ECS CVR casted - ECS Holdings Limitedecs.listedcompany.com/misc/ar2000.pdf · The shares of ECS are listed on the mainboard of the Singapore Exchange Securities Trading Limited as

ECS Holdings Limited Blk 19, Kallang Avenue, #07-153/155/157/159 Singapore 339410Tel: 65-299 9433 Fax: 65-298 3629 Website: http://www.ecssin.com.sg

A N N U A L R E P O R T 2 0 0 0

e-Infrastructure Enabler

e-Services Provider

A N N U A L R E P O R T 2 0 0 0


e-Services Provider

e-Distributore-Distributor

CONTENTS

About ECS Holdings Limited 2

Core Business Network 3

Financial Highlights 4

Chairman’s Message 10

Chief Executive Officer’s Message 14

Operations Review 18

Board of Directors 22

Management Staff 24

Organisation Chart 25

Corporate Governance 26

Corporate Information 28

Financial Statements 29

NOTE TO SHAREHOLDERS

ECS Holdings Limited would like to inform our shareholders that

the financial information set out in the Financial Highlights,

Chairman’s Message, Chief Executive Officer’s Message and

Operations Review sections of this Annual Report on Pages 4 to 21

are presented on a pro forma basis. The “Pro forma Group” refers

to the companies which now form part of the ECS Holdings Group

as a result of the restructuring exercise that was mentioned in our

Prospectus dated 30 January 2001. The pro forma results have

been prepared as if the restructured ECS Holdings Group had

always been in existence. The pro forma results have been arrived

at after making the pro forma adjustments described in the

Prospectus.

The financial statements of the ECS Holdings Group for the year

ended 31 December 2000, based on the legal group, is set out on

Pages 29 to 66 of this Annual Report.

About ECS Holdings Limited

ECS Holdings Limited (“ECS”) is the holding company of a group

of three companies comprising ECS Computers (Asia) Pte Ltd in

Singapore, K.U. Sistem Holdings Sdn Bhd in Malaysia and The Value

Systems Co., Ltd in Thailand (“the Group”).

The Group is a leading e-infrastructure enabler and e-services

provider serving and supporting Asia’s growing internet economies.

The substantial shareholders of ECS comprise Technocrat

Investments Limited (35.7%). Solectron Technology Singapore Pte

Ltd (29.0%) and V Investment Holdings Limited (8.7%)

The shares of ECS are listed on the mainboard of the Singapore

Exchange Securities Trading Limited as of 9 February 2001.

ECS Holdings Limited

ECS Holdings Limited Annual Report 2000 3

CORE BUSINESS NETWORK

ECS Computers(Asia) Pte LtdBlk 19Kallang Avenue#07-153 to 159Singapore 339410

Mr Tay Eng HoeManaging Director

Mr Foong Kam ThoGeneral Manager

ECS HoldingsLimitedBlk 19Kallang Avenue#07-153Singapore 339410

Mr Tay Eng HoeChief Executive Officer

K.U. Sistem HoldingsSdn. Bhd.107 Block CGlomac Business Centre10 Jalan SS6/1Kelana Jaya 47301Petaling JayaMalaysia

Mr Foo Sen ChinManaging Director

The Value SystemsCo., Ltd.34th Floor, Charn IssaraTower 22922/328-331New Petchburi RoadBangkapi, Huay-KwangBangkok 10320,Thailand

Mr Narong IntanatePresident

4 ECS Holdings Limited Annual Report 2000

FINANCIAL HIGHLIGHTS

Earnings per share (cents)

10.00

5.00

0

1.91

(0.00)

6.39

9.06

1997 1998 1999 2000

Revenue (S$’000)500,000

400,000

300,000

200,000

100,000

0

217,956 187,596

267,074

434,070

1997 1998 1999 2000

Profit (S$’000)20,000

16,000

12,000

8,000

4,000

01997 1998 1999 2000

3,184

221

8,289

18,093

1,436

(1)

4,796

11,169

Profit Before Tax Profit After Tax & MI

Note: For meaningful comparison, earnings per share for 1997 and 1998 are computedbased on the share capital existing in 1999


REVENUE

The Group’s revenue rose from $267.1 million in 1999 to $434.1

million in 2000 representing an increase of approximately 62.5% or

$167.0 million over that of the previous year.

The improvement in the Group’s revenue is attributable to the

stronger performance across all its business segments. With the

economic recovery in Singapore, Malaysia and Thailand, many

customers also increased their budget for IT expenditure to cater

to both replacement and upgrading needs for their existing

technologies. Furthermore, as businesses escalate to improve their

competitive edge through the implementation of e-commerce

infrastructure, the demand for the Group’s internet and e-commerce

related products and services also increased. This has been an

important factor underlying the growth of the Group’s e- enabling

infrastructure business in 2000.

PROFIT

On a pro forma basis, the Group’s profit after taxation and minority

interests rose from $4.8 million in 1999 to $11.2 million in 2000

representing an increase of about 133.3% over the previous year.

The higher profitability is a result of the strong business growth in

Singapore, Malaysia and Thailand.

EARNINGS PER SHARE

Corresponding to the significantly improved profitability of the Group

in 2000, its earnings per share also rose from 6.39 cents to 9.06

cents representing an increase of about 41.8% over that of the

previous year.



Group Revenue Contribution byGeographical Segments

100%

50%

0%1997 1998 1999

Malaysia Thailand

Singapore

IT Products Distribution IT Services

E-enabling Infrastructure

1997 1998 1999 2000

Group Revenue Contribution byProduct Category

100%

80%

60%

40%

20%

0%


34.4%

2.6%

63.0%

33.9%

3.5%

62.6% 62.6%

2.8%

34.6%

54.0%

4.0%

42.0%

33.7%

42.9%

23.4%

48.0%

32.7%

19.3%

46.1%

32.8%

21.1%

50.4%

30.1%

19.5%



REVENUE

BY BUSINESS SEGMENTS

Growth was seen across all business segments during the year.

E-enabling Infrastructure

This segment saw the strongest growth in 2000 posting an increase

of about $90.0 million or 97.3%. E-enabling infrastructure business

contributed a total of $182.5 million during the year compared to

$92.5 million in 1999.

IT Services

Revenue from IT services rose by approximately $9.6 million or

128.0%, rising from $7.5 million to $17.1 million in 2000.

IT Products Distribution

IT products distribution contributed about $234.5 million in 2000

compared to $167.1 million in 1999. This represents an increase of

about $67.4 million or 40.3%.

BY GEOGRAPHIC SEGMENTS

Singapore

The revenue from our operations in Singapore rose from $123.2

million to $219.0 million in 2000 representing an increase of about

$95.8 million or 77.8%.

Malaysia

The contributions from Malaysia rose by about $28.1 million or

49.8% during the year from $56.4 million in 1999 to $84.5 million in

2000.

Thailand

In 2000, Thailand also saw significant growth contributing about

$130.6 million to the Group’s revenue. Comparing to the $87.5

million posted in 1999, year 2000 saw a significant growth of about

$43.1 million or 49.3% with the stronger Thai economy.



Interest Coverage (Times)

15.00

10.00

5.00

01997 1998 1999 2000

2.03

1.10

7.97

13.19

Interest Expense (S$’000)4

2

0

3,077

2,230

1,189 1,484

1997 1998 1999 2000

1997 1998 1999 2000

Leverage Ratios

2.00

1.50

1.00

0.50

0

0.27

1.54

1.38

1.16

1.35

0.26 0.23 0.27

External Borrowing vs Total AssetsDebt Equity Ratio


LEVERAGE RATIOS

The Group’s strong business growth in 2000 also brought about

higher working capital requirements. This working capital demand

was met primarily through bank borrowings. The Group’s gearing

rose from 1.16 in 1999 to 1.35 in 2000 reflecting the increased

borrowings.

INTEREST EXPENSE AND COVERAGE

Corresponding to the higher borrowings, the Group’s interest

expense for the year rose from $1.2 million in 1999 to $1.5 million

in 2000. However, the higher interest expense was mitigated by the

stronger profitability of the Group. Interest cover in 2000 was 13.2

times compared to 8.0 times in the previous year.



CHAIRMAN’S MESSAGE

Mr Chester Lin ChienChairman


The year 2000 marks an important milestone in the history of ECS

Holdings Limited (“ECS”). ECS has finally joined the ranks of listed

companies in Singapore. On 9 February 2001 the shares of ECS

commenced trading on the Singapore Exchange Securities Trading

Limited. A total of $23,459,700 was raised from the Group’s initial

public listing and the funds were used to repay bank borrowings

and for working capital.

On a pro forma basis for the financial year ended 31 December

2000, ECS turned in strong growth across its operations in the

region. Turnover rose to $434.1 million with pre-tax operating profit

increasing by approximately 118.1 % to $18.1 million. Profit after

tax and minority interests rose to $11.2 million registering a 133.3%

increase compared with 1999. Earnings per share rose 41.8% from

6.39 cents to 9.06 cents and net tangible asset backing per ordinary

share rose by 70.8% to 15.94 cents.

No dividends will be declared this year as stated in the Company’s

prospectus dated 30 January 2001.

Our Business

Supported by the growth in the regional economies, our operations

in Singapore, Malaysia and Thailand recorded strong performance.

Turnover in Singapore rose from $123.2 million to $219.0 million, a

growth of 77.8%, while in Malaysia and Thailand, our companies

posted turnovers of $84.5 million and $130.6 million respectively,

representing growth of about 49.8% and 49.3%.

Profit before taxation from e-enabling infrastructure business and

IT services business were about $10.8 million and $2.6 million

representing approximately 60% and 14% of the Group’s total

business. The balance 26% of the business was derived from the

Group’s IT products distribution business segment.




e-Distribution is a rapidly growingbusiness segment in ECS.



Our People

It has always been the philosophy of ECS to invest and to grow our

people. People are an important asset of the Group. Our employees

will continue to play an increasingly important role as we expand

our business in the areas of e-enabling infrastructure and IT

services. We are committed to train our employees and better their

skills to further their personal growth. At ECS we encourage our

employees to participate in community enriching services and

extend a helping hand to people who require our assistance.

Our Prospects

The Board and Management of ECS remain optimistic about the

business prospects of the Group into the new financial year. In

addition to growing our business in Singapore, Malaysia and

Thailand, we continue to search for opportunities that will help the

growth and expansion of the Group in the region.

On behalf of the Board, I would like to thank our shareholders,

customers, business partners and employees for their support and

help during our initial public listing. I would like to express my

appreciation to the Board, Audit Committee and Compensation

Committee for their counsel and commitment.

Chester Lin Chien

Chairman of the Board


CHIEF EXECUTIVE OFFICER’S MESSAGE

Mr Tay Eng HoeChief Executive Officer


Year 2000 in Perspective

The year 2000 was an important year for ECS Holdings Limited

(“ECS”) as we prepared for our initial public offering. A total of

40,000,000 ordinary shares of $0.10 each comprising 35,545,000

New Shares and 4,455,000 Vendor Shares were offered by way of

placement and public offer. With the overwhelming response from

the public, we received a total of 17.6 times subscription for our

public offer. Our shares commenced trading on the main board of

the Singapore Exchange Securities Trading Limited on 9 February

2001.

Performance by Business Segments

The business of the Group during the 2000 financial year remained

strong as companies continue to upgrade their information

technology systems after the smooth transition into the new

millennia. Moreover, as businesses and organisations further

upgrade their operations and invest in advanced IT systems, we

saw strong growth in our e-enabling infrastructure business. On a

pro forma basis, during the year, our IT products distribution

business turnover grew by about 40.3% from $167.1 million in 1999

to $234.5 million in 2000 while our e-enabling infrastructure business

turnover grew from $92.5 million in 1999 to $182.5 million in 2000

representing a growth of 97.3%. Supporting the growth of our e-

enabling infrastructure business, our IT services business turnover

also expanded by 128.0% during the year.

Performance by Geographic Segments

The three countries within the Group - Singapore, Malaysia and

Thailand all turned in strong performance in 2000. On a pro forma

basis, Singapore reported a turnover of $219.0 million, a growth of

about 77.8% over that of the previous year while Malaysia and

Thailand contributed $84.5 million and $130.6 million representing

growths of 49.8% and 49.3% respectively.




e-Enabling infrastructure businesswill become increasingly importantas companies in the regionimplement and upgrade their ITinfrastructure.



Prospects Ahead

Following our initial public offering, the Group will be looking into

the opportunities to expand our business into the surrounding Asian

countries. It remains the objective of the Group to continue our

growth through a combination of equity acquisit ions and

partnerships. This strategy will help us ascertain continuity in the

new business entities that we acquire and better manage business

risks.

Besides the regional expansion, the Group will also focus necessary

resources to enhance existing operations in Singapore, Malaysia

and Thailand in order to improve profitability and achieve higher

revenue growth. We will focus investment to upgrade our IT

infrastructure, provide more training for our staff’s development and

enhance our operational process to improve efficiency.

To support the continued growth of the Group, we will also be

sourcing for more product lines and widen our range of services.

While the current financial year may see some consolidation in the

IT market globally, we remain optimistic that the Group’s

performance will improve as we continue to broaden our product

offerings to meet the expanding IT services and e-infrastructure

needs in the surrounding Asian countries.

Finally, I would like to thank all our customers, principals, employees,

business associates and friends for their help over all these years.

We are all committed to ensure the future growth of ECS as the

Group embeds its footprints in the region.

Tay Eng Hoe

Chief Executive Officer


OPERATIONS REVIEW

The B-2-B on-line system at ECShelps expedite the ordering and

delivery of IT equipment toresellers in the market.


OPERATIONS REVIEW

SINGAPORE

Singapore continues to see strong growth across all segments of

our business. During the year, contributions from Singapore were

approximately 50.4% and 55.0% of the Group’s turnover and profit

before taxation. Complementing the increased business activities,

our staff strength also rose from 121 as at the end of 1999 to 160

employees by 31 December 2000 representing an increase of about

32%. The new employees comprise mainly technicians and

engineers whose primary roles are to support our e-enabling

infrastructure and e-services business. This move corresponds to

our strategy to focus on these two high value added segments of

our business.

To facilitate and expedite the delivery of our products to customers,

we activated our business-to-business (“B2B”) on-line system for

our e-distribution business in March 2000. Following the launch of

this on-line system, we have received very encouraging response

from our customers. The B2B on-line system has also been

instrumental in supporting our ability to improve our productivity

and customer service delivery. The response time to our customers’

orders have experienced significant improvement whereby all orders

received via our on-line system can be delivered within 24 hours

from the time of receipt.

MALAYSIA

During the year, Malaysia posted a turnover of $84.5 million,

representing an increase of 49.8% over the $56.4 million reported

in the previous year. At the profit before taxation, Malaysia

contributed about $2.1 million representing approximately 11.5%

of the Group’s profit before taxation.

In August 2000, we opened the new warehouse cum service centre

at Hicom Glenmarie in Shah Alam. The warehouse, occupying an

area of about 20,000 sq feet, will provide additional warehousing

space and catering to the higher business volume in Malaysia. Part

of the warehouse was organised as a service centre to provide

more efficient services and faster turn around time for repair

services.


OPERATIONS REVIEW

ECS provides training services to ourcustomers. We are the authorised

training centre for Sun Microsystem,iPlanet and Check Point.


OPERATIONS REVIEW

THAILAND

Business in Thailand was very brisk during the year. At the turnover

level, our Thai operations reported a total turnover of $130.6 million

representing an increase of about 49.3% over that of 1999.

Corresponding to the higher business activity, profit before taxation

also grew by about 79.4% to $6.1 million.

In 2000, four new service centres were opened in Thailand. These

are located in the southern, northern and northeastern parts of

Thailand in Surat, Phuket, Pitsanuloke and Nakornratchaseema.

Three new products were added during the year. These were Toshiba

notebooks, IBM personal computers, notebook and workstation and

Check Point network security and management software.

Our Thai B2B on-line system, Value Online experienced a 300%

growth during the year. Total sales for the year rose from 42 million

baht in 1999 to 178 million baht in 2000. In June 2000 we also

launched a new version of the web-based management information

systems for sales, credit, procurement and inventory management

and the new on-line payment system.


BOARD OF DIRECTORS

Mr Chester Lin Chien is the Chairman of our Company. Mr Lin wasappointed as Chairman of the Company on 1 October 1998. He isalso the president of Solectron Asia Pacific Region and managingdirector of Solectron Technology Singapore Pte Ltd (formerly knownas NatSteel Electronics Ltd) our substantial shareholder. Prior tojoining Solectron Technology Singapore Pte Ltd, Mr Lin spent 10years in General Instruments of Taiwan where he held seniorpositions in the quality production and engineering departmentsbefore leaving for a management position at General Electric inSingapore, where he worked for 6 years. In 1984, Mr Lin startedthe Singapore subsidiary of US-based SCI Systems, Inc. He holdsa Bachelor of Science degree in Electrical Engineering from theTaipei Institute of Technology.

Mr Tay Eng Hoe is a Director and the Chief Executive Officer of our Company.Mr Tay was appointed as a Director of the Company on 1 April 2000. He is alsothe managing director of ECS Computers (Asia) Pte Ltd and a director of TheValue Systems Co. Ltd., our subsidiaries. He holds a Bachelor of Science(Honours) degree from La-Trobe University and a Master of BusinessAdministration degree from Melbourne University. Prior to joining our Company,he was managing Engineering Computer Services (S) Pte Ltd, a CAD/CAMcompany and prior to that, an officer of the National Productivity Board.

Mr Chay Yee Meng is a Director of our Company. Mr Chay was appointed as aDirector of the Company on 1 October 1998. He is also a director of ECSComputers (Asia) Pte Ltd and The Value Systems Co. Ltd. He holds a Bachelorof Accountancy degree from Nanyang University. He started his career as anaudit assistant in Arthur Young in 1980. In 1982 he left for a position as a senioraccountant and project manager of GM Singapore Pte Ltd. In 1987, he wasemployed by SCI Singapore as a financial controller and director. He is currentlythe director and vice-president of finance, Solectron Asia Pacific Region and aboard member of Solectron Technology Singapore Pte Ltd (formerly known asNatSteel Electronics Ltd.)

Mr Foo Sen Chin is a Director of our Company. Mr Foo was appointed as aDirector of the Company on 15 December 2000. He is also the managing directorof K.U. Sistem Holdings Sdn Bhd, our subsidiary. He holds a Master’s degreein Business Administration from the Cranfield School of Management in theUnited Kingdom. Prior to joining our Company, he was the general manager ofa computer bureau services company in Kuala Lumpur before forming K.U.Sistem Sdn Bhd in 1985.


BOARD OF DIRECTORS

Mr Narong Intanate is a Director of our Company. Mr Narong was appointed as aDirector of the Company on 15 December 2000. He is also the president of TheValue Systems Co. Ltd., our subsidiary. He holds a Bachelor of Science degree inBusiness Administration and a master of Business Administration from CaliforniaState University. Prior to forming The Value Systems Co. Ltd., he was the marketingmanager of Sahaviriya Computers Co., Ltd from 1982 to 1983. Between 1983 to1988, he was the marketing director of Sahaviriya OA.

Mr Wong Heng Chong is a Director and the Chief Financial Officer of our Company.Mr Wong was appointed as a Director of the Company on 15 December 2000. Heis a member of the Institute of Chartered Accountants in Australia and holds adiploma in Management Studies from the University of Chicago Graduate Schoolof Business. Prior to joining our Company, he was an executive director of BousteadSingapore Limited. He was also a director and the group financial controller ofQAF Limited. Prior to joining QAF Limited, he was a director and group generalmanager of Sunshine Allied Investments Limited (now known as Network FoodsInternational Limited).

Mr Hsieh Fu Hua is a Director of our Company. Mr Hsieh is the general partner ofPrimePartners Asset Management, Inc. and former group managing director of theBNP Prime Peregrine Group. Mr Hsieh was appointed as a Director of the Companyon 27 March 2001. He has over 27 years of experience in merchant banking in Asia.Prior to forming PrimePartners in 1994, he was chief executive officer of Morgan GrenfellAsia Holdings Pte. Ltd. From 1983 to 1985, he headed the Singapore branch of LloydsBank International. Mr Hsieh has served on the boards of several country funds and isa director of CapitaLand Limited and a member of the Governing Council of theSingapore Institute of Management. He is a graduate of the University of Singaporewith an honours degree in business administration.

Mr Leong Horn Kee is an Independent Director of our Company. He was appointedas an Independent Director of the Company on 15 December 2000. He graduatedwith a Bachelor of Technology in Production Engineering Loughborough Universityin the United Kingdom. He also holds an Economics degree from the University ofLondon and a Masters in Business Administration from INSEAD, France. He iscurrently the chief executive officer/managing director of Yeo Hiap Seng Limitedand an executive director of the Far East Organisation. He is also a member ofparliament and the chairman of the Government Parliamentary Committee forFinance, Trade and Industry.

Mrs Lee Suet Fern is an Independent Director of our Company. She was appointedas an Independent Director of the Company on 15 December 2000. She sits on theAdvisory Committee of the Nanyang Technological University’s School ofAccountancy and Business, and the Singapore National Committee for PacificEconomic Cooperation Council. She is a practicing advocate and solicitor of theSupreme Court of Singapore. She qualified as a barrister-at-law at Gray’s Inn, Londonand graduated from Cambridge University with a double first in law.


MANAGEMENT STAFF

Mr Tay Eng Hoe

Director and Chief Executive Officer, appointed on 1 April 2000. He is also the Managing Directorof ECS Computers (Asia) Pte Ltd. He holds a Bachelor of Science (Honours) degree from La-Trobe University and a Master of Business Administration degree from Melbourne University.

Mr Wong Heng Chong

Director, appointed on 15 December 2000. He is also the Chief Financial Officer of ECS HoldingsLimited and a member of The Institute of Chartered Accountants in Australia. He holds a diplomain Management Studies from University of Chicago Graduate School of Business.

Mr Foo Sen Chin

Director, appointed on 15 December 2000. He is also the managing director of K.U. SistemHoldings Sdn Bhd. He holds a Master’s degree in Business Administration from Cranfield Schoolof Management in the United Kingdom.

Mr Narong Intanate

Director, appointed on 15 December 2000. He is also the president of The Value Systems Co.,Ltd. He holds a Bachelor of Science degree in Business Administration and a Master of BusinessAdministration from California State University.

Mr Foong Kam Tho

General Manager of ECS Computers (Asia) Pte Ltd. He holds a Bachelor of Science degree(Computer Science) from the National University of Singapore.

Mr Wee Sien Yang

Financial Controller of ECS Computers (Asia) Pte Ltd and Company Secretary of ECS HoldingsLimited. He is a Certified Public Accountant of Singapore and an associate member of theAssociation of Chartered Certified Accountants in the United Kingdom.

Mr Somsak Pejthaveeporndej

Vice president of the sales division of The Value Systems Co., Ltd. He holds a Bachelor ofScience degree majoring in electronics from Rajapat Institution Bangkok, Thailand.

Mr Soong Jan Hsung

General manager and executive director of Astar Marketing Sdn Bhd and Pericomp-Sistech SdnBhd. He holds a Bachelor of Science (Honours) degree in Mathematics from the University ofMalaya.


ORGANISATION CHART

ECS Holdings Limited

75%*(Thailand)

The Value SystemsCo., Ltd.

100%(Singapore)

ECS Computers(Asia) Pte Ltd

60%(Malaysia)

K.U. SistemHoldings Sdn Bhd

70%

Antara ITSdn Bhd

100%Astar

MarketingSdn Bhd

100%

K.U. SistemSdn Bhd

80%Pericomp-

SistechSdn Bhd

* denotes effective interest

99.9%*

EC Sure Holdings(Thailand) Co., Ltd.


CORPORATE GOVERNANCE

Board of Directors

The Board at ECS Holdings Limited comprises nine directors namely

Mr Chester Lin Chien (Chairman), Mr Tay Eng Hoe (Chief Executive

Off icer), Mr Wong Heng Chong (Chief Financial Off icer),

Mr Chay Yee Meng, Mr Foo Sen Chin, Mr Narong Intanate, Mr Hsieh

Fu Hua, Mr Leong Horn Kee (independent) and Mrs Lee Suet Fern

(independent).

ECS places great importance on the quality of its Board of Directors.

The Group achieves this by appointing to its Board highly respected

individuals and prominent leaders in their respective professions.

The current Board of ECS comprises individuals with proven track

record in the public and/or corporate sector, and is each a highly

respected member of the business community.

The Board shall hold at least three formal meetings a year and

shall also hold informal meetings regularly. The Board of Directors

supervises the management of the business and affairs of the Group

and approves the Group’s strategic operational initiatives, major

investments and funding decisions. Apart from fulfilling its statutory

responsibi l i t ies, the Board reviews the Group’s f inancial

performance and compensation of senior management personnel.

These functions are performed either directly or through the Board

committees like the Audit Committee and the Compensation

Committee, as well as through a system of Delegation of Authority

to senior management personnel within the Group.

AUDIT COMMITTEE

The Audit Committee comprises our independent directors, Mr

Leong Horn Kee and Mrs Lee Suet Fern and our Chief Financial

Officer, Mr Wong Heng Chong. Mr Leong is the Chairman of the

Audit Committee. The Audit Committee shall meet periodically to

perform the following functions:-


• Monitoring the effectiveness of the management of financial

business risks and the reliability of management reporting;

• Monitoring the compliance with laws and regulations, particularly

those of the Companies Act, Chapter 50 and the Singapore

Exchange Listing Manual;

• Reviewing the appropriateness of half year and full year

annoucements and reports;

• Reviewing the effectiveness and efficiency of internal and

external audits; and

• Reviewing related party transactions.

Specific functions of the audit committee include reviewing the

scope of work of the internal and external auditors, the assistance

given by the Company to the auditors and receiving and considering

the reports of the internal and external auditors including their

evaluation of the system of internal controls. The consolidated

financial statements of the Company are reviewed by the audit

committee prior to their submission to the Board of Directors for

adoption. The audit committee also recommends the appointment

of the external auditors and reviews the level of audit fees.

Compensation Committee

We have established a Compensation Committee with the

responsibility to oversee the general compensation of employees

of our Group with a goal to motivate, recruit and retain employees

and directors through competitive compensation and progressive

policies. In particular, the Compensation Committee is responsible

for overseeing our employee profit sharing scheme as well as the

share incentives, including the ECS Share Option Scheme I and

ECS Share Option Scheme II. The Compensation Committee of the

Board comprises Mr Leong Horn Kee, Mr Chester Lin and Mr Tay

Eng Hoe. Mr Leong is the Chairman of the Compensation

Committee.

ECS adopts the Best Practices Guide issued by The Singapore

Exchange Securities Trading Limited and has issued its own internal

compliance code on dealings in securities by the company, its

directors and officers.

CORPORATE GOVERNANCE


CORPORATE INFORMATION

AUDITORS KPMGCertified Public Accountants16 Raffles Quay #22-00Hong Leong BuildingSingapore 048581(Partner-in-charge: Ms Frances Cheang Chin Neo)

SHARE REGISTRAR M&C Services Private Limited138 Robinson Road #17-00Hong Leong CentreSingapore 068906

REGISTERED OFFICE 19 Kallang Avenue #07-153Singapore 339410

PRINCIPAL BANKERS ABN AMRO Bank63 Chulia StreetSingapore 049514

Citibank N.A.3 Temasek AvenueCentennial TowerSingapore 039190

Deutsche Bank6 Shenton Way #15-08DBS Building Tower TwoSingapore 068809

Oversea-Chinese Banking Corporation65 Chulia StreetOCBC CentreSingapore 049513

Overseas Union Bank Limited1 Raffles PlaceOUB CentreSingapore 048616

Standard Chartered Bank6 Battery RoadSingapore 049909

United Overseas Bank Limited80 Raffles PlaceUOB Plaza 1Singapore 048624

COMPANY SECRETARY Wee Sien Yang, CPA


CONTENTS

Directors’ Report 30

Statement by Directors 40

Report of the Auditors 41

Balance Sheets 42

Profit and Loss Accouts 43

Statements of Changes in Equity 44

Statement of Cash Flows 45

Notes to the Financial Statements 47

Analysis of Shareholdings 67

Notice of Annual General Meeting 68

Proxy Form 71


We, the undersigned directors, on behalf of all the directors of the Company, submit this annual report to themembers together with the audited financial statements of the Group and of the Company for the financial yearended 31 December 2000.

DIRECTORATE

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

Lin Chien (Chairman)Tay Eng Hoe (Chief Executive Officer, appointed on 1 April 2000)Chay Yee MengFoo Sen Chin (Appointed on 15 December 2000)Narong Intanate (Appointed on 15 December 2000)Wong Heng Chong (Appointed on 15 December 2000)Leong Horn Kee (Appointed on 15 December 2000)Lee Suet Fern (Appointed on 15 December 2000)Hsieh Fu Hua (Appointed on 27 March 2001)

PRINCIPAL ACTIVITIES

The principal activities of the Company are those relating to investment holding and the distribution of informationtechnology products. The principal activities of the subsidiaries are set out in note 4. There have been nosignificant changes in such activities during the financial year.

ACQUISITIONS AND DISPOSALS OF SUBSIDIARIES

During the financial year, the Company -

(a) Acquired an additional 40% interest in the equity of its subsidiary, ECS Computers (Asia) Pte Ltd (“ECSA”),for a consideration of $4,403,754, representing the Company’s share of the fair value of the identifiablenet assets of ECSA at the date of acquisition. Following the acquisition, ECSA became a wholly ownedsubsidiary.

(b) Acquired a 60% interest in the equity of K.U. Sistem Holdings Sdn. Bhd (“KU”), incorporated in Malaysia,for a consideration of RM 6,210,990 ($2,831,591), representing the Company’s share of the fair value ofthe identifiable net assets of KU at the date of acquisition.

(c) Incorporated a 99.9% owned subsidiary, EC Sure Holdings (Thailand) Co., Ltd (“EC Sure”) in Thailand,with an issued share capital of Baht 2 million and partly paid up to Baht 500,000.

In addition, EC Sure acquired a 38% interest in the equity of The Value Systems Co., Ltd (“VS”), incorporated inThailand. The consideration for EC Sure’s acquisition of VS amounted to Baht 66,159,514 ($2,847,103) basedon a relevant share of the fair value of identifiable net assets of Baht 90,481,890 ($3,981,203). Following ECSure’s acquisition, the Group’s effective interest in VS increased from a 37% equity accounted associated companyto a 75% controlled subsidiary.

Except as disclosed, the Company and its subsidiaries did not acquire or dispose of any subsidiaries.

DIRECTORS’ REPORTFor the year ended 31 December 2000


FINANCIAL RESULTS

Results of the Group and of the Company for the financial year are as follows:-

The Group The Company$ $

Profit from ordinary activities after taxation 11,819,155 183,254

Minority interests (3,373,669) -

Profit attributable to members of the Company 8,445,486 183,254

Unappropriated profits/(accumulated losses) brought forward 1,551,226 (1,495,191)

Unappropriated profits/(accumulated losses) carried forward 9,996,712 (1,311,937)

TRANSFERS TO AND FROM RESERVES AND PROVISIONS

There were the following material transfers to/(from) reserves during the financial year:-

The Group The Company$ $

Capital Reserve -

Capital Reserve arising on consolidation of subsidiaries 1,044,624 -

Currency Translation Reserve -

Exchange differences on translation of net assetsof foreign subsidiary and associated company (741,390) -

Movements in provisions are as set out in the accompanying notes to the financial statements.

ISSUES OF SHARES AND DEBENTURES

During the financial year:-

(a) On 24 July 2000, subsidiary, EC Sure Holdings (Thailand) Co., Ltd issued 196,000 preference shares and204,000 ordinary shares of Baht 5 each, partly paid up to Baht 1.25 per share for cash to incorporate thecompany.

(b) On 18 September 2000, the authorised share capital of the Company was revised from $23,065,000 dividedinto 18,500,000 ordinary shares of $1 each (“Ordinary Share”), 4,500,000 redeemable non-participatingcumulative convertible preference shares of $1 each (“Class A RCCPS”) and 6,500,000 redeemable non-participating convertible preference shares of $0.01 each (“Class B RCPS”) to $23,065,000 divided into23,065,000 Ordinary Shares by the cancellation of 4,500,000 Class A RCCPS and 6,500,000 Class BRCPS and the creation of 4,565,000 Ordinary Shares.

(c) On 13 December 2000, the authorised share capital of the Company was increased from $23,065,000 to$50,000,000 by the creation of an additional 26,935,000 Ordinary Shares. Thereafter, each Ordinary Sharecomprised in the existing authorised and issued and paid-up share capital was sub-divided into 10 ordinaryshares of $0.10 each.

(d) On 29 December 2000, the Company issued 96,430,000 ordinary shares of $0.10 each fully paid at parfor cash to provide funds for the repayment of bank borrowings which had been taken to finance theGroup’s acquisition of subsidiaries.

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

DIRECTORS’ REPORT


ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE SHARES AND DEBENTURES

On 21 December 2000, the Company granted one-off stock options to the executive directors of the Companyand the Group to subscribe for an aggregate 15,585,000 shares of the Company at the exercise price of $0.10per share, as disclosed under “Share Options”.

Other than for the share options granted, there were no arrangements during the financial year entered into bythe Company or the Group to enable the directors to acquire shares or debentures of the Company or any othercompany.

DIRECTORS’ INTERESTS IN SHARES OR DEBENTURES

According to the register kept by the Company for the purposes of Section 164 of the Companies Act, Chapter50, particulars of interests of directors who held office at the end of the financial year in shares and share optionsin the Company and related corporations are as follows:-

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

spouse or infant children to have an interest

At beginning At beginningof the year/ of the year/

date of At end date of At endappointment of the year appointment of the year

The Company Ordinary shares of $0.10 each fully paid

Tay Eng Hoe - - - 78,450,000Foo Sen Chin - - - 957,000Narong Intanate - - - 17,988,000

Options to subscribe for ordinary sharesof $0.10 each exercisable between

21/12/2001 to 20/12/2002 at $0.10 per share

Tay Eng Hoe - 1,113,000 - -Foo Sen Chin - 1,670,000 - -Narong Intanate - 4,453,000 - -Wong Heng Chong - 556,500 - -

Options to subscribe for ordinary sharesof $0.10 each exercisable between

21/12/2002 to 20/12/2005 at $0.10 per share

Tay Eng Hoe - 1,113,000 - -Foo Sen Chin - 1,670,000 - -Narong Intanate - 4,453,000 - -Wong Heng Chong - 556,500 - -

There was no change in any of the abovementioned interests in the Company between the end of the financialyear and 21 January 2001.

Except as disclosed above, no director who held office at the end of the financial year had interests in shares ordebentures of the Company or of related corporations either at the beginning of the financial year, or date ofappointment, if later or at the end of the financial year.

DIRECTORS’ REPORT


DIVIDENDS

Since the end of the last financial year, no dividend has been paid in respect of that previous year. No dividendhas been paid or is proposed to be paid in respect of the financial year under review.

OTHER STATUTORY INFORMATION

(a) Bad and Doubtful Debts

Before the profit and loss account and the balance sheet of the Company were made out, the directorstook reasonable steps to ascertain what action had been taken in relation to writing off bad debts andproviding for doubtful debts of the Company. The directors have satisfied themselves that all known baddebts have been written off and that adequate provision has been made for doubtful debts.

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

(b) Current Assets

Before the profit and loss account and the balance sheet of the Company were made out, the directorstook reasonable steps to ascertain that current assets of the Company which were unlikely to realise theirbook values in the ordinary course of business have been written down to their estimated realisable valuesand that adequate provision has been made for the diminution in value of such current assets.

At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in thisreport which would render the values attributable to current assets in the consolidated financial statementsmisleading.

(c) Charges and Contingent Liabilities

Since the end of the financial year:-

• no charge on the assets of the Company or any corporation in the Group has arisen which securesthe liabilities of any other person; and

• no contingent liability of the Company or any corporation in the Group has arisen.

(d) Ability to Meet Obligations

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

(e) Other Circumstances Affecting the Financial Statements

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

DIRECTORS’ REPORT


OTHER STATUTORY INFORMATION (CONT’D)

(f) Unusual Items

In the opinion of the directors, no item, transaction or event of a material and unusual nature has substantiallyaffected the results of the operations of the Group or of the Company during the financial year.

In the opinion of the directors, no item, transaction or event of a material and unusual nature has arisen inthe interval between the end of the financial year and the date of this report which is likely to affectsubstantially the results of the operations of the Group or of the Company for the financial year in whichthis report is made.

DIRECTORS’ INTERESTS IN CONTRACTS

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

SHARE OPTIONS

(a) Share Option Shares

The ECS Share Option Scheme I (“Scheme I”) was approved at the Company’s extraordinary generalmeeting held on 13 December 2000 to grant one-time share options to certain eligible directors andexecutives of the Company in recognition of their contribution to the growth and performance of theCompany.

The ECS Share Option Scheme II (“Scheme II”) was approved at the Company’s extraordinary generalmeeting held on 13 December 2000. Scheme II provides an opportunity for employees and directors,including non-executive directors, of the Group who have contributed significantly to the growth andperformance of the Group to participate in the equity of the Company.

The above schemes are administered by a compensation committee (“Committee”) comprising directorsof the Company and the Group. The Committee comprises the following members:-

Leong Horn Kee (Chairman)Lin ChienTay Eng Hoe

• Size of the Plan

The total number of new shares over which options may be granted shall not exceed 22,264,000shares for Scheme I and shall be determined at the discretion of the Committee for Scheme II.

• Grant of Option

Options pursuant to Scheme I were granted on 21 December 2000. Options pursuant to SchemeII may be granted at any time during the period when Scheme II is in force, except that no optionsshall be granted during the period of 30 days immediately preceding the date of announcement ofthe Company’s financial results.

DIRECTORS’ REPORT


SHARE OPTIONS (CONT’D)

(a) Share Option Shares (CONT’D)

• Acceptance of Option

The grant of an option shall be accepted within 30 days from the date of grant and accompaniedby payment to the Company of a nominal consideration of $1.

• Exercise Price

The exercise price for each share in respect of which an option is exercisable pursuant to SchemeI shall be the par value of the share. Under Scheme II, the exercise price shall be determined bythe Committee at its absolute discretion and fixed at:-

- A price equal to the average of the last dealt prices for a share, as determined by reference tothe Financial News or other publication published by the Singapore Exchange SecuritiesTrading Limited for the three consecutive trading days immediately preceding the grant of theoptions (the “Market Price”); or

- A price which is set at a discount to the Market Price provided that the maximum discountshall not exceed 20% of the Market Price and the shareholders of the Company in generalmeeting shall have authorised the making of offers and grants of option under Scheme II ata discount not exceeding the maximum discount as aforesaid.

Where the exercise price as determined above is less than the par value of the share, the exerciseprice shall be the par value.

• Exercise of Option

Options pursuant to Scheme I shall be exercisable after the first anniversary but before the fifthanniversary of the date of grant of the option, subject to the following:-

- Up to 50% of the shares in respect of which option is granted may be exercised within the12 month period after the first anniversary of the date of grant of the option; and

- The balance of the shares in respect of which option is granted may be exercised at anytime after the expiry of the aforesaid 12 month period.

Options granted pursuant to Scheme II shall be exercisable, in the case of options with exerciseprice set at Market Price, at any time after the first anniversary of date of grant and in the case ofoptions with exercise price set at a discount, at any time after the second anniversary of date ofgrant. Options granted to employees and executive directors are exercisable up to the tenthanniversary of date of grant and those granted to non-executive directors are exercisable up to thefifth anniversary of the date of grant.

• Duration of the Schemes

Scheme I and Scheme II shall continue to be in force at the discretion of the Committee, subject toa maximum period of 5 years and 10 years respectively commencing 13 December 2000.

DIRECTORS’ REPORT



(b) Options Granted

On 21 December 2000, the following options were granted to eligible persons under Scheme I at theexercise price of $0.10 per share:-

No. of No. of Shares under OptionOption Category Holders Period 1 Period 2 Total

(1) (2)Executive directors- Tay Eng Hoe 1 1,113,000 1,113,000 2,226,000- Foo Sen Chin 1 1,670,000 1,670,000 3,340,000- Narong Intanate 1 4,453,000 4,453,000 8,906,000- Wong Heng Chong 1 556,500 556,500 1,113,000Executive officer- Foong Kam Tho 1 3,339,500 3,339,500 6,679,000

5 11,132,000 11,132,000 22,264,000

(1) Exercisable between 21/12/2001 to 20/12/2002(2) Exercisable between 21/12/2002 to 20/12/2005

No options were granted under Scheme II.

(c) Issue of Shares Under Option

During the financial year, no shares were issued pursuant to the exercise of options, under the Company’sshare option schemes, to take up unissued shares of the Company or its subsidiaries.

(d) Unissued Shares under Option

At the end of the financial year, unissued shares of the Company under Scheme I are as follows:-

AggregateExercise Options

Exercise Period Period Outstanding

21/12/2001 – 20/12/2002 $0.10 11,132,00021/12/2002 – 20/12/2005 $0.10 11,132,000

22,264,000

DIRECTORS’ REPORT



(d) Unissued Shares under Option (cont’d)

The details of options granted and exercised during the year are as follows:-

Aggregate Aggregate AggregateName of Options Options Options OptionsParticipants Granted Granted Exercised Outstanding

(1) (2) (3) (4)

Executive directors- Tay Eng Hoe 2,226,000 2,226,000 - 2,226,000- Foo Sen Chin 3,340,000 3,340,000 - 3,340,000- Narong Intanate 8,906,000 8,906,000 - 8,906,000- Wong Heng Chong 1,113,000 1,113,000 - 1,113,000Executive officer- Foong Kam Tho 6,679,000 6,679,000 - 6,679,000

22,264,000 22,264,000 - 22,264,000

(1) Options granted during the financial year under review.(2) Aggregate options granted since commencement of the scheme to the end of the financial year under review.(3) Aggregate options exercised since commencement of the scheme to the end of the financial year under review.(4) Aggregate options outstanding as at end of the financial year under review.

The options granted by the Company do not entitle the holders of the options, by virtue of such holdings,to any right to participate in any share issue of any other company.

Except as disclosed, there were:-

(i) no options granted by the Company or its subsidiaries to any person to take up unissued shares in theCompany or its subsidiaries;

(ii) no shares issued by virtue of any exercise of option to take up unissued shares of the Company or itssubsidiaries; and

(iii) no unissued shares of the Company or its subsidiaries were under option at the end of the financial year.

DIRECTORS’ REPORT


AUDIT COMMITTEE

The audit committee was formed by the Board of Directors during the year and its members at the date of thisreport are as follows:-

Leong Horn Kee (Chairman)Lee Suet FernWong Heng Chong

The principal responsibility of the audit committee is to assist the Board of Directors in the identification andmonitoring of areas of significant business risks including the following:-

• The effectiveness of the management of financial business risks and the reliability of management reporting;

• Compliance with laws and regulations, particularly those of the Companies Act, Chapter 50 and theSingapore Exchange Listing Manual;

• The appropriateness of half year and full year announcements and reports;

• The effectiveness and efficiency of internal and external audits; and

• Related party transactions.

Specific functions of the audit committee include reviewing the scope of work of the internal and external auditors,the assistance given by the Company to the auditors and receiving and considering the reports of the internaland external auditors including their evaluation of the system of internal controls. The consolidated financialstatements of the Company are reviewed by the audit committee prior to their submission to the Board of Directorsfor adoption. The audit committee also recommends the appointment of the external auditors and reviews thelevel of audit fees.

In addition, the audit committee has, in accordance with Chapter 9A of the Singapore Exchange Listing Manual,reviewed the requirements for approval and disclosure of interested person transactions, reviewed the internalprocedures set up by the Company to identify and report and where necessary, seek approval for interestedperson transactions and, with the assistance of the internal auditors, reviewed interested person transactions.

The audit committee has recommended to the Board of Directors that the auditors, KPMG, be nominated for re-appointment as auditors at the forthcoming Annual General Meeting of the Company.

DIRECTORS’ REPORT


SUBSEQUENT EVENTS

On 30 January 2001, the Company offered a total of 40,000,000 ordinary shares of $0.10 each comprising of35,545,000 new shares and 4,455,000 vendor shares at $0.66 each to the public by way of placement andsubscription, in conjunction with its initial public offer, out of which 1,375,000 shares were reserved for andsubscribed to by the following directors at $0.66 per share:-

No. of ReservedShares Subscribed

Lin Chien 550,000

Chay Yee Meng 450,000

Foo Sen Chin 125,000

Wong Heng Chong 250,000

1,375,000

On 9 February 2001, the Company’s shares were listed on the Mainboard of the Singapore Exchange SecuritiesTrading Limited.

AUDITORS

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

On behalf of the Board of Directors

TAY ENG HOEDirector

WONG HENG CHONGDirector

Singapore

12 April 2001

DIRECTORS’ REPORT


We, Tay Eng Hoe and Wong Heng Chong, being directors of ECS Holdings Limited, do hereby state that in ouropinion:-

(a) the financial statements set out on pages 42 to 66 are drawn up so as to give a true and fair view of thestate of affairs of the Group and of the Company as at 31 December 2000 and of the results of thebusiness and the changes in equity of the Group and of the Company and cash flows of the Group for theyear ended on that date; and

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

On behalf of the Board of Directors

TAY ENG HOEDirector

WONG HENG CHONGDirector

Singapore

12 April 2001

STATEMENT BY DIRECTORSFor the year ended 31 December 2000


We have audited the financial statements of ECS Holdings Limited and consolidated financial statements ofECS Holdings Limited and its subsidiaries (the ”Group”) for the year ended 31 December 2000 as set out onpages 42 to 66. These financial statements are the responsibility of the Company’s directors. Our responsibilityis 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 weplan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts anddisclosures in the financial statements. An audit also includes assessing the accounting principles used andsignificant estimates made by the directors, as well as evaluating the overall financial statement presentation.We believe that our audit provides a reasonable basis for our opinion.

In our opinion:-

(a) the financial statements and consolidated financial statements are properly drawn up in accordance withthe provisions of the Companies Act, Chapter 50 (the “Act”) and Singapore Statements of AccountingStandard and so as to give a true and fair view of:-

(i) the state of affairs of the Group and of the Company as at 31 December 2000 and the results andchanges in equity of the Group and of the Company and cash flows of the Group for the yearended on that date; and

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

(b) the accounting and other records and the registers required by the Act to be kept by the Company and byits subsidiary incorporated in the Republic of Singapore have been properly kept in accordance with theprovisions of the Act.

We have considered the financial statements and auditors’ reports of the subsidiaries which have been auditedby associated firms of KPMG, being financial statements that have been included in the consolidated financialstatements. The names of these subsidiaries are disclosed in note 4 to the financial statements.

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

The auditors’ reports on the financial statements of the subsidiaries were not subject to any qualification, and inrespect of the subsidiary incorporated in the Republic of Singapore, did not include any comment made underSection 207(3) of the Act.

KPMGCertified Public Accountants

Singapore

12 April 2001

REPORT OF THE AUDITORSTo the Members of ECS Holdings Limited


The Group The Company

Note 2000 1999 2000 1999

$ $ $ $Non-Current AssetsProperty, plant and equipment 3 5,048,178 1,795,902 16,568 526,076Subsidiaries 4 - - 10,943,732 1,520,053Associated company 5 - 3,051,028 - 2,178,534Club memberships, at cost - 159,110 - 159,110Deferred expenditure 39,960 - - -

5,088,138 5,006,040 10,960,300 4,383,773

Current AssetsInventories 6 34,192,527 10,483,057 - 289,571Trade and other receivables 7 94,142,066 34,996,796 4,908,810 12,160,809Cash and cash equivalents 12 1,806,984 250,685 281,195 76,219

130,141,577 45,730,538 5,190,005 12,526,599

Current LiabilitiesBank overdrafts 12 1,267,934 221,592 K- 100,172Trade and other payables 13 59,793,411 27,498,626 319,242 10,635,080Current portion of interest

bearing bank loans 16 35,710,900 9,989,263 - -Current portion of obligations

under finance leases 17 37,800 64,353 - 26,553Provision for taxation 4,752,127 1,292,620 - -

101,562,172 39,066,454 319,242 10,761,805

Net Current Assets 28,579,405 6,664,084 4,870,763 1,764,794

Non-Current LiabilitiesInterest bearing bank loans 16 325,785 - - -Obligations under finance leases 17 53,550 235,108 KKK- 143,758Deferred taxation 18 31,619 110,000 KKK- -

410,954 345,108 KKK- 143,758

Minority Interests 5,926,959 2,387,106 - -

NET ASSETS 27,329,630 8,937,910 15,831,063 6,004,809

Capital and ReservesShare capital 19 17,143,000 7,500,000 17,143,000 7,500,000Reserves 20 10,186,630 1,437,910 (1,311,937) (1,495,191)

SHAREHOLDERS’ EQUITY 27,329,630 8,937,910 15,831,063 6,004,809

The notes set out on pages 47 to 66 form part of these financial statements.

BALANCE SHEETSAs at 31 December 2000



Note 2000 1999 2000 1999

$ $ $ $

Revenue 21 373,994,737 133,004,843 23,390,144 24,749,700

Cost of sales (336,932,637) (119,462,309) (22,567,593) (24,673,726)

Gross profit 37,062,100 13,542,534 822,551 75,974

Other income 22 253,011 19,074 10,530 38,176

Selling, general andadministrative expenses (20,720,025) (9,850,091) (589,735) (1,605,809)

Profit/(loss) fromoperations 23 16,595,086 3,711,517 243,346 (1,491,659)

Finance costs 25 (1,217,815) (504,576) (60,092) (3,439)

15,377,271 3,206,941 183,254 (1,495,098)Share of profit of

associated company 1,105,103 1,260,063 - -

Profit/(loss) from ordinaryactivities before taxation 16,482,374 4,467,004 183,254 (1,495,098)

Taxation 26 (4,663,219) (1,541,947) - -

Profit/(loss) from ordinaryactivities after taxation 11,819,155 2,925,057 183,254 (1,495,098)

Minority interests (3,373,669) (1,373,738) - -

Net profit/(net loss)for the year transferredto revenue reserve 8,445,486 1,551,319 183,254 (1,495,098)

Earnings per share 27- Basic 11.1 cents 3.6 cents- Fully diluted 11.1 cents 3.6 cents


PROFIT AND LOSS ACCOUNTSFor the year ended 31 December 2000


CurrencyShare Capital Revenue Translation

Capital Reserve Reserve Reserve Total

$ $ $ $ $

The Group

1999As at 1 January 1999 2 - (93) - (91)Issue of shares 7,499,998 - - - 7,499,998Profit for the year - - 1,551,319 - 1,551,319Exchange differences

on translation of netassets of foreignassociated company - - - (113,316) (113,316)

As at 31 December 1999 7,500,000 - 1,551,226 (113,316) 8,937,910

2000Issue of shares 9,643,000 - - - 9,643,000Capital reserve arising on

consolidation ofsubsidiaries - 1,044,624 - - 1,044,624

Profit for the year - - 8,445,486 - 8,445,486Exchange differences

on translation of netassets of foreignsubsidiaries andassociated company - - - (741,390) (741,390)

As at 31 December 2000 17,143,000 1,044,624 9,996,712 (854,706) 27,329,630

The Company

1999As at 1 January 1999 2 - (93) - (91)Issue of shares 7,499,998 - - - 7,499,998Loss for the year - - (1,495,098) - (1,495,098)

As at 31 December 1999 7,500,000 - (1,495,191) - 6,004,809

2000Issue of shares 9,643,000 - - - 9,643,000Profit for the year - - 183,254 - 183,254

As at 31 December 2000 17,143,000 - (1,311,937) - 15,831,063


STATEMENTS OF CHANGES IN EQUITYFor the year ended 31 December 2000


STATEMENT OF CASH FLOWSFor the year ended 31 December 2000

The Group

2000 1999

$ $

Cash Flows from Operating Activities

Profit from ordinary activities before taxation 16,482,374 4,467,004

Adjustments for:

Share of results of associated company - (1,260,063)

Depreciation of property, plant and equipment 940,839 353,031

Loss/(gain) on disposal of property, plant and equipment 135,633 (1,483)

Interest expense 1,217,815 504,576Interest income (116,480) (19,074)

Operating profit before working capital changes 18,660,181 4,043,991

(Increase)/Decrease in working capital:-

Inventories (11,722,636) (4,063,674)

Trade and other receivables (26,656,798) (14,419,312)

Trade and other payables 12,104,686 13,677,084

Cash utilised in operations (7,614,567) (761,911)

Income taxes paid (1,722,018) (415,674)

Net cash outflow from operating activities (9,336,585) (1,177,585)

Cash Flows from Investing Activities

Interest received 116,480 19,074

Acquisition of subsidiaries, net of cash acquired

(see summary of effect of acquisition of subsidiaries) (4,863,374) (1,901,987)

Acquisition of associated company - (1,711,679)

Additional investment in subsidiary (4,403,754) -

Purchases of property, plant and equipment (1,910,459) (1,502,321)

Proceeds from disposal of property, plant and equipment 568,001 49,999

Proceeds from sale/(purchases) of club memberships 159,110 (159,110)

Net cash outflow from investing activities (10,333,996) (5,206,024)

Cash Flows from Financing Activities

Interest paid (1,217,815) (471,111)

Proceeds from issue of shares 9,643,000 7,499,998

Proceeds from bank loans 11,963,464 -

Repayment of loan from holding company - (890,008)

(Repayment)/financing from finance leases (208,111) 235,108

Net cash inflow from financing activities 20,180,538 6,373,987

Net increase/(decrease) in cash and cash equivalents 509,957 (9,622)

Cash and cash equivalents at beginning of the year 29,093 38,715

Cash and cash equivalents at end of the year (note 12) 539,050 29,093


The Group

2000 1999

$ $

Summary of Effect of Acquisition of Subsidiaries:-

Non-current assets 3,028,370 695,129

Current assets 46,188,424 27,005,593

Current liabilities (33,793,986) (24,057,301)

Non-current liabilities (379,195) (1,110,000)Minority interests (4,762,082) (1,013,368)

10,281,531 1,520,053

Translation adjustment (92,921) -Capital reserve arising from acquisition of subsidiaries (1,044,624) -

9,143,986 1,520,053

Overdrafts less cash and bank balances of subsidiaries acquired 132,254 615,934

Amount previously accounted as investment in associated company (3,051,028) (234,000)

Deposit paid (1,361,838) -

Net cash utilised for acquisition of subsidiaries 4,863,374 1,901,987


STATEMENT OF CASH FLOWS


These notes form an integral part of and should be read in conjunction with the accompanying balance sheets,profit and loss accounts, statements of changes in equity and statement of cash flows.

1. PRINCIPAL ACTIVITIES

ECS Holdings Limited (the “Company”) is a company incorporated in the Republic of Singapore with itsregistered office at 19, Kallang Avenue #07-153, Singapore 339410. The consolidated financial statementsof the Company for the year ended 31 December 2000 relate to the Company and its subsidiaries (togetherreferred to as the “Group”).

The principal activities of the Company are those relating to investment holding and the distribution ofinformation technology products. The principal activities of the subsidiaries are set out in note 4.

2. SIGNIFICANT ACCOUNTING POLICIES

(a) Statement of Compliance

These financial statements have been prepared in accordance with the Statements of AccountingStandard issued by the Institute of Certified Public Accountants of Singapore and the disclosurerequirements of the Singapore Companies Act, Chapter 50.

(b) Basis of Financial Statements Preparation

The financial statements, expressed in Singapore dollars, are prepared on the historical cost basis.

(c) Basis of Consolidation

(i) Subsidiaries

A subsidiary is a company in which the Group, directly or indirectly, holds more than half ofthe issued share capital, or controls more than half of the voting power, or controls thecomposition of the board of directors.

The consolidated financial statements include the financial statements of the Companyand its subsidiaries made up to the end of the financial year. The results of subsidiariesacquired or disposed of during the year are included from the effective date of acquisitionor up to the effective date of disposal.

(ii) Associated Company

An associated company is one in which the Group or Company has significant influence,but not control or joint control, over its management, including participation in the financialand operating policy decisions.

NOTES TO THE FINANCIAL STATEMENTS31 December 2000


NOTES TO THE FINANCIAL STATEMENTS

2. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(c) Basis of Consolidation (cont’d)

(ii) Associated Company (cont’d)

Unless the interest in the associated company is acquired and held exclusively with a viewto subsequent disposal in the near future, an investment in an associated company isaccounted for in the financial statements under the equity method and is initially recordedat cost and adjusted thereafter for post acquisition changes in the Group’s share of theassociated company’s assets. The consolidated profit and loss account reflects the Group’sshare of the post-acquisition results of the associated company for the year.

(iii) Transactions Eliminated on Consolidation

All significant intercompany transactions and balances are eliminated on consolidation.Unrealised profits and losses resulting from transactions between the Group and itsassociated company are eliminated to the extent of the Group’s interest in the associatedcompany, except where unrealised losses provide evidence of an impairment of the assettransferred, in which case they are recognised immediately in the profit and loss account.

(iv) Goodwill / Negative Goodwill

Goodwill arising on acquisition represents the excess of the cost of acquisition over the fairvalue of the Group’s share of the identifiable net assets acquired. Goodwill is stated at costless accumulated amortisation and impairment losses. Negative goodwill arising onacquisition represents the excess of the fair value of the identifiable net assets acquiredover the cost of acquisition. Negative goodwill is credited to the capital reserve.

(d) Property, Plant and Equipment

Property, plant and equipment are stated at cost less accumulated depreciation. Depreciation isprovided on the straight line basis so as to write off the cost of the assets over their estimateduseful lives as follows:-

Freehold building 50 yearsLeasehold improvements 10 yearsOffice equipment 5 yearsFurniture and fittings 5 yearsComputers 5 yearsMotor vehicles 5 years

(e) Subsidiaries

Investments in subsidiaries in the Company’s balance sheet are stated at cost less any provisionsfor diminution in value which are other than temporary as determined by the directors for eachsubsidiary individually. Any such provisions are recognised as an expense in the profit and lossaccount.




(f) Associated Company

In the Company’s balance sheet, investment in associated company is stated at cost less anyprovision for diminution in value which is other than temporary as determined by the directors. Anysuch provision is recognised as an expense in the profit and loss account.

The Company’s share of results of the associated company is included in the Company’s profitand loss account to the extent of dividends received and receivable.

(g) Inventories

Inventories are stated at the lower of cost and net realisable value. Cost is calculated using theweighted average basis and comprises all costs of purchase and other costs incurred in bringingthe inventories to their present location and condition. Net realisable value is the estimated sellingprice in the ordinary course of business less the estimated costs of completion and the estimatedcosts necessary to make the sale.

(h) Cash and Cash Equivalents

Cash and cash equivalents comprise cash in hand, bank deposits and short-term, highly liquidinvestments which are readily convertible into known amounts of cash and which are subject to aninsignificant risk of change in value. For the purpose of the statement of cash flows, cash andcash equivalents are presented net of bank overdrafts which are repayable on demand and whichform an integral part of the Group’s cash management.

(i) Deferred Taxation

Deferred taxation is provided using the liability method in respect of the taxation effect arising fromall material timing differences between the accounting and tax treatment of income and expenditurewhich are expected with reasonable probability to crystallise in the foreseeable future. Deferredtax benefits are recognised in the financial statements only to the extent of any deferred tax liabilityor when such benefits are reasonably expected to be realisable in the near future.

(j) Revenue Recognition

(i) Sale of Goods

Revenue from sale of goods is recognised upon the transfer of significant risks and rewardsof ownership to the buyer which normally occurs upon the delivery of goods.

(ii) Service Fees

Fees from service maintenance contracts are recognised over the period of the contract.

(iii) Interest Income

Interest income from bank deposits is accrued on a time-apportioned basis on the principaloutstanding and at the rate applicable.




(k) Foreign Currency

(i) Translation of Foreign Currencies

Foreign currency transactions during the year are translated into recording currencies atthe exchange rate ruling at the transaction dates. Monetary assets and liabilitiesdenominated in foreign currencies are translated into Singapore dollars at the exchangerates ruling at the balance sheet date. Exchange gains and losses are dealt with in theprofit and loss account.

(ii) Financial Statements of Foreign Operations

The financial statements of foreign subsidiaries and associated companies are translatedinto Singapore dollars at the rates of exchange closely approximate to those ruling at thebalance sheet date. The exchange differences are dealt with as a movement in the currencytranslation reserve.

(l) Related Parties

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

(m) Segment Reporting

A segment is a distinguishable component of the Group that is engaged either in providing productsor services (business segment), or in providing products or services within a particular economicenvironment (geographical segment), which is subject to risks and rewards that are different fromthose of other segments.

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

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

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

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


NOTES TO THE FINANCIAL STATEMENTS3.

PR

OP

ER

TY, P

LAN

T A

ND

EQ

UIP

ME

NT

Free

ho

ldLe

aseh

old

Off

ice

Furn

iture

and

Bui

ldin

gIm

pro

vem

ents

Eq

uip

men

tFi

ttin

gs

Co

mp

uter

s M

oto

r Ve

hic

les

Tota

l$

$$

$$

$$

The

Gro

up

Co

stA

s at

1 J

anua

ry 2

000

-22

1,73

218

1,89

413

0,95

51,

029,

686

761,

578

2,32

5,84

5A

sset

s of

sub

sidi

arie

s ac

quire

d1,

675,

327

-1,

128,

616

128,

391

-53

,956

2,98

6,29

0A

dditi

ons

44,6

6511

3,55

063

6,03

314

3,21

261

9,23

135

3,76

81,

910,

459

Dis

posa

ls-

(177

,379

)(1

16,2

74)

(40,

713)

(162

,488

)(5

47,5

66)

(1,1

93,6

56)

As

at 3

1 D

ecem

ber 2

000

1,71

9,99

215

7,90

31,

830,

269

361,

845

1,48

6,42

962

1,73

66,

028,

938

Acc

umul

ated

Dep

reci

atio

nA

s at

1 J

anua

ry 2

000

-57

,866

66,2

7654

,997

238,

790

112,

014

529,

943

Dep

reci

atio

n ch

arge

39,8

9016

,205

448,

587

60,4

5027

1,63

510

4,07

294

0,83

9D

ispo

sals

-(4

9,52

0)(7

0,37

7)(1

3,88

4)(9

3,05

5)(1

13,9

50)

(490

,022

)

As

at 3

1 D

ecem

ber 2

000

39,8

9024

,551

444,

486

101,

563

417,

370

102,

136

980,

760

Dep

reci

atio

n C

har

ge

for

1999

-17

,028

39,7

2723

,897

157,

853

114,

526

353,

031

Net

Bo

ok

Valu

eA

s at

31

Dec

embe

r 200

01,

680,

102

133,

352

1,38

5,78

326

0,28

21,

069,

059

519,

600

5,04

8,17

8

As

at 3

1 D

ecem

ber 1

999

-16

3,86

611

5,61

875

,958

790,

896

649,

564

1,79

5,90

2

The

Co

mp

any

Co

stA

s at

1 J

anua

ry 2

000

-4,

900

9,56

913

,486

49,6

3954

4,57

862

2,17

2D

ispo

sals

-(4

,900

)(7

,392

)(1

3,06

6)(2

7,48

2)(5

44,5

78)

(597

,418

)

As

at 3

1 D

ecem

ber 2

000

--

2,17

742

022

,157

-24

,754

Acc

umul

ated

Dep

reci

atio

nA

s at

1 J

anua

ry 2

000

-85

81,

057

1,46

66,

018

86,6

9796

,096

Dep

reci

atio

n ch

arge

-98

180

595

65,

958

27,2

5335

,953

Dis

posa

ls-

(1,8

39)

(1,1

86)

(2,2

98)

(4,5

90)

(113

,950

)(1

23,8

63)

As

at 3

1 D

ecem

ber 2

000

--

676

124

7,38

6-

8,18

6

Dep

reci

atio

n C

har

ge

for

1999

-85

81,

057

1,46

66,

018

86,6

9796

,096

Net

Bo

ok

Valu

eA

s at

31

Dec

embe

r 200

0-

-1,

501

296

14,7

71-

16,5

68

As

at 3

1 D

ecem

ber 1

999

-4,

042

8,51

212

,020

43,6

2145

7,88

152

6,07

6

The

net b

ook

valu

e of

fixe

d as

sets

of t

he G

roup

incl

udes

mot

or v

ehic

les

held

und

er fi

nanc

e le

ases

with

a c

arry

ing

valu

e of

$14

8,28

3 (1

999:

$19

1,68

3).



4. SUBSIDIARIESThe Company

2000 1999

Unquoted equity shares, at cost 10,943,732 1,520,053

During the financial year, the Company -

(a) Acquired an additional 40% interest in the equity of its subsidiary, ECS Computers (Asia) Pte Ltd(“ECSA”), for a consideration of $4,403,754, representing the Company’s share of the fair value ofthe identifiable net assets of ECSA at the date of acquisition. Following the acquisition, ECSAbecame a wholly owned subsidiary.

(b) Acquired a 60% interest in the equity of K.U. Sistem Holdings Sdn. Bhd (“KU”), incorporated inMalaysia, for a consideration of RM 6,210,990 ($2,831,591), representing the Company’s share ofthe fair value of the identifiable net assets of KU at the date of acquisition.

(c) Incorporated a 99.9% owned subsidiary, EC Sure Holdings (Thailand) Co., Ltd (“EC Sure”) inThailand, with an issued share capital of Baht 2 million, partly paid up to Baht 500,000.

Details of the subsidiaries directly held by the Company are as follows:-

Place of Group’s Effective Cost ofName of Incorporation/ Equity Interest InvestmentCompany Principal Activities Business 2000 1999 2000 1999

% % $ $

ECS Computers Provider of information Singapore 100 60 5,923,807 1,520,053(Asia) Pte Ltd technology products and

services for e-commerce ITinfrastructure, providerof general IT products andservices and distributorof IT products

K.U. Sistem Investment holding Malaysia 60 - 2,831,591 -Holdings Sdn.Bhd.#

EC Sure Holdings Investment holding Thailand 99.9 - 9,800 -(Thailand) Co., Ltd#

The Value Provider of information Thailand 75 37* 2,178,534 -Systems technology products andCo., Ltd# services for e-commerce IT

infrastructure, providerof general IT products andservices and distributorof IT products

10,943,732 1,520,053

# Audited by associated firm of KPMG Singapore* Associated company in 1999 (note 5)



4. SUBSIDIARIES (CONT’D)

Details of the subsidiaries held by other subsidiaries of the Group are set out below. All companies areaudited by associated firms of KPMG Singapore.

Place of Group’s EffectiveIncorporation/ Equity Interest

Name of Company Principal Activities Business 2000 1999% %

Subsidiaries of K.U. Sistem Holdings Sdn. Bhd.

K.U. Sistem Sdn. Bhd. ) Provider of information Malaysia 60 -) technology products and

Pericomp Sistech Sdn. Bhd. ) services for e-commerce Malaysia 48 -) IT infrastructure, provider

Astar Marketing Sdn. Bhd. ) of general IT products Malaysia 60 -) and services and distributor) of IT products

Antara IT Sdn. Bhd. Dormant Malaysia 42 -

5. ASSOCIATED COMPANYThe Group The Company

2000 1999 2000 1999

$ $ $ $

Unquoted equity shares, at cost - 2,178,534 - 2,178,534Share of post-acquisition

revenue reserves - 985,810 - -Translation adjustment - (113,316) - -

- 3,051,028 - 2,178,534

Details of the associated company are as follows:-

Name of associated company : The Value Systems Co., LtdPrincipal activities : Provider of information technology products and services for

e-commerce IT infrastructure, provider of general IT products andservices and distributor of IT products

Place of incorporation : Thailand

Group’s effective equity interest : NIL (1999: 37%)

In July 2000, the Group acquired an additional 38% interest in the equity of The Value Systems Co., Ltd(“VS”) through a subsidiary, EC Sure Holdings (Thailand) Co., Ltd (“EC Sure”). Following ECSure’sacquisition, the Group’s effective interest in VS increased from a 37% equity accounted associated companyto a 75% controlled subsidiary.



6. INVENTORIESThe Group The Company

2000 1999 2000 1999

$ $ $ $

Trading inventories 34,538,890 10,891,923 - 289,571Less:Provision for inventory

obsolescence -Balance at 1 January 408,866 - - -Provision made during

the year 1,040,962 530,669 - -Inventories written off

against provision (1,103,465) (121,803) - -

Balance at 31 December 346,363 408,866 - -

34,192,527 10,483,057 - 289,571

7. TRADE AND OTHER RECEIVABLESThe Group The Company

Note 2000 1999 2000 1999

$ $ $ $

Trade receivables 8 89,274,898 30,162,095 15,678 1,433,799Other receivables, deposits

and prepayments 9 4,725,932 2,143,870 998,588 1,567,212Amounts due from- Holding company 10 - 83,340 - -- Subsidiaries 11 - - 3,772,987 6,666,560- Associated company

(trade) - 2,607,491 - 2,493,238- Shareholder (non-trade) 141,236 - 121,557 -

94,142,066 34,996,796 4,908,810 12,160,809



8. TRADE RECEIVABLESThe Group The Company

2000 1999 2000 1999

$ $ $ $

Trade receivables 89,990,179 30,592,003 15,678 1,433,799Less:

Provision for doubtful debts -Balance at 1 January 429,908 - - -Provision made during

the year 841,933 477,272 - -Bad debts written off

against provision (556,560) (47,364) - -

Balance at 31 December 715,281 429,908 - -

89,274,898 30,162,095 15,678 1,433,799

9. OTHER RECEIVABLES, DEPOSITS AND PREPAYMENTS


2000 1999 2000 1999

$ $ $ $Recoverables 2,309,058 1,477,664 2,441 1,390,824Sundry receivables 1,824,512 - 258,912 -Deposits 235,580 209,917 - 176,388Prepayments 356,782 456,289 737,235 -

4,725,932 2,143,870 998,588 1,567,212

10. AMOUNTS DUE FROM HOLDING COMPANYThe Group The Company

2000 1999 2000 1999

$ $ $ $Amounts due from- Trade receivable - 83,340 - -

Amounts due to- Non-trade payable - 32,045 - 32,045

In the previous financial year, the holding company was Solectron Technology Singapore Pte Ltd (formerlyknown as NatSteel Electronics Ltd) (“Solectron”), incorporated in the Republic of Singapore. During theyear, Solectron ceased to be the holding company as a result of the Company issuing shares to theminority shareholder. As at 31 December 2000, the Company does not have a holding company.



11. AMOUNTS DUE FROM/TO SUBSIDIARIESThe Company

2000 1999

$ $Amounts due from- Trade receivables 142,563 6,666,560- Non-trade receivables 3,630,424 -

3,772,987 6,666,560Amounts due to- Trade payables 47,880 -

12. CASH AND CASH EQUIVALENTSThe Group The Company

2000 1999 2000 1999

$ $ $ $

Cash and cash equivalents 1,806,984 250,685 281,195 76,219Bank overdrafts (1,267,934) (221,592) - (100,172)

Cash and cash equivalents inthe Statement of Cash Flows 539,050 29,093 281,195 (23,953)

13. TRADE AND OTHER PAYABLESThe Group The Company

Note 2000 1999 2000 1999

$ $ $ $

Trade payables 52,303,632 25,033,942 622 10,467,190Other payables and

accruals 14 6,484,529 2,065,399 270,740 135,845Amounts due to- Holding company 10 - 32,045 - 32,045- Subsidiaries 11 - - 47,880 -Deferred income 15 1,005,250 367,240 - -

59,793,411 27,498,626 319,242 10,635,080



14. OTHER PAYABLES AND ACCRUALSThe Group The Company

2000 1999 2000 1999

$ $ $ $

Accrued operating expenses 3,882,239 1,418,190 5,950 100,370Deposits received 165,930 482,680 - -Sundry payables 2,436,360 164,529 264,790 35,475

6,484,529 2,065,399 270,740 135,845

15. DEFERRED INCOME

Deferred income relates to fees received in advance on service maintenance contracts.

16. INTEREST BEARING BANK LOANSThe Group

2000 1999

$ $SecuredShort term loans (a) 4,931,385 -

UnsecuredShort term loans (b) 25,556,000 6,000,000Trust receipts 5,549,300 3,989,263

31,105,300 9,989,263

36,036,685 9,989,263

Comprising:-Current portion 35,710,900 9,989,263Non-current portion 325,785 -

36,036,685 9,989,263

(a) The secured bank facilities of the Group bear interest at rates ranging from 4.35% to 9.25%(1999: nil ) per annum and are secured by :-

- Fixed charge over the freehold office blocks of a subsidiary;- Pledge of personal shares belonging to a director of a subsidiary;- Fixed and floating charge over all the assets of certain subsidiaries;- Joint and several guarantee by certain directors of subsidiaries; and- Corporate guarantee of a subsidiary.

(b) The unsecured bank facilities of the Group bear interest at rates ranging from 3.38% to 4.40%(1999: 3.00% to 4.75%) per annum.



17. OBLIGATIONS UNDER FINANCE LEASESPayments Interest Principal

$ $ $The Group

2000Within 1 year 42,336 4,536 37,800After 1 year but within 5 years 59,978 6,428 53,550

As at 31 December 2000 102,314 10,964 91,350


As at 31 December 1999 348,939 49,478 299,461

The Company

2000As at 31 December 2000 - - -


As at 31 December 1999 204,289 33,978 170,311

18. DEFERRED TAXATIONThe Group

2000 1999

$ $

Balance at 1 January 110,000 -Provision of subsidiary acquired 31,619 135,000Provision written back during the year (110,000) (25,000)

Balance at 31 December 2000 31,619 110,000



19. SHARE CAPITAL

2000 1999 2000 1999

No. of shares (‘000) $ $

Authorised:Ordinary shares of $1 each - 18,500 - 18,500,000Ordinary shares of $0.10 each 500,000 - 50,000,000 -Class A redeemable

non-participatingcumulative convertiblepreference shares of $1each (“Class A RCCPS”) - 4,500 - 4,500,000

Class B redeemablenon-participatingconvertible preferenceshares of $0.01 each(“Class B RCPS”) - 65 - 65,000

500,000 23,065 50,000,000 23,065,000

Issued and fully paid:Balance at 1 January 7,500 7,500 7,500,000 2Issue of ordinary shares of

$1 each - - - 7,499,998Sub-division of shares of

$1 to $0.10 each 67,500 - - -

75,000 7,500 7,500,000 7,500,000Issue of ordinary shares

of $0.10 each 96,430 - 9,643,000 -

Balance at 31 December 2000 171,430** 7,500* 17,143,000 7,500,000

* Ordinary shares of $1 each** Ordinary shares of $0.10 each

During the financial year:-

(a) On 18 September 2000, the authorised share capital of the Company was revised from $23,065,000divided into 18,500,000 ordinary shares of $1 each (“Ordinary Shares”), 4,500,000 redeemablenon-participating cumulative convertible preference shares of $1 each (“Class A RCCPS”) and6,500,000 redeemable non-participating convertible preference shares of $0.01 each (“Class BRCPS”) to $23,065,000 divided into 23,065,000 Ordinary Shares by the cancellation of 4,500,000Class A RCCPS and 6,500,000 Class B RCPS and the creation of 4,565,000 Ordinary Shares.

(b) On 13 December 2000, the authorised share capital of the Company was increased from$23,065,000 to $50,000,000 by the creation of an additional 26,935,000 Ordinary Shares. Thereafter,each Ordinary Share comprised in the existing authorised and issued and paid-up share capitalwas sub-divided into 10 ordinary shares of $0.10 each.



19. SHARE CAPITAL (CONT’D)

(c) On 29 December 2000, the Company issued 96,430,000 ordinary shares of $0.10 each fully paidat par for cash to provide funds for the repayment of bank borrowings which had been taken tofinance the Group’s acquisition of subsidiaries.

The Class A RCCPS and Class B RCPS conferred upon the shareholders the following rights:-

(a) Right to cumulative preference dividend to be paid out of distributable profit for Class A RCCPS.

(b) Right to convert into fully paid ordinary shares in the capital of the Company whereby the Class ARCCPS and/or Class B RCPS shall be first redeemed and the redemption amount be appliedtowards the payment of ordinary shares.

(c) Right to repayment at issue price on redemption.

(d) Right, upon the winding-up of the Company, to repayment of the capital paid up on the Class ARCCPS and Class B RCPS in priority to the holders of ordinary shares. However, Class A RCCPSwill have priority over Class B RCPS. There are no further rights to participate in surplus assets ofthe Company remaining after payment of capital paid up on the ordinary shares.

(e) Right to receive copies of the reports and financial statements but no right to attend or vote at anygeneral meeting except in respect of any resolution which varies the rights attached to Class ARCCPS and Class B RCPS or for the winding up of the Company. In such instances, right is to onevote for each Class A RCCPS and Class B RCPS held.

At the end of the financial year, options for 22,264,000 unissued ordinary shares of $0.10 each of theCompany granted under the ECS Share Option Scheme I were outstanding.

20. RESERVESThe Group The Company

2000 1999 2000 1999

$ $ $ $

Capital reserve 1,044,624 - - -Revenue reserve 9,996,712 1,551,226 (1,311,937) (1,495,191)Currency translation reserve (854,706) (113,316) - -

10,186,630 1,437,910 (1,311,937) (1,495,191)

In accordance with SAS 1 (Revised 1999) “Presentation of Financial Statements”, movements in reservesfor the Group and the Company are set out in the Statements of Changes in Equity.



20. RESERVES (CONT’D)

(a) Revenue ReserveThe Group

2000 1999

$ $Unappropriated profits/(losses) are retained in:-

The Company (1,311,937) (1,495,191)Subsidiaries 11,308,649 2,060,607Associated company - 985,810

9,996,712 1,551,226

(b) Currency Translation Reserve

This comprises all foreign exchange differences arising from the translation of the financialstatements of foreign operations that are not integral to the operations of the Company.

21. REVENUEThe Group The Company

2000 1999 2000 1999

$ $ $ $

Sale of goods 362,901,136 131,638,626 23,390,144 24,749,700Maintenance services 11,093,601 1,366,217 - -

373,994,737 133,004,843 23,390,144 24,749,700

Transactions within the Group have been excluded in arriving at revenue for the Group.

22. OTHER INCOMEThe Group The Company

2000 1999 2000 1999

$ $ $ $

Interest income 116,480 19,074 10,530 38,176Miscellaneous income 136,531 - - -

253,011 19,074 10,530 38,176



23. PROFIT /(LOSS) FROM OPERATIONSThe Group The Company

Note 2000 1999 2000 1999

$ $ $ $Profit/(Loss) from operations

is arrived after charging:

Auditor’s remuneration- Auditors of the Company

• current year 39,000 32,000 15,000 8,000• prior year - 1,000 - 1,000

- Other auditors 21,448 - - -

Depreciation of property,plant and equipment 3 940,839 353,031 35,953 96,096

Directors’ remuneration- Directors of the Company 581,182 620,384 131,980 620,384- Other directors 235,572 - - -

Exchange loss 37,566 - 27,357 -

Loss on disposal ofproperty, plant andequipment 135,633 - 3,167 -

Operating lease expenses 765,050 450,923 10,400 20,800

Provision for- trade receivables 8 841,933 477,272 - -- inventory obsolescence 6 1,040,962 530,669 - -

Staff costs* 13,495,465 6,766,217 267,648 305,360

And crediting:

Exchange gain - 235,565 - 15,478

Gain on disposal of property,plant and equipment - 1,483 - -

* The number of employees in the Group and the Company as at 31 December 2000 were 495 (1999:396) and 2 (1999: 5) respectively.

24. DIRECTORS’ REMUNERATION

The remuneration of the Company’s directors fall within the following remuneration bands:-

Number of Directors

2000 1999

Executive Non-Executive Executive Non-ExecutiveDirectors Directors Directors Directors

$250,000 to $499,999 1 - 2 -Below $250,000 4 - - -

5 - 2 -



25. FINANCE COSTSThe Group The Company

2000 1999 2000 1999

$ $ $ $Interest paid and payable

- bank overdrafts 77,567 53,529 1,141 -- lease financing 6,567 54,932 1,324 3,089- short term loan 1,132,791 253,048 57,627 -- trade financing - 138,299 - -- others 890 4,768 - 350

1,217,815 504,576 60,092 3,439

26. TAXATIONThe Group

2000 1999

$ $Based on results for the year- Current taxation 4,773,219 1,292,694- Deferred taxation (110,000) (25,000)- Associated company - 274,253

4,663,219 1,541,947

As at 31 December 2000, the Company has unabsorbed tax losses and unutilised wear and tear allowancesof approximately $1 million (1999: $1.3 million) which are available for carry forward and set-off againstfuture taxable income subject to the agreement of the Comptroller of Income Tax and compliance with theprovisions of Sections 37 and 23 of the Singapore Income Tax Act, Chapter 134.

In accordance with the accounting policy of the Group, deferred tax benefit of approximately $0.25 million(1999: $0.3 million) arising from these losses and allowances and other timing differences have not beenrecognised in the financial statements.

The taxation charge of the Group is higher than that arrived at by applying the respective statutory tax rateto the individual group companies’ profit principally because the losses incurred by the Company cannotbe set-off against profits earned by the subsidiaries and the tax rates of different countries in which theGroup operates vary.

27. EARNINGS PER SHARE

The calculation of earnings per share is based on the following:-The Group

2000 1999

Basic Earnings Per Share• Profit after taxation and minority interests $8,445,486 $1,551,319• Weighted average number of shares 75,790,410 43,750,000

Fully Diluted Earnings Per Share• Profit after taxation and minority interests $8,445,486 $1,551,319• Weighted average number of shares 76,264,889 43,750,000

In arriving at the fully diluted earnings per share, only those potential ordinary shares arising from theexercise of conversion options which would dilute the basic earnings per share of the Group during thefinancial year are included in the computation.



28. RELATED PARTY TRANSACTIONS

During the financial year, significant transactions with related parties, based on terms as agreed betweenthe parties, are as follows:-


2000 1999 2000 1999

$ $ $ $Sales to- holding company - 561,535 K- -- subsidiaries - - 14,931,408 12,512,514- associated company 4,982,467 7,783,466 3,724,995 7,437,134- shareholder 80,336 - - -Sale of property, plant andequipment- former director 208,505 - 208,505 -

29. COMMITMENTS

As at 31 December, the following commitments were not provided for in the financial statements:-


2000 1999 2000 1999

$ $ $ $Investments in- Subsidiaries - - 60,000 5,868,000- Associated company - 7,609,000 - 7,609,000

- 7,609,000 60,000 13,477,000

30. CONTINGENT LIABILITIES

As at 31 December 2000, the subsidiary, ECS Computers (Asia) Pte Ltd has an outstanding contingentliability of $112,500 in respect of an unsecured counter indemnity given to a financial institution for a bankguarantee issued on behalf of a third party.

31. BUSINESS SEGMENTS (GROUP)

The Group comprises the following main business segments:-

- E-enabling infrastructure: The design, installation and implementation of e-enabling infrastructuretools, operating systems and hardware.

- IT services: Network infrastructure design and security implementation, training and maintenancesupport services

- IT products distribution: Distribution of IT products for IT principals.



31. BUSINESS SEGMENTS (GROUP) (CONT’D)

E-enabling IT IT ProductsInfrastructure Services Distribution TOTAL

$’000 $’000 $’000 $’000Revenue and Expenses

2000Total revenue- External customers 187,246 16,241 170,508 373,995

Segment results 9,215 2,222 3,940 15,377

Share of profit of associated company 1,105Profit from ordinary activities before taxation 16,482Taxation (4,663)Profit from ordinary activities after taxation 11,819Minority interests (3,374)Retained profit for the year 8,445

1999Total revenue- External customers 67,087 2,617 63,301 133,005

Segment results 2,458 357 392 3,207

Share of profit of associated company 1,260Profit from ordinary activities before taxation 4,467Taxation (1,542)Profit from ordinary activities after taxation 2,925Minority interests (1,374)Retained profit for the year 1,551

Assets and Liabilities

2000Segment assets 65,191 4,102 59,364 128,657Unallocated assets 6,573Total assets 135,230

Segment liabilities 50,795 5,850 44,879 101,524Unallocated liabilities 449Total liabilities 101,973

Capital expenditure 1,040 90 946 2,076

1999Segment assets 21,394 1,388 19,659 42,441Unallocated assets 8,295Total assets 50,736

Segment liabilities 19,671 2,131 17,168 38,970Unallocated liabilities 441Total liabilities 39,411

Capital expenditure 752 65 685 1,502



32. GEOGRAPHICAL SEGMENTS (GROUP)

The Group operates principally in Singapore, Thailand and Malaysia. In presenting information on thebasis of geographic segments, segment revenue is based on the geographic location of operations.Segment assets are based on the geographic location of the assets.

Singapore Thailand Malaysia TOTAL

$’000 $’000 $’000 $’0002000Total revenue from- External customers 223,946 65,571 84,478 373,995

Segment assets 71,391 37,612 26,227 135,230

Segment liabilities 56,521 25,865 19,587 101,973

Capital expenditure 839 430 807 2,076

Significant non-cash expenses- Depreciation 408 244 289 941

1999Total revenue from- External customers 133,005 - - 133,005

Segment assets 50,736 - - 50,736

Segment liabilities 39,411 - - 39,411

Capital expenditure 1,502 - - 1,502

Significant non-cash expenses- Depreciation 353 - - 353

33. SUBSEQUENT EVENTS

Subsequent to the balance sheet date, the Company issued 35,545,000 new ordinary shares of $0.10each at an offer price of $0.66 per share pursuant to its initial public offer. The Company’s shares werelisted on the Mainboard of the Singapore Exchange Securities Trading Limited on 9 February 2001.

34. COMPARATIVE FIGURES

The presentation and classification of items in the financial statements have been changed due to theadoption of the requirements of SAS 1 (Revised 1999) ”Presentation of Financial Statements”, SAS 15(Revised 1999) “Leases” and SAS 23 “Segment Reporting”. As a result, additional line items have beenincluded on the face of the balance sheet and profit and loss account, and statements of changes inequity have been presented as required by SAS 1 (Revised 1999). Finance lease obligations have beenanalysed to disclose a reconciliation of the total minimum lease payments at the balance sheet date andtheir present value for periods not later than one year, later than one year and not later than five years,and later than five years as required by SAS 15 (Revised 1999). Segment information has also beenanalysed to include additional information on segment liabilities, capital expenditure and significant non-cash expenses. Comparative figures have been adjusted to conform with the current year’s presentation.


Number of Number ofRange of Shareholdings Shareholders % Shares %

1 - 1,000 148 9.42 148,000 0.07

1,001 - 10,000 1,119 71.18 5,642,000 2.73

10,001 - 1,000,000 294 18.70 21,737,000 10.50

1,000,001 and above 11 0.70 179,448,000 86.70

1,572 100.00 206,975,000 100.00

MAJOR SHAREHOLDERS LIST AS AT 12 APRIL 2001Number of

S/No. Name Shares Held %

1 TECHNOCRAT INVESTMENTS LIMITED 73,995,000 35.75

2 SOLECTRON TECHNOLOGY SINGAPORE PTE LTD(formerly known as NatSteel Electronics Ltd) 60,000,000 28.99

3 V INVESTMENT HOLDINGS LIMITED 17,988,000 8.69

4 RAFFLES NOMINEES PTE LTD 14,100,000 6.81

5 FOONG KAM THO 2,598,000 1.26

6 LEE CHONG HEANG 2,330,000 1.13

7 CITIBANK NOMINEES SINGAPORE PTE LTD 2,107,000 1.02

8 UNITED OVERSEAS BANK NOMINEES PTE LTD 2,073,000 1.00

9 OVERSEA-CHINESE BANK NOMINEES PTE LTD 1,635,000 0.79

10 KEPPEL BANK NOMINEES PTE LTD 1,456,000 0.70

11 J M SASSOON & CO (PTE) LTD 1,166,000 0.56

12 SENGIN SDN BHD 957,000 0.46

13 NG HOCK CHING 942,000 0.46

14 TAN HUP FOI 787,000 0.38

15 PHILLIP SECURITIES PTE LTD 628,000 0.30

16 DBS NOMINEES PTE LTD 608,000 0.29

17 LIN CHIEN 550,000 0.27

18 DAIWA SECURITIES SMBC SINGAPORE PTE LTD 500,000 0.24

19 CHAY YEE MENG 450,000 0.22

20 KEE KIM HONG 390,000 0.19

185,260,000 89.51

SUBSTANTIAL SHAREHOLDERS LIST AS AT 12 APRIL 2001

Number ofS/No. Name Shares Held %

1 TECHNOCRAT INVESTMENTS LIMITED 73,995,000 35.75

2 SOLECTRON TECHNOLOGY SINGAPORE PTE LTD(formerly known as NatSteel Electronics Ltd) 60,000,000 28.99

3 V INVESTMENT HOLDINGS LIMITED 17,988,000 8.69

ANALYSIS OF SHAREHOLDINGSAS AT 12 APRIL 2001


NOTICE OF ANNUAL GENERAL MEETINGFor the year ended 31 December 2000

NOTICE IS HEREBY GIVEN that the Third Annual General Meeting of the Company will be held at Traders Hotel,1A Cuscaden Road, Singapore, Level 2, Function Room on 28 May 2001 at 10.00am to transact the followingbusiness :-

AS ORDINARY BUSINESS

1 To receive and adopt the Directors’ Report and Audited Accounts for the financial year ended 31 December2000 and the Auditors’ Report thereon. [Resolution 1]

2 (a) To re-elect Mr Chay Yee Meng who is retiring in accordance with Article 91 of the Company’sArticles of Association, as Director of the Company. [Resolution 2(a)]

(b) To re-elect Mr Leong Horn Kee who is retiring in accordance with Article 97 of the Company’sArticles of Association, as Director of the Company.[See explanatory note (i)] [Resolution 2(b)]

(c) To re-elect Mrs Lee Suet Fern who is retiring in accordance with Article 97 of the Company’s Articlesof Association, as Director of the Company.[See explanatory note (ii)] [Resolution 2(c)]

(d) To re-elect Mr Wong Heng Chong who is retiring in accordance with Article 97 of the Company’sArticles of Association, as Director of the Company.[See explanatory note (iii)] [Resolution 2(d)]

(e) To re-elect Mr Narong Intanate who is retiring in accordance with Article 97 of the Company’sArticles of Association, as Director of the Company. [Resolution 2(e)]

(f) To re-elect Mr Foo Sen Chin who is ret i r ing in accordance with Art ic le 97 of theCompany’s Articles of Association, as Director of the Company. [Resolution 2(f)]

(g) To re-elect Mr Hsieh Fu Hua who is retiring in accordance with Article 97 of the Company’s Articlesof Association, as Director of the Company. [Resolution 2(g)]

3 To re-appoint KPMG as Auditors and to authorise the Directors to fix their remuneration. [Resolution 3]

4 To transact any other business that may be properly transacted at an Annual General Meeting.[Resolution 4]

AS SPECIAL BUSINESS

5 To consider and, if thought fit, to pass the following as Ordinary Resolutions, with or without modifications:-

Ordinary Resolutions:-

(a) “That pursuant to Section 161 of the Companies, Act, Chapter 50 and the listing rules of the SingaporeExchange Securities Trading Limited, authority be and is hereby given to the Directors of the Companyto issue ordinary shares in the Company (“whether by way or rights, bonus or otherwise) at any timeand upon such terms and conditions and for such purposes and to such persons as the Directors may


in their absolute discretion deem fit provided that the aggregate number of ordinary shares to beissued pursuant to this Resolution does not exceed fifty per cent (50%) of the issued share capital ofthe Company for the time being, of which the aggregate number of ordinary shares to be issued otherthan on a pro-rata basis to shareholders of the Company does not exceed twenty per cent (20%) of theissued share capital of the Company for the time being, and, unless revoked or varied by the Companyin general meeting, such authority shall continue in force until the conclusion of the next Annual GeneralMeeting of the company or the date by which the next Annual General Meeting of the Company isrequired by law to be held, whichever is the earlier.”[See explanatory note (iv)] [Resolution 5(a)]

(b) “That the Directors be and are hereby authorized to offer and grant options in accordance with theprovisions of the ECS Share Option Scheme II (the “Scheme II”), and to allot and issue from timeto time such number of ordinary shares of S$0.10 each in the capital of the Company as may berequired to be issued pursuant to the exercise of the options under the Scheme II provided alwaysthat the aggregate number of ordinary shares to be issued pursuant to the Scheme II shall notexceed fifteen per cent (15%) of the total issued share capital of the Company from time to time.”[See explanatory note (v)] [Resolution 5(b)]

(c) “That for the purposes of Chapter 9A of the Listing Manual of the Singapore Exchange SecuritiesTrading Limited:

(i) approval be and is hereby given for the renewal of the mandate for the Company, itssubsidiaries and target associated companies or any of them to enter into any of thetransactions falling within the types of Interested Person Transactions as set out in theCompany’s Prospectus dated 30 January 2001 (the “Prospectus”) with the Interested Personsdescribed in the Prospectus, provided that such transactions are carried out in the normalcourse of business, on commercial terms and in accordance with the guidelines for InterestedPerson Transactions as set out in the Prospectus (the “IPT Mandate”);

(ii) the IPT Mandate shall, unless revoked or varied by the Company in general meeting, continuein force until the next Annual General Meeting of the Company; and

(iii) the Directors of the Company be and are hereby authorized to complete and do all suchacts and things (including executing all such documents as may be required) as they mayconsider expedient or necessary or in the interests of the Company to give effect to the IPTMandate and/or this Resolution.” [See explanatory note (vi)] [Resolution 5(c)]

By Order of the Board

Wee Sien YangCompany SecretarySingapore11 May 2001

NOTICE OF ANNUAL GENERAL MEETING


EXPLANATORY NOTES :

(i) Mr Leong Horn Kee, if re-elected, will remain the Chairman of the Company’s Audit Committee and will beconsidered as an independent director.

(ii) Mrs Lee Suet Fern, if re-elected, will remain a member of the Company’s Audit Committee and will beconsidered as an independent director.

(iii) Mr Wong Heng Chong, if re-elected, will remain a member of the Company’s Audit Committee and will beconsidered as a non-independent director.

(iv) Resolution No. 5(a), if passed, is to authorize the Directors to issue ordinary shares in the capital of theCompany up to an amount not exceeding in total fifty percent (50%) of the issued ordinary share capitalof the Company from time to time.

(v) Resolution 5(b), if passed, is to authorise the Directors to offer and grant options and to allot and issueshares pursuant to the ECS Share Option Scheme II, provided that the aggregate number of sharesissued pursuant to the ECS Share Option Scheme II shall not exceed 15 per cent of the total issued sharecapital of the Company from time to time.

(vi) Resolution 5(c), if passed, is to renew the IPT Mandate to allow the Company, its subsidiaries and targetassociated companies or any of them to enter into certain interested person transactions with personswho are considered “interested persons” (as defined in Chapter 9A of the Listing Manual of the SingaporeExchange Securities Trading Limited). Please refer to the Company’s Prospectus dated 30 January 2001for details.

NOTES :

A member entitled to attend and vote at the Annual General Meeting may appoint not more than two proxies toattend and vote on his behalf and where a member appoints more than one proxy, he shall specify the proportionof his shareholding to be represented by each proxy. A proxy need not be a member of the Company. Theinstrument appointing a proxy or proxies must be deposited at the Share Registrar office of the Company atM&C Services Private Limited, 138 Robinson Road #17-00, Hong Leong Centre, Singapore 068906, not lessthan 48 hours before the time set for the Annual General Meeting.

NOTICE OF ANNUAL GENERAL MEETING


I/We______________________________________________________________________________________________

of_______________________________________________________________________________________________

being a member/members of ECS HOLDINGS LIMITED hereby appoint

NRIC/Passport Proportion ofName Address Number Shareholdings (%)

and/or (delete as appropriate)

as my/our proxy/proxies to vote for me/us on my/our behalf and, if necessary, to demand a poll, at the AnnualGeneral Meeting of ECS HOLDINGS LIMITED to be held at Traders Hotel, 1A Cuscaden Road, Singapore, Level 2,Function Room on 28 May 2001 at 10.00am and at any adjournment thereof.

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

NO ORDINARY RESOLUTIONS FOR AGAINSTOrdinary Business :

1. Adoption of Reports and Accounts2. Re-election of Directors :

(a) Mr Chay Yee Meng(b) Mr Leong Horn Kee(c) Mrs Lee Suet Fern(d) Mr Wong Heng Chong(e) Mr Narong Intanate(f) Mr Foo Sen Chin(g) Mr Hsieh Fu Hua

3. Re-appointment of Auditors4. Any other ordinary business

Special Business :5. (a) Authority for Directors to Issue Shares pursuant to Section 161 of the

Companies Act, Cap. 50.(b) Authority for Directors to offer and grant options and/or allot shares

pursuant to the ECS Share Option Scheme II.(c) Approval for renewal of the IPT Mandate for transactions with

interested persons

Dated this ______________ day of __________________ 2001.

__________________________________________Signature(s) of member(s) or Common Seal

IMPORTANT :-PLEASE READ NOTES OVERLEAF

PROXY FORM

ECS HOLDINGS LIMITED(Incorporated in the Republic of Singapore)

Important:1. For investors who have used their CPF monies to buy

the Company’s shares, the Annual Report is forwardedto them at the request of their CPF Approved Nomineesand is sent solely FOR INFORMATION ONLY.

2. This Proxy Form is not valid for use by CPF investorsand shall be ineffective for all intents and purposes ifused or purported to be used by them.

Total Number of Shares Held In:

�

NOTES :-

1. Please insert the total number of shares held by you. If you have shares entered against your name in theDepository Register (as defined in Section 130A of the Companies Act, Chapter 50 of Singapore), youshould 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 DepositoryRegister and shares registered in your name in the Register of Members, you should insert the aggregatenumber of shares entered against your name in the Depository Register and registered in your name inthe Register of Members. If no number is inserted, the instrument appointing a proxy or proxies shall bedeemed 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 appointone or two proxies, whether a member or not, to attend and vote instead of him.

3 Where a member appoints two proxies, the appointments shall be invalid unless he specifies the proportionof his shareholding (expressed as a percentage of the whole) to be represented by each proxy.

4 The instrument appointing a proxy or proxies must be deposited at the Share Registrar office of theCompany at M&C Services Private Limited, 138 Robinson Road #17-00, Hong Leong Centre, Singapore068906, not less than forty-eight (48) hours before the time appointed for the Annual General Meeting.

5 The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorneyduly authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation,it must be executed either under its common seal or under the hand of an officer or attorney duly authorised.

6 A corporation which is a member may authorise by a resolution of its directors or other governing bodysuch person as it thinks fit to act as its representative at the Annual General Meeting, in accordance withSection 179 of the Companies Act, Chapter 50 of Singapore.

GENERAL:

The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperlycompleted or illegible or where the true intentions of the appointor are not ascertainable from the instructions ofthe appointor specified in the instrument appointing a proxy or proxies. In addition, in the case of shares enteredin the Depository Register, the Company may reject any instrument appointing a proxy or proxies lodged if themember, being the appointor, is not shown to have shares entered against his name in the Depository Registeras at forty-eight (48) hours before the time appointed for holding the Annual General Meeting, as certified by TheCentral Depository (Pte) Limited to the Company.

ECS Holdings Limited Blk 19, Kallang Avenue, #07-153/155/157/159 Singapore 339410Tel: 65-299 9433 Fax: 65-298 3629 Website: http://www.ecssin.com.sg

A N N U A L R E P O R T 2 0 0 0


e-Services Provider

A N N U A L R E P O R T 2 0 0 0


e-Services Provider

e-Distributore-Distributor

Documents

ECS CVR casted - ECS Holdings Limitedecs.listedcompany.com/misc/ar2000.pdf · The shares of ECS are listed on the mainboard of the Singapore Exchange Securities Trading Limited as