 2008 5 Credit to profit and loss (3)

At December 31, 2008 2 Charge to profit and loss 1

At December 31, 2009 3

At the balance sheet date, the aggregate amount of temporary differences associated with undistributed profits of certain overseas subsidiaries for which deferred tax liabilities have not been recognised is $3,326,000 (2008 : $1,502,000). No liability has been recognised because the group controls the dividend policy of the subsidiaries and has determined that the profits from these subsidiaries will not be distributed in the foreseeable future.



26 SHARE-BASED PAYMENTS

Share award scheme

(a) SMB Performance Share Plan (the “Plan”)

The Plan was approved by the shareholders of the company at an Extraordinary General Meeting held on April 30, 2009. Awards granted under the Plan are principally performance-based with performance targets to be set over a multi-year performance period. Performance targets set are intended to be based on medium-term corporate objectives covering market competitiveness, quality of returns, business growth and productivity growth. The performance targets are stretched targets aimed at sustaining long term growth.

The committee administering this scheme comprises independent directors: Koh Ah Huat (Chairman), Henry Hoe Leong Seng and Tay Teng Tiow.

The Committee shall decide, in relation to each Award to be granted to a Participant:

i) the Award date;

ii) the number of shares comprised under an Award or their equivalent in cash (based on the aggregate market value of the shares which are the subject of the Award) or if a combination of both, the proportion between the shares and the cash which are the subject of the Award;

iii) the performance target(s) (if any), the performance period during which such performance target(s) are to be satisfied, if any; and

iv) any other condition which the Committee may determine in relation to that Award.

The total number of new shares which may be issued pursuant to Awards granted under the proposed Plan, when added to the number of new shares issued and issuable in respect of all Awards granted thereunder, shall not exceed 15% of the issued share capital of the company on the day preceding the relevant date of Award.

No Awards under the plan have been granted since the commencement of the plan.

Equity-settled share option scheme

(a) SMB Share Option Scheme 2001

This scheme was approved by the shareholders on September 7, 2001. As at the beginning of the year, there were no unissued shares under option under this scheme. During the financial year, the SMB Share Option Scheme 2001 was terminated.

(b) EDMI Share Option Scheme 2003

Each share option entitles the directors (excluding executive directors who are substantial shareholders) and employees (excluding employees who are also controlling shareholders and their associates) of EDMI Limited group to subscribe for one new ordinary share in EDMI Limited at an exercise price determined at the average price of EDMI Limited’s share traded in the Singapore Exchange Securities Trading Limited for the three consecutive trading days immediately preceding the offer date of that option, rounded up to the nearest whole cent in the event of fractional prices.

The aggregate nominal amount of shares that the committee may grant options, when added to the aggregate nominal amount of shares issued and issuable under the EDMI Share Option Scheme 2003 shall not exceed 15% of the issued share capital of EDMI Limited on the date immediately preceding the offer date of the option.




26 SHARE-BASED PAYMENTS (CONT’D)

Equity-settled share option scheme (cont’d)

(b) EDMI Share Option Scheme 2003 (cont’d)

To qualify for the EDMI Share Option Scheme 2003, eligible employees must be in full time service of EDMI Limited group for at least one year on or prior to the relevant offer date. However, the committee administering the scheme may at its discretion abridge the one-year service requirement in respect of any employee.

The options are granted for a consideration of $1.00 for all the shares in respect of which the options are granted. The options may be exercised after one year from the date of the grant subject to the condition that up to 25%, 50% and 75% of the options may be exercised prior to the second, third and fourth anniversary of the offer date of options respectively. The shares under option may be exercised in full or in multiples of 1,000 shares on payment of the exercise price. Options granted will be cancelled upon the occurrence of certain events such as cessation of employment.

Options are exercisable at a price based on the average of the last dealt prices on the Singapore Exchange Securities Trading Limited, for a share over the three trading days immediately preceding the grant of the option, rounded to the nearest whole cent in the event of fractional prices. The exercisable period is 10 years for directors and employees, and 5 years for independent directors of EDMI Limited group. If the options remain unexercised after the specified period from the date of grant, the options expire. Options are forfeited if the participant leaves the EDMI Limited group before the options vest.

Details of the share options outstanding during the year are as follows:

EDMI Limited 2009 2008 Weighted Weighted Number average Number average of share exercise of share exercise options price options price ’000 $ ’000 $

Outstanding at beginning of year 11,965 0.22 15,505 0.23 Exercised during the year (1,400) 0.13 (590) 0.13 Lapsed during the year (500) 0.13 (2,950) 0.31

Outstanding at end of year 10,065 11,965

Exercisable at end of year 8,880 6,728

The weighted average share price at the date of exercise for share options exercised during the year was $0.13 (2008 : $0.22). The options outstanding at the end of the year have a weighted average remaining contractual life of 4.6 years (2008 : 5.6 years) for executive share options and 0.1 years (2008 : 1.1 years) for non-executive share options.

No share options were granted in 2009.

During the year, the group recognised total expense (net of minority interests) of $116,000 (2008 : $131,000) related to equity-settled share-based payment transactions under the EDMI Share Option Scheme 2003.


27 SHARE CAPITAL

Group and Company 2009 2008 2009 2008 ’000 ’000 $’000 $’000 Number of ordinary shares Issued and paid up: At end and beginning of year 479,752 479,752 75,113 75,113

The ordinary shares, which have no par value, carry one vote per share and do not carry a right to fixed dividends.

28 RESERVES

Capital Reserve

The share option reserve arises on the grant of share option to directors and employees under the employee share option plan. Further information about share-based payments is disclosed in Note 26 of the financial statements.

Revaluation Reserve

The investment revaluation reserve arises on the revaluation of available-for-sale financial assets. Where a revalued financial asset is sold, the portion of the reserve that relates to that financial asset is effectively realised, and is recognised in profit or loss. Where a revalued financial asset is impaired, the portion of the reserve that relates to that financial asset is recognised in profit or loss.

Currency Translation Reserve

Exchange differences relating to the translation from the functional currencies of the group’s foreign subsidiaries into Singapore dollars are brought to account by recognising those exchange differences in other comprehensive income and accumulating them in a separate component of equity under the header of currency translation reserve.

29 REVENUE

Group 2009 2008 $’000 $’000

Sale of goods 173,215 193,756 Contract revenue 46,887 13,448 Service income 6,406 6,143

226,508 213,347

30 OTHER OPERATING INCOME

Group 2009 2008 $’000 $’000

Interest income from non-related companies 185 357 Dividend income from non-related companies 3 7 Government grant 1,533 11 Miscellaneous income 1,955 546

3,676 921



31 OTHER GAINS AND (LOSSES)

Group 2009 2008 $’000 $’000

Gain on disposal of property, plant and equipment 36 119 Net foreign exchange gain (loss) 4,027 (3,149) Loss on dilution of shareholding interest in a subsidiary (79) (26) Gain on dilution of shareholding interest in an associate 73 - Impairment loss on available-for-sale investments - (190) Gain on disposal of a subsidiary 277 - Gain on acquisition of shareholding interest in a subsidiary 643 - Gain on disposal of available-for-sale investments 2,263 - Release of fair value reserve on disposal of available-for-sale investments (1,844) - Intangible assets written off - (23) Changes in fair value of financial derivative instruments (Note 23) (60) -

5,336 (3,269)

32 INCOME TAX EXPENSE

Group 2009 2008 $’000 $’000 Current 5,085 3,463 Deferred 212 189 Over provision in prior years (19) (484)

Income tax expense for the year 5,278 3,168

Domestic income tax is calculated at 17% (2008 : 18%) of the estimated assessable profit for the year. Taxation for foreign entities is calculated at the rates prevailing in the relevant jurisdictions.

The total charge for the year can be reconciled to the accounting profit as follows:

2009 2008 $’000 $’000

Profit before tax 29,256 18,181

Income tax expense 5,278 3,168

Average effective tax rate 18.0% 17.4%



32 INCOME TAX EXPENSE (CONT’D)

Group 2009 2008 % %

Tax at the domestic income tax rate 17.0 18.0 Tax effect of expenses that are not deductible in determining taxable profit - 3.1 Over provision in prior years (0.1) (2.6) Tax effect of utilisation of deferred tax benefit previously not recognised (0.1) (0.1) Deferred tax benefit not recognised 0.6 0.5 Effect of different tax rates of subsidiaries operating in other jurisdictions 1.2 0.9 Tax exemption and rebate (0.8) (1.8) Effect of change in tax rate (0.2) (0.3) Other items 0.4 (0.3)

Average effective tax rate 18.0 17.4

The group has tax losses carryforwards available for offsetting against future taxable income as follows: Group 2009 2008 $’000 $’000

Amount at beginning of year 5,250 5,635 Exchange differences 64 (150) Adjustments 5 325 Amount in current year 971 451 Amount utilised in current year (155) (1,011) Disposal of a subsidiary (1,182) -

Amount at end of year 4,953 5,250

Deferred tax benefit on above: - recognised 67 14 - not recognised 984 1,054

Deferred tax benefits vary from the Singapore statutory tax rate as it includes deferred tax on overseas operation.

The potential tax savings relating to tax losses carried forward are recognised as deferred tax assets only when there is reasonable expectation of realisation in the foreseeable future. The tax losses can be carried forward to future periods subject to the conditions imposed by the law in the respective tax jurisdictions.



33 PROFIT FOR THE YEAR

Profit for the year has been arrived at after charging (crediting):

Group 2009 2008 $’000 $’000

Depreciation, amortisation and impairment: Depreciation of property, plant and equipment 3,220 3,054 Depreciation of assets on lease 44 - Amortisation: Patents, trademarks and licences (1) - 36 Software development cost (2) - 29 Product development cost (1) - 76 Product development cost (2) - 78 Impairment loss on available-for-sale investments - 190

Total depreciation, amortisation and impairment 3,264 3,463

Directors’ remuneration: Company’s directors 3,535 2,714 Subsidiaries’ directors 5,741 3,033

Total directors’ remuneration 9,276 5,747

Employee benefits expense (including directors’ remuneration): Cost of defined contribution plans 2,954 2,973 Others 49,024 44,704

Total employee benefits expense 51,978 47,677

Research costs (3) 3,295 3,076 Non-audit fees paid/payable to: Auditors of the company 66 60 Other auditors 15 12 Cost of inventories recognised as expense 147,238 141,042 Allowance (Reversal of allowance) for inventories 2,486 (66) Allowance for doubtful trade receivables 476 149 Allowance for doubtful non-trade receivables - 141 Allowance for foreseeable losses on contracts 836 831 Inventory written off 161 14 Bad debts written off 37 106

(1) These are included in general and administrative expenses in the consolidated statement of comprehensive income.

(2) These are included in cost of sales in the consolidated statement of comprehensive income.

(3) These are included in other operating expenses in the consolidated statement of comprehensive income.



34 EARNINGS PER SHARE

The calculation of basic earnings per share is based on the group’s net profit attributable to owners of the company of $21,221,000 (2008 : $13,563,000) divided by the ordinary shares of 479,751,999 shares in issue throughout both years.

For both years, fully diluted earnings per share is the same as basic earnings per share as there are no

dilutive shares outstanding at the end at both years. 35 COMMITMENTS

(i) Financial commitment

Group Company 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Performance guarantee - unsecured 4,772 1,754 - - Performance guarantee - secured 4,819 5,185 - - Bankers’ guarantee – unsecured 289 - - - Bankers’ guarantee – secured 259 176 - - Corporate guarantees to banks in connection with credit facilities of subsidiaries - unsecured - - 44,200 44,823

The maximum estimated amount that the group and the company could become liable is shown above.

In addition to deposits amounting to approximately $197,000 (2008 : $196,000) pledged to the bank for bank credit facilities, the securities for performance guarantee include legal mortgages on the subsidiaries’ leasehold properties.

(ii) Capital commitment Group 2009 2008 $’000 $’000 Purchase of plant and equipment 349 500



36 OPERATING LEASE ARRANGEMENTS

The group as lessee

Group 2009 2008 $’000 $’000

Minimum lease payments under operating leases recognised as an expense in the year 2,240 2,310

At the balance sheet date, the group has outstanding commitments under non-cancellable operating leases which fall due as follows:

Group 2009 2008 $’000 $’000

Within one year 1,986 1,451 In the second to fifth year inclusive 4,734 1,917 After five years 6,055 5,921

12,775 9,289

Operating lease payments represent rentals payable by the group for its leasehold land, certain of its factory and office premises, and office equipment. Leases are entered into for a period of one to thirty years.

Operating lease commitments stated above includes existing rental rates before deduction for discretionary rebates given by the landlord for certain premises. Certain rental rates are subject to future adjustments based on changes in the consumer price index.

The group as lessor

The group rents out its meters, which was previously classified as inventory, under operating leases. Service income earned during the year was $224,000 (2008 : $Nil).

The agreements provide for service income to be earned as long as the customers’ faculties are tenanted and meter readings taken. There is no guaranteed minimum number of subscription to metered readings and correspondingly no fixed minimum operating lease income committed for future period.

Leases are negotiated and service income was fixed for an average term of five years.



37 SEGMENT INFORMATION

Segment revenue and expense: The accounting policies of the reportable segments are the same as the group’s accounting policies described in Note 2. Segment revenue and expense are the operating revenue and expense reported in the group’s statement of comprehensive income that are directly attributable to a segment and the relevant portion of such revenue and expense that can be allocated on a reasonable basis to a segment.

Segment assets and liabilities: Segment assets include all operating assets used by a segment and consist principally of operating receivables, inventories and property, plant and equipment, net of allowances and provisions. Capital additions mainly include the total cost incurred to acquire property, plant and equipment directly attributable to the segment. Segment liabilities include all operating liabilities and consist principally of accounts payable and accruals.

Products and services from which reportable segments derive their revenues

For management purposes, the group is organised into four main operating divisions: switchgear; power and technology; trading and distribution; and building services. These are also the divisions the group’s chief operating decision maker focused on for the purposes of resource allocation and assessment of segment performance. The group’s reportable segments under FRS 108, therefore, remained unchanged from 2008.

Principal activities of each reportable segment are as follows:

Switchgear - Manufacture and supply of electrical switchgear.

Power and technology - Manufacture and sale of electronic revenue meters for use principally by utility companies involved in the generation, distribution and supply of electricity; provision of electrical efficiency and energy management solutions.

Trading and distribution - Import, export and supply of electrical and electronic components and equipment.

Building services - Design, installation and maintenance of computerised automation and control systems; plumbing and electrical contracting and supply of related products.

Others - This comprise investment holding and corporate activities.



37 SEGMENT INFORMATION (CON’TD)

Information regarding the group’s reportable segments is presented below.

Segment revenues and results

Power and Trading and Building Switchgear technology distribution services Others Elimination Total $’000 $’000 $’000 $’000 $’000 $’000 $’000

2009

Revenue External revenue 121,743 69,266 14,980 20,519 - - 226,508 Inter-segment revenue 2,544 541 6,901 14 - (10,000) -

124,287 69,807 21,881 20,533 - (10,000) 226,508

Result Segment results 16,215 8,504 3,783 796 744 - 30,042 Interest expense (454) Interest income 185 Share of results of associates (361) Share of results of joint ventures (156)

Profit before income tax 29,256 Income tax expense (5,278)

Profit after income tax 23,978

2008

Revenue External revenue 116,684 56,125 15,620 24,918 - - 213,347 Inter-segment revenue 1,810 511 8,413 - - (10,734) -

118,494 56,636 24,033 24,918 - (10,734) 213,347

Result Segment results 12,080 2,738 2,065 1,217 782 - 18,882 Interest expense (553) Interest income 357 Share of results of associates (222) Share of results of joint ventures (283)

Profit before income tax 18,181 Income tax expense (3,168)

Profit after income tax 15,013

The accounting policies of the reportable segments are the same as the group’s accounting policies described

in Note 2. Segment profit represents the profit earned by each segment with allocation of interest expense and income, share of profits of associates, joint ventures and income tax expense. This is the measure reported to the chief operation decision maker for the purposes of resource allocation and assessment of segment performance.




Segment revenues and results (cont’d)

Power and Trading and Building Switchgear technology distribution services Others Elimination Total $’000 $’000 $’000 $’000 $’000 $’000 $’000

2009

Segment assets 107,515 78,042 19,204 14,831 10,622 - 230,214 Associates and joint ventures 1,331 Unallocated corporate assets 1,606

Consolidated total assets 233,151

Segment liabilities 21,843 17,501 3,734 7,420 3,188 - 53,686 Unallocated corporate liabilities 19,417

Consolidated total liabilities 73,103

Other information Capital expenditure (property, plant and equipment) 1,289 1,676 76 86 12 - 3,139 Depreciation and amortisation 1,661 1,168 216 135 84 - 3,264 Non-cash expenses other than depreciation and amortisation - 198 - - - - 198

2008

Segment assets 96,216 56,334 17,006 17,533 2,815 - 189,904 Associates and joint ventures 1,293 Unallocated corporate assets 1,712

Consolidated total assets 192,909

Segment liabilities 12,541 13,705 3,395 8,541 1,357 - 39,539 Unallocated corporate liabilities 15,099

Consolidated total liabilities 54,638

Other information Capital expenditure (property, plant and equipment) 6,160 864 175 64 12 - 7,275 Depreciation and amortisation 1,727 954 234 252 106 - 3,273 Non-cash expenses other than depreciation and amortisation 23 232 - - - - 255

For the purposes of monitoring segment performance and allocating resources between segments, the chief operating decision maker monitors the tangible, intangible and financial assets attributable to each segment.

All assets are allocated to reportable segments other than investments in associates (Note 14), investments in joint venture (Note 15), available-for-sale investments and deferred tax assets. Goodwill has been allocated to reportable segments as described in Note 17. Assets used jointly by reportable segments are allocated on the basis of the revenues earned by individual reportable segments.




Geographical information

The group operates in five principal geographical areas namely Singapore, Oceania, Malaysia, Europe and Asia (excluding Singapore and Malaysia).

The group’s revenue from external customers and information about its non-current assets by geographical location is detailed below:

Revenue from Non-current external customers assets 2009 2008 2009 2008 $’000 $’000 $’000 $’000

Singapore 116,179 112,565 29,960 31,836 Oceania 50,336 38,003 8,817 1,969 Malaysia 13,628 26,609 4,551 4,584 Asia (excluding Singapore and Malaysia) 19,232 21,469 1,412 1,201 Europe 20,709 11,915 - - Others 6,424 2,786 - -

226,508 213,347 44,740 39,590

Information about major customers

In 2009, revenue arising from a single customer of 10% or more of the Group’s total revenue amounted to $36,112,000 (2008 : Nil). This is a customer of our switchgear division.

38 DIVIDENDS

In 2008, the company declared and paid a final dividend of 1.4 cents per ordinary shares (tax exempt one-tier) totalling $6,716,528 in respect of the financial year ended December 31, 2007.

In 2009, the company declared and paid a final dividend of 1.0 cent per ordinary shares (tax exempt one-tier) totalling $4,797,520 in respect of the financial year ended December 31, 2008.

In respect of the current year, the directors proposed that a final dividend of 1.5 cents per ordinary share (tax exempt one-tier) be paid to shareholders on May 21, 2010. This dividend is subject to approval by shareholders at the Annual General Meeting and has not been included as liability in these financial statements. The proposed dividend is payable to all shareholders who are on the Register of Members as at May 7, 2010. Based on the number of shares as at February 26, 2010, the total estimated dividend to be paid is $7,196,000.



39 DISPOSAL OF A SUBSIDIARY

In April 2009, the group disposed its subsidiary, MW Dynamics Pte Ltd.

Details of the disposal are as follows:

2009 $’000 Book values of net assets (liabilities) disposed

Non-current assets Property, plant and equipment 49

Current assets Inventories 3 Trade and other receivables 987 Contract work-in-progress 26 Cash and bank balances 4

Total current assets 1,020

Non-current liabilities Finance lease (10) Deferred tax liability (1)

Total non-current liabilities (11)

Current liabilities Income tax payable (5) Finance lease (12) Trade and other payables (1,118)

Total current liabilities (1,135)

Net liabilities disposed (77) Gain on disposal 277

Total consideration 200

Satisfied by: Cash 100 Deferred consideration 100

200

Net cash inflow arising on disposal: Cash consideration received 100 Cash and cash equivalents disposed of (4)

96

The deferred consideration will be settled in cash by the purchaser in 2010.



40 ACQUISITION OF A SUBSIDIARY

On April 1, 2009, EDMI Limited (a subsidiary) acquired 75% of the share capital of EDMI Gas Pty Ltd (formerly known as Atlas Measurement Pty Ltd) for a cash consideration of $3,902,000. On May 21, 2009, EDMI Limited acquired the remaining 25% of the share capital of EDMI Gas Pty Ltd from the two other shareholders for a cash consideration of $378,000. This transaction has been accounted for by the purchase method of accounting.

The net assets acquired in the transaction and the goodwill arising are as follows:

Acquiree’s carrying amount Fair value before combination adjustments Fair value $’000 $’000 $’000 Net assets acquired:

Plant and equipment 832 - 832 Inventories 288 207 495 Deferred tax asset 109 - 109 Other current assets 9 (4) 5 Employee entitlements (363) 117 (246) Bank loan (413) - (413) Bank overdraft (276) - (276) Finance lease (62) - (62)

124 320 444

Goodwill 3,836

Total consideration 4,280

2009 $’000 Net cash inflow arising on acquisition: Total cash consideration (4,280) Add: Bank overdraft (276) Less: Offset of loan receivable from EDMI Gas Pty Ltd (Note 18) 653

Cash paid in statemet of cash flow (3,903)

The goodwill arising on the acquisition of EDMI Gas Pty Ltd is attributable to the anticipated positive net cash flows from the distribution of the group’s products in the new markets and the anticipated future operating synergies from the combination.

EDMI Gas Pty Ltd contributed approximately $4,408,000 revenue and $185,000 to the Group’s profit before income tax for the period between the date of acquisition and December 31, 2009.

If the acquisition had been completed on January 1, 2009, total group revenue and profit for the year would have not been materially different.



41 EVENTS AFTER THE REPORTING PERIOD

(i) On January 28, 2010 and March 23, 2010 EDMI Limited (subsidiary) issued an aggregate of 440,000 and 60,000 ordinary shares at $0.13 per share, pursuant to the exercise of options granted under the EDMI Share Option Scheme 2003.

(ii) Subsequent to the reporting period, (a) EDMI Limited has incorporated a wholly-owned subsidiary, EDMI HK Limited (“EDMI HK”) in

Hong Kong with paid up capital of HKD10,000. The principal activity of EDMI HK is that of investment holding and the sale of electronic revenue meters in Hong Kong or abroad.

(b) Noustech Pty Ltd, a wholly-owned subsidiary of EDMI Limited has made an application with

the Australian Securities & Investments Commission for voluntary deregistration.

42 RECLASSIFICATIONS AND COMPARATIVE FIGURES

Certain reclassifications have been made to the prior year’s financial statements to enhance comparability with the current year’s financial statements.

As a result, certain line items have been amended in the statement of comprehensive income. Comparative figures have been adjusted to conform to the current year’s presentation.

The items were reclassified as follows:

Previously After reported reclassification 2008 2008 $’000 $’000

Statements of financial position

Group

Other payables (under current liabilities) 9,781 9,471 Other payables (under non-current liabilities) - 310

9,781 9,781

Company

Other payables (under current liabilities) 3,551 2,614 Other payables (under non-current liabilities) - 937

3,551 3,551

These reclassifications have no impact on the corresponding amount as at December 31, 2007.

Consolidated statement of comprehensive income

General and administrative expenses (33,561) (30,531) Other operating expenses (3,712) (3,473) Other gains and losses - (3,269)

(37,273) (37,273)



>> Statistics of ShareholdingsAs at March 17, 2010

Class of equity securities : OrdinaryNumber of equity securities : 479,751,999 ordinary sharesVoting Rights : One vote per share DISTRIBUTION OF SHAREHOLDINGS No. of Size of Shareholding Shareholders % No. of Shares % 1 - 999 9 0.11 1,360 0.001,000 - 10,000 5,430 66.59 26,866,236 5.6010,001 - 1,000,000 2,672 32.77 160,945,842 33.551,000,001 and above 43 0.53 291,938,561 60.85 8,154 100.00 479,751,999 100.00

TWENTY LARGEST SHAREHOLDERS No. Name of Shareholders No. of Shares % 1. LEE YONG HENG 46,170,923 9.62 2. LEE PHUAN WENG 35,688,544 7.44 3. GOH BAN KIN 22,632,514 4.72 4. LEE SOO CHIN MRS TEE SEONG KEE 19,426,810 4.05 5. CITIBANK NOMINEES SINGAPORE PTE LTD 18,306,800 3.82 6. OCBC SECURITIES PRIVATE LTD 13,598,000 2.83 7. LEE HWEE CHOO 11,886,000 2.48 8. LEE WEE HIAN (LI WEIXIAN) 10,669,000 2.22 9. FOO JUAT ENG 10,045,000 2.09 10. UNITED OVERSEAS BANK NOMINEES PTE LTD 9,303,000 1.94 11. DBS NOMINEES PTE LTD 9,088,000 1.89 12. ANG LUCY 7,761,248 1.62 13. DMG & PARTNERS SECURITIES PTE LTD 7,727,000 1.61 14. PHILLIP SECURITIES PTE LTD 7,248,000 1.51 15. SIMON SEAH SEOW KEE 5,383,000 1.12 16. TAN SEK KHOON 4,882,000 1.02 17. CHIANG SOK YANG 3,583,000 0.75 18. YEO LAY LENG 3,500,000 0.73 19. FOO ENG ENG 3,096,000 0.65 20. CHOY WEE CHIAP 3,000,000 0.63

TOTAL 252,994,839 52.74

PERCENTAGE OF SHAREHOLDING HELD IN THE HANDS OF THE PUBLIC Approximately 62% of the Company’s shares are held in the hands of the Public. Accordingly, the Company has complied with Rule 723 of the Listing Manual of the SGX-ST.

SUBSTANTIAL SHAREHOLDERS(As recorded in the Register of Substantial Shareholders) Name Direct Interest % Deemed Interest %

Lee Yong Heng 46,170,923 9.62 - -Lee Phuan Weng 35,688,544 7.44 7,761,248 (i) 1.62Goh Ban Kin 22,632,514 4.72 10,045,000 (ii) 2.09 Notes: (i) Lee Phuan Weng is deemed to be interested in 7,761,248 shares held by his spouse, Ang Lucy.(ii) Goh Ban Kin is deemed to be interested in 10,045,000 shares held by his spouse, Foo Juat Eng.


>> Notice of Annual General MeetingSMB UNITED LIMITED (Company Registration No. 199506364D) (Incorporated in Singapore with limited liability)

NOTICE IS HEREBY GIVEN that the Annual General Meeting of SMB United Limited (“the Company”) will be held at The Conference Room, 17 Senoko Avenue, Singapore 758307 on Friday, April 30, 2010 at 10.00 a.m. for the following purposes:

AS ORDINARY BUSINESS:

1. To receive and adopt the Directors’ Report and the Audited Accounts of the Company for the year ended December 31, 2009 together with the Auditors’ Report thereon. (Resolution 1)

2. To declare a one-tier tax exempt Final Dividend of 1.5 cents per ordinary share, for the year ended December

31, 2009 (2008: One-tier tax exempt Final Dividend of 1.0 cent per ordinary share). (Resolution 2)

3. To re-elect the following Directors of the Company retiring pursuant to Article 107 of the Articles of Association of the Company:

Mr Henry Hoe Leong Seng (Resolution 3) Mr Goh Ban Kin (Resolution 4) Mr Lee Kwang Mong (Resolution 5)

Mr Henry Hoe Leong Seng will, upon re-election as Director of the Company, remain as the Chairman of the Audit Committee, a member of the Nominating Committee and the Remuneration Committee and will be considered independent for the purposes of Rule 704(8) of the Listing Manual of the Singapore Exchange Securities Trading Limited.

Mr Goh Ban Kin will, upon re-election as Director of the Company, be considered non-independent for the purposes of Rule 704(8) of the Listing Manual of the Singapore Exchange Securities Trading Limited.

Mr Lee Kwang Mong will, upon re-election as Director of the Company, be considered non-independent for the purposes of Rule 704(8) of the Listing Manual of the Singapore Exchange Securities Trading Limited.

4. To approve the Directors’ fees of $231,000 for the year ended December 31, 2009 (2008: $231,000). (Resolution 6)

5. To re-appoint Messrs Deloitte & Touche LLP as the Auditors of the Company and to authorise the Directors of the Company to fix their remuneration. (Resolution 7)

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

AS SPECIAL BUSINESS:

To consider and if thought fit, to pass the following resolutions as Ordinary Resolutions, with or without any modifications: 7. Authority to issue shares up to 50 per centum (50%) of the issued shares in the capital of the

Company

That pursuant to Section 161 of the Companies Act, Cap. 50 and Rule 806 of the Listing Manual of the Singapore Exchange Securities Trading Limited, the Directors of the Company be authorised and empowered to:

(a) (i) issue shares in the Company (“shares”) whether by way of rights, bonus or otherwise; and/or

(ii) make or grant offers, agreements or options (collectively, “Instruments”) that might or would require shares to be issued, including but not limited to the creation and issue of (as well as adjustments to) options, warrants, debentures or other instruments convertible into shares,

at any time and upon such terms and conditions and for such purposes and to such persons as the Directors of the Company may in their absolute discretion deem fit; and



(b) (notwithstanding the authority conferred by this Resolution may have ceased to be in force) issue shares in pursuance of any Instrument made or granted by the Directors of the Company while this Resolution was in force,

provided that:

(1) the aggregate number of shares (including shares to be issued in pursuance of the Instruments, made or granted pursuant to this Resolution) and Instruments to be issued pursuant to this Resolution shall not exceed fifty per centum (50%) of the total number of issued shares (excluding treasury shares) in the capital of the Company (as calculated in accordance with sub-paragraph (2) below), of which the aggregate number of shares and Instruments to be issued other than on a pro rata basis to existing shareholders of the Company shall not exceed twenty per centum (20%) of the total number of issued shares (excluding treasury shares) in the capital of the Company (as calculated in accordance with sub-paragraph (2) below);

(2) (subject to such calculation as may be prescribed by the Singapore Exchange Securities Trading Limited) for the purpose of determining the aggregate number of shares and Instruments that may be issued under sub-paragraph (1) above, the percentage of issued shares and Instruments shall be based on the total number of issued shares (excluding treasury shares) in the capital of the Company at the time of the passing of this Resolution, after adjusting for:

(a) new shares arising from the conversion or exercise of the Instruments or any convertible securities; (b) new shares arising from exercising share options or vesting of share awards outstanding and

subsisting at the time of the passing of this Resolution; and (c) any subsequent bonus issue, consolidation or subdivision of shares;

(3) in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of the Listing Manual of the Singapore Exchange Securities Trading Limited for the time being in force (unless such compliance has been waived by the Singapore Exchange Securities Trading Limited) and the Articles of Association of the Company; and

(4) unless revoked or varied by the Company in a general meeting, such authority shall continue in force (i) until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company is required by law to be held, whichever is earlier or (ii) in the case of shares to be issued in pursuance of the Instruments, made or granted pursuant to this Resolution, until the issuance of such shares in accordance with the terms of the Instruments.

[See Explanatory Note (I)] (Resolution 8) 8. Renewal of Share Buy Back Mandate

That:

(a) for the purposes of Sections 76C and 76E of the Companies Act, Chapter 50 of Singapore (the “Companies Act”), the Directors of the Company be and are hereby authorised to exercise all the powers of the Company to purchase or otherwise acquire issued ordinary Shares in the capital of the Company (“Shares”) not exceeding in aggregate the Prescribed Limit (as hereinafter defined), at such price(s) as may be determined by the Directors of the Company from time to time up to the Maximum Price (as hereinafter defined), whether by way of:

(i) market purchase(s) (“Market Purchase”) transacted on the Singapore Exchange Securities Trading Limited (“SGX-ST”); and/or

(ii) off-market purchase(s) (“Off-Market Purchase”) effected otherwise than on the SGX-ST in accordance with any equal access scheme(s) as may be determined or formulated by the Directors as they consider fit, which scheme(s) shall satisfy all the conditions prescribed by the Companies Act.

and otherwise in accordance with all other provisions of the Companies Act and the Listing Manual of the SGX-ST as may for the time being be applicable, be and is hereby authorised and approved generally and unconditionally (the “Share Buy Back Mandate”);



(b) any Share that is purchased or otherwise acquired by the Company pursuant to the Share Buy Back Mandate shall, at the discretion of the Directors of the Company, either be cancelled or held in treasury and dealt with in accordance with the Companies Act;

(c) unless varied or revoked by the Company in general meeting, the authority conferred on the Directors of the Company pursuant to the Share Buy Back Mandate may be exercised by the Directors at any time and from time to time during the period commencing from the passing of this Resolution and expiring on the earlier of:

(i) the date on which the next Annual General Meeting of the Company is held or is required by law to be held;

(ii) the date on which the share buybacks are carried out to the full extent mandated; or

(iii) the date on which the authority conferred by the Share Purchase Mandate is varied or revoked;

(d) for purposes of this Resolution:

“Prescribed Limit” means 10 per cent. of the issued ordinary Shares in the share capital of the Company as at the date of the passing of this Resolution unless the Company has effected a reduction of the share capital of the Company in accordance with the applicable provisions of the Companies Act, at any time during the Relevant Period, in which event the issued ordinary Shares in the share capital of the Company shall be taken to be the amount of the issued ordinary Shares of the Company as altered (excluding any treasury shares as at that date);

“Relevant Period” means the period commencing from the date on which the last AGM was held and expiring on the date the next AGM is held or is required by law to be held, whichever is the earlier, after the date of this Resolution;

“Maximum Price” in relation to a Share to be purchased or acquired, means the purchase price (excluding brokerage, commission, stamp duties, applicable goods and services tax and other related expenses) which shall not exceed:

(i) in the case of a Market Purchase, 105 per cent. of the Average Closing Price of the Share; and

(ii) in the case of an Off-Market Purchase, 120 per cent. of the Average Closing Price of the Shares, where :

“Average Closing Price” means the average of the closing market prices of a Share over the last five market days, on which transactions in the Shares on the SGX-ST were recorded, immediately preceding the day of the Market Purchase by the Company or, as the case may be, the day of making of the offer pursuant to the Off-Market Purchase, and deemed to be adjusted, in accordance with the Listing Manual of the SGX-ST, for any corporate action that occurs after the relevant five-days period;

“date of the making of the offer” means the day on which the Company announces its intention to make an offer for the purchase or acquisition of Shares from shareholders of the Company stating the purchase price (which shall not be more than the Maximum Price calculated on the foregoing basis) for each Share and the relevant terms of the equal access scheme for effecting the Off-Market Purchase; and

“market day” means a day on which the SGX-ST is open for trading in securities; and

(e) any of the Directors of the Company be and are hereby authorised to complete and do all such acts and things (including, without limitation, to execute all such documents as may be required and to approve any amendments, alterations or modifications to any documents), as they or he may consider desirable, expedient or necessary to give effect to the transactions contemplated and/or authorised by this Resolution.”

[See Explanatory Note (II)] (Resolution 9)



Explanatory Notes:

(I) The Ordinary Resolution 8 in item 7 above, if passed, will empower the Directors of the Company from the date of this Meeting until the date of the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of the Company is required by law to be held or such authority is varied or revoked by the Company in a general meeting, whichever is the earlier, to issue shares, make or grant instruments convertible into shares and to issue shares pursuant to such instruments, up to a number not exceeding, in total, 50% of the total number of issued shares (excluding treasury shares) in the capital of the Company, of which up to 20% may be issued other than on a pro-rata basis to existing shareholders of the Company.

For determining the aggregate number of shares that may be issued, the percentage of issued shares in the capital of the Company will be calculated based on the total number of issued shares (excluding treasury shares) in the capital of the Company at the time this Ordinary Resolution is passed after adjusting for new shares arising from the conversion or exercise of the Instruments or any convertible securities, the exercise of share options or the vesting of share awards outstanding or subsisting at the time when this Ordinary Resolution is passed and any subsequent bonus issue, consolidation or subdivision of shares.

(II) The Ordinary Resolution 9 in item 8 above, if passed, will empower the Directors from the date of the above Meeting until the next Annual General Meeting to repurchase ordinary issued shares of the Company by way of market purchases or off-market purchases of up to 10% of the total number of issued shares (excluding treasury shares) in the capital of the Company at the Maximum Price. Information relating to this proposed Resolution are set out in the Circular attached.

Notes:

1. A Member entitled to attend and vote at the Annual General Meeting (the “Meeting”) is entitled to appoint a proxy to attend and vote in his/her stead. A proxy need not be a Member of the Company.

2. The instrument appointing a proxy must be deposited at the Registered Office of the Company at 9 Senoko

Drive, Singapore 758197 not less than forty-eight (48) hours before the time appointed for holding the Meeting.

NOTICE OF BOOK CLOSURE

NOTICE IS HEREBY GIVEN that the Share Transfer Books and Register of Members of SMB United Limited (the “Company”) will be closed at 5.00 p.m. on May 7, 2010 for the preparation of dividend warrants.

Duly completed registrable transfers received by the Company’s Share Registrar, Boardroom Corporate & Advisory Services Pte. Ltd., 50 Raffles Place, #32-01 Singapore Land Tower, Singapore 048623 up to 5.00 p.m. on May 7, 2010 will be registered to determine shareholders’ entitlements to the said dividend. Members whose Securities Accounts with The Central Depository (Pte) Limited are credited with shares at 5.00 p.m. on May 7, 2010 will be entitled to the proposed dividend.

Payment of the dividend, if approved by the members at the Annual General Meeting to be held on April 30, 2010 will be made on May 21, 2010.

By Order of the Board

Tan Ngiap HongElizabeth KrishnanCompany Secretaries

SingaporeApril 6, 2010


!IMPORTANT:

1. For investors who have used their CPF monies to buy SMB United Limited’s shares, this Report is forwarded to them at the request of the CPF Approved Nominees and is sent solely FOR INFORMATION ONLY.

2. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents and purposes if used or purported to be used by them.

3. CPF investors who wish to attend the Meeting as an observer must submit their requests through their CPF Approved Nominees within the time frame specified. If they also wish to vote, they must submit their voting instructions to the CPF Approved Nominees within the time frame specified to enable them to vote on their behalf.

SMB UNITED LIMITEDCompany Registration No. 199506364D(Incorporated In The Republic of Singapore)

>> Proxy Form(Please see notes overleaf before completing this Form)

I/We,

of

being a member/members of SMB United Limited (the “Company”), hereby appoint:

Name NRIC/Passport No. Proportion of Shareholdings

No. of Shares %

Address

and/or (delete as appropriate)

Name NRIC/Passport No. Proportion of Shareholdings

No. of Shares %

Address

or failing the person, or either or both of the persons, referred to above, the Chairman of the Meeting as my/our proxy/proxies to vote for me/us on my/our behalf at the Annual General Meeting (the “Meeting”) of the Company to be held on Friday, April 30, 2010 at 10.00 a.m. and at any adjournment thereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at the Meeting as indicated hereunder. If no specific direction as to voting is given or in the event of any other matter arising at the Meeting and at any adjournment thereof, the proxy/proxies will vote or abstain from voting at his/her discretion. The authority herein includes the right to demand or to join in demanding a poll and to vote on a poll.

(Please indicate your vote “For” or “Against” with a tick [ ] within the box provided.)

No. Resolutions relating to: For Against

1 Directors’ Report and Audited Accounts for the year ended December 31, 2009

2 Declaration of one-tier tax exempt Final Dividend of 1.5 cents per ordinary share

3 Re-election of Mr Henry Hoe Leong Seng as a Director

4 Re-election of Mr Goh Ban Kin as a Director

5 Re-election of Mr Lee Kwang Mong as a Director

6 Approval of Directors’ fees amounting to $231,000

7 Re-appointment of Messrs Deloitte & Touche LLP as Auditors

8 Authority to issue new shares

9 Renewal of Share Purchase Mandate

Dated this day of 2010

Signature of Shareholder(s)or, Common Seal of Corporate Shareholder

Total number of Shares in: No. of Shares

(a) CDP Register

(b) Register of Members

106 >> SMB United LimitedNotes :

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

2. A member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies to attend and vote in his/her stead. A proxy need not be a member of the Company.

3. Where a member appoints two proxies, the appointments shall be invalid unless he/she specifies the proportion of his/her shareholding (expressed as a percentage of the whole) to be represented by each proxy.

4. Completion and return of this instrument appointing a proxy shall not preclude a member from attending and voting at the Meeting. Any appointment of a proxy or proxies shall be deemed to be revoked if a member attends the meeting in person, and in such event, the Company reserves the right to refuse to admit any person or persons appointed under the instrument of proxy to the Meeting.

5. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company at 9 Senoko Drive, Singapore 758197 not less than 48 hours before the time appointed for the Meeting.

6. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its seal or under the hand of an officer or attorney duly authorised. Where the instrument appointing a proxy or proxies is executed by an attorney on behalf of the appointor, the letter or power of attorney or a duly certified copy thereof must be lodged with the instrument.

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

FOLD ALONG THIS LINE

FOLD ALONG THIS LINE

AFFIXSTAMP

The Company SecretarySMB UNITED LIMITED

9 Senoko DriveSingapore 758197

General:

The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible, or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument appointing a proxy or proxies. In addition, in the case of Shares entered 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 entered against his name in the Depository Register as at 48 hours before the time appointed for holding the Meeting, as certified by The Central Depository (Pte) Limited to the Company.

SMB UNITED LIMITED Co.Reg.No.: 199506364D

9 Senoko Drive Singapore 758197T (65) 6756 0188 • F (65) 6755 4889

E [email protected] • W www.smbunited.com

SWITCHGEAR DIVISION

SMB Electric Pte Ltd15 Senoko Avenue Singapore 758305 (Office)15 Senoko Way Singapore 758036 (Plant)T (65) 6756 0988 • F (65) 6756 6097E [email protected] www.smbelectric.com

SMB Electric Systems Pte Ltd17 Senoko Avenue Singapore 758307T (65) 6753 8010 • F (65) 6755 0665E [email protected] www.smbelectric.com

SMB Electric Industries Pte Ltd15 Senoko Avenue Singapore 758305T (65) 6756 0988 • F (65) 6753 2927E [email protected] www.smbelectric.com

Bridex Harwal Pte Ltd9 Senoko Drive Singapore 758197T (65) 6753 2779 • F (65) 6753 0969E [email protected] www.bridexharwal.com

SMB United Industries Sdn Bhd - (“SMBUI”)SMB Switchgear & Engineering Sdn Bhd- (“SMB S&E”)Brighten Switchboard Builders (M) Sdn Bhd - (“BSB”)PLO 131, 133, 134, Jalan Cyber 5Kawasan Perindustrian Senai 3,81400 Senai Johor, MalaysiaT (60 7) 598 3812 (SMBUI / SMB S&E) (60 7) 598 3818 (BSB)F (60 7) 598 3815 (SMBUI / SMB S&E) (60 7) 598 3817 (BSB)

SMB Brighten Switchboard Engineering Sdn Bhd23-1, Jalan 109E, Desa Business ParkJalan Desa, Taman Desa58100, Kuala Lumpur, MalaysiaT (60 3) 7984 2175 • F (60 3) 7984 3009

SMB Harwal Electric Pty LimitedUnit D3, Lane Cove Business Park,16 Mars Road, Lane CoveNSW 2066, AustraliaT (61 2) 9420 7777 • F (61 2) 9420 7700E [email protected] www.smbharwal.com.au

SMB United Limited9 Senoko Drive Singapore 758197 • T (65) 6756 0188 • F (65) 6755 4889 • E [email protected] • W www.smbunited.com

SMB Electric Vietnam Co., LtdLot N1, Viet Huong Industrial ParkThuan An District, Binh Duong Province, VietnamT (84 650) 3715 193 • F (84 650) 3715 194

SMB Electric (Xiamen) Co., LtdNo. 38, 3rd Floor 1# BuildingXin Jia Lu, HaiCang XinYang Industrial ParkXiamen, Fujian, People’s Republic of China,P.C. 361022T (86 592) 651 2318 • F (86 592) 651 2328E [email protected]

POWER & TECHNOLOGY DIVISION

EDMI Limited and its subsidiaries47 Yishun Industrial Park ASingapore 768724T (65) 6756 2938 • F (65) 6756 0125E [email protected] [email protected] www.edmi-meters.com TRADING & DISTRIBUTION DIVISION

Bridex Singapore Pte Ltd15 Senoko Avenue Singapore 758305T (65) 6756 0833 • F (65) 6756 2007E [email protected] www.bridex.com.sg

Bridex Australia Pty Limited

- Head Office (New South Wales)No. 12/20 Narabang WayBelrose NSW 2085, AustraliaT (61 2) 9986 1711 • F (61 2) 9986 1766

- Queensland Branch Office162 South Pine RoadBrendale Queensland 4500, AustraliaT (61 7) 3881 6450 • F (61 7) 3881 6467E [email protected] www.bridex.com.au

Bridex Electric Philippines, Inc2100 Pasong Tamo Extension1200 Makati City, PhilippinesT (63 2) 757 1217-19 • F (63 2) 757 3031W www.bridex.com.sg

Bridex Malaysia Sdn BhdSuite 1-3A, 1st Floor, N-Tatt BuildingNo. 2 Jalan TP 5, Taman Perindustrian UEP,47600 Subang Jaya,Selangor Darul Ehsan, MalaysiaT (60 3) 8023 6317 • F (60 3) 8023 6315

Vietnam Rep Office - Bridex Singapore Pte Ltd12/6 Dao Duy Anh Str. Ward 9Phu Nhuan DistrictHo Chi Minh City, VietnamT (84 8) 3845 2055 • F (84 8) 3845 2042

BUILDING SERVICES DIVISION

Quantum Automation Pte Ltd - (“QA”)Quantum Automation (Asia) Pte Ltd - (“QA Asia”)Quantum Security Systems Pte Ltd - (“QSS”)Blue Tree Controls Pte Ltd - (“Blue Tree Controls”)eSwitch Engineering Pte Ltd - (“eSwitch”)18 Kaki Bukit Road 3 #04-01/2/3 Entrepreneur Business Centre Singapore 415978

- QA/QA Asia/QSS/Blue Tree ControlsT (65) 6744 2921 • F (65) 6748 6801E [email protected] www.qa.com.sg

- eSwitchT (65) 6271 0588 • F (65) 6748 6801E [email protected] QA Systems Integration (M) Sdn Bhd11-3 Jalan PJU 8/3BBandar Damansara Perdana,47820 Petaling JayaSelangor Darul Ehsan, MalaysiaT (60 3) 7725 1590 • F (60 3) 7725 1593

Quantum Automation Systems (Shanghai) Co., Ltd Shanghai Xu Hui Qu 900 Yishan RoadHigh Tech Building, Unit 15-06, ShanghaiPeople’s Republic of China, P. C. 200233T (86 21) 5423 4667 • F (86 21) 5423 4463E [email protected] www.qachina.com

QA Systems Integration - M.E. LLC Nasser Lutha Building 1st FloorNear Dubai Airport Terminal 1P O Box 116392, Dubai, UAET (971) 50 287 6359 • F (971) 4 337 4310E [email protected]

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