AR2013

A N E W E R AS U P E R G R O U P LT D • A N N UA L R E P O R T 2 0 1 2

SUP

ER G

RO

UP

LTD

An

nu

al R

epo

rt 2012a

ne

W e

ra

Super InduStrIalbuIldIng

Chap Hup Chong Food Industries

Everich

Tee Yih JiaBLDG

West Admiralty Rd

Seno

ko S

outh

Rd

Senoko South Rd

Kwong On Cheong

Food Industries

SumitomoBakelite

RoyalFood

Metal ComponentEngineering

Kong Hwee Iron

Works & Contruction

Singapore Storage &

Warehouse

Sin Hwa Dee Foodstuff Industries

2 Senoko South RoadSuper Industrial Building

Singapore 758096Tel: (65) 6753 3088Fax: (65) 6753 7833

Website: www.supergroupltd.comEmail: [email protected]

CREATING A NEW LOOKBrands Showcase 4Products Showcase 6

ENTERING NEW HORIZONSGlobal Presence 12

Group Structure 14

DISCOVERING NEW PERSPECTIVESChairman’s Statement 18

Financial Highlights 20

Operati ons & Financial Review 24

SCALING NEW HEIGHTSBoard of Directors 30

Key Management 36

Corporate Informati on 38

Financial Contents 40

Corporate Governance 41

Financial Statements 51

Shareholders' Informati on 143

Noti ce of Annual General Meeti ng 145

Appendix I 150

Proxy Form

conTenTs

smile! it’s a brand new super!

1SUPER GROUP LTD Annual Report 2012

unveiling a better brand

our pursuit of excellence has led us to reinvent and rethink the way we operate as we continue to keep up with changing times. to this end, we are delighted to embrace a new brand identity that reflects our culture of optimism. despite a revamped look, one thing remains the same – our unwavering commitment to create quality and innovative products that will delight customers from generation to generation

10weLL Known Brands

More Than

creaTinG anew LooK

Being in the business of

MaKinG peopLe happy, w e s t r i v e t o bring smiles to many faces with our producTs.

• w e B eL i e v e T HAT •

G o o dT h i n G s d o c o m e i n s m a l l s a c h e t s .

BrANdssHoWcAse

4 A NEW ERA

super coFFee

Coff ee you look forward to everyday – We believe that a good cup of coff ee makes for a great day. That’s why we pour all our experti se into creati ng a great tasti ng cup of happiness for you.

Our 3in1 Regular coff ee makes use of the fi nest coff ee beans, top grade creamer and sugar to concoct a perfect cup of coff ee with an impressive and smooth delicate undertone to delight your taste buds.

An irresisti ble cup, our 3in1 Brown Sugar coff ee is wonderfully fragrant cuppa right out of the pack. It has just the right touch of caramel from the brown sugar in this enti cing blend.

Looking for sheer indulgence? Our 3in1 Rich blend is an affordable daily luxury that is specially brewed to uplift and satisfy coffee lovers who prefer a distinct premium taste and robust aroma.

For the health conscious coffee addicts, our popular 3in1 Reduced Sugar coffee offers the same great taste with lower sugar content so that you still enjoy a great cup of smooth coffee!

For the 2in1 coff ee lovers, Super Coff ee range also off ers Kopi-O – a strong brew of premium black coff ee without creamer, and Coff ee & Creamer – a robust blend of coff ee and creamer without additi onal sugar.

productssHoWcAse

6 A NEW ERA

charcoaL roasTedwhiTe coFFee

Authentic taste for today’s coffee lovers – Charcoal Roasted White Coff ee range is inspired by the traditi onal coff ee shop culture in Ipoh, Malaysia in the 19th century. Super’s roasti ng and blending techniques faithfully capture the aroma and buttery characteristi cs of this classic brew to give you a coff ee experience that will remind you of what you love about life.Indulge in its smooth, creamy and

full fl avored taste while relishing in the perfect harmony of premium Robusta and Arabica freeze-dried coff ee, this nostalgic coff ee fl avor will bring coff ee afi cionados back to the good old days.

Savour our 3in1 Classic White Coff ee, charcoal roasted to perfecti on, boosti ng a robust strong-bodied taste with a sti mulati ng aroma.

The 3in1 Roasted Hazelnut White Coff ee off ers a rich and roasted hazelnut taste to the traditi onal favorite.

Our 3in1 Brown Sugar White Coff ee off ers a strong-bodied coff ee that has been winning coff ee lovers over with its complex layers fi lled with intense, rich and aromati c caramel fl avours.

Our 2in1 White Coff ee and Creamer is a smooth blend with no added sugar, appealing to coff ee lovers who prefer strong, intense roasted fl avors with a hint of bitt erness.

everyone loves that time of the day when we simply sit back, be happy and savour life’s little joys.

That’s why we put our best into each cup to bring a smile on your face.

after all, we at super believe that good things do come in small sachets.


productssHoWcAse

oTher producTs

To date, Super has more than 300 products in its portf olio spanning a wide spectrum of product categories from instant-coffeemix, cereal, soymilk, teamix, non dairy creamer and many others.

8 A NEW ERA

At OWL, we combine ti me-tested recipes with more than 50 years of experience in roasti ng and blending to ensure each cup you make has a consistent aroma, body and fl avour. Based in Singapore, OWL preserves the disti ncti ve taste of coff ee and tea from the culturally rich Straits Asian region that weaves from Penang through the Straits of Malacca and down to Java.

OWL is a leading Straits Asian coffee brand. We promise to bring consumers the disti ncti ve taste and fl avours of Southeast Asian inspired coff ee. Our product range includes the fi nest blends of instant coff ee as well as ground coff ee. We have created 3 ranges of coff ee products; namely, Owl Everyday Favourites, Kopiti am Roast and White Coff ee Tarik.

The OWL brand has become synonymous with dedicati on, passion and an appreciati on of the Straits Asian food and beverage culture. These same values defi ne OWL’s very fi rst café in the F&B business. Since its soft launch, the Owl Café has garnered rave reviews for its enti cing menu and fabulous fare.

OWL’s fresh and contemporary brand persona is showcased in the café’s stylish interiors and unique presentati on of its food and beverages. These elements are a testament to the OWL’s brand evoluti on from traditi onal roots to embrace today’s contemporary and modern ti mes.

Conti nuing its eff ort in bringing you OWL’s fi nest coff ee craft smanship that

has served the nati on since 1956, OWL presents to you its latest range of

White Coff ee Tarik Special Recipes which consists of fi ve unique fl avours

that suits everyone’s taste buds.


enTerinGnew horizons

counTries aroundThe worLd & counTinG

presence in

52

extending our reach

We are honoured to be recognised as one of the top 100 singapore brands in 2012 and retain our leading position in market share for instant coffeemix within southeast Asia. Moving forward, we will continue to further our product lines with innovative offerings that will not only enable us to reinforce our presence in familiar markets, but also introduce our brand to the rest of the world.

52couNtrIes ArouNdtHe WorLd & couNtINgWIDENING OUR REACHWe have been delighti ng taste buds around the world and will build upon our global presence as we move toward new horizons. Guided by an experienced management team and support of a strong distributi on network, we are well-positi oned to achieve greater growth and deliver greater value to our customers wherever they are. Super’s consumer products & food ingredients products can be found in 52 countries.

we are well-positioned to achieve greater growth and deliver greater value to our customers wherever they are.

gLoBALpreseNce

s I N g A p o r e

Top 100BrANds AWArd2012

12 A NEW ERA

15stAte-oF-tHe-Art MANuFActurINg FAcILItIesCHINAChangzhou Super Technology Development Co., LtdChangzhou Super Food Co., LtdChangzhou Super Chartered Food Co., LtdWuxi Super Food Technology Co., Ltd

MYANMARSuper Coff eemix Ltd

THAILANDSCML (Thailand) Co., Ltd

MALAYSIASuper Food Technology Sdn BhdSuper Coff eemix Marketi ng Sdn BhdSuper NHF Canning Sdn BhdSuper Food Specialists (M) Sdn BhdSuper Bio-Food Ingredients (M) Sdn Bhd

SINGAPORESuper Conti nental Pte LtdOwl Internati onal Pte LtdSuper Coff ee Corporati on Pte Ltd

VIETNAMSuper Coff emix Vietnam Ltd

Brand ranking improved tremendously from 74 in 2011 to 42 in 2012

Brand value nearly doubled from usd70m in 2011 to usd130m in 2012


Super Group Ltd(Formerly known as Super Coffeemix Manufacturing Ltd)

(Singapore)

100%Super coffee corporation pte. Ltd.

(Singapore)

100% SCML

Overseas Pte Ltd

(Singapore)

100%Super Food Investment

International Pte Ltd

(Singapore)

100% Super

Vending Pte Ltd

(Singapore)

100% Super

Continental Pte Ltd

(Singapore)

100% Changzhou Super Food

Co., Ltd(China)

100%Changzhou

Super Chartered

Food Co., Ltd (China)

60%Super

CoffeemixLtd

(Myanmar)

100%Super

Coffeemix Vietnam Ltd(Vietnam)

100% Changzhou

Super Technology

Development Co., Ltd (China)

100%Super Foods

Specialists Sdn Bhd

(Malaysia)

90%Wuxi Super

Food Technology

Co., Ltd(China)

100%Super

Bio-FoodIngredients

(M)Sdn Bhd

(Malaysia)

100%Super Dairy

Sdn Bhd (Malaysia)

groupstructure

14 A NEW ERA

100% Super

Investment Holdings Pte Ltd

(Singapore)

100% Haddington Enterprises

Ltd (Hong Kong)

100% Super

Coffeemix (Russia)

LLC (Russia)

100%Super Monte

Marketing Pte Ltd

(Singapore)

100% PT Super

Aneka Foods &

Beverages (Indonesia)

58.7%Beecomb

Food Industries

Pte Ltd(Singapore)

50% Tianjin Super

Lifestyle Food

DevelopmentCo., Ltd(China)

35.3% Sun

ResourcesHoldings Pte Ltd

(Singapore)

50% JHS Holding

Pte Ltd(Singapore)

100% Owl

International Pte Ltd

(Singapore)

100% Super U&U

(Hong Kong) Ltd

(Hong Kong)

100% Super FoodTechnology

Sdn Bhd(Malaysia)

99.9%SCML

(Thailand)Co., Ltd

(Thailand)

30% San Miguel

Super Coffeemix Co., Inc.

(Philippines)

40% Ceres Super

Pte Ltd (Singapore)

30%BS Global

LLC(Mongolia)

80%PT

DwisindoMas

(Indonesia)

100% Shantou

SEZ Perfect Foods

Industries Co., Ltd (China)

50% Ningxia Yin Ou Super Lifestyle

Food Co., Ltd(宁夏银鸥超闲

食品公司)(China)

94%Changzhou Care Real

Estate Development

Co., Ltd (常州凯瑞置业有限公司)

(China)

70%Jiangsu

Care Real Estate

Co., Ltd (江苏凯尔置业有限公司)

(China)

100%Sun

DevelopmentPte. Ltd

(新发展有限公司)

(Singapore)

100%Changzhou Care (QSY)

EstateCo. Ltd

(常州凯雷置业有限公司) (China)

92.5% Changzhou Care Real

Estate Co., Ltd

(常州凯尔置业有限公司)

(China)

100%Owl Food

Manufacture (M) Sdn Bhd(Malaysia)

90%Super

Coffeemix Marketing Sdn Bhd

(Malaysia)

100%Super NHF

Canning Sdn Bhd

(Malaysia)

96%Super Food

Marketing Sdn Bhd

(Malaysia)


seizing greater opportunities

We believe in improving ourselves and investing in our future. Apart from refreshing our brand, we also sought to strengthen our manufacturing capabilities and expand our product offerings. to this end, our investment in freeze-dried coffee and botanical herbal extract facilities have allowed us to enhance our product portfolio and create greater value for our customers.

15sTaTe-oF-The-arT

ManuFacTurinG FaciLiTies

discoverinGnew

perspecTives

dear sharehoLders,

It had been another excellent year for Super. In FY2012, we achieved record revenue of S$519.3 million and net profi t of S$82.6 million. For our shareholders, Super conti nued to deliver a strong return on equity of 21%.

We were able to deliver record revenue amidst a challenging business climate due to the strength and experience of our management team and our business strategy. Throughout the year, the Group maintained vigilance and took appropriate measures to improve operati onal effi ciencies and contain costs across our operati ons while focusing on executi ng our growth strategies well. This is evident in the improvement of our gross profi t margin which grew to 35% in FY2012, up from 32% in FY2011, despite a higher proporti on of Food Ingredients sales which carry a lower gross profi t margin.

Achieving growth based on an integrated business modelThe sterling result is a testament to our resilient business structure based on a robust integrated business model with two complementary businesses: Branded Consumer and Food Ingredients.

Our Branded Consumer business is centred on customers’ daily consumption of our high-quality instant beverages and convenient food products. We continued to innovate and stay close to our customers, as well as driving branding initiatives to strengthen our brand presence and deepen brand loyalty amongst the consumers. Our Food Ingredients business is based on providing high-quality food ingredients to F & B manufacturers worldwide. We are an ingredients application specialist who works closely with our major customers to develop customised food ingredients solution and explore new applications for the food ingredients we supply.

In the last 25 years, Super has grown from strength to strength by staying focused on our core business which are instant beverages and convenient food products. Our journey began with our 3in1 coffee for consumers who wanted great tasting coffee quickly and conveniently. Today, Super offers a wide range of products including instant coffeemix, instant teamix, instant cereal, instant organic soymilk, cup noodles, non-dairy creamer and soluble coffee powder.

To further enhance our product offerings, we had constructed a freeze-dried coffee production line. We are also on track with the construction of our botanical herbal extract plant. These investments will not only strengthen our position as a food ingredients application specialist but will also drive product innovation for our Branded Consumer business as the new food ingredients can be used to produce new and exciting instant beverages and convenient food products for our consumers.

Branding, the next big driveOur brands are one of our most valuable assets. In FY2011, we successfully gave one of our coffee brands “OWL” a fresh new look with new packaging along with the introduction of new flavours.

We followed up on that success by opening the first OWL Café at The Star Vista, a new lifestyle complex offering dining, entertainment, retail and services. This café puts the OWL brand in a lifestyle hub where the young and trendy professionals can gather to enjoy Singapore’s favourite brand of Straits Asian coffee amidst a great dining experience.

In FY2012, we drove another successful branding campaign in Malaysia to introduce our new and contemporary packaging for our popular Super Charcoal Roasted White Coffee. By rejuvenating the product brand and packaging, we were able to capture a segment of the consumers with a preference for premium instant white coffee.

Moving into 2013, we unveiled the new logo and identity for our flagship brand “SUPER” at a private event organised for our business partners on 10 January 2013 This is part of the Group’s global rebranding initiative designed to align SUPER’s brand identity across product and geographical lines, creating a consistent brand personality that resonates well with our loyal consumer base. Through this global branding initiative, the SUPER brand will be elevated as the leading brand in Southeast Asia. The rejuvenated SUPER brand symbolises enthusiasm and optimism. Through these qualities, we will build a shared culture of optimism and confidence with our stakeholders including employees, customers and partners.

We have carefully calibrated this revitalised SUPER brand to help the Group improve its product portfolio management while enhancing its global brand presence and recognition. To promote the new identity, the Group will be rolling out campaigns in phases beginning with Singapore, Malaysia and China in 2013, starting with a campaign to introduce the new logo and packaging.

Together with the refreshed look, the Group will consolidate its product lines and add new product variants that will better meet the changing tastes of our customers.

Our dividend policySuper is committed to the dividend policy of distributing at least 50% of the Group’s annual net profit as dividends to shareholders. In this regard, the Board of Directors has proposed a 2nd and final dividend of 5.1 cent per share, payable on 28 May 2013. Including the interim dividend of 2.0 cent per share, total dividend amounted to 7.1 cent per share, a 22% increase from the previous year.

Thank you and looking aheadMarket conditions are expected to remain competitive into FY2013. Our experienced and prudent management team will continue to be vigilant while focusing on executing our growth strategies.

At this point, I want to take this opportunity to thank my fellow directors for their valuable contributions and guidance. I also want to thank our customers, business partners, employees and shareholders. We could not have delivered the good results without your support. I hope you will continue to support Super for many more years ahead.

Yours sincerely,

David Teo Kee BockChairman and Managing Director

cHAIrMAN’sstAteMeNt


2012 2011 2010 2009 2008

Profit and Loss Account (S$’000)

Revenue 519,268 440,972 351,832 296,262 300,195

Gross profit 181,426 142,076 131,402 103,407 99,770

Net profit 82,564 63,871 59,335 40,448 26,084

Profit attributable to shareholders 79,044 61,898 58,355 40,242 25,143

Balance Sheet (S$'000)

Total assets 542,863 502,446 447,097 364,778 344,295

Total liabilities 126,196 120,268 105,514 77,109 84,021

Total equity 416,667 382,178 341,583 287,669 260,274

Shareholders' equity 398,917 366,907 329,750 277,231 249,812

Per Share Data (cents)

Basic earnings per share 14.18 11.10 10.66 7.48 4.64

Net asset value per share (note 1) 71.55 65.82 59.16 51.55 46.12

Interim dividends per share 2.00 2.00 1.80 0.60 0.60

Final dividends per share 5.10 3.80 3.60 2.00 2.00

Other Financial Ratios

Return on shareholders' equity (%) 20.64 17.77 19.23 15.27 10.53

Return on assets (%) 15.12 13.04 14.38 11.35 7.61

Dividend payout (%)(note 2) 50.08 52.24 50.97 34.74 34.41

Current ratio (no. of times) 2.50 2.74 3.12 3.14 2.63

Debt-to-equity ratio (note 3) (no. of times) 0.30 0.31 0.31 0.27 0.32

Notes:1. Net asset value per share is computed based on total assets less total liabilities and minority interests.2. Dividend payout is calculated by dividing total dividends against profit attributable to shareholders. 3. Debt-to-equity ratio is calculated by dividing total liabilities against total equity.

FINANcIALHIgHLIgHts

20 A NEW ERA

super AcHIeves record reveNue oF

s$519.3MILLIoN

ANd record Net proFIt oF

s$82.6MILLIoN

S h a r e h o l d e r s ’ e q u i t y g r e w f r o m S$249.8m in FY2008 to S$398.9m in FY2012. Dividend payout increased from 34.41% in FY2008 to 50.1% in FY2012.

Revenue (S$’000)

Shareholders’ Equity (S$’000)

Dividend Payout (%)

519,

268

2012

440,

972

2011

351,

832

2010

296,

262

2009

300,

195

2008

Net Profit (S$’000)

82,5

6420

12

63,8

7120

11

59,3

3520

10

40,4

4820

09

26,0

8420

08

50.0

820

12

52.2

420

11

50.9

720

10

34.7

420

09

34.4

120

08

398,

917

2012

366,

907

2011

329,

750

2010

277,

231

2009

249,

812

2008


Group saLesby Geographical Desti nati on (S$’000)

in percenTaGe

201226%

7%

62%

5%

201020%

11%63%

6%

201121%

9%64%

6%

200912%69%

12%

7%

200812%67%

8%

13%

Southeast Asia (excluding Singapore) Singapore East Asia Others

FINANcIALHIgHLIgHts

Southeast Asia(excluding Singapore)

Singapore East Asia Others

320,

916

2012

281,

045

2011

220,

805

2010

205,

671

2009

201,

777

2008

2012

2011

2010

2009

2008

2012

2011

69,6

8120

10

2009

23,9

1620

08

2012

2011

2010

2009

2008

133,

412

93,5

10

35,2

98

38,6

00

38,5

15

36,9

59

34,5

15

29,6

42

27,8

17

22,8

31

19,6

24 39,9

87

34,0

08

22 A NEW ERA

Branded Consumer Sales Food Ingredients Sales

201223%

8%6%

54%

9%

201014%

8%62%

13%2%

201120%

10%

7%

55%

7% 1% 1%

20099% 67%

13%

8%3%

20089%

64%

15%

9%3%

in percenTaGe

Coff ee Products Cereal Products Others (Branded Consumer Sales) Soluble Coff ee Powder Non-Dairy Creamer Others ( Food Ingredients Sales)

Group saLesby Product Category (S$’000)

Coff ee Products Cereal Products Others(BrandedConsumer Sales)

Non-Dairy Creamer

Soluble Coff ee Powder

Others(FoodIngredients Sales)

2012

2011

2010

2009

2008

281,

019

240,

472

218,

328

199,

229

193,

475

2012

2011

2010

2009

2008

29,3

59

28,7

67

27,4

33

27,2

07

27,0

45

2012

2011

2010

2009

2008

42,8

88

30,7

71

7,62

5

9,35

2

8,95

8

2012

2011

2010

2009

2008

257

3,76

7

5,17

2

2012

2011

2010

2009

2008

44,7

43

47,8

40

38,6

52

44,7

81

49,3

78

2012

2011

2010

2009

2008

121,

002

87,8

17

45,4

34

25,9

36

21,8

22


operAtIoNs &FINANcIAL revIeW

Another Record Year; An Excellent Performance with Healthy Balance SheetFollowing FY2011’s strong performance, Super Group Ltd, (“Super” or “the Group”) delivered yet another record year with excellent results.

The Group achieved total revenue of S$519.3 million, up 18% from a year ago. Gross profit grew to S$181.4 million, up 28% from a year ago. Net profit also grew to S$82.6 million, up 29% from the record S$63.9 million in FY2011.

The Group expanded production facilities and, alongside that, increased headcount in FY2012. As such, general and administrative expenses increased to S$42.3 million, up from S$38.2 million in FY2011.

However, the Group took measures that drove effective cost management and operational efficiency, as evident in the improvements in gross profit margin (FY12: 35%, FY11: 32%), trade receivables and inventory turnover. The Group was able to continue to embark on strong advertising and promotion initiatives while maintaining selling and distribution expenses stable at approximately 10% of sales revenue.

For FY2012, the Group generated substantial cash and bank balances of S$112.2 million and a low debt-to-equity ratio of 0.30 times. Accounts receivable turnover improved to 2.05 months from 2.08 months in the preceding year. Inventory turnover stood at 3.25 months in FY2012 against 3.42 months in FY2011.

Branded Consumer Segment – Returns on Brand Awareness With the Group’s sustained investment in brand-building for the Branded Consumer segment, revenue grew to S$355.1 million, up 11% from a year ago. Coffee products continued to be the best-selling products, accounting for 79% of total Branded Consumer segment sales.

Super delivered on customer expectations with new product variants and continued to revive interest in existing product brands such as OWL and SUPER with strong brand-building activities in key markets, and a wider sales network throughout the markets.

Sales revenue in all geographies increased in FY2012. In Southeast Asia (including Singapore), East Asia and rest of the world, Branded Consumer sales grew 11%, 21% and 6% respectively.

Overall, the Group continued to retain the top 5 positions in terms of market share for instant coffeemix in key markets within Southeast Asia, namely Singapore, Malaysia, Thailand and Myanmar.

The excellent market positions were largely due to strong brand loyalty driven by the Group’s branding initiatives across key markets, and the introduction of product variants for the discerning audiences in all markets.

In FY2012, the Group launched brand new packaging for its white coffee range of products, Super Charcoal Roasted White Coffee. This revival of the premium instant charcoal roasted white coffee is targeted at sophisticated coffee drinkers who prefer to consume traditional coffee flavours. The brand-building programme includes a series of advertising and demand-generation campaigns featuring the new packaging to consumers. By strengthening brand loyalty, the Group continued to benefit from sustainable and growing sales revenue, as well as improvements in profitability.

The Group also opened its first OWL Café in the Star Vista, an upscale complex, to take advantage of Singapore’s growing coffee culture. The OWL Café serves the signature Straits Asian charcoal-roasted coffee blends to young professionals and families who frequent this upscale lifestyle complex.

The Group continues to carry a portfolio of brands targeted at different segments of the population. For instance, the “SUPER” product brand offers high-quality premium range for the affluent and discerning coffee drinkers, the “CAFÉ NOVA” brand offers a range of innovative and quality products for the young professionals or Generation Y drinkers while the “OWL” brand offers robust and traditional coffee flavours for the mature generation of drinkers. Other brands under the Group include “YE YE”, “COFFEE KING”, “SUPER POWER”, etc.

The Branded Consumer segment offers high-quality food and beverage products such as instant teamix, instant cereal, instant organic soymilk as well as instant noodles in a variety of brands that suit different demographics.

These brands of food and beverage items are sold through the Group’s distribution network throughout Southeast Asia (including Singapore, Malaysia, Indonesia, Thailand, Myanmar, the Philippines and Vietnam), East Asia, Oceania, the Middle East, Europe, Africa and the Americas.

24 A NEW ERA

Food Ingredients Segment – Growing With New CustomersSuper’s Food Ingredients segment continued to grow from strength to strength in FY2012 with revenue of S$164.1 million, up from S$122.4 million a year ago. This business segment now accounted for 32% of the Group’s total sales revenue, up from 28% in the preceding year. The top-selling food ingredient is non-dairy creamer, which contributed 74% of the total Food Ingredients sales followed by soluble coffee powder with a 26% contribution.

This business segment grew strongly in FY2012 with higher sales from East Asia, particularly in China, as well as new customers from Southeast Asia. Sales revenue for Food Ingredients in East Asia grew a tremendous 48% while sales revenue in Southeast Asia grew 12% from a year ago. The excellent growth in East Asia is attributed to the high demand by F&B manufacturers as well as orders from new customers secured during the year.

The demands for food ingredients used by other F&B manufacturers in ready-to-drink segments and even F&B providers such as bubble tea franchises continued to grow based on the Group’s sterling reputation for food quality and safety. Products in Food Ingredients segment include non-diary creamer, soluble coffee powder, fat-filled milk and others.

Prior to FY2012, the Group had been constrained by production capacity, but had since addressed that issue when production facilities were added in the year under review. By end of FY2012, the Group was able to produce 15,000 metric tonnes of spray-dried soluble coffee powder, 4,000 metric tonnes of cereal flakes, and 125,000 metric tonnes of non-dairy creamer. These helped the Group to meet demands for its Food Ingredient products.

In East Asia, the largest opportunity lies in China. The Group delivers products that are closely aligned to the needs of its customers in F&B manufacturing, and is growing its network of partners and support team. Products for East Asia are manufactured under the most stringent safety standards in the Group’s manufacturing facilities located in Malaysia and China.

On track to completion is the Group’s new botanical herbal extract production line at its Malaysia plant, with an annual production capacity of 3,000 metric tonnes. With this facility, the Group will be able to add new products such as tea, chicory, ginger and chrysanthemum to its current list of food ingredients. In either liquid or powder forms, these botanical ingredients have a niche and loyal following in Asia. By leveraging the trend towards healthy F&B products, the Group will be able to offer a wide and complementary portfolio of high-quality, premium products. This investment is in line with the Group’s strategy of becoming a premier ingredient specialist. Additionally, the Group’s production facility for high-quality freeze-dried soluble coffee powder is scheduled for commencement in the first quarter of 2013. This will add 1,500 metric tonnes of freeze-dried coffee to the Group’s overall production capacity. This

25SUPER GROUP LTD Annual Report 2012 25SUPER GROUP LTD Annual Report 2012 25SUPER GROUP LTD Annual Report 2012

food ingredient is accepted in the F&B industry as a superior product over spray-dried coffee for its robust flavour and aroma. The Group’s investment in this production line will enable it to offer premium coffee products for both its Food Ingredients and Branded Consumer business segments.

Overall, the Group has gained a strong reputation in the competitive F&B industry for the quality of its products, ability to innovate and deliver on new applications for mass consumption, as well as its solid reputation for food safety and authenticity.

The Group continues to have ingredient specialists working closely with its in-house Research and Development unit. The specialists advise and collaborate with customers on how to apply the Group’s food ingredients – extracted under highly controlled environments aimed at retaining their potency and flavours - to their existing or new food and beverage products.

In doing so, F&B manufacturers who are customers of Super gain knowledge and the ability to create and deliver a wider and stronger portfolio of quality products for their own customers. With the increased confidence amongst the customers for Super’s Food Ingredient products, growth for this business segment is strong.

Integrated Business Model; Sustainable Growth The integrated business model is reaping benefits for the Group’s plan to build and maintain a sustainable business built on growth. Both business segments, Branded Consumer and Food Ingredients, have synergies which the Group is continually leveraging. This is evident, for instance, in the recently completed freeze-dried coffee production line and the upcoming botanical herbal extract production facility whose products can be used by both Food Ingredients and Branded Consumer business segments. For the Branded Consumer business segment, these new food ingredients can be used to deliver new product variants targeted at affluent consumers.

The Group is also on track to complete the construction of its factory extension at the existing Tuas plant, which will house all of the Group’s business and production operations in Singapore. By having all operations at a single site, the Group aims to drive cost and operational efficiencies. The expanded Tuas plant will also serve as the Group’s Headquarters and Research & Development Centre, it is expected to be ready by early 2014.

Going ahead, the Group will drive business growth and developments with very strong branding at both product and corporate levels as part of its long-term goal of building brand-loyal customers. The Group will also maintain its focus on driving cost efficiencies through higher productivity, and be fast on the market with product innovations and grow its product portfolio.

Outlook – Grow With Strong BrandMoving into FY2013, Super has laid the foundation for a sustainable future with its expanded production capabilities and solid distribution network. To continue to leverage on the strength of its 25-year-old brand, Super will undertake a global rebranding programme with a new and revitalised corporate logo and brand identity. This new global rebranding programme will be undertaken in phases to minimise any potential concerns by the local consumers and partners, as well as to maximise returns on the branding initiatives.

The new rebranding initiative is designed to ensure alignment of the Group’s brand identity across all product lines and across all geographies.

operAtIoNs &FINANcIAL revIeW

26 A NEW ERA

The new rebranding initiative is designed to ensure alignment of the Group’s brand identity across all product lines and across all geographies. This will create a consistent brand personality for Super around the world, making it synonymous with positive qualities of hope, optimism and happiness, underlined by the strengths of the Group’s ability to deliver on product innovation, safety and quality.

The Group will commence branding campaigns in Singapore and Malaysia in 2013 to introduce the new Super logo and product packaging. Along with the revitalised brand, the Group will consolidate its product lines and add new and premium product variants that will meet the changing tastes of its consumers in these markets.

This new rebranding initiative is not only targeted at customers of the Group’s Branded Consumer business segment but also at the Food Ingredients business segment. F&B manufacturers and providers will see the new Super logo on all the packages of food ingredients. This marks the first time that Super has taken steps to stamp its signature of brand quality on all the food ingredients supplied. Customers are assured of the high standards of product quality and safety in Super’s food ingredients.

In addition to the rebranding initiative, the Group will continue to be prudent and watchful. Asia is expected to drive sales for the Group, although there are expected challenges in areas such as prices of raw materials and currency fluctuations.

With the experienced management team in place, the Group will be able to manage these challenges and undertake appropriate actions to mitigate the impact of these factors on the Group’s business.

The Group will continue to execute its strategy of focusing on its core strengths and businesses of Branded Consumer and Food Ingredients, while disposing of non-core businesses, as was done with the canned drinks production facility and the vending sales business during 2012.

Overall, the Group expects to continue its growth momentum, barring any unforeseen circumstances.


scaLinGnew heiGhTs

guided by a clear vision and commitment to uphold our mission, we will strive for greater performances to come. Building on the cohesive network forged between our staff, customers, business partners and shareholders, we are confident to deliver upon our brand promise.

s$82.6

and record neT proFiT oF

MiLLion

super achieves record revenue oF

MiLLions$519.3

delivering higher returns

BoArd oFdIrectors

Mr Teo Kee BocK

Chairman & Managing Director

Mr Teo, a founding member of Super, is credited as the initiator of Super’s 3in1 beverage products. For more than 25 years, he has led the Group’s growth and development in Asia’s fast-paced and competitive food and beverage industry.

In 1994, upon the successful listing of Super on Singapore Stock Exchange, Mr Teo was appointed Chairman and Managing Director of the Group. As an active contributor to the Singapore economy and society, Mr Teo also founded another publicly-listed company, Fuji Offset Plates Manufacturing Ltd, and remained as its Chairman.

Mr Teo was recognised for his entrepreneurial vision and achievement when he was named the Ernst & Young Entrepreneur of the Year Singapore 2006 and the Category Winner in Manufacturing and Business Services.

Present Directorships:Listed

Fuji Offset Plates Manufacturing Ltd (Executive Chairman)Others

NIL

Principal Commitments:NIL

Past Directorships in Other Listed Companies Held Over the Preceding 3 Years:PSC Corporation Ltd (now known as Hanwell Holdings Limited)

Mr Te KoK chiew

Executive Director

Mr Te holds the office of Executive Director and is also a founding member of Super, which was incorporated in 1987. He is responsible for the overall sales & marketing, purchasing, R&D and production of Super’s product.


NILOthers

NIL


Past Directorships in Other Listed Companies Held Over the Preceding 3 Years:NIL

Ms Te Lay hoon

Executive Director

Ms Te holds the office of Executive Director and is also a founding member of Super. She administers the human resource function in the Company.


NILOthers

NIL



30 A NEW ERA

Ms Te Lay GuaT

Executive Director

Ms Te holds the office of Executive Director and is also a founding member of Super. She is responsible for general administration functions in the Company.

Ms Te has resigned as a Director of the Company with effect from 19 March 2013.


NILOthers

NIL



Mr Li KanG @ charLes K Li

Executive Director

Mr Li joined the Company in 1996 as a Project Manager and was appointed as an Executive Director of the Company’s subsidiary, Super Continental Pte Ltd, in 2002. In August 2004, Mr Li was appointed as an Executive Director of the Company and is responsible for food ingredient manufacturing, R&D, project development and technical management. Mr Li is responsible for the overall strategic development of Super’s Food Ingredients business segment.


NILOthers

NIL



Mr wonG FooK sunG

Executive Director

Mr Wong joined the Company in 1997 as General Manager for Group Corporate Affairs and was appointed as an Executive Director in 1999. He assists the Chairman in the Group’s business development, accounts, finance and corporate matters. He was the Group Financial Controller of Bonvest Holdings from 1982 to 1989, General Manager of Coop International from 1990 to 1992 and subsequently ventured into his own business. Prior to joining Super in 1997, he was the Financial Controller of Sinochem Asia Holding Co. Ltd.


NILOthers

NIL




BoArd oFdIrectors

Mr Tan Tian oon

Executive Director

Mr Tan joined the Company in June 1998 as International Sales Manager. He was promoted to General Manager (International Sales) in January 2001, and appointed as an Executive Director in June 2003. He oversees sales and marketing planning and execution for various key subsidiaries and distributors in Asia. Prior to joining the Company, Mr Tan held sales and marketing positions in various food and beverage companies.


NILOthers

NIL



Mr Lee chee TaK

Executive Director

Mr Lee joined the Company in 1992 as an accountant and was appointed as an Executive Director in 1994. He is responsible for the development of overseas markets and worldwide trademark matters of the Group. He is also the management representative of the Company’s ISO Committee.


NILOthers

NIL



Mr Goi senG hui

Vice Chairman & Non-Executive Director

Mr Goi joined the Board as Vice-Chairman and Non-Executive Director on 28 February 2006. He is the Executive Chairman of Tee Yih Jia Group (a global food and beverage group with operations in Singapore, Malaysia, USA, Europe and China); and Yangzhou Junhe Real Estate Group (a growing property development company in China).

Apart from these core businesses, Mr Goi has investments across a range of listed and private entities in numerous industries, such as food and beverage, consumer essentials, recycling, distribution and logistics. Mr Goi also serves as on the board of four other Mainboard-listed companies – as Chairman of GSH Corporation Limited, Vice-Chairman of Etika International Hldgs Ltd, Vice-Chairman of JB Foods Limited, and Director of Tung Lok Restaurants (2000) Ltd.

He is also Enterprise 50 Club’s Honorary Past President and Vice Chairman of IE Singapore’s “Network China” Steering Committee, Regional Representative for Fuzhou City and Fujian Province, council member of the Singapore-Zhejiang Economic & Trade Council, as well as Senior Consultant to Su-Tong Science & Technology Park. He is currently the Honorary Chairman for the International

32 A NEW ERA

M r c h a n d r a d a s s/ o rajaGopaL siTaraM

Non-Executive Director

Mr Das joined the board as Non-Executive Director in 2011. He is currently the Managing Director of NUR Investment & Trading Pte Ltd. He also sits on the Boards of Yeo Hiap Seng Limited and Ascott Residence Trust Management Limited. Currently, he is Singapore’s non-resident Ambassador to Turkey. Mr Das was the Chairman of the Trade Development Board from 1983 to 1986. He served as a Member of Parliament from 1980 to 1996. Mr Das graduated from the University of Singapore with a Bachelor of Arts in Economics (Honours). He also holds a Certificate in Education from the former Singapore Teachers’ Training College.


Yeo Hiap Seng Limited (Also Deputy Chairman)Ascott Residence Trust Management Limited, the Manager of Ascott Residence TrustOthers

NUR Investment & Trading Pte Ltd (Managing Director)


Past Directorships in Other Listed Companies Held Over the Preceding 3 Years:Si2i Ltd (Formerly known as Spice i2i Limited)Sincere Watch LimitedCapitaMall Trust Management Ltd, the Manager of CapitaMall TrustNera Telecommunications Ltd

Mr Goh Boon KoK

Independent Director

Mr Goh joined the Board as an Independent Director in 1994. He is a Certified Public Accountant who runs his own practice, Goh Boon Kok & Co. He has more than 30 years of experience in both auditing and accounting through holding various positions with companies and government agencies.

He served as the Regional Financial Controller at Richardson-Merrell Pte Ltd and the Chief Accountant at Far East Levingston Shipyard Ltd. Prior to that, he was a Cost and Finance Analyst at the Economic Development Board and the Assistant Examiner at the Inland Revenue Department of Singapore.


Blumont Group Ltd. (Independent Director)Magnus Energy Group Ltd. (Independent Director)Pan Asian Water Solutions Limited(Independent Director)Others

Yin Associates Private Limited

Principal Commitments:Goh Boon Kok & Co (Sole-Proprietorship / Partner)


Federation of Fuqing Association, and a member of the Singapore University of Technology and Design (SUTD) Board of Trustee, and Chairman of Dunman High School Advisory Committee and Ulu Pandan Citizens Consultative Committee.


Tung Lok Restaurants (2000) LtdGSH Corporation LimitedEtika International Holdings LtdOthers

Tee Yih Jia Food Manufacturing Sdn Bhd

Principal Commitments:Singapore University of Technology and Design (Director, Member, Board of Trustees) Duman High School Advisory Committee (Chairman)Enterprise 50 Club (Honorary Past President)Network China, Fuzhou / Fujian (Regional Representative)Network China, International Enterprise Singapore (Vice Chairman)Singapore-Zhejiang Economic & Trade Council (SZETC) (Council Member)Singapore-Jiangsu Cooperation Council (Council Member)Su-Tong Science & Technology Park (Senior Consultant)Ulu Panda Consultative Committee (Chairman)



BoArd oFdIrectors

Mr KuiK see juan


Mr Kuik joined the Board as an Executive Director in 1994, relinquished the position at the end of 2000 and has since been an Independent Director. He also serves as Independent Director on the Board of three other public companies listed on SGX. Mr Kuik started his corporate banking career with Bank of America in Singapore in 1972 and left the banking service industry in 1981. Since then and for the next 20 years, he held Executive Director positions with several public companies (including Super) listed on SGX at various periods up to end of the 2000. Mr Kuik is an Associate member of the Chartered Institute of Bankers, United Kingdom.


China Farm Equipment Limited (Independent Director)China Yuanbang Property Holdings Limited (Independent Director)Tat Seng Packaging Group Ltd (Independent Director)Others

NIL


Past Directorships in Other Listed Companies Held Over the Preceding 3 Years:China Kangda Food Company Limited

Mr Lai Mun onn


Mr Lai joined the Board as an Independent Director in June 2003. He graduated from the University of London with a Bachelor of Law degree with Honours and obtained his Barrister-at-Law from Lincoln’s Inn. In 1982, he was admitted as an Advocate and Solicitor of the Supreme Court of Singapore. He is presently a Notary Public and Commissioner for Oaths, and a member of the Singapore Institute of Arbitrators. He is the First Vice President of the Singapore Tennis Association, the Honorary Legal Advisor to the Basketball Association of Singapore and the President of the Keppel Club. He is also a Non-Executive and Independent Director of Koh Brothers Group Limited. Mr Lai is also the Managing Partner of Lai Mun Onn & Co, a law firm in Singapore.


Koh Brothers Group Limited (Independent Director)Others

NIL

Principal Commitments:Lai Mun Onn & Co (Manager / Owner)Singapore Tennis Association (First Vice President)Keppel Club (President)


Mr LiM KanG san


Mr Lim joined the Board as an Independent Director in August 2004. He graduated from Monash University, Australia with a Bachelor’s Degree majoring in Accounting and a Bachelor’s Degree in Law in 1985 and 1986, respectively. Mr Lim runs his own business in Malaysia.


Fuji Offset Plates Manufacturing Ltd (Independent Director)Others

NIL



34 A NEW ERA

Mr Ko chuan aun


Mr Ko joined the Board as an Independent Director in November 2006. He is currently the Chief Executive Officer and Executive Director of Scorpio East Holdings Ltd. Prior to this, he was the Chairman of Athena Corporation Pte Ltd. Mr Ko also holds chairmanship and directorships at various companies. He also serves as Independent Director on the Board of two other public companies public company listed on SGX – Koon Holdings Limited and San Teh Ltd.


Koon Holdings Limited (Independent Director)San Teh Ltd (Independent Director)Scorpio East Holdings Ltd. (Executive Director / CEO)Others

Athena Corporation pte. Ltd.HSK Resources Pte. Ltd.Star Route Pte. Ltd.

Principal Commitments:Fushun Foreign Trade & Economic Cooperation Bureau (Investment Advisor)

Past Directorships in Other Listed Companies Held Over the Preceding 3 Years:Brothers (Holdings) Limited

Ms juLi e T T e L ee h wee Khoon

Alternate Director to Goi Seng Hui

Ms Lee was appointed as an Alternate Director to Mr Goi Seng Hui in February 2007. Ms Lee is an Executive Director of Tee Yih Jia Group, a position she has held since 1992. She also serves on the board of GSH Corporation Limited. She holds a Masters in Business Administration BA (Strategic Management) from Maastricht School of Management.


GSH Corporation Limited (Non-Executive and Non-Independent Director)Others

Junhe Investment Pte LtdSuper Elite Holdings Pte LtdTee Yih Jia Food Manufacturing Pte LtdYangzhou Junhe Property Development Co., LtdJunhe Real Estate (Jiangsu) Co., Ltd


Past Directorships in Other Listed Companies Held Over the Preceding 3 Years:Tung Lok Restaurants (2000) Ltd


Ms eLaine Teo sze hwee

General Manager

Ms Teo joined the Company in 1999 and is responsible for the branding, marketing and product development of the Group. Elaine’s extensive experience in these fields has given her an edge to heighten the Group’s market expansion in the region. She is also responsible for business development in Singapore and Malaysia. She is spearheading the branding initiatives of the Company.

Mr darren Teo junxianG

Corporate Strategy & Business Development Manager

Mr Teo joined the Company in 2007 and was promoted to Corporate Strategy Manager in 2011. He assists the key management in the Company’s corporate strategy and business development for the Group’s key markets. His key role involves planning and executing the Company’s business strategies. As overseas expansion is key to Super Group’s growth strategies, he is responsible for managing overseas markets like Myanmar and China. He is also involved in investor relations for the Company.

Mr Koh chun yuan

Chief Financial Controller

Mr Koh joined the Company in 2004. He is responsible for the Group’s financial and accounting function which includes auditing, taxation and banking matters. Mr Koh is also involved in the Company’s compliance with the Company Act and SGX listing requirements as well as the corporate affairs for the Group.

Mr sTeven LiM KiM huaT

General Manager – Super Food Marketing Sdn Bhd, a subsidiary company

Mr Lim is the General Manager of Super Food Marketing Sdn Bhd. He oversees the distribution of the Group’s products in Malaysia. Mr Lim has been with the Group since 1999; prior to which he was the marketing manager of a leading food manufacturer in Malaysia. Mr Lim has more than 20 years of experience in sales and marketing.

Mr richard LiM chee KeonG

Chief Executive Officer – Super Food Technology Sdn Bhd, a subsidiary company

Mr Lim is the Chief Executive Officer of Super Food Technology Sdn Bhd and its subsidiary companies in Malaysia. He is responsible for financial and accounting matters as well as corporate affairs of the SFT group of companies. Mr Lim also oversees the operations of the Group’s instant noodles and potato chips manufacturing facilities. He joined the Group in 1997 during the initial construction of the manufacturing facilities at Plentong, Johor Bahru.

Mr LiM Lee senG

General Manager – Super Coffeemix Ltd (Myanmar), a subsidiary company

Mr Lim joined the Company in 1995. He is the General Manager of Super Coffeemix Ltd (Myanmar). Mr Lim takes charge of the operations, financial and accounting matters of the Group’s packaging plant in Myanmar. He is also involved in business development for the Myanmar market.

KeYMANAgeMeNt

36 A NEW ERA

Mr jaMes yeo pecK honG

General Manager, Asia Pacific

Mr Yeo joined the Company in 1998. He is responsible for export sales to the Asia Pacific region. Mr Yeo undertakes sales and marketing planning and execution for the markets under his purview. He is also the General Director of Super Coffeemix Vietnam Ltd, a subsidiary company. Mr Yeo takes charge of business development for the Group’s investment in Vietnam.

Mr wanG wen jia

General Manager, Research & Development

Mr Wang worked in the Company’s Research & Development Department from 1994 to 2000, and rejoined the Company in January 2010 as Group R&D Assistant General Manager in charge of research & development and quality assurance matters for the Group. Prior to the latter appointment, he was with Fraser & Neave as its Technical Development Manager in charge of research and development for diary and non-carbonated soft drinks.

Mr jaichndra rao

General Manager, Europe/Middle East/Africa

Mr Rao joined the Company in 1996 from Nestle India Ltd where he spent 12 years holding various roles in sales, marketing and business development in different regions of the country. Mr Rao is responsible for export sales to the Europe/Middle East/Africa region. Mr Rao undertakes sales and marketing planning and execution for the markets under his purview. He is also responsible for exploring various markets in South Asia.

Mr dennis LiM

General Manager, Singapore Sales

A veteran in the Fast-Moving-Consumer-Goods (“FMCG”) industry, Mr Lim joined the Company in 2000. He leads the local sales team, and undertakes sales and marketing execution for the markets under his purview. Mr Lim is fully responsible for the day-to-day running of the sales department and also oversees the sales of the Group’s Owl brand coffee.

Mr vijayandran joseph

General Manager – Super Continental Pte Ltd, a subsidiary company

Mr Joseph joined the Company in 1995, and assumed the post of General Manager of Super Continental Pte Ltd from 2001 to 2009. He rejoined the Group in 2011 after a career move to Australia. Mr Joseph is involved in the supply chain, business development and raw materials procurement of the Group’s ingredient business segment.


Board oF direcTorsEXECUTIVETeo Kee Bock (Chairman & Managing Director)Te Kok ChiewTe Lay HoonTe Lay Guat (Resigned with effect from 19 March 2013)Lee Chee TakWong Fook SungTan Tian OonLi Kang @ Charles K Li

NON-EXECUTIVEGoi Seng Hui (Vice-chairman)Chandra Das S/O Rajagopal Sitaram Juliette Lee Hwee Khoon(Alternate Director To Goi Seng Hui)

INDEPENDENTGoh Boon Kok (Lead Independent Director)Kuik See JuanLai Mun OnnLim Kang SanKo Chuan Aun

audiT coMMiTTeeGoh Boon Kok (Chairman)Kuik See JuanLai Mun OnnKo Chuan Aun

noMinaTinG coMMiTTeeLim Kan San (Chairman)Teo Kee BockWong Fook SungGoh Boon KokLai Mun OnnKuik See Juan

reMuneraTion coMMiTTeeLai Mun Onn (Chairman)Teo Kee BockTe Kok ChiewGoh Boon KokKuik See JuanLim Kang San

speciaL coMMiTTeeTeo Kee Bock (Chairman)Wong Fook SungTan Tian OonGoh Boon Kok

coMpany secreTaryTan Cher Liang

reGisTered oFFice2 Senoko South RoadSuper Industrial BuildingSingapore 758096Tel : (65) 6753 3088Fax : (65) 6753 7833Website : www.supergroupltd.com

share reGisTrarBoardroom Corporate &Advisory Services Pte Ltd50 Raffles Place#32-01Singapore Land TowerSingapore 048623Tel : (65) 6536 5355Fax : (65) 6536 1360

audiTorsErnst & Young LLPOne Raffles QuayNorth Tower, Level 18Singapore 048583Nelson Chen Wee Teck (Audit Partner)(Appointed in 2011)

soLiciTorRHTLaw Taylor Wessing LLP

corporAteINForMAtIoN

38 A NEW ERA

corporAtegoverNANce

whaT a sMiLe TasTes LiKe

Corporate Governance 41

Directors’ Report 51

Statement by Directors 57

Independent Auditor’s Report 58

Consolidated Income Statement 60

Consolidated Statement of Comprehensive Income 61

Balance Sheets 62

Statements of Changes in Equity 64

Consolidated Statement of Cash Flow 68

Notes to the Financial Statements 70

FinanciaL conTenT s

40 A NEW ERA40 A NEW ERA

Corporate GovernanCe

The Board of Directors (or “the Board”) of Super Group Ltd. (“Super” or “the Company”) recognises the importance of corporate governance and good business practices and is committed to complying with the principles and guidelines set out in the Code of Corporate Governance 2005 (the “Code 2005”).

The Board also noted the recommended guidelines given under the revised Code of Corporate Governance 2012 (“2012 Code”) issued on 2 May 2012 which would be effective for the Company for financial year commencing from 1 January 2013. The Board as at the date of this corporate governance report has complied with some of the principles and guidelines of the 2012 Code and will continue to implement the recommendations as and when appropriate for the coming financial year.

BOARD MATTERS

Board of Directors (Principle 1)

The Board comprises 15 directors, 8 of whom hold executive positions:

Executive DirectorsTeo Kee Bock (Chairman & Managing Director)Te Kok Chiew Te Lay Hoon Te Lay Guat (Resigned with effect from 19 March 2013) Lee Chee Tak Wong Fook Sung Tan Tian Oon Li Kang @ Charles K Li

Non-Executive DirectorsGoi Seng Hui (Vice-Chairman)Juliette Lee Hwee Khoon (Alternate Director to Goi Seng Hui)Chandra Das S/O Rajagopal Sitaram

Independent DirectorsGoh Boon KokKuik See JuanLai Mun OnnLim Kang SanKo Chuan Aun

Role of the Board (Principle 1)

The Board’s primary role is to protect and enhance long-term shareholders’ value. It sets the overall strategy for the Group and supervises the executive management. To fulfil this role, the Board is responsible for the overall corporate governance of the Group including setting its strategic direction, establishing goals for management and monitoring the achievement of these goals. The Board has adopted internal guidelines that require Board approval for various matters, including appointment of directors, major funding, investment proposals and material capital expenditures.

Board Processes (Principle 1)

To assist in the execution of its responsibilities, the Board has delegated specific responsibilities to four board committees namely Nominating, Remuneration, Audit and Special Committees. These board committees have clear mandates and operating procedures, which are reviewed regularly. The Board is also responsible for ensuring an adequate system of internal and management control.

The Board meets on quarterly basis to review and evaluate performance and business strategies of the Group and address key policy issues. Ad-hoc Board meetings are convened when necessary to deliberate on urgent matters.

Meetings may be conducted through the use of audio and video conferencing.



Special Committee (“SC”) (Principle 1)

The SC, is a board committee, set up for the following purposes:

(a) to review business risks and recommend financial strategies and policies;

(b) to review and recommend any equity capital raising or restructuring plans; and

(c) to review and recommend mergers, acquisitions and divestments.

To enable it to discharge its function properly, the SC may, as it deems fit, obtain such external or other independent professional advice as it considers necessary to carry out its duties.

The SC comprises Mr Teo Kee Bock (Chairman), Mr Wong Fook Sung, Mr Tan Tian Oon and Mr Goh Boon Kok.

Training (Principle 1)

The Company has in place an orientation program for new directors to ensure that incoming directors are familiar with the Group’s business, operational and financial policies. The Company supports its directors in being members of the Singapore Institute of Directors and encourages directors to keep abreast with on-going developments and changes to the financial, legal and regulatory requirements through attending courses organised by professional bodies. During the year, the Board was briefed and/or updated on the following (1) revisions under the 2012 Code; (2) directors’ duties in respect of financial statements; (3) changes to the disclosure regime under the Securities and Future Act; and (4) enhanced changes to the Listing Rules to strengthen corporate governance.

Board Composition and Balance (Principle 2)

The composition of the Board is determined in accordance with the following principles:

(a) one-third of the Board should be made up of independent directors;

(b) the Board should have enough directors to serve on various committees of the Board without over-burdening the directors or making it difficult for them to fully discharge their responsibilities;

(c) the Board should comprise directors with a broad range of expertise; and

(d) directors appointed by the Board are subject to election by shareholders at the following Annual General Meeting and thereafter directors are subject to re-election at least once every three years. The tenure for executive directors is linked to their respective executive offices.

The Board constantly examines its size to determine the impact of its number on its effectiveness and decides on the appropriate size of the Board. The composition of the Board is reviewed annually by the Nominating Committee to ensure that the Board has the appropriate mix of expertise and experience. When a vacancy exists, or where it is considered that the Board would benefit from the services of a new director with particular skills, the Nominating Committee, in consultation with the Board, determines the suitability of the potential candidates, and where necessary with advice from an external consultant. The Board then appoints the most suitable candidate who must stand for election at the next Annual General Meeting (“AGM”). The Board considers the size and composition of the Board appropriate for the scope and nature of the Company’s operations.

Details of directors’ qualifications and experience are set out on pages 30 to 35 of this Annual Report.

42 A NEW ERA


In accordance with the Company’s Articles of Association, other than the Managing Director, not less than one-third of the directors will retire and submit themselves for re-election once every three years and newly appointed Director will also submit himself for re-election at the AGM immediately following the appointment. The year of initial appointment and last re-election of the directors are set out below:

Director PositionDate of Initial Appointment

Date of Last Re-election /

Re-appointment

Teo Kee Bock Chairman & Managing Director 07-Jan-1992 N/A

Te Kok Chiew Executive Director 13-Apr-1991 28-Apr-2011

Te Lay Hoon Executive Director 13-Apr-1991 28-Apr-2011

Te Lay Guat (Resigned with effect from 19 March 2013) Executive Director 21-May-1991 27-Apr-2012

Lee Chee Tak Executive Director 07-Mar-1994 28-Apr-2011

Wong Fook Sung Executive Director 17-Aug-1999 27-Apr-2012

Tan Tian Oon Executive Director 01-Jun-2003 27-Apr-2012

Li Kang @ Charles K Li Executive Director 05-Aug-2004 28-Apr-2010

Goi Seng Hui Vice-Chairman & Non-Executive Director 28-Feb-2006 28-Apr-2010

Juliette Lee Hwee Khoon Alternate Director to Goi Seng Hui 26-Feb-2007 N/A

Chandra Das S/O Rajagopal Sitaram Non-Executive Director 28-Apr-2011 27-Apr-2012

Goh Boon Kok Independent Director 27-Jun-1994 27-Apr-2012

Kuik See Juan Independent Director 07-Mar-1994 28-Apr-2011

Lai Mun Onn Independent Director 01-Jun-2003 27-Apr-2012

Lim Kang San Independent Director 05-Aug-2004 28-Apr-2011

Ko Chuan Aun Independent Director 08-Nov-2006 28-Apr-2010

For the forthcoming AGM, Messrs Goi Seng Hui, Te Kok Chiew, Li Kang @ Charles K Li and Ko Chuan Aun will retire pursuant to Article 88 of the Company’s Articles of Association. Messrs Goh Boon Kok and Chandra Das S/O Rajagopal Sitaram, who have attained the age of 70, will retire pursuant to Section 153(6) of the Companies Act, Cap. 50. The Nominating Committee has recommended the Directors for re-election and re-appointment at the forthcoming AGM.

Chairman and Managing Director (Principle 3)

Mr Teo Kee Bock is both Chairman and Managing Director of the Company. He bears executive responsibility for the business performance of the Company as Managing Director and has been running the day-to-day business of the Company since he assumed these positions in 1994.

He has in-depth knowledge of the business and operations; in particular, his relationship with customers, suppliers and other parties has contributed positively to the growth and development of the Group’s business since its inception.

The Board is satisfied that in relation to the Company’s present business needs and in consideration of Mr Teo’s past performance, integrity and objectivity in discharging his responsibilities, the Board fully supports the retention of his role as Chairman and Managing Director. As Chairman, he ensures that Board meetings are held when necessary, sets the agenda and ensures complete, adequate and timely information flow between the Board and management.



The attendance of the directors at meetings of the Board and board committees held in the course of the year under review, as well as the frequency of meetings, is disclosed as follows:

BoardAudit

CommitteeNominating Committee

Remuneration Committee

No. of meetings held in 2012 4 4 1 2

Name & Attendance of Director:

Teo Kee Bock 4 – 1 2

Te Kok Chiew 4 – – 2

Te Lay Hoon 4 – – –

Te Lay Guat 4 – – –

Lee Chee Tak 4 – – –

Wong Fook Sung 4 4* 1 2*

Tan Tian Oon 4 – – –

Li Kang @ Charles K Li 4 – – –

Goi Seng HuiAlternate Director - Juliette Lee Hwee Khoon 4 – – –

Chandra Das S/O Rajagopal Sitaram 3 – – –

Goh Boon Kok 4 4 1 2

Kuik See Juan 3 3 1 1

Lai Mun Onn 4 4 1 2

Lim Kang San 4 – 1 2

Ko Chuan Aun 4 4 – –

* By invitation.

No Special Committee meeting was held during the year.

Lead Independent Director (Principle 3)

Mr Goh Boon Kok, an independent director who is also the Chairman of the AC, member of NC and RC, has been appointed as the lead independent director with effect from 1 March 2013 in line with the guidelines under the 2012 Code. He will be available to shareholders where they have concerns for which normal channels to the Chairman and Managing Director has failed to resolve or is inappropriate.

Nominating Committee (“NC”) (Principles 4 and 5)

The NC comprises Mr Lim Kang San (Chairman), Mr Kuik See Juan, Mr Goh Boon Kok, Mr Lai Mun Onn, Mr Teo Kee Bock and Mr Wong Fook Sung. Mr Lim Kang San, the Chairman of NC is not associated with any substantial shareholder.

The NC looks into the appointment and re-appointment of directors to the Board. Four of its six members are independent directors. Its function is to evaluate and to review nominations for appointments and re-appointment to the Board, to nominate any director for re-election at the Annual General Meeting having regard to the directors’ contribution and performance, to determine whether or not a director is independent, and to assess the effectiveness of the Board.

The NC has adopted a formal system of evaluating the board performance as a whole. This process entails the completion of a questionnaire. A summary of findings is prepared following the return of the completed questionnaire for review and deliberation by the NC. The NC Chairman will report the findings to the Board so that appropriate course of action is agreed. The appraisal process focuses on areas such as board composition, board access to information, board processes, board accountability, board performance in discharging its principal responsibilities and Managing Director/senior management succession planning. While the Code 2005 recommends that the NC be responsible for assessing the effectiveness of the Board as a whole and the contribution by each director to the effectiveness of the Board, the NC felt that it is more appropriate and effective for the entire Board to assess the Board as a whole bearing in mind that each member of the Board contributes in different way. For FY2013, the NC will be looking into the evaluation of board committees as recommended by the 2012 Code.

44 A NEW ERA


In its annual review of the independence of Messrs Goh Boon Kok, Kuik See Juan, Lai Mun Onn, Ko Chuan Aun and Lim Kang San, the NC, having considered the guidelines set out in the Code 2005, is satisfied that there are no relationships which would deem any of them not to be independent. For FY2013, the NC will review the independence of the directors based on the guidelines recommended by the 2012 Code.

Notwithstanding that some of the Directors have other board representations, the NC is satisfied that these Directors are able to and adequately carry out their duties as Directors of the Company.

Access to Information (Principle 6)

All directors have unrestricted access to the Company’s records and information and independent access to senior management of the Company.

Should directors, whether as a group or individually, need independent professional advice, the Company will bear the costs of such advice with the Chairman’s approval.

The Company Secretary and/or his nominee attends all meetings of the Board, Audit, Remuneration and Nominating Committees. The directors have separate and independent access to the Company Secretary who is responsible for ensuring that all Board procedures are followed and requirements under the Companies Act are complied with.

REMUNERATION MATTERS

Remuneration Committee (“RC”) (Principle 7 and 8)

The RC comprises Mr Lai Mun Onn (Chairman), Mr Goh Boon Kok, Mr Kuik See Juan, Mr Teo Kee Bock, Mr Te Kok Chiew and Mr Lim Kang San. A majority of the RC members, including its Chairman, are independent directors. The Board opined that the membership of executive directors, Mr Teo Kee Bock and Mr Te Kok Chiew, would not give rise to potential conflict of interest given that the directors are not involved in deciding their own remuneration.

The RC reviews and determines the remuneration packages, wages/remuneration policies and promotions for senior executives in the Group. To enable it to discharge its function properly, the Committee may, as it deems fit, seek advice from an external human resource consultant at the cost of the Company.

No director in the RC is involved in deciding his own remuneration. The RC and the Board are of the view that the remuneration of the directors is adequate but not excessive. The remuneration packages of the executive directors include a component linked to the Company’s performance and is aligned to the interest of shareholders.

Non-executive directors are paid a fixed fee set at a competitive level based on their level of contribution, taking into account factors such as effort and time spent and the respective responsibilities of the directors. Directors’ fees are tabled annually for shareholders’ approval at the Annual General Meeting.

Executive directors are on service contracts, which are subject to review every three years. The Board is of the view that the directors’ service contracts are not excessively long or with onerous removal clauses.

The Company has in place a share awards scheme known as Super Group Share Award Scheme (the “Scheme”) which was approved by shareholders on 28 April 2011. The Scheme is administered by the RC. Further information on the Scheme is detailed under the Directors’ Report found in pages 53 to 54.



Directors’ and Key Executives’ Remuneration (Principle 9)

The following table shows a breakdown (in percentage terms) of the remuneration of directors and key executives for the year ended 31 December 2012:

Remuneration Bands Salary BonusDirectors’

Fees

Allowance & Other Benefits

Total Compensation

Directors:

$500,000 & above

Teo Kee Bock 10% 88% 1% 1% 100%

Te Kok Chiew 15% 81% 1% 3% 100%

$250,000 - $499,000

Wong Fook Sung 58% 21% 10% 11% 100%

Tan Tian Oon 40% 33% 8% 19% 100%

Li Kang @ Charles K Li 31% 28% 6% 35% 100%

Below $250,000

Te Lay Hoon 57% 20% 14% 9% 100%

Te Lay Guat 43% 17% 14% 26% 100%

Lee Chee Tak 44% 16% 15% 25% 100%

Goi Seng Hui – – 100% – 100%

Juliette Lee Hwee Khoon (Alternate Director to Goi Seng Hui)

– – – – –

Chandra Das S/O Rajagopal Sitaram – – 100% – 100%

Goh Boon Kok – – 100% – 100%

Kuik See Juan – – 100% – 100%

Ko Chuan Aun – – 100% – 100%

Lai Mun Onn – – 100% – 100%

Lim Kang San – – 100% – 100%

Key Executives:

Below $250,000

Elaine Teo Sze Hwee 52% 33% – 15% 100%

Darren Teo Junxiang 54% 31% – 15% 100%

Richard Lim Chee Kheong 65% 19% – 16% 100%

Koh Chun Yuan 63% 26% – 11% 100%

Dennis Lim 55% 29% – 16% 100%

Wang Wen Jia 68% 16% – 16% 100%

Vijayandran Joseph 65% 22% – 13% 100%

Steven Lim Kim Huat 68% 21% – 11% 100%

James Yeo Peck Hong 57% 30% – 13% 100%

Jaichndra Rao 65% 19% – 16% 100%

Lim Lee Seng 67% 33% – – 100%

Ms Elaine Teo Sze Hwee, whose remuneration exceeds S$150,000 during the year ended 31 December 2012, is the daughter of Mr Teo Kee Bock and Madam Te Lay Hoon. Mr Darren Teo Junxiang is the son of Mr Teo Kee Bock and Madam Te Lay Hoon. However, his remuneration did not exceed S$150,000 during the year ended 31 December 2012.

46 A NEW ERA


ACCOUNTABILITY AND AUDIT

Accountability (Principle 10)

The Board is accountable to the shareholders while the management of the Company is accountable to the Board. The management presents to the Board the Group’s quarterly and full year accounts and the Audit Committee reports on the results for review and approval. The Board approves the results and authorises the release of the results to SGX-ST and the public via SGXNET.

Periodic management report is provided to Board members to keep the Board apprised of the Company’s performance, position and prospects on a timely basis.

Audit Committee (“AC”) (Principle 11)

The AC comprises four members who are independent of management within the meaning of the Code 2005:

Goh Boon Kok (Chairman)Kuik See JuanLai Mun OnnKo Chuan Aun

The Chairman of the AC is a Certified Public Accountant and runs his own accounting practice. The other members of the AC have garnered their business and financial management experience from running their own business or, from appointments at senior management and Board levels.

The AC met four times during the year. The functions of the AC are as follows:

(a) assist the Board in discharging its statutory responsibilities on financial and accounting matters;

(b) reviews the Group’s financial and operating results and accounting policies;

(c) reviews significant financial reporting issues and judgments relating to financial statements for each financial year, quarterly and annual results announcement before submission to the Board for approval;

(d) reviews the audit plans and reports of the internal auditors and external auditors and consider the effectiveness of the actions taken by Management on the auditors’ recommendations.;

(e) reviews the adequacy of the Company’s internal controls and risk management policies and systems established by Management;

(f) reviews interested person transactions as defined in the Listing Manual of SGX-ST; and

(g) reviews the nature and extent of non-audit services provided by the external auditors yearly to determine the independence of the external auditors.

The AC is authorised to investigate any matters within its terms of reference, has full access to management and also full discretion to invite any director or executive officer to attend its meetings, as well as reasonable resources to enable it to discharge its function properly.

Annually, the AC meets with the external auditors without the presence of management and the external auditors has attended all the AC meetings every quarter. The aggregate amount of audit and non-audit fees paid to the external auditors are S$502,000 and S$205,000 respectively. The AC, having reviewed all the non-audit services provided by the external auditors to the Group, is satisfied that the nature and extent of such services did not affect the independence of the external auditors.

The AC is satisfied that the Company has complied with Listing Rules 712 and 715 of the Listing Manual regarding the audit of its subsidiaries and associated companies in Singapore and outside Singapore.



As part of ongoing good corporate governance initiatives, the Board and Audit Committee are of the view that the external auditors should be rotated and would like to propose that KMPG LLP be appointed in place of Ernst & Young LLP for the financial year ending 31 December 2013. In recommending the appointment of KPMG LLP as external auditors, the AC has considered various factors, including the adequacy of the resources of KPMG LLP, their experience and audit engagements, the number and experience of the supervisory and professional staff who will be assigned to the audit of the consolidated accounts and KPMG LLP’s proposed audit arrangements for the Group. The AC is of the opinion that KPMG LLP will be able to meet the audit requirements of the Group. The appointment of KPMG LLP in place of retiring auditors, Ernst & Young LLP will be tabled for shareholders’ approval at the AGM.

Internal Controls (Principle 12) / Internal Audit (Principle 13)

Management regularly reviews the system of internal controls to ensure that there are sufficient checks and balances to safeguard the Company’s assets. The Audit Committee ensures that these controls are effective by engaging external consultant as the internal auditor. The internal auditor works within the scope of an audit plan, which has been approved by the Audit Committee, to review and test the adequacy and effectiveness of the internal controls of the Group. The external auditors will, in the course of their statutory audit, conduct a review of the internal control procedures and highlight any material internal control weaknesses which have come to their attention. All audit findings and recommendations made by the internal and external auditors are reported to the Audit Committee. Significant issues are discussed at the Audit Committee meetings. The Internal Auditor follows up on all its recommendations to ensure that Management has implemented them in a timely and appropriate fashion.

The internal audit function is outsourced to Grant Thornton Advisory Services Pte Ltd, which reports directly to the AC. The Internal Auditors support the AC in its role to assess the effectiveness of the Group’s overall system of internal controls. The assistance provided by the Internal Auditors is primarily accomplished through their appraisals of the financial and operational controls, policies and procedures established by management and their reviews for compliance by the Group’s operating entities with these established controls, policies and procedures.

Risk Management

In an effort to implement an Enterprise Risk Management (“ERM”) framework, the Board has, in November 2012, engaged Grant Thornton Advisory Services Pte Ltd to conduct a strategic and operational risk assessment to assist the Group in identifying and assessing its top tier risks. This exercise seeks to provide a structured and common methodology to identify and manage potential risks affecting the Group and to ensure that sufficient controls are in place to monitor and mitigate these risks. The Board, through the Audit Committee, will continuously identify, review and monitor the key risks, control measures and management actions as part of the ERM process.

Based on the internal controls and risk management framework established and maintained by Management, work performed by internal and external auditors and reviews performed by Management and the AC, the Board, with the concurrence of the AC, is of the opinion that the internal controls were adequate as at 31 December 2012 to address financial, operational and compliance risks which the Board considers relevant and material to its operations.

The Board notes that the system of internal controls and risk management provides reasonable, but not absolute, assurance that the Group will not be adversely affected by any event that could be reasonably foreseen as it works to achieve its business objectives.

Communication With Shareholders (Principle 14 And 15)

The Company believes that timely disclosure of significant or price sensitive information is an essential practice of good corporate governance. Hence, the Company gives full disclosure in all public announcements via SGXNET, press releases and annual reports. The Company does not practise selective disclosure. Both directors and management take precautions to ensure that no unreported price-sensitive information is disclosed at such sessions.

In addition, the Company also conduct results briefing for media and analysts in conjunction with the release of results announcements. From time to time, the Investor Relations team will meet up with institutional investors, the investment community, analysts and the media so as to allow them opportunities to interact with the Company to further understand and gain insights to the development and outlook of the Company. To ensure transparency, briefing materials are released to SGX-ST via SGXNET. The Company’s website and the SGXNET are the principal media of communication with shareholders.

48 A NEW ERA


The annual report is sent to all shareholders of the Company and notice of every general meeting is advertised in the newspapers. At general meetings, shareholders are given the opportunity to air their views and direct questions to the Board on any matter relating to the Group’s business and operations. The Company’s Articles of Association allow a member to appoint up to two proxies to attend and vote at general meetings.

Directors and senior management are present at general meetings to address shareholders’ queries. The external auditors are also present at the Annual General Meetings of the Company to address queries about the conduct of audit and the preparation and content of the auditors’ report.

INTERNAL COMPLIANCE CODE ON DEALINGS IN COMPANY’S SECURITIES

The Company has adopted an internal compliance code to provide guidance to all directors and key officers in relation to their dealings in the Company’s securities. Directors and key officers should not deal in the company’s securities on short-term considerations and are required to confirm annually that they have complied with the code on dealings in the Company’s securities.

Directors and key officers are not permitted to deal in the Company’s shares during the period commencing one month before the announcement of the full year results, and two weeks before the announcement of the quarterly results, until the relevant results are announced. Directors are required to report to the Company Secretary whenever they deal in the Company’s shares.

INTERESTED PERSON TRANSACTIONS POLICY

There is no general mandate obtained for interested person transaction. The Company has adopted an internal policy in respect of transactions with interested persons and has set out the procedures for review and approval of the Company’s interested person transactions.

The AC and the Board have reviewed all transactions conducted with interested persons as tabled below and are satisfied that these transactions were carried out at arm’s length and under normal commercial terms. The AC and the Board are satisfied that the terms of the transactions are not prejudicial to the interests of the Company or its minority shareholders.

Interested Person Transactions

Name of Interested Person Aggregate value of all interested person transactions during the

financial year (excluding transactionsless than S$100,000 and transactions

conducted under shareholders’mandate pursuant to Rule 920)

(S$’000)

Aggregate value of all interested person transactions conducted under shareholders’ mandate pursuant to

Rule 920 (excluding transactions less than S$100,000)

(S$’000)

Sun Resources Holdings Pte Ltd 2,313 N/A – the Company does not have a shareholder mandate for interested person

transactions

Black On Black Creative Pte Ltd 423 N/A – the Company does not have a shareholder mandate for interested person

transactions

Veer Motion Graphics Pte Ltd 451 N/A – the Company does not have a shareholder mandate for interested person

transactions



MATERIAL CONTRACTS

Other than transactions mentioned under Interested Person Transactions above, and save for the disclosures made in the Directors’ Report, there were no material contracts entered into in the ordinary course of business by the Company and its subsidiaries involving the interests of the directors and controlling shareholders of the Company.

WHISTLE BLOWING POLICY

The Board has put in place a Whistle Blowing Policy and Procedure (“Policy”) for reporting impropriety in matters of financial reporting and other matter.

The Policy has been disseminated to all staff. Employees have been advised that no one would be intimidated or restrained from reporting any impropriety to the AC Chairman. Also, the identity of complainant would be kept confidential unless required by law to reveal or the identity of the complainant is already publicly known or the Board of Directors opined that it would be in the best interests of the Group to disclose the identity.

Upon receipt of such complaint, AC Chairman in consultation with fellow members would exercise discretion on how to proceed with the investigation, thereafter recommend any remedial or legal action to be taken, where necessary.

The AC Chairman has not received any complaint up to the date of this report.

UPDATE ON THE UTILISATION OF PROCEEDS FROM THE TAIWAN DEPOSITORY RECEIPTS ISSUE

The utilisation of the proceeds of S$23.6 million raised from Company’s Taiwan Depository Receipts (“TDRs”) issue is as follows:-

Amount(S$ million)

Gross proceeds from the Company’s TDRs issue 23.6Less:(1) Proceeds utilised for working capital as per announcement dated 27 January 2011 0.6(2) TDRs and related expenses 0.8(3) Proceeds utilised for the purchase of a leasehold land located at private lot at A1185201 at Tuas

West Drive/Tuas Link 2 in Jurong Industrial Estate (the “Property”) as per announcement dated 28 March 2011

3.7

(4) Costs incurred for the construction of a multi-storey building on the Property 12.0

Balance of proceeds remaining from the Company’s TDRs issue 6.5

50 A NEW ERA

DireCtors’ report

The directors are pleased to present their report to the members together with the audited consolidated financial statements of Super Group Ltd (the “Company”) and its subsidiaries (collectively, the “Group”) and the balance sheet and statement of changes in equity of the Company for the financial year ended 31 December 2012.

DIRECTORS

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

Teo Kee Bock (Chairman)Goi Seng Hui (Vice-Chairman)Juliette Lee Hwee Khoon (Alternate director to Goi Seng Hui)Te Kok ChiewTe Lay HoonTe Lay GuatLee Chee TakWong Fook SungTan Tian OonLi Kang @ Charles K LiGoh Boon KokKuik See JuanLai Mun OnnLim Kang SanKo Chuan Aun Chandra Das S/O Rajagopal Sitaram

ARRANGEMENTS TO ENABLE DIRECTORS TO ACqUIRE SHARES AND DEBENTURES

Except as described in the directors’ interest in shares and debentures section, neither at the end of nor at any time during the financial year was the Company a party to any arrangement whose objects are, or one of whose objects is, to enable the directors of the Company to acquire benefits by means of the acquisition of shares or debentures of the Company or any other body corporate.

DIRECTORS’ INTEREST IN SHARES AND DEBENTURES

The following directors, who held office at the end of the financial year, had, according to the register of directors’ shareholdings required to be kept under Section 164 of the Singapore Companies Act, Cap. 50, an interest in shares of the Company and related corporations (other than wholly-owned subsidiaries) as stated below:

Direct interest Deemed interest

Name of directorAt the beginning of financial year

At the end of financial year

At the beginning of financial year


The CompanyOrdinary shares

Teo Kee Bock 65,367,375 65,367,375 – –Goi Seng Hui 64,070,908 64,070,908 26,319,000 26,319,000Te Kok Chiew 43,824,625 51,824,625 8,000,000 –


DireCtors’ report

Directors’ interest in shares anD Debentures (cont’D)

Direct interest Deemed interest

Name of directorAt the beginning of financial year


At the beginning of financial year

At the end offinancial year

The CompanyOrdinary shares

Te Lay Hoon 67,596,125 67,596,125 150,000 150,000Te Lay Guat – – 11,301,696 11,115,696Lee Chee Tak 100,000 50,000 – –Wong Fook Sung 9,000 9,000 – –Tan Tian Oon 36,000 54,000 50,000 50,000Li Kang @ Charles K Li 63,000 123,000 33,000 33,000Lim Kang San 10,000 10,000 – –Chandra Das S/O

Rajagopal Sitaram 500,000 500,000 – –

(1) Pursuant to Section 164(15)(a) of the Companies Act, Cap. 50, the deemed interest of Mr Teo Kee Bock as at 1 January 2012 and 31 December 2012 did not include his spouse, Mdm Te Lay Hoon’s interest as Mdm Te Lay Hoon is also a director of the Company. Mr Teo Kee Bock is not deemed to be interested in the shares held by Mdm Te Lay Hoon. As such, Mr Teo Kee Bock is not deemed to have an interest in the shares of all subsidiaries of the Company at the beginning and the end of the financial year.

(2) Pursuant to Section 164(15)(a) of the Companies Act, Cap. 50, the deemed interest of Mdm Te Lay Hoon as at 1 January 2012 and 31 December 2012 did not include her spouse, Mr Teo Kee Bock’s interest as Mr Teo Kee Bock is also a director of the Company. Mdm Te Lay Hoon is not deemed to be interested in the shares held by Mr Teo Kee Bock. As such, Mdm Te Lay Hoon is not deemed to have an interest in the shares of all subsidiaries of the Company at the beginning and the end of the financial year.

There were no changes in any of the above-mentioned interests of the directors between the end of the financial year and 21 January 2013.

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

DIRECTORS’ CONTRACTUAL BENEFITS

Except as disclosed in the financial statements, since the end of the previous financial year, no director of the Company has received or become entitled to receive a benefit by reason of a contract made by the Company or a related corporation with the director, or with a firm of which the director is a member, or with a company in which the director has a substantial financial interest.

52 A NEW ERA

DireCtors’ report

SUPER GROUP SHARE AWARD SCHEME

At an Extraordinary General Meeting held on 28 April 2011, shareholders of the Company approved a share award scheme known as the Super Group Share Award Scheme (the “Scheme”) to grant awards, on a free-of-charge basis which represent a specified number of fully paid shares in the share capital of the Company, to selected employees of the Group provided that certain prescribed performance targets are met within a prescribed performance period.

The Company has the flexibility to either issue and deliver new shares of the Company, or purchase and deliver existing shares of the Company, to participants upon the vesting of the awards.

The Scheme is administered by the Remuneration Committee which comprises Messrs Lai Mun Onn, Kuik See Juan, Goh Boon Kok, Teo Kee Bock, Te Kok Chiew and Lim Kang San.

Eligibility

The following persons are eligible to participate in the Scheme subject to the absolute discretion of the Remuneration Committee:

(a) Key Group Employees; (b) Group Executive Directors.

Key Group Employees and Group Executive Directors who are also Controlling Shareholders or Associates of a Controlling Shareholder are eligible to participate in the Scheme.

Size of the Scheme

The aggregate number of Shares to be issued pursuant to Awards granted on any date, when added to the number of Shares issued and/or issuable under such other share-based incentive plans of the Company, shall not exceed 15% of the total number of issued Shares of the Company (excluding treasury shares) on the day preceding that date.

The aggregate of the number of Shares comprised in Awards granted to the Controlling Shareholders and Associates of the Controlling Shareholders under the Scheme shall not exceed 25% of the aggregate of the total number of Awards which may be granted under the Scheme, and the aggregate of the number of Shares in respect of Awards granted to each Controlling Shareholder or Associate of such Controlling Shareholder shall not exceed 10% of the total number of Awards which may be granted under the Scheme.


DireCtors’ report

super Group share awarD scheme (cont’D)

Grant of the Scheme

Awards may be granted at any time in the course of a financial year.

During the financial year, the Company had granted a total of 78,000 share awards pursuant to the Scheme. Details of which are as follows:

Name of the participant Date of grant

Awards granted

during the financial year

Aggregateawards granted

since the commencement of the scheme to

the end offinancial year

Aggregate awards

outstanding as at end of

financial year

Director of the Company

Li Kang @ Charles K Li ¹ 10 August 2012 60,000 123,000 –

Tan Tian Oon ¹ 10 August 2012 18,000 54,000 –

¹ The share awards were granted to reward the past performance of the two Executive Directors (the “Participants”) based on the performance criteria as determined by the Remuneration Committee who is administering the Scheme. The shares under the Award were released to the Participants on 17 August 2012. Pursuant to the release of the shares under the Award, a total of 78,000 treasury shares in the Company’s Share Buy-Back Account were transferred to the Participants.

Since the commencement of the Scheme till the end of the financial year:

• No Awards have been granted to the controlling shareholders of the Company and their associates.

• No participant other than those disclosed above has received 5% or more of the total awards available under the Scheme.

54 A NEW ERA

DireCtors’ report

AUDIT COMMITTEE

The Audit Committee comprises all independent directors. The members of the Audit Committee (“AC”) during the year and as at the date of this report are:

Goh Boon Kok, (Chairman), independent directorKuik See Juan, independent directorLai Mun Onn, independent director Ko Chuan Aun, independent director

The AC carried out its functions in accordance with Section 201B(5) of the Singapore Companies Act, Cap. 50, including the following:

• Reviewed the audit plans of the internal and external auditors of the Company and reviewed the internal auditors’ evaluation of the adequacy of the Company’s system of accounting controls and the co-operation given by the Company’s management to the external and internal auditors;

• Reviewed the quarterly and annual financial statements and the auditors’ report on the annual financial statements of the Company before their submission to the Board of directors;

• Reviewed the effectiveness of the Company’s material internal controls, including financial, operational and compliance controls and risk management via reviews carried out by the internal auditors;

• Met with the external auditors, other committees, and management in separate executive sessions to discuss any matters that these groups believe should be discussed privately with the AC;

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

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

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

• Recommended to the Board of directors the external auditors to be appointed in place of the retiring external auditors and reviewed the scope and results of the audit;

• Reported actions and minutes of the AC to the Board of directors with such recommendations as the AC considers appropriate; and

• Reviewed interested person transactions in accordance with the requirements of the SGX-ST’s Listing Manual.

The AC, having reviewed all non-audit services provided by the external auditors to the Group, is satisfied that the nature and extent of such services would not affect the independence of the external auditors. The AC has also conducted a review of interested person transactions.

The AC convened four meetings during the year and has also met with the external auditors, without the presence of the Company’s management at least once a year.

Further details regarding the AC are disclosed in the Report on Corporate Governance.


DireCtors’ report

AUDITORS

Ernst & Young LLP will not be seeking re-appointment as auditors.

On behalf of the Board of directors:

Teo Kee BockDirector

Te Kok ChiewDirector

Singapore12 March 2013

56 A NEW ERA

We, Teo Kee Bock and Te Kok Chiew, being two of the directors of Super Group Ltd, do hereby state that, in the opinion of the directors,

(a) the accompanying balance sheets, consolidated income statement, consolidated statement of comprehensive income, statements of changes in equity and consolidated cash flow statement together with notes thereto are drawn up so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 December 2012 and the results of the business, changes in equity and cash flow of the Group and the changes in equity of the Company for the year ended on that date, and

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

On behalf of the Board of directors:

Teo Kee BockDirector

Te Kok ChiewDirector

Singapore12 March 2013

statement by DireCtors


INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF SUPER GROUP LTD

Report on the Financial Statements

We have audited the accompanying financial statements of Super Group Ltd (the “Company”) and its subsidiaries (collectively, the “Group”) set out on pages 60 to 142, which comprise the balance sheets of the Group and the Company as at 31 December 2012, statements of changes in equity of the Group and the Company, and the consolidated income statement, consolidated statement of comprehensive income and consolidated cash flow statement of the Group for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statements

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

Auditor’s Responsibility

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

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

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

inDepenDent auDitor’s report For the financial year ended 31 December 2012

58 A NEW ERA

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF SUPER GROUP LTD

Opinion

In our opinion, the consolidated financial statements of the Group and the balance sheet and statement of changes in equity of the Company are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 December 2012 and the results, changes in equity and cash flow of the Group and the changes in equity of the Company for the year ended on that date.

Report on Other Legal and Regulatory Requirements

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

ERNST & YOUNG LLPPublic Accountants and Certified Public AccountantsSingapore

12 March 2013

inDepenDent auDitor’s report For the financial year ended 31 December 2012


Note 2012 2011$’000 $’000

Revenue 3 519,268 440,972Cost of sales (337,842) (298,896)

Gross profit 181,426 142,076

Other income 4 5,476 13,352Selling and distribution expenses (50,843) (44,127)General and administrative expenses (42,328) (38,215)Other expenses (3,921) (1,496)

Profit from operating activities 5 89,810 71,590Finance costs 6 (45) (239)Net gain/(loss) from investment securities 7 1,359 (1,675)Share of results of associated and joint venture companies 173 503

Profit before taxation 91,297 70,179Taxation 8 (8,733) (6,308)

Profit for the year 82,564 63,871

Attributable to:Equity holders of the Company 79,044 61,898Non-controlling interests 3,520 1,973


Earnings per share (cents per share)Basic 9 14.18 cents 11.10 cents

Diluted 9 14.18 cents 11.10 cents

ConsoliDateD inCome statement For the financial year ended 31 December 2012

The accompanying accounting policies and explanatory notes form an integral part of the financial statements.

60 A NEW ERA

2012 2011$’000 $’000


Other comprehensive income:

Foreign currency translation (14,802) 6,642Share of other comprehensive income of associated and joint venture companies (598) (51)

Other comprehensive income for the year (15,400) 6,591

Total comprehensive income for the year 67,164 70,462

Total comprehensive income attributable to:Equity holders of the Company 64,074 68,229Non-controlling interests 3,090 2,233

67,164 70,462

ConsoliDateD statement of Comprehensive inCome For the financial year ended 31 December 2012



Note Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Non-current assets

Property, plant and equipment 10 211,706 166,221 317 323Intangible assets 11 3,044 3,044 – –Investment in subsidiary companies 12 – – 97,200 97,200Investment in associated companies 13 2,665 3,090 706 706Investment in joint venture companies 14 12,818 12,818 10,000 10,000Other receivables 15(a) 10,275 10,315 9,267 6,954Deferred tax assets 16 17 428 – 180

240,525 195,916 117,490 115,363

Current assets

Inventories 17 82,707 93,033 – –Trade receivables 18 95,645 78,103 – –Other receivables, prepayments and

deposits 15(b) 8,816 10,866 7 23Amounts due from subsidiary

companies 19 – – 98,362 60,914Investment securities 20 2,976 1,856 2,976 1,856Cash and short-term deposits 21 112,194 122,672 18,292 39,702

302,338 306,530 119,637 102,495

Current liabilities

Bank overdrafts 21 670 779 – –Trade payables 22 40,056 35,594 – –Other payables and accruals 23 68,481 64,097 13,515 13,404Amounts due to subsidiary companies 24 – – 4,634 3,659Hire purchase creditors 25 217 217 – –Bank borrowings 26 – 911 – –Deferred gain 27 3,143 3,143 – –Provision for taxation 8,261 6,937 2,144 2,156

120,828 111,678 20,293 19,219

Net current assets 181,510 194,852 99,344 83,276

balanCe sheets As at 31 December 2012

62 A NEW ERA

Note Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Non-current liabilities

Hire purchase creditors 25 377 582 – –Deferred gain 27 – 3,143 – –Deferred tax liabilities 16 4,991 4,865 39 –

5,368 8,590 39 –

Net assets 416,667 382,178 216,795 198,639

Equity attributable to equity holders of the parent

Share capital 28(a) 163,543 163,543 163,543 163,543Treasury shares 28(b) (193) (272) (193) (272)Reserves 29 235,567 203,636 53,445 35,368

398,917 366,907 216,795 198,639Non-controlling interests 17,750 15,271 – –

Total equity 416,667 382,178 216,795 198,639

balanCe sheets As at 31 December 2012



Att

ribu

tabl

e to

equ

ity

hold

ers

of th

e pa

rent

2012

Gro

up

Shar

e ca

pita

l(N

ote

28(a

))

Trea

sury

sh

ares

(N

ote

28(b

))

Gai

n or

loss

on

reis

suan

ce o

f tre

asur

shar

es

(Not

e 29

(h))

Ass

et

reva

luat

ion

rese

rve

(Not

e 29

(a))

Capi

tal

rese

rve

(Not

e 29

(b))

Rese

rve

on

cons

olid

atio

n (N

ote

29(c

))

Stat

utor

y re

serv

e (N

ote

29(d

))

Dis

coun

t on

acqu

isit

ion

of n

on-

cont

rolli

ng

inte

rest

s (N

ote

29(i)

)

Fore

ign

curr

ency

tr

ansl

atio

nre

serv

e (N

ote

29(e

))

Div

iden

d re

serv

e (N

ote

29(f

))A

ccum

ulat

ed

prof

its

Tota

l at

trib

utab

le

to e

quit

y ho

lder

s of

th

e pa

rent

Non

-co

ntro

lling

in

tere

sts

Tota

l eq

uity

$’00

0$’

000

$’00

0$’

000

$’00

0$’

000

$’00

0$’

000

$’00

0$’

000

$’00

0$’

000

$’00

0$’

000

Ope

ning

bal

ance

at

1 Ja

nuar

y 20

1216

3,54

3(2

72)

421,

563

9435

82,

473

–(1

2,05

4)21

,184

189,

976

366,

907

15,2

7138

2,17

8

Prof

it fo

r th

e ye

ar–

––

––

––

––

–79

,044

79,0

443,

520

82,5

64

Oth

er

com

preh

ensi

ve

inco

me:

Fore

ign

curr

ency

tr

ansl

atio

n–

––

––

––

–(1

4,37

2)–

–(1

4,37

2)(4

30)

(14,

802)

Shar

e of

oth

er

com

preh

ensi

ve

inco

me

of

asso

ciat

ed a

nd

join

t ven

ture

co

mpa

nies

––

––

––

––

(598

)–

–(5

98)

–(5

98)

Dis

posa

l of f

ixed

as

sets

of a

su

bsid

iary

co

mpa

ny–

––

(668

)–

––

––

–66

8–

––

Tota

l com

preh

ensi

ve

inco

me

for t

he

year

––

–(6

68)

––

––

(14,

970)

–79

,712

64,0

743,

090

67,1

64

Cont

ribu

tion

s by

an

d di

stri

buti

on

to o

wne

rsD

ivid

ends

pai

d

(Not

e 30

)–

––

––

––

––

(21,

184)

(11,

151)

(32,

335)

–(3

2,33

5)Pr

opos

ed fi

nal

divi

dend

(Not

e 30

)–

––

––

––

––

28,4

35(2

8,43

5)–

––

Div

iden

d pa

id/

paya

ble

by

a su

bsid

iary

co

mpa

ny

to m

inor

ity

shar

ehol

der

––

––

––

––

––

––

(196

)(1

96)

Trea

sury

sha

res

reis

sued

pur

suan

t to

Sha

re A

war

d Sc

hem

e –

7993

––

––

––

––

172

–17

2Tr

ansf

er to

sta

tuto

ry

rese

rve

(Not

e 29

(d))

––

––

––

4,53

8–

––

(4,5

38)

––

–A

cqui

sitio

n of

no

n-co

ntro

lling

in

tere

sts

in

subs

idia

ry

com

pani

es–

––

––

––

99–

––

99(4

15)

(316

)

Tota

l tra

nsac

tion

s w

ith

owne

rs in

th

eir

capa

city

as

owne

rs–

7993

––

–4,

538

99–

7,25

1(4

4,12

4)(3

2,06

4)(6

11)

(32,

675)

Clos

ing

bala

nce

at

31 D

ecem

ber 2

012

163,

543

(193

)13

589

594

358

7,01

199

(27,

024)

28,4

3522

5,56

439

8,91

717

,750

416,

667

statements of ChanGes in equity For the year ended 31 December 2012

The

acco

mpa

nyin

g ac

coun

ting

polic

ies

and

expl

anat

ory

note

s fo

rm a

n in

tegr

al p

art o

f the

fina

ncia

l sta

tem

ents

.

64 A NEW ERA

Att

ribu

tabl

e to

equ

ity

hold

ers

of th

e pa

rent

2011

Gro

up

Shar

e ca

pita

l(N

ote

28(a

))

Trea

sury

sh

ares

(N

ote

28(b

))

Gai

n or

lo

ss o

n re

issu

ance

of

trea

sury

shar

es

(Not

e 29

(h))

Ass

et re

valu

atio

n re

serv

e (N

ote

29(a

))

Capi

tal

rese

rve

(Not

e 29

(b))

Rese

rve

on

cons

olid

atio

n (N

ote

29(c

))

Stat

utor

y re

serv

e (N

ote

29(d

))

Fore

ign

curr

ency

tran

slat

ion

rese

rve

(Not

e 29

(e))

Div

iden

d re

serv

e (N

ote

29(f

))

Fair

valu

e re

serv

e(N

ote

29(g

))A

ccum

ulat

ed

prof

its

Tota

l at

trib

utab

le to

equ

ity

hold

ers

of

the

pare

nt

Non

-co

ntro

lling

inte

rest

sTo

tal

equ

ity

$’00

0$’

000

$’00

0$’

000

$’00

0$’

000

$’00

0$’

000

$’00

0$’

000

$’00

0$’

000

$’00

0$’

000

Ope

ning

bal

ance

at

1 Ja

nuar

y 20

1116

3,54

3(3

72)

–1,

563

7035

82,

341

(18,

534)

20,0

6517

316

0,54

332

9,75

011

,833

341,

583

Prof

it fo

r th

e ye

ar–

––

––

––

––

–61

,898

61,8

981,

973

63,8

71

Oth

er

com

preh

ensi

ve

inco

me:

Fore

ign

curr

ency

tr

ansl

atio

n–

––

––

––

6,38

2–

––

6,38

226

06,

642

Shar

e of

oth

er

com

preh

ensi

ve

inco

me

of

asso

ciat

ed a

nd

join

t ven

ture

co

mpa

nies

––

––

70–

–98

–63

–23

1–

231

Dis

posa

l of a

n as

soci

ated

co

mpa

ny–

––

–(4

6)–

––

–(2

36)

–(2

82)

–(2

82)

Tota

l com

preh

ensi

ve

inco

me

for t

he

year

––

––

24–

–6,

480

–(1

73)

61,8

9868

,229

2,23

370

,462

Cont

ribu

tion

s by

an

d di

stri

buti

on

to o

wne

rsD

ivid

ends

pai

d

(Not

e 30

)–

––

––

––

–(2

0,06

5)–

(11,

149)

(31,

214)

–(3

1,21

4)Pr

opos

ed fi

nal

divi

dend

(Not

e 30

)–

––

––

––

–21

,184

–(2

1,18

4)–

––

Div

iden

d pa

id/

paya

ble

by

a su

bsid

iary

co

mpa

ny

to m

inor

ity

shar

ehol

der

––

––

––

––

––

––

(20)

(20)

Issu

e of

sha

res

by

a su

bsid

iary

co

mpa

ny–

––

––

––

––

––

–1,

225

1,22

5Tr

easu

ry s

hare

s re

issu

ed p

ursu

ant

to S

hare

Aw

ard

Sche

me

–10

042

––

––

––

––

142

–14

2Tr

ansf

er to

sta

tuto

ry

rese

rve

(Not

e 29

(d))

––

––

––

132

––

–(1

32)

––

–

Tota

l tra

nsac

tion

s w

ith

owne

rs in

th

eir

capa

city

as

owne

rs–

100

42–

––

132

–1,

119

–(3

2,46

5)(3

1,07

2)1,

205

(29,

867)

Clos

ing

bala

nce

at

31 D

ecem

ber 2

011

163,

543

(272

)42

1,56

394

358

2,47

3(1

2,05

4)21

,184

–18

9,97

636

6,90

715

,271

382,

178

statements of ChanGes in equity For the year ended 31 December 2012 (cont’d)

The

acco

mpa

nyin

g ac

coun

ting

polic

ies

and

expl

anat

ory

note

s fo

rm a

n in

tegr

al p

art o

f the

fina

ncia

l sta

tem

ents

.


2012Company

Share capital

(Note 28(a))

Treasury Shares

(Note 28(b))

Gain or loss on

reissuance of treasury

shares (Note 29(h))

Dividend reserve

(Note 29(f))Accumulated

profits Total$’000 $’000 $’000 $’000 $’000 $’000

Opening balance at 1 January 2012 163,543 (272) 42 21,184 14,142 198,639

Profit for the year and total comprehensive income for the year – – – – 50,319 50,319

Dividends paid (Note 30) – – – (21,184) (11,151) (32,335)Proposed final dividend

(Note 30) – – – 28,435 (28,435) –Treasury shares reissued

pursuant to Share Award Scheme – 79 93 – – 172

Total transactions with owners in their capacity as owners – 79 93 7,251 10,733 18,156

Closing balance at 31 December 2012 163,543 (193) 135 28,435 24,875 216,795



66 A NEW ERA

2011Company

Share capital

(Note 28(a))

Treasury Shares

(Note 28(b))

Gain or loss on

reissuance of treasury

shares (Note 29(h))

Dividend reserve

(Note 29(f))Accumulated

profits Total$’000 $’000 $’000 $’000 $’000 $’000

Opening balance at 1 January 2011 163,543 (372) – 20,065 39,229 222,465

Profit for the year and total comprehensive income for the year – – – – 7,246 7,246

Dividends paid (Note 30) – – – (20,065) (11,149) (31,214)Proposed final dividend

(Note 30) – – – 21,184 (21,184) –Treasury shares reissued

pursuant to Share Award Scheme – 100 42 – – 142

Total transactions with owners in their capacity as owners – 100 42 1,119 (25,087) (23,826)

Closing balance at 31 December 2011 163,543 (272) 42 21,184 14,142 198,639




2012 2011$’000 $’000

Cash flow from operating activitiesProfit before taxation 91,297 70,179Adjustments for:

Amortisation of intangible assets – 6Depreciation of property, plant and equipment 11,623 9,820Gain on disposal of property, plant and equipment (2,855) (10,368)Loss on disposal of a subsidiary company 308 –Loss on disposal of an associated company – 725Recognition of deferred gain (3,143) (3,143)Property, plant and equipment written off 825 545Impairment loss on property, plant and equipment 535 226Dividend income from quoted investment securities (72) (95)Interest expense 45 239Interest income (570) (484)Gain on disposal of quoted investment securities – (5)Changes in fair value of quoted investment securities (1,287) 1,775Share of results of associated and joint venture companies (173) (503)Employee benefits expenses – Treasury shares reissued pursuant to Share Award Scheme 172 142Currency realignment (1,034) 996

Operating gain before reinvestment in working capital 95,671 70,055Increase in trade and other receivables (17,411) (1,437)Decrease/(increase) in inventories 10,114 (23,205)Increase in trade and other payables 3,767 17,907

Cash generated from operations 92,141 63,320Interest received 570 484Interest paid (45) (239)Income taxes paid (6,739) (6,402)

Net cash generated from operating activities 85,927 57,163

Cash flow from investing activitiesPurchase of property, plant and equipment (63,292) (73,076)Proceeds from disposal of property, plant and equipment 3,341 4,057Compensation received for relocation of factory 4,724 –Payment for conversion of warrants into quoted equity shares – (480)Proceeds from disposal of an associated company – 24,053Investment in associated companies – (1,252)Quasi-equity loans to associated companies (3,321) –Net cash inflow on disposal of a subsidiary company 321 –Proceeds from disposal of quoted investment securities 167 119Dividends received 72 589

Net cash used in investing activities (57,988) (45,990)

ConsoliDateD statement of Cash flow For the year ended 31 December 2012

68 A NEW ERA

2012 2011$’000 $’000

Cash flow from financing activitiesProceeds from issue of shares to non-controlling shareholder by a subsidiary company – 1,225Payment of dividends to shareholders of the Company (32,335) (31,214)Payment of dividends to non-controlling shareholder by a subsidiary company – (20)Repayment of bank borrowings (911) (1,064)Repayment of hire purchase creditors (205) (227)Cash paid on acquisition of non-controlling interests of a subsidiary company (316) –

Net cash used in financing activities (33,767) (31,300)

Net decrease in cash and cash equivalents (5,828) (20,127)Cash and cash equivalents at beginning of year 121,893 140,764Effect of exchange rate changes on cash and cash equivalents (4,541) 1,256

Cash and cash equivalents at end of year (Note 21) 111,524 121,893

Super Vending Pte Ltd (“SVPL”), an 80% owned subsidiary company, disposed its 100% equity interest in its wholly-owned subsidiary, Super Multi Vending Pte Ltd(“SMVPL”) on 31 October 2012 at a consideration of S$516,000. The sale consideration was arrived at based on SMVPL’s financial position and on a willing buyer and willing seller basis. The disposal consideration was fully settled in cash. Subsequently, Super Coffee Corporation Pte. Ltd (“SCCPL”) acquired the remaining 20% equity interest in SVPL. After the acquisition, SVPL became a wholly-owned subsidiary of SCCPL.

The value of assets and liabilities of SMVPL recorded in the consolidated financial statements as at 31 October 2012, and the cash flow effect of the disposal were:

$’000

Property, plant and equipment 665Trade and other receivables 92Inventories 212Cash and cash equivalents 195

1,164Trade and other payables (206)Deferred tax liabilities (133)Provision for taxation (1)

Carrying value of net assets 824

Total consideration 516Cash and cash equivalents of the subsidiary (195)

Net cash inflow on disposal of a subsidiary 321

ConsoliDateD statement of Cash flow For the year ended 31 December 2012 (cont’d)



notes to the finanCial statements - 31 December 2012

1. CORPORATE INFORMATION

Super Group Ltd (the “Company”) is a limited liability company, incorporated and domiciled in Singapore and is listed on the Singapore Exchange Securities Trading Limited (“SGX-ST”).

The registered office and principal place of business of the Company is located at 2, Senoko South Road, Super Industrial Building, Singapore 758096.

The principal activity of the Company is investment holding. The principal activities of the subsidiaries are disclosed in Note 12 to the financial statements.

Related companies in the financial statements refer to the Super Group Ltd’s group of companies.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2.1 Basis of preparation

The consolidated financial statements of the Group and the balance sheet and statement of changes in equity of the Company have been prepared in accordance with Singapore Financial Reporting Standards (“FRS”).

The financial statements have been prepared on the historical cost basis except as disclosed in the accounting policies below.

The financial statements are presented in Singapore Dollars (“SGD” or “$”) and all values in the tables are rounded to the nearest thousand ($’000) as indicated.

2.2 Changes in accounting policies

The accounting policies adopted are consistent with those of the previous financial year except in the current financial year, the Group has adopted all the new and revised standards and Interpretations of FRS (INT FRS) that are effective for annual periods beginning on or after 1 January 2012. The adoption of these standards and interpretations did not have any significant effect on the financial performance or position of the Group and the Company.

70 A NEW ERA


2. summary of siGnificant accountinG policies (cont’D)

2.3 Standards issued but not yet effective

The Group has not adopted the following standards and interpretations that have been issued but not yet effective:

Description

Effective for annual periods beginning

on or after

Amendments to FRS 1 Presentation of Items of Other Comprehensive Income 1 July 2012Revised FRS 19 Employee Benefits 1 January 2013FRS 113 Fair Value Measurement 1 January 2013Amendments to FRS 107 Disclosures – Offsetting Financial Assets and Financial Liabilities 1 January 2013Improvements to FRSs 2012 1 January 2013Amendment to FRS 1 Presentation of Financial Statements 1 January 2013Amendment to FRS 16 Property, Plant and Equipment 1 January 2013Amendment to FRS 32 Financial Instruments: Presentation 1 January 2013Revised FRS 27 Separate Financial Statements 1 January 2014 Revised FRS 28 Investments in Associates and Joint Ventures 1 January 2014 FRS 110 Consolidated Financial Statements 1 January 2014 FRS 111 Joint Arrangements 1 January 2014 FRS 112 Disclosure of Interests in Other Entities 1 January 2014 Amendments to FRS 32 Offsetting Financial Assets and Financial Liabilities 1 January 2014

Except for the Amendments to FRS 1, FS110, Revised FRS 27, FRS 111, Revised FRS 28 and FRS 112, the directors expect that the adoption of the other standards and interpretations above will have no material impact on the financial statements in the period of initial application. The nature of the impending changes in accounting policy on adoption of the Amendments to FRS 1, FRS110, Revised FRS 27, FRS 111, Revised FRS 28 and FRS 112 are described below.

Amendments to FRS 1 Presentation of Items of Other Comprehensive Income

The Amendments to FRS 1 Presentation of Items of Other Comprehensive Income (OCI) are effective for financial periods beginning on or after 1 July 2012.

The Amendments to FRS 1 will change the grouping of items presented in OCI. Items that could be reclassified to profit or loss at a future point in time would be presented separately from items which will never be reclassified. As the Amendments only affect the presentations of items that are already recognised in OCI, the Group does not expect any impact on its financial position or performance upon adoption of this standard.




2.3 Standards issued but not yet effective (cont’d)

FRS 110 Consolidated Financial Statements and Revised FRS 27 Separate Financial Statements

FRS 110 Consolidated Financial Statements and Revised FRS 27 Separate Financial Statements are effective for financial periods beginning on or after 1 January 2014. FRS 110 establishes a single control model that applies to all entities including special purpose entities. The changes introduced by FRS 110 will require management to exercise significant judgment to determine which entities are controlled, and therefore are required to be consolidated by the Group, compared with the requirements that were in FRS 27. Therefore, FRS 110 may change which entities are consolidated within a group. The revised FRS 27 was amended to address accounting for subsidiaries, jointly controlled entities and associates in separate financial statements. The Group is currently determining the impact of the changes to control and does not expect that the adoption of FRS 110 in 2014 will likely lead to more entities being consolidated to the Group.

FRS 111 Joint Arrangements and Revised FRS 28 Investments in Associates and Joint Ventures

FRS 111 Joint Arrangements and Revised FRS 28 Investments in Associates and Joint Ventures are effective for financial periods beginning on or after 1 January 2014.

FRS 111 classifies joint arrangements either as joint operations or joint ventures. Joint operation is a joint arrangement whereby the parties that have rights to the assets and obligations for the liabilities whereas joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement.

FRS 111 requires the determination of joint arrangement’s classification to be based on the parties’ rights and obligations under the arrangement, with the existence of a separate legal vehicle no longer being the key factor. FRS 111 disallows proportionate consolidation and requires joint ventures to be accounted for using the equity method. The revised FRS 28 was amended to describe the application of equity method to investments in joint ventures in addition to associates. As the Group currently applies equity method for its joint ventures, the Group does not expect any impact on its financial statement presentation.

FRS 112 Disclosure of Interests in Other Entities

FRS 112 Disclosure of Interests in Other Entities is effective for financial periods beginning on or after 1 January 2014.

FRS 112 is a new and comprehensive standard on disclosure requirements for all forms of interests in other entities, including joint arrangements, associates, special purpose vehicles and other off balance sheet vehicles. FRS 112 requires an entity to disclose information that helps users of its financial statements to evaluate the nature and risks associated with its interests in other entities and the effects of those interests on its financial statements. As this is a disclosure standard, it will have no impact to the financial position and financial performance of the Group when implemented in 2014.

72 A NEW ERA



2.4 Significant accounting judgments and estimates

The preparation of the Group’s consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenue, expenses, assets and liabilities, and the disclosure of contingent liabilities at the reporting date. However, uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in the future periods.

(a) Judgments made in applying accounting policies

In the process of applying the Group’s accounting policies, management has made the following judgments, apart from those involving estimations, which have the most significant effect on the amounts recognised in the consolidated financial statements:

(i) Income taxes

The Group has exposure to income taxes in several jurisdictions. Significant judgment is involved in determining the group-wide provision for income taxes. There are certain transactions and computations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognises liabilities for expected tax issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recognised, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made. The carrying amounts of the Group’s and Company’s deferred tax assets/liabilities and provisions for taxation are disclosed in the balance sheets. Further information is disclosed in Note 8.

(ii) Determination of functional currency

Foreign currency transactions are measured in the respective functional currencies of the Company and its subsidiaries. In determining the functional currencies of the entities in the Group, judgment is required to determine the currency that mainly influences selling prices for goods and services and of the country whose competitive forces and regulations mainly determines the selling prices of its goods and services. The functional currencies of the entities in the Group are determined based on management’s assessment of the economic environment in which the entities operate and the entities’ process of determining selling prices.




2.4 Significant accounting judgments and estimates (cont’d)

(b) Key sources of estimation uncertainty

The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below. The Group based its assumptions and estimates on parameters available when the financial statements was prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising beyond the control of the Group. Such changes are reflected in the assumptions when they occur.

(i) Fair value of financial instruments

Where the fair values of financial instruments recorded on the balance sheet cannot be derived from active markets, they are determined using valuation techniques including the discounted cash flow model. The inputs to these models are derived from observable market data where possible, but where this is not feasible, a degree of judgment is required in establishing fair values. The judgments include considerations of liquidity and model inputs regarding the future financial performance of the investee, its risk profile, and economic assumptions regarding the industry and geographical jurisdiction in which the investee operates. Changes in assumptions about these factors could affect the reported fair value of financial instruments. The valuation of financial instruments is described in more detail in Note 35.

(ii) Useful lives of plant and machinery

The cost of plant and machinery are depreciated on a straight line basis over their estimated useful lives. Management estimates the useful lives of these plant and machinery to be within 5 to 11 years. The carrying amount of the Group’s plant and machinery at 31 December 2012 was $31,955,000 (2011: $26,282,000). Changes in the expected level of usage could impact the economic useful lives and the residual values of these assets, therefore future depreciation charges could be revised.

(iii) Impairment of non-financial assets

An impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount, which is its value in use. The value in use calculation is based on a discounted cash flow model. The cash flows are derived from the budget for the next five years and do not include restructuring activities that the Group is not yet committed to or significant future investments that will enhance the asset’s performance of the cash generating unit being tested. The recoverable amount is most sensitive to the discount rate used for the discounted cash flow model as well as the expected future cash inflows and the growth rate used for extrapolation purposes. Further details of the key assumptions applied in the impairment assessment of goodwill and brands, are given in Note 11 to the financial statements.

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2.4 Significant accounting judgments and estimates (cont’d)

(b) Key sources of estimation uncertainty (cont’d)

(iv) Impairment of loans and receivables

The Group assesses at each balance sheet date whether there is any objective evidence that a financial asset is impaired. To determine whether there is objective evidence of impairment, the Group considers factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay in payments.

Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on historical loss experience for assets with similar credit risk characteristics. The carrying amount of the Group’s loans and receivables at the balance sheet date is disclosed in Note 34.

2.5 Basis of consolidation and business combinations

(A) Basis of consolidation

Basis of consolidation from 1 January 2010

The consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at the end of the reporting period. The financial statements of the subsidiaries used in the preparation of the consolidated financial statements are prepared for the same reporting date as the Company. Consistent accounting policies are applied to like transactions and events in similar circumstances.

All intra-group balances, income and expenses and unrealised gains and losses resulting from intra-group transactions and dividends are eliminated in full.

Subsidiaries are consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that such control ceases.

Losses within a subsidiary are attributed to the non-controlling interest even if that results in a deficit balance.




2.5 Basis of consolidation and business combinations (cont’d)

(A) Basis of consolidation (cont’d)

Basis of consolidation from 1 January 2010 (cont’d)

A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, it:

De-recognises the assets (including goodwill) and liabilities of the subsidiary at their carrying amounts at the date when controls is lost;

De-recognises the carrying amount of any non-controlling interest;

De-recognises the cumulative translation differences recorded in equity;

Recognises the fair value of the consideration received;

Recognises the fair value of any investment retained;

Recognises any surplus or deficit in profit or loss;

Re-classifies the Group’s share of components previously recognised in other comprehensive income to profit or loss or retained earnings, as appropriate.

Basis of consolidation prior to 1 January 2010

Certain of the above-mentioned requirements were applied on a prospective basis. The following differences, however, are carried forward in certain instances from the previous basis of consolidation:

Acquisition of non-controlling interests, prior to 1 January 2010, were accounted for using the parent entity extension method, whereby, the difference between the consideration and the book value of the share of the net assets acquired were recognised in goodwill.

Losses incurred by the Group were attributed to the non-controlling interest until the balance was reduced to nil. Any further losses were attributed to the Group, unless the non-controlling interest had a binding obligation to cover these. Losses prior to 1 January 2010 were not reallocated between non-controlling interest and the owners of the Company.

Upon loss of control, the Group accounted for the investment retained at its proportionate share of net asset value at the date control was lost. The carrying value of such investments as at 1 January 2010 have not been restated.

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(B) Business combinations

Business combinations from 1 January 2010

Business combinations are accounted for by applying the acquisition method. Identifiable assets acquired and liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Acquisition-related costs are recognised as expenses in the periods in which the costs are incurred and the services are received.

When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date. This includes the separation of embedded derivatives in host contracts by the acquiree.

Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration which is deemed to be an asset or liability, will be recognised in accordance with FRS 39 either in profit or loss or as a change to other comprehensive income. If the contingent consideration is classified as equity, it is not be remeasured until it is finally settled within equity.

In business combinations achieved in stages, previously held equity interests in the acquiree are remeasured to fair value at the acquisition date and any corresponding gain or loss is recognised in profit or loss.

The Group elects for each individual business combination, whether non-controlling interest in the acquiree (if any) is recognised on the acquisition date at fair value, or at the non-controlling interest’s proportionate share of the acquiree’s identifiable net assets.

Any excess of the sum of the fair value of the consideration transferred in the business combination, the amount of non-controlling interest in the acquiree (if any), and the fair value of the Group’s previously held equity interest in the acquiree (if any), over the net fair value of the acquiree’s identifiable assets and liabilities is recorded as goodwill. The accounting policy for goodwill is set out in Note 2.11(a). In instances where the latter amount exceeds the former, the excess is recognised as gain on bargain purchase in profit or loss on the acquisition date.





(B) Business combinations (cont’d)

Business combinations prior to 1 January 2010

In comparison to the above mentioned requirements, the following differences applied:

Business combinations are accounted for by applying the purchase method. Transaction costs directly attributable to the acquisition formed part of the acquisition costs. The non-controlling interest (formerly known as minority interest) was measured at the proportionate share of the acquiree’s identifiable net assets.

Business combinations achieved in stages were accounted for as separate steps. Adjustments to those fair values relating to previously held interests are treated as a revaluation and recognised in equity. Any additional acquired share of interest did not affect previously recognised goodwill.

When the Group acquired a business, embedded derivatives separated from the host contract by the acquiree were not reassessed on acquisition unless the business combination resulted in a change in the terms of the contract that significantly modified the cash flows that otherwise would have been required under the contract.

Contingent consideration was recognised if, and only if, the Group had a present obligation, the economic outflow was more likely than not and a reliable estimate was determinable. Subsequent adjustments to the contingent consideration were recognised as part of goodwill.

2.6 Transactions with non-controlling interests

Non-controlling interest represents the equity in subsidiaries not attributable, directly or indirectly, to owners of the Company, and are presented separately in the consolidated statement of comprehensive income and within equity in the consolidated balance sheet, separately from equity attributable to owners of the Company.

Changes in the Company’s ownership interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. In such circumstances, the carrying amounts of the controlling and non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiary. Any difference between the amount by which the non-controlling interest is adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributed to owners of the Company.

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2.7 Foreign currency

The Group’s consolidated financial statements are presented in Singapore Dollars, which is also the Company’s functional currency. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency.

(a) Transactions and balances

Transactions in foreign currencies are measured in the respective functional currencies of the Company and its subsidiaries and are recorded on initial recognition in the functional currencies at exchange rates approximating those ruling at the transaction dates. Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the end of the reporting period. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined.

Exchange differences arising on the settlement of monetary items or on translating monetary items at the end of the reporting period are recognised in profit or loss except for exchange differences arising on monetary items that form part of the Group’s net investment in foreign operations, which are recognised initially in other comprehensive income and accumulated under foreign currency translation reserve in equity. The foreign currency translation reserve is reclassified from equity to profit or loss of the Group on disposal of the foreign operation.

(b) Consolidated financial statements

For consolidation purpose, the assets and liabilities of foreign operations are translated into SGD at the rate of exchange ruling at the end of the reporting period and their profit or loss are translated at the exchange rates prevailing at the date of the transactions. The exchange differences arising on the translation are recognised in other comprehensive income. On disposal of a foreign operation, the component of other comprehensive income relating to that particular foreign operation is recognised in profit or loss.

In the case of a partial disposal without loss of control of a subsidiary that includes a foreign operation, the proportionate share of the cumulative amount of the exchange differences are re-attributed to non-controlling interest and are not recognised in profit or loss. For partial disposals of associates or jointly controlled entities that are foreign operations, the proportionate share of the accumulated exchange differences is reclassified to profit or loss.




2.8 Subsidiaries

A subsidiary is an entity over which the Group has the power to govern the financial and operating policies so as to obtain benefits from its activities.

In the Company’s separate financial statements, investments in subsidiaries are accounted for at cost less impairment losses.

2.9 Joint venture

A joint venture is a contractual arrangement whereby two or more parties undertake an economic activity that is subject to joint control, where the strategic financial and operating decisions relating to the activity require the unanimous consent of the parties sharing control. The Group recognises its interest in joint venture using the equity method. Under the equity method, the investment in joint venture is carried in the balance sheet at cost plus post-acquisition changes in the Group’s share of net assets of the joint venture.

When the Group’s share of losses in a joint venture equals or exceeds its interest in the joint venture, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the joint venture.

The financial statements of the joint venture are prepared as of the same reporting date as the Company. Where necessary, adjustments are made to bring the accounting policies in line with those of the Group.

Upon loss of joint control, the Group measures and recognises any retained investment at its fair value. Any difference between the carrying amount of the former jointly controlled entity upon loss of joint control and the aggregate of the fair value of the retained investment and proceeds from disposal is recognised in profit or loss.

2.10 Associates

An associate is an entity, not being a subsidiary or a joint venture, in which the Group has significant influence. An associate is equity accounted for from the date the Group obtains significant influence until the date the Group ceases to have significant influence over the associate.

The Group’s investments in associates are accounted for using the equity method. Under the equity method, the investment in associates is carried in the balance sheet at cost plus post-acquisition changes in the Group’s share of net assets of the associates. Goodwill relating to associates is included in the carrying amount of the investment and is neither amortised nor tested individually for impairment. Any excess of the Group’s share of the net fair value of the associate’s identifiable asset, liabilities and contingent liabilities over the cost of the investment is included as income in the determination of the Group’s share of results of the associate in the period in which the investment is acquired.

The profit or loss reflects the share of the results of operations of the associates. Where there has been a change recognised in other comprehensive income by the associates, the Group recognises its share of such changes in other comprehensive income. Unrealised gains and losses resulting from transactions between the Group and the associates are eliminated to the extent of the interest in the associates.

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2.10 Associates (cont’d)

The Group’s share of the profit or loss of its associates is the profit attributable to equity holders of the associate and, therefore is the profit or loss after tax and non-controlling interests in the subsidiaries of associates.

When the Group’s share of losses in an associate equals or exceeds its interest in the associate, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate.

After application of the equity method, the Group determines whether it is necessary to recognise an additional impairment loss on the Group’s investment in its associates. The Group determines at each balance sheet date whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount in profit or loss.

The financial statements of the associates are prepared as of the same reporting date as the Company. Where necessary, adjustments are made to bring the accounting policies in line with those of the Group.

Upon loss of significant influence over the associate, the Group measures and recognises any retained investment at its fair value. Any difference between the carrying amount of the associate upon loss of significant influence and the fair value of the aggregate of the retained investment and proceeds from disposal is recognised in profit or loss.

2.11 Intangible assets

(a) Goodwill

Goodwill is initially measured at cost. Following initial recognition, goodwill is measured at cost less any accumulated impairment losses.

For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Group’s cash-generating units that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units.

The cash-generating unit to which goodwill has been allocated is tested for impairment annually and whenever there is an indication that the cash-generating unit may be impaired. Impairment is determined for goodwill by assessing the recoverable amount of each cash-generating unit to which the goodwill relates. Where the recoverable amount of the cash-generating unit is less than the carrying amount, an impairment loss is recognised in profit or loss. Impairment losses recognised for goodwill are not reversed in subsequent periods.

Where goodwill forms part of a cash-generating unit and part of the operation within that cash-generating unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the relative fair values of the operations disposed of and the portion of the cash-generating unit retained.




2.11 Intangible assets (cont’d)

(a) Goodwill (cont’d)

Goodwill and fair value adjustments arising on the acquisition of foreign operations on or after 1 January 2005 are treated as assets and liabilities of the foreign operations and are recorded in the functional currency of the foreign operations and translated in accordance with the accounting policy set out in Note 2.7.

Goodwill and fair value adjustments which arose on acquisitions of foreign operations before 1 January 2005 are deemed to be assets and liabilities of the Company and are recorded in SGD at the rates prevailing at the date of acquisition.

(b) Trademark

Trademark is stated at cost less accumulated amortisation and any impairment loss.

The useful life of trademark is assessed as finite.

Trademark is amortised on a straight-line basis over the estimated useful lives of 10 years, and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method are reviewed at least at each financial year end.

Changes in the expected useful lives or the expected pattern of consumption of future economic benefits is accounted for by changing the amortisation period or method, as appropriate, and are treated as changes in accounting estimates.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in profit or loss when the asset is derecognised.

2.12 Property, plant and equipment

All items of property, plant and equipment are initially recorded at cost. Such cost includes the cost of replacing part of the property, plant and equipment and borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying property, plant and equipment. The accounting policy for borrowing costs is set out in Note 2.18. The cost of an item of property, plant and equipment is recognised as an asset if, and only if, it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably.

Subsequent to recognition, property, plant and equipment are stated at cost less accumulated depreciation and any accumulated impairment losses. Repair and maintenance costs are recognised in profit or loss as incurred.

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2.12 Property, plant and equipment (cont’d)

Freehold land has an unlimited useful life and therefore is not depreciated. Included in leasehold land are land use rights acquired by certain subsidiaries of the Group. Depreciation is computed on a straight-line basis over the estimated useful life of the asset as follows:

Buildings – 20 to 50 yearsLeasehold land and buildings – over period of leases ranging from 14 to 64 yearsPlant and machinery – 5 to 11 yearsMotor vehicles – 5 to 10 yearsElectrical installation – 6 to 8 yearsFurniture and fittings – 2 to 10 yearsAir conditioners – 6 yearsComputer equipment – 3 to 6 yearsLaboratory equipment – 3 yearsOffice equipment – 2 to 10 yearsRenovation – 6 to 10 years

Assets under construction are not depreciated as these assets are not yet available for use.

The carrying values of property, plant and equipment are reviewed for impairment when events or changes in circumstances indicate that the carrying value may not be recoverable.

The residual values, useful life and depreciation method are reviewed at each financial year-end, and adjusted prospectively, if appropriate.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognising of the asset is included in profit or loss in the year the asset is derecognised.

2.13 Impairment of non-financial assets

The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when an annual impairment testing for an asset is required, the Group makes an estimate of the asset’s recoverable amount.

An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or group of assets. Where the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows expected to be generated by the asset are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, recent market transactions are taken into account if available. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples or other available fair value indicators.




2.13 Impairment of non-financial assets (cont’d)

The Group bases its impairment calculation on detailed budgets and forecast calculations which are prepared separately for each of the Group’s cash-generating units to which the individual assets are allocated. These budgets and forecast calculations are generally covering a period of five years. For longer periods, a long-term growth rate is calculated and applied to project future cash flows after the fifth year.

Impairment losses of continuing operations are recognised in profit or loss in those expense categories consistent with the function of the impaired asset, except for assets that are previously revalued where the revaluation was taken to other comprehensive income. In this case, the impairment is also recognised in other comprehensive income up to the amount of any previous revaluation.

For assets excluding goodwill, an assessment is made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased. If such indication exists, the Group estimates the asset’s or cash-generating unit’s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. If that is the case, the carrying amount of the asset is increased to its recoverable amount. That increase cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised previously. Such reversal is recognised in profit or loss unless the asset is measured at revalued amount, in which case the reversal is treated as a revaluation increase.

2.14 Financial assets

Initial recognition and measurement

Financial assets are recognised when, and only when, the Group becomes a party to the contractual provisions of the financial instrument. The Group determines the classification of its financial assets at initial recognition.

When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial assets not at fair value through profit or loss, directly attributable transaction costs.

Subsequent measurement

The subsequent measurement of financial assets depends on their classification as follows:

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

Financial assets at fair value through profit or loss include financial assets held for trading and financial assets designated upon initial recognition at fair value through profit or loss. Financial assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term.

The Group has not designated any financial assets upon initial recognition at fair value through profit or loss.

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2.14 Financial assets (cont’d)

Subsequent measurement (cont’d)

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

Subsequent to initial recognition, financial assets at fair value through profit or loss are measured at fair value. Any gains or losses arising from changes in fair value of the financial assets are recognised in profit or loss. Net gains or net losses on financial assets at fair value through profit or loss include exchange differences, interest and dividend income.

(b) Loans and receivables

Non-derivative financial assets with fixed or determinable payments that are not quoted in an active market are classified as loans and receivables. Subsequent to initial recognition, loans and receivables are measured at amortised cost using the effective interest method, less impairment. Gains and losses are recognised in profit or loss when the loans and receivables are derecognised or impaired, and through the amortisation process.

(c) Held-to-maturity investment

Non-derivative financial assets with fixed or determinable payments and fixed maturity are classified as held-to-maturity when the Group has the positive intention and ability to hold the investment to maturity. Subsequent to initial recognition, held-to-maturity investments are measured at amortised cost using the effective interest method, less impairment. Gains and losses are recognised in profit or loss when the held-to-maturity investments are derecognised or impaired, and through the amortisation process.

Derecognition

A financial asset is derecognised where the contractual right to receive cash flows from the asset has expired. On derecognition of a financial asset in its entirety, the difference between the carrying amount and the sum of the consideration received and any cumulative gain or loss that had been recognised in other comprehensive income is recognised in profit or loss.

Regular way purchase or sale of a financial asset

All regular way purchases and sales of financial assets are recognised or derecognised on the trade date i.e., the date that the Group commits to purchase or sell the asset. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the period generally established by regulation or convention in the marketplace concerned.




2.15 Impairment of financial assets

The Group assesses at each reporting date whether there is any objective evidence that a financial asset is impaired.

(a) Financial assets carried at amortised cost

For financial assets carried at amortised cost, the Group first assesses whether objective evidence of impairment exists individually for financial assets that are individually significant, or collectively for financial assets that are not individually significant. If the Group determines that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit risk characteristics and collectively assesses them for impairment. Assets that are individually assessed for impairment and for which an impairment loss is, or continues to be recognised are not included in a collective assessment of impairment.

If there is objective evidence that an impairment loss on financial assets carried at amortised cost has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the financial asset’s original effective interest rate. If a loan has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account. The impairment loss is recognised in profit or loss.

When the asset becomes uncollectible, the carrying amount of impaired financial assets is reduced directly or if an amount was charged to the allowance account, the amounts charged to the allowance account are written off against the carrying value of the financial asset.

To determine whether there is objective evidence that an impairment loss on financial assets has been incurred, the Group considers factors such as the probability of insolvency or significant financial difficulties of the debtor and default or significant delay in payments.

If in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed to the extent that the carrying amount of the asset does not exceed its amortised cost at the reversal date. The amount of reversal is recognised in profit or loss.

(b) Financial assets carried at cost

If there is objective evidence (such as significant adverse changes in the business environment where the issuer operates, probability of insolvency or significant financial difficulties of the issuer) that an impairment loss on financial assets carried at cost has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment losses are not reversed in subsequent periods.

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2.15 Impairment of financial assets (cont’d)

(c) Available-for-sale financial assets

In the case of equity investments classified as available-for-sale, objective evidence of impairment include (i) significant financial difficulty of the issuer or obligor, (ii) information about significant changes with an adverse effect that have taken place in the technological, market, economic or legal environment in which the issuer operates, and indicates that the cost of the investment in equity instrument may not be recovered; and (iii) a significant or prolonged decline in the fair value of the investment below its costs. ‘Significant’ is to be evaluated against the original cost of the investment and ‘prolonged’ against the period in which the fair value has been below its original cost.

If an available-for-sale financial asset is impaired, an amount comprising the difference between its acquisition cost (net of any principal repayment and amortisation) and its current fair value, less any impairment loss previously recognised in profit or loss, is transferred from other comprehensive income and recognised in profit or loss. Reversals of impairment losses in respect of equity instruments are not recognised in profit or loss; increase in their fair value after impairment are recognised directly in other comprehensive income.

2.16 Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and on hand, demand deposits, and short-term, highly liquid investments that are readily convertible to known amount of cash and which are subject to an insignificant risk of changes in value. These also include bank overdrafts that form an integral part of the Group’s cash management.

2.17 Inventories

Inventories are stated at the lower of cost and net realisable value. Costs incurred in bringing the inventories to their present location and condition are accounted for as follows:

• Raw materials: purchase costs on a first-in first-out basis;

• Finished goods and work-in-progress: costs of direct materials and labour and a proportion of manufacturing overheads based on normal operating capacity. These costs are assigned on a first-in first-out basis.

Where necessary, allowance is provided for damaged, obsolete and slow moving items to adjust the carrying value of inventories to the lower of cost and net realisable value.

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




2.18 Borrowing costs

Borrowing costs are capitalised as part of the cost of a qualifying asset if they are directly attributable to the acquisition, construction or production of that asset. Capitalisation of borrowing costs commences when the activities to prepare the asset for its intended use or sale are in progress and the expenditures and borrowing costs are incurred. Borrowing costs are capitalised until the assets are substantially completed for their intended use or sale. All other borrowing costs are expensed in the period they occur. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.

2.19 Financial liabilities

Initial recognition and measurement

Financial liabilities are recognised when, and only when, the Group becomes a party to the contractual provisions of the financial instrument. The Group determines the classification of its financial liabilities at initial recognition.

All financial liabilities are recognised initially at fair value plus in the case of financial liabilities not at fair value through profit or loss, directly attributable transaction costs.

Subsequent measurement

The measurement of financial liabilities depends on their classification as follows:

Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss includes financial liabilities held for trading and financial liabilities designated upon initial recognition at fair value through profit or loss.

Subsequent to initial recognition, financial liabilities at fair value through profit or loss are measured at fair value. Any gains or losses arising from changes in fair value of the financial liabilities are recognised in profit or loss.

The Group has not designated any financial liabilities upon initial recognition at fair value through profit or loss.

Other financial liabilities

After initial recognition, other financial liabilities are subsequently measured at amortised cost using the effective interest rate method. Gains and losses are recognised in profit or loss when the liabilities are derecognised, and through the amortisation process.

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2.19 Financial liabilities (cont’d)

Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expired. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in profit or loss.

2.20 Provisions

Provisions are recognised when the Group has a present obligation as a result of a past event, it is probable that an outflow of economic resources will be required to settle the obligation and the amount of the obligation can be estimated reliably.

Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. If it is no longer probable that an outflow of economic resources will be required to settle the obligation, the provision is reversed. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, where appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

2.21 Employee benefits

(a) Defined contribution plans

The Group participates in the national pension schemes as defined by the laws of the countries in which it has operations. In particular, the Singapore companies in the Group make contributions to the Central Provident Fund scheme in Singapore, a defined contribution pension scheme. Contributions to defined contribution pension schemes are recognised as an expense in the period in which the related service is performed.

(b) Employee leave entitlement

Employee entitlements to annual leave are recognised as a liability when they accrue to the employees. The estimated liability for leave is recognised for services rendered by employees up to the balance sheet date.

(c) Share award scheme

Employees of the Group receive remuneration in the form of fully paid shares as consideration for services rendered. The cost of these equity-settled share based payment transactions with employees is measured by reference to the fair value of the shares at the date on which the shares are granted. This cost is recognized in profit or loss.




2.22 Leases

The determination of whether an arrangement is, or contains a lease is based on the substance of the arrangement at inception date: whether fulfilment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset, even if that right is not explicitly specified in an arrangement.

For arrangements entered into prior to 1 January 2005, the date of inception is deemed to be 1 January 2005 in accordance with the transitional requirements of INT FRS 104.

(a) As lessee

Finance leases which transfer to the Group substantially all the risks and rewards incidental to ownership of the leased item, are capitalised at the inception of the lease at the fair value of the leased asset or, if lower, at the present value of the minimum lease payments. Any initial direct costs are also added to the amount capitalised. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged to profit or loss. Contingent rents, if any, are charged as expenses in the periods in which they are incurred.

Capitalised leased assets are depreciated over the shorter of the estimated useful life of the asset and the lease term, if there is no reasonable certainty that the Group will obtain ownership by the end of the lease term.

Operating lease payments are recognised as an expense in profit or loss on a straight-line basis over the lease term. The aggregate benefit of incentives provided by the lessor is recognised as a reduction of rental expense over the lease term on a straight-line basis.

(b) As lessor

Leases where the Group retains substantially all the risks and rewards of ownership of the asset are classified as operating leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same bases as rental income. The accounting policy for rental income is set out in Note 2.23(d). Contingent rents are recognised as revenue in the period in which they are earned.

2.23 Revenue recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured, regardless of when the payment is made. Revenue is measured at the fair value of consideration received or receivable, excluding discounts, rebates, and sales taxes or duty. The Group assesses its revenue arrangements to determine if it is acting as principal or agent. The Group has concluded that it is acting as a principal in all of its revenue arrangements. The following specific recognition criteria must also be met before revenue is recognised:

90 A NEW ERA



2.23 Revenue recognition (cont’d)

(a) Sale of goods

Revenue is recognised upon the transfer of significant risk and rewards of ownership of the goods to the customer, usually on delivery of goods. Revenue is not recognised to the extent where there are significant uncertainties regarding recovery of the consideration due, associated cost or the possible return of goods.

(b) Interest income

Interest income is recognised using the effective interest method.

(c) Dividend income

Dividend income is recognised when the Group’s right to receive payment is established.

(d) Rental income

Rental income arising on warehouse space is accounted for on a straight-line basis over the lease terms. The aggregate costs of incentives provided to lessees are recognised as a reduction of rental income over the lease term on a straight-line basis.

(e) Technical support income

Technical support income is recognized upon the provision of technical support services.

2.24 Taxes

(a) Current income tax

Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the end of the reporting period, in the countries where the Group operates and generates taxable income.

Current income taxes are recognised in profit or loss except to the extent that the tax relates to items recognised outside profit or loss, either in other comprehensive income or directly in equity. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.




2.24 Taxes (cont’d)

(b) Deferred taxation

Deferred income tax is provided using the liability method on temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.

Deferred tax liabilities are recognised for all temporary differences, except:

– where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

– in respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred tax assets are recognised for all deductible temporary differences, carry-forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry-forward of unused tax credits and unused tax losses can be utilised except:

– where the deferred tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

– in respect of deductible temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, deferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.

The carrying amount of deferred tax asset is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed at the end of each reporting period and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered.

92 A NEW ERA



2.24 Taxes (cont’d)

(b) Deferred taxation (cont’d)

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the balance sheet date.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax items are recognised in correlation to the underlying transaction either in other comprehensive income or directly in equity and deferred tax arising from a business combination is adjusted against goodwill on acquisition.

Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current income tax assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

Tax benefits acquired as part of a business combination, but not satisfying the criteria for separate recognition at that date, would be recognised subsequently if new information about facts and circumstances changed. The adjustment would either be treated as a reduction to goodwill (as long as it does not exceed goodwill) if it incurred during the measurement period or in profit or loss.

(c) Sales tax

Revenue, expenses and assets are recognised net of the amount of sales tax except:

– Where the sales tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case the sales tax is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and

– Receivables and payables that are stated with the amount of sales tax included.

The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet.

2.25 Share capital and share issue expenses

Proceeds from issuance of ordinary shares are recognised as share capital in equity. Incremental costs directly attributable to the issuance of ordinary shares are deducted against share capital.




2.26 Treasury shares

The Group’s own equity instruments, which are reacquired (treasury shares) are recognised at cost and deducted from equity. No gain or loss is recognised in profit or loss on the purchase, sale, issue or cancellation of the Group’s own equity instruments. Any difference between the carrying amount of treasury shares and the consideration received, if reissued, is recognised directly in equity. Voting rights related to treasury shares are nullified for the Group and no dividends are allocated to them respectively.

2.27 Segment reporting

For management purposes, the Group is organised into operating segments based on the geographical locations of the operations. The management of the Company regularly reviews the segment results in order to allocate resources on each of the segments and to assess the segment performance. Additional disclosures on each of these segments are shown in Note 36, including the factors used to identify the reportable segments and the measurement basis of the segment information.

2.28 Contingencies

A contingent liability is:

(a) a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group; or

(b) a present obligation that arises from past events but is not recognised because:

(i) It is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or

(ii) The amount of the obligation cannot be measured with sufficient reliability.

A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group.

Contingent liabilities and assets are not recognised on the balance sheet of the Group, except for contingent liabilities assumed in a business combination that are present obligations and which the fair values can be reliably determined.

2.29 Financial guarantee

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

Financial guarantees are recognised initially as a liability at fair value, adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequent to initial recognition, financial guarantees are recognised as income in profit or loss over the period of the guarantee. If it is probable that the liability will be higher than the amount initially recognised less amortisation, the liability is recorded at the higher amount with the difference charged to profit or loss.

94 A NEW ERA



2.30 Government grants

Government grants are recognised at their fair value where there is reasonable assurance that the grant will be received and all attaching conditions will be complied with. Government grant shall be recognised in profit or loss on a systematic basis over the periods in which the entity recognises as expenses the related costs for which the grants are intended to compensate. Grants related to income may be presented as a credit in profit or loss, either separately or under a general heading such as “Other income”. Alternatively, they are deducted in reporting the related expenses.

2.31 Related parties

A related party is defined as follows:

(a) A person or a close member of that person’s family is related to the Group and Company if that person:

(i) Has control or joint control over the Company;

(ii) Has significant influence over the Company; or

(iii) Is a member of the key management personnel of the Group or Company or of a parent of the Company.

(b) An entity is related to the Group and the Company if any of the following conditions applies:

(i) The entity and the Company are members of the same group (which means that each parent, subsidiary and fellow subsidiary is related to the others).

(ii) One entity is an associate or joint venture of the other entity (or an associate or joint venture of a member of a group of which the other entity is a member).

(iii) Both entities are joint ventures of the same third party.

(iv) One entity is a joint venture of a third entity and the other entity is an associate of the third entity.

(v) The entity is a post-employment benefit plan for the benefit of employees of either the Company or an entity related to the Company. If the Company is itself such a plan, the sponsoring employers are also related to the Company;

(vi) The entity is controlled or jointly controlled by a person identified in (a);

(vii) A person identified in (a) (i) has significant influence over the entity or is a member of the key management personnel of the entity (or of a parent of the entity).

3. REvENUE

Revenue of the Group principally represents the invoiced value of goods sold after allowances for goods returned and discounts. All intra-company transactions have been eliminated in arriving at the Group’s revenue.



4. OTHER INCOME

Group2012 2011

$’000 $’000

Interest income 570 484Foreign exchange gain – 51Gain on disposal of property, plant and equipment 2,855 10,368Gain on disposal of scrap 509 534Government grant 758 137Insurance claim and compensation 122 913Rental income 280 264Others 382 601

5,476 13,352

Included in gain on disposal of property, plant and equipment in 2011 is the gain from relocation of the factory owned by Changzhou Super Food Co. Ltd. The 100% owned subsidiary company had entered into a relocation and compensation agreement on 17 October 2011 with the Qishuyan District Government and Jiangsu Province Changzhou Qishuyan Economic Development Zone Management Committee on the relocation of its Changzhou packaging plant in view of the re-zoning of the area pursuant to the city development plans of the Changzhou City Qishuyan District People’s Government. The aggregate value of the compensation (comprising land and cash considerations) amounted to RMB62,670,000 resulting in a gain of RMB51,541,000, net of related expenses of RMB 3,000,000 was recognised in 2011.

5. PROFIT FROM OPERATING ACTIvITIES

The following items have been included in arriving at profit from operating activities:

Group2012 2011

$’000 $’000

Recognition of deferred gain (3,143) (3,143)Amortisation of intangible assets – 6Allowances made for/(written back):- inventory obsolescence 514 2,079- doubtful trade receivables 356 169- doubtful non-trade receivables – (652)Audit fees paid to auditors of the Company 350 347Audit fees paid to other auditors 152 156Non-audit fees paid to auditors of the Company 113 136Non-audit fees paid to other auditors 92 51Inventories written off 448 279Impairment loss on property, plant and equipment 535 226Property, plant and equipment written off 825 545Depreciation of property, plant and equipment 11,623 9,820Operating lease expenses 4,833 4,765Foreign exchange loss/(gain) 2,253 (51)Staff costs 36,963 31,645Contributions to defined contribution plans (included in staff costs) 3,422 2,340

96 A NEW ERA


6. FINANCE COSTS

Group2012 2011

$’000 $’000

Interest expense on bank borrowings (including bank overdrafts) 25 217Interest expense on hire purchase 20 22

45 239

7. net Gain/(loss) from investment securities

Group2012 2011

$’000 $’000

Fair value gain/(loss) on quoted investment securities 1,287 (1,775)Gain on disposal of quoted investment securities – 5Dividend income from quoted investment securities 72 95

1,359 (1,675)

8. TAxATION

(a) Major components of income tax expense

The major components of income tax expense for the years ended 31 December 2012 and 2011 are:

Group2012 2011

$’000 $’000

Current income tax- Current income tax 9,158 5,797- (Over)/under provision in respect of prior years (1,318) 132

7,840 5,929

Deferred income tax- Origination and reversal of temporary differences 1,333 755- Benefits from previously unrecognised temporary differences (187) (171)- Overprovision in respect of previous years (253) (205)

893 379

Income tax expense recognised in the income statement 8,733 6,308



8. taxation (cont’D)

(b) Relationship between tax expense and accounting profit

The reconciliation between the tax expense and the product of accounting profit multiplied by applicable corporate tax rate for the years ended 31 December 2012 and 2011 is as follows:

2012 2011$’000 $’000

Profit before taxation 91,297 70,179

Income tax at statutory tax rate 15,520 11,930Effect of different tax rates in other countries 11,143 9,978Benefits from previously unrecognised tax losses (187) (171)Expenses not deductible for tax purposes 568 2,231Tax incentives and income not subject to tax (17,711) (17,116)Utilisation of capital/reinvestment allowances previously not recognised (668) (1,005)Deferred tax assets not recognised 1,675 604(Over)/under provision of:- current taxation (1,318) 132- deferred taxation (253) (205)Others (36) (70)

Income tax expense recognised in the income statement 8,733 6,308

Certain subsidiary companies have been granted tax incentives and/or exemptions in the country they operate in.

A subsidiary company in Singapore is granted the Development and Expansion incentive (“DEI”) for an initial period of 6 years for certain qualifying activities from 1 April 2006 to 31 March 2012, and 2 years extension subject to fulfillment of certain conditions set out in the tax incentive certificate. Under the incentive, profits generated from the qualifying activities will be taxed at a concessionary rate of 10%. As at 31 December 2012, the subsidiary company is seeking confirmation that one of the conditions is also considered as met. The subsidiary company is currently negotiating with the relevant authority to extend the DEI Scheme for which it believes approval will be forthcoming, and for purposes of its tax provision has applied the concessionary rate of 10%.

A subsidiary company in Malaysia had been granted a 5 year pioneer status by the local tax authority from July 2006 with an option to extend its pioneer status for another 3 years after the end of the initial term, subject to compliance with terms and conditions of the tax incentive. All qualifying income earned during the pioneer status will be exempt from tax. The subsidiary has applied for 3 years extension subsequent to the expiry of 5 years period. The extension of pioneer status was subjected to certain required conditions. The subsidiary has verified all transactions and documentations to ensure it has fulfilled the required conditions. During the financial year, the local tax authority has approved the application for 3 years extension of pioneer status from 1 August 2011 to 31 July 2014.

98 A NEW ERA


9. EARNINGS PER SHARE

Basic earnings per share from continuing operations are calculated by dividing profit from continuing operations, net of tax, attributable to owners of the Company by the weighted average number of ordinary shares outstanding during the financial year.

Diluted earnings per share from continuing operations are calculated by dividing profit from continuing operations, net of tax, attributable to owners of the Company by the weighted average number of ordinary shares outstanding during the financial year.

The following tables reflect the profit and share data used in the computation of basic and diluted earnings per share for the years ended 31 December:

Group2012 2011

$’000 $’000

Profit from continuing operations, net of tax, attributable to owners of the Company, used in the computation of basic and diluted earnings per share 79,044 61,898

No. of shares2012 2011’000 ’000

Weighted average number of ordinary shares included in the calculation of basic earnings per share and adjusted for the effect of dilution * 557,495 557,403

* The weighted average number of shares takes into account the weighted average effect of changes in treasury share transactions during the year.

The basic and diluted earnings per share are calculated by dividing the profit for the year attributable to owners of the Company by the weighted average number of ordinary shares for basic earnings per share computation and weighted average number of ordinary shares for diluted earnings per share computation respectively. These profit and share data are presented in the tables above.



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62,7

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4,72

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7,17

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100 A NEW ERA


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10. property, plant anD equipment (cont’D)

Company

Leasehold land and buildings

Plant and machinery

Motor vehicles

Other assets Total

$’000 $’000 $’000 $’000 $’000

CostAt 1 January 2011 373 – – – 373Additions – – – – –

At 31 December 2011, 1 January 2012 and 31 December 2012 373 – – – 373

Accumulated depreciationAt 1 January 2011 45 – – – 45Depreciation charge for the year 5 – – – 5

At 31 December 2011 and 1 January 2012 50 – – – 50

Depreciation charge for the year 6 – – – 6

At 31 December 2012 56 – – – 56

Net carrying amountAt 31 December 2012 317 – – – 317

At 31 December 2011 323 – – – 323

(a) Included in leasehold land and buildings are land use rights owned by certain subsidiaries of the Group. The net book value of land use rights acquired amounted to approximately $7,704,000 (2011: $5,448,000).

(b) During the year, the Group acquired property, plant and equipment with an aggregate cost of $Nil (2011: $837,000) by hire purchase. The total cash outflow for acquisition of property, plant and equipment amounted to $63,292,000 (2011: $73,076,000).

(c) Assets under construction are mainly located in Singapore, Malaysia and China.

(d) Other assets comprise electrical installation, furniture and fittings, air-conditioners, computer equipment, laboratory equipment, office equipment and renovation.

102 A NEW ERA


10. property, plant anD equipment (cont’D)

(e) Included in property, plant and equipment are the following:

Group2012 2011

$’000 $’000

Carrying amount of assets:Acquired under hire purchase agreements (Note 25):- motor vehicles 995 1,300- other assets 16 20

1,011 1,320

Pledged to banks for banking facilities granted (Note 26):- Freehold land and building 12,082 12,511- Plant and machinery – 3,497

12,082 16,008

(f) The depreciation charge for the Group is recognised in the following line items of the Income Statement:

Group2012 2011

$’000 $’000

Cost of sales 9,871 8,025General and administrative expenses 1,752 1,795

11,623 9,820

(g) During the financial year, a subsidiary of the Group, Wuxi Super Food Technology Co., Ltd, carried out a review of the utilisation of its plant and machinery and an impairment charge of $535,000 (2011: $226,000), representing the write-down of these equipment to the recoverable amount, was recognised in “other expenses”.



11. INTANGIBLE ASSETS

GroupGoodwill on

consolidation Trademark Total$’000 $’000 $’000

CostAt 31 December 2011 and 2012 3,044 964 4,008

Accumulated amortizationAt 31 December 2011 and 2012 – 964 964

Net carrying amountAt 31 December 2012 3,044 – 3,044

At 31 December 2011 3,044 – 3,044

(a) Goodwill

Goodwill arising from business combinations has been allocated to 3 individual cash-generating units (“CGUs”), which are part of the Singapore reportable segment, as follows:

Group2012 2011

$’000 $’000

Super Continental Pte Ltd 969 969Owl International Pte Ltd 2,068 2,068Super Investment Holdings Pte Ltd 7 7

3,044 3,044

For goodwill impairment testing, the recoverable amounts of the CGUs have been determined based on value-in-use calculations using cash flow projections based on financial budgets approved by management covering a five year period. The pre-tax discount rate applied to the cash flow projections is 5.0% to 6.0% (2011: 5.5% to 6.0%).

The calculations of value in use for the CGUs are most sensitive to the following assumptions:

Budgeted gross margins – Gross margins are based on average values achieved in the three years preceding the start of the budget period. These are increased over the budget period for anticipated efficiency improvements.

Growth rates – The growth rates are based on past performance and management’s expectations of market development.

Pre-tax discount rates – Discount rates represent the current market assessment of the risks specific to each CGU. This is the benchmark used by management to assess operating performance and to evaluate future investment proposals.

(b) Amortisation

The amortisation charge for the Group is recognised in general and administrative expenses in the Income Statement.

104 A NEW ERA


12. INvESTMENT IN SUBSIDIARY COMPANIES

Company2012 2011

$’000 $’000

Unquoted equity shares - at cost 101,419 101,419Impairment losses (4,219) (4,219)

97,200 97,200

(a) Details of the subsidiary companies are as follows:

Name of subsidiary companies(Country of incorporation)

Principal activities(Place of business)

Effective equity held by the Group

2012 2011% %

Super Coffee Corporation Pte Ltd (1) (Singapore)

Manufacture and distribution of beverages and food products (Singapore)

100 100

Super Food Investment International Pte Ltd (1)

(Singapore)

Investment holding(Singapore)

100 100

Beecomb Food Industries Pte Ltd (1) (Singapore)


58.67 58.67

SCML Overseas Pte Ltd (1) (Singapore)


100 100

Super Vending Pte Ltd (1) (Singapore)


100 70

Super Monte Marketing Pte Ltd (1)

(Singapore)Dormant 100 100

Super Continental Pte Ltd (1)

(Singapore)Manufacture and distribution of non-dairy creamer (Singapore)

100 100

Owl International Pte Ltd (1)

(Singapore)Manufacture and distribution of beverages and food products(Singapore)

100 100

Super Investment Holdings Pte Ltd (7)

(Singapore)Investment holding(Singapore)

100 100

Super Food Technology Sdn Bhd (2)

(Malaysia)Manufacture and distribution of beverages and food products(Malaysia)

100 100

SCML (Thailand) Co., Ltd (2)

(Thailand)Manufacture and distribution of beverages(Thailand)

99.99 99.99



12. investment in subsiDiary companies (cont’D)

(a) Details of the subsidiary companies are as follows (cont’d):




2012 2011% %

PT Super Aneka Foods & Beverages (Indonesia)

Dormant 100 100

Super U&U (Hong Kong) Ltd (3)

(Hong Kong)Distribution of beverages (Hong Kong)

100 100

Haddington Enterprises Ltd (3)

(Hong Kong)Dormant 100 100

Super Coffeemix (Russia) LLC (7)

(Russia)Dormant 100 100

Wuxi Super Food Technology Co., Ltd (4)

(People’s Republic of China)Manufacture and distribution of non-dairy creamer(People’s Republic of China)

90 90

Changzhou Super Food Co., Ltd (5)

(People’s Republic of China)Manufacture and distribution of beverages (People’s Republic of China)

100 100

Changzhou Super Chartered Food Co., Ltd (5)

(People’s Republic of China)

Manufacture of beverages and food products(People’s Republic of China)

100 100

Shantou SEZ Perfect Foods Industries Co., Ltd (7)


Dormant 58.67 58.67

Super Coffeemix Ltd (7)

(Myanmar)Manufacture and distribution of beverages(Myanmar)

60 60

Super Coffeemix Vietnam Ltd (6)

(Vietnam)Manufacture and distribution of beverages (Vietnam)

100 100

Changzhou Super Technology Development Co., Ltd (5)


Manufacture of cereal related products(People’s Republic of China)

100 100

Super Multi Vending Pte Ltd(Singapore) (1)

Provision of vending machine services (Singapore)

– 70

Super Food Specialists (M) Sdn Bhd (2)

(Malaysia)Manufacture and distribution of soluble coffee powder(Malaysia)

100 100

Owl Food Manufacture (M) Sdn Bhd (2)

(Malaysia)Dormant 100 100

106 A NEW ERA



(a) Details of the subsidiary companies are as follows (cont’d):




2012 2011% %

Super Coffeemix Marketing Sdn Bhd (2)

(Malaysia)Manufacture and distribution of beverages(Malaysia)

90 90

Super NHF Canning Sdn Bhd (2)

(Malaysia)Manufacture and distribution of beverages(Malaysia)

100 80

Super Food Marketing Sdn Bhd (2)

(Malaysia)Distribution of beverages and food products(Malaysia)

96 88

PT Dwisindo Mas (7)

(Indonesia)Dormant 80 80

Super Dairy Sdn Bhd (2)

(Malaysia)Dormant 100 100

Super Bio-Food Ingredients(M) Sdn Bhd (2)

(Malaysia)

Manufacture and distribution of Botanical Herbal Extract (Malaysia)

100 100

(1) Audited by Ernst & Young LLP, Singapore(2) Audited by member firms of Ernst & Young Global in the respective countries(3) Audited by C.F. Cheung & Co, Hong Kong(4) Audited by Wuxi Ruihua Certified Public Accountants Co., Ltd(5) Audited by ChangZhou Xinhuarui United CPA(6) Audited by Vietnam Accounting Auditing Consulting Company(7) Not required to be audited in accordance with the laws of the country of incorporation




(b) Acquisition of non-controlling interests:

On 31 March 2012, the Group’s subsidiary company, Super Food Technology Sdn Bhd (“SFT”), acquired the remaining 20% non-controlling equity interest comprising 1,230,000 ordinary shares in Super NHF Canning Sdn Bhd. (“NHF”) at a nominal consideration of RM1.00. As a result of this acquisition, NHF became a wholly-owned subsidiary of SFT, and total interest in Super Food Marketing Sdn Bhd (“SFM”) increased by 8% to 96%.

The carrying value of the net assets of NHF at 31 March 2012 was $531,000, and the carrying value of the additional interest acquired was $106,000. The carrying value of the net assets of SFM at 31 March 2012 was $1,049,000 and the carrying value of the additional interest acquired was $18,000. The difference between the consideration and the carrying value of the additional interest acquired has been recognized as “Discount on acquisition of non-controlling interests” within equity.

(i) The following summarises the effect of the change in the Group’s ownership interest in NHF on the equity attributable to the owners of the Company:

$’000

Consideration paid for acquisition of non-controlling interests –Decrease in equity attributable to non-controlling interests 106

Increase in equity attributable to owners of the company 106

(ii) The following summarises the effect of the change in the Group’s ownership interest in SFM on the equity attributable to owners of the company:

$’000

Consideration paid for acquisition of non-controlling interests –Decrease in equity attributable to non-controlling interests 18


On 30 August 2012, the Group’s subsidiary company, Super Coffee Corporation Pte. Ltd. (“SCCPL”) acquired an additional 10% equity interest comprising 45,000 ordinary shares in Super Vending Pte Ltd. (“SVPL”) at a consideration of S$86,000. As a result of this acquisition, SCCPL held 80% equity interest in SVPL comprising 360,000 ordinary shares in SVPL.

The carrying value of the net assets of SVPL at 30 August 2012 was $1,198,000, and the carrying value of the additional interest acquired was $120,000. The difference between the consideration and the carrying value of the additional interest acquired has been recognized as “Discount on acquisition of non-controlling interests” within equity.

108 A NEW ERA



(b) Acquisition of non-controlling interests (cont’d):

(iii) The following summarises the effect of the change in the Group’s ownership interest in SVPL on the equity attributable to owners of the company:

$’000

Consideration paid for acquisition of non-controlling interests 86Decrease in equity attributable to non-controlling interests 120


On 12 December 2012, SCCPL acquired the remaining equity interest comprising 90,000 ordinary shares in SVPL at a consideration of $230,000. As a result of this acquisition, SVPL became a wholly-owned subsidiary of SCCPL.

The carrying value of the net assets of SVPL at 31 December 2012 was $851,000, and the carrying value of the additional interest acquired was $171,000. The difference between the consideration and the carrying value of the additional interest acquired has been recognised as “Discount on acquisition of non-controlling interests” within equity.

(iv) The following summarises the effect of the change in the Group’s ownership interest in SVPL on the equity attributable to owners of the company:

$’000


Decrease in equity attributable to owners of the company 59

The following summarises the effect of the overall change in the Group’s ownership interest in the above mentioned subsidiaries on the equity attributable to owners of the company:

$’000





13. INvESTMENT IN ASSOCIATED COMPANIES

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Unquoted equity shares, at cost 3,369 3,369 706 706Share of post acquisition reserves (704) (279) – –

2,665 3,090 706 706

(a) Details of the associated companies are as follows:

Name of associated companies(Country of incorporation)



2012 2011% %

San Miguel Super Coffeemix Co., Inc (1) (Philippines)

Packing and distribution of beverages(Philippines)

30.0 30.0

Sun Resources Holdings Pte Ltd (2)


35.3 35.3

Ceres Super Pte Ltd (4)

(Singapore)Marketing, distribution and sales of instant beverages (Indonesia)

40 40

BS Global LLC (5)

(Mongolia)Manufacturing and distribution of food products (Mongolia)

30 30

Held through an associated companyChangzhou Care Real Estate Co., Ltd (3) (People’s Republic of China)

Real estate development and consultancy(People’s Republic of China)

32.7 32.7

Changzhou Care Real Estate Development Co., Ltd (3) (People’s Republic of China)

Real estate development and consultancy(People’s Republic of China)

33.2 33.2

Sun Development Pte. Ltd (2)


35.3 –

(1) Audited by KPMG(2) Audited by Low Seow Chye & Co.(3) Audited by Changzhou Yongshen Renhe CPA Co., Ltd(4) Audited by PriceWaterhouse Coopers(5) Audited by Ulaanbaatar Audit Corporation LLC

The Group had entered into a sales agreement to sell its investment in PSC on 28 February 2011. The agreed sales price was S$24m (which was the Group’s initial cost of purchase), and on 7 June 2011, the disposal was completed which resulted in a loss on disposal of approximately S$0.7m for the Group after deducting expenses incurred in respect of the divestment.

110 A NEW ERA


13. investment in associateD companies (cont’D)

(b) The financial information of the associated companies, not adjusted for the proportion of ownership interest held by the Group, is as follows:

2012 2011$’000 $’000

Assets and liabilities:Current assets 184,250 167,087Non-current assets 4,848 3,335

Total assets 189,098 170,422

Current liabilities 169,349 149,126Non-current liabilities – –

Total liabilities 169,349 149,126

Results:Revenue 78,547 81,696

Profit before tax 1,262 5,753Tax (752) (856)

Profit for the year 510 4,897



14. INvESTMENT IN JOINT vENTURE COMPANIES

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Interests in joint venture companies 13,828 13,828 13,828 13,828Impairment losses (3,828) (3,828) (3,828) (3,828)Share of post acquisition reserves 2,818 2,818 – –

12,818 12,818 10,000 10,000

(a) Details of the joint venture companies are as follows:

Name of joint venture companies(Country of incorporation)



2012 2011% %

JHS Holding Pte Ltd (Singapore)


50 50

Tianjin Super Lifestyle Food Development Co., Ltd (People’s Republic of China)

Manufacture and distribution of convenience foods (People’s Republic of China)

50 50

Held through joint venture companies

Ningxia Yin Ou Super Lifestyle Food Co., Ltd (People’s Republic of China)

Manufacture of potato flour and processing of flour precipitates(People’s Republic of China)

25 25

JHS Holding Pte Ltd (“JHS”) was initially incorporated for the purpose of holding investments in the People’s Republic of China. On 2 July 2010, JHS completed the divestment of 49% interest in Jiangsu Hengshun Seasonings and Foods Co., Ltd. The Group had placed JHS under Members’ Voluntary Liquidation on 3 January 2011 and closure of the liquidation process is pending the receipt of IRAS tax clearance.

(b) The aggregate amounts of current assets, non-current assets, current liabilities, non-current liabilities, income and expenses related to the Group’s interests in the jointly-controlled entities are as follows:

Group2012 2011

$’000 $’000

Assets and liabilities:Current assets 13,854 13,919Non-current assets 2,506 2,663

Total assets 16,360 16,582

Current liabilities, representing total liabilities 1,966 2,089

There was no income and expenses related to the Group’s interests in the jointly-controlled entities which were dormant during the year.

112 A NEW ERA


15. OTHER RECEIvABLES AND DEPOSITS

(a) Other receivables (non-current):

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Loan to subsidiary companies – – 2,772 3,110Quasi-equity loans to associated

companies 10,275 6,954 9,267 6,954

10,275 6,954 12,039 10,064Compensation for relocation of

factory – 3,361 – –Allowance for doubtful receivables

from subsidiary companies – – (2,772) (3,110)

10,275 10,315 9,267 6,954

Loans to subsidiary and associated companies are non-trade related, unsecured, non-interest bearing and are to be settled in cash. The amounts are not expected to be repaid within the next 12 months.

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Movements in allowance account:At 1 January – – 3,110 3,132Exchange differences – – (338) (22)

At 31 December – – 2,772 3,110

Other receivables (non-current) are denominated in the following currencies:

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Singapore dollar 9,267 6,954 9,267 6,954Indonesia Rupiah – – 2,772 3,110Chinese Renminbi – 3,361 – –United States dollar 1,008 – – –

Total 10,275 10,315 12,039 10,064



15. other receivables anD Deposits (cont’D)

(b) Other receivables, prepayments and deposits (current):

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Amount due from joint venture company 981 1,089 – –

Sundry debtors 1,452 1,140 7 18Compensation from relocation of

factory 4,148 5,975 – –Loan to associated company - 543 – –Deposits 766 871 – 5Staff loans and advances 66 55 – –Prepayments 1,403 1,193 – –

8,816 10,866 7 23

The sundry debtors and deposits are unsecured, non-interest bearing and are to be settled in cash. The amount due from joint venture company and loan to associated company is non-trade related, unsecured, non-interest bearing, repayable upon demand and is to be settled in cash.

Included in prepayments are prepayments for construction of a factory extension amounting to approximately $Nil (2011: $9,000).

Other receivables and deposits (current) are denominated in the following currencies:

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Singapore dollar 495 551 6 23United States dollar 1,045 1,717 1 –Chinese Renminbi 5,170 6,760 – –Malaysia Ringgit 252 134 – –Thai Baht 218 265 – –Others 233 246 – –

Total 7,413 9,673 7 23

114 A NEW ERA


16. DEFERRED TAxATION

Net deferred tax liabilities

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Deferred tax assetsUnutilised tax losses and

capital allowances 17 248 – –Others – 180 – 180

Total 17 428 – 180

Deferred tax liabilitiesExcess of net book value over tax written

down value of property, plant and equipment (4,952) (4,865) – –

Others (39) – (39) –

Total (4,991) (4,865) (39) –

Net deferred tax liabilities (4,974) (4,437) (39) 180

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

Group2012 2011

$’000 $’000

Tax losses 15,898 5,906Capital and reinvestment allowances 3,104 3,243

19,002 9,149

The unutilised tax losses and unabsorbed capital and reinvestment allowances are subject to compliance with the relevant provisions of the tax legislation and agreement by the relevant tax authorities in the respective countries in which certain subsidiary companies operate. The tax losses of a subsidiary company amounting to $680,000 (2011: $680,000) will expire between 2013 and 2014 (2011: 2012 and 2014).

The deferred tax assets have not been recognised as it is uncertain that future taxable profit will be available against which the relevant subsidiary companies can utilise the benefits.



17. INvENTORIES

Group2012 2011

$’000 $’000

Raw materials 33,263 34,287Packing materials 10,534 10,059Work-in-progress 2,639 3,102Finished goods 27,523 35,673Spare parts 393 431Goods-in-transit 8,355 9,481

82,707 93,033

Inventories are stated after deducting allowance for inventory obsolescence of: 3,245 4,032

The following items were recorded in income statement for the year:Allowance for inventory obsolescence 514 2,079Inventories written off 448 279

116 A NEW ERA


18. TRADE RECEIvABLES

Group2012 2011

$’000 $’000

Trade receivables 97,735 80,015Allowance for impairment (2,090) (1,912)

95,645 78,103

Included in trade receivables is an amount due from an associate of $1,862,000 (2011: $2,207,000) which is unsecured, non-interest bearing, repayable upon demand.

Trade receivables are non-interest bearing and are generally on 30 to 90 day terms. They are recognised at their original invoiced amounts which represent their fair value on initial recognition.

As at balance sheet date, trade receivables arising from export sales amounting to $753,000 (2011: $1,299,000) were arranged to be settled via letters of credit issued by reputable banks.

Trade receivables of the Group is denominated in the following currencies:

Group2012 2011

$’000 $’000

Singapore dollar 9,205 8,267United States dollar 26,369 21,856Thai Baht 32,811 22,168Chinese Renminbi 20,715 16,394Malaysia Ringgit 7,841 11,211Others 794 119

Total 97,735 80,015



18. traDe receivables (cont’D)

(a) Trade receivables that are past due but not impaired

The Group has trade receivables amounting to $23,793,000 (2011: $21,595,000) that are past due at the balance sheet date but not impaired. These receivables are unsecured and the analysis of their aging at the balance sheet date is as follows:

Group2012 2011

$’000 $’000

Trade receivables past due:Less than or 30 days 16,792 12,93131 to 60 days 3,961 3,82061 to 90 days 1,041 1,13491 to 120 days 521 774More than 120 days 1,478 2,936

23,793 21,595

(b) Trade receivables that are impaired

The Group’s trade receivables that are impaired at the balance sheet date and the movements of the allowance account used to record the impairment are as follows:

Group2012 2011

$’000 $’000

Trade receivables – nominal amounts 3,414 2,017Allowance for impairment (2,090) (1,912)

1,324 105

Movements in allowance account:

At 1 January (1,912) (1,719)Charge for the year (356) (169)Written off 136 –Exchange differences 42 (24)

At 31 December (2,090) (1,912)

Trade receivables that are determined to be impaired at the balance sheet date relate to outstanding receivables that are more than 120 days and deemed uncollectible and/or that are in significant financial difficulties or have defaulted on payments. Included in the trade receivables was $1,698,000 which was not fully impaired previously as it was secured on a property in Russia. However, owing to the difficulty in obtaining legal title to this property, full impairment was made in 2010.

118 A NEW ERA


19. AMOUNTS DUE FROM SUBSIDIARY COMPANIES

Company2012 2011

$’000 $’000

Trade 2,073 2,212Allowance for impairment (2,073) (2,212)

– –

Non-trade 100,238 63,332Allowance for impairment (1,876) (2,418)

98,362 60,914

98,362 60,914

Amounts due from subsidiary companies are unsecured, non-interest bearing, repayable upon demand and are to be settled in cash.

Company2012 2011

$’000 $’000

Movements in allowance account:At 1 January 4,630 4,598Written off (649) –Exchange differences (32) 32

At 31 December 3,949 4,630

Amounts due from subsidiary companies are denominated in the following currencies:

Company2012 2011

$’000 $’000

Singapore dollar 90,799 56,959United States dollar 10,424 5,794Thai Baht 1,088 2,791

Total 102,311 65,544



20. INvESTMENT SECURITIES

Group and Company2012 2011

$’000 $’000

Held-for-trading investments- Equity instruments (quoted) 2,976 1,856

Changes in fair value of held-for-trading investments are recorded in “Net gain/(loss) from investment securities”.

21. cash anD short-term Deposits

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Cash and bank balances 85,005 83,305 1,790 9,526Short-term deposits 27,189 39,367 16,502 30,176

112,194 122,672 18,292 39,702Bank overdrafts (secured) (670) (779) – –

Cash and cash equivalents 111,524 121,893 18,292 39,702

Cash balances earn interest at floating rates based on daily bank deposit rates. Short-term deposits are made for varying periods of between one day and three months, depending on the immediate cash requirements of the Group and the Company, and earn interest at the respective short-term deposit rates. The average effective interest rate of short-term deposits is 3.12% (2011: 2.31%) per annum.

Cash, bank balances and fixed deposits with banks are denominated in the following currencies at 31 December:

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Singapore dollar 9,559 32,045 905 13,534United States dollar 59,882 38,445 17,166 5,926Euro 213 20,222 213 20,222Malaysia Ringgit 3,728 2,098 – –Chinese Renminbi 29,875 23,112 – –Thai Baht 8,514 6,295 – –Others 423 455 8 20

112,194 122,672 18,292 39,702

The bank overdrafts are secured by land and building of a subsidiary company and a corporate guarantee from the Company. They are repayable on demand and bear interest at 6.85% (2011: 6.85%-8.60%) per annum.

120 A NEW ERA


22. TRADE PAYABLES

Trade payables are non-interest bearing. Trade payables are normally settled on 60 day terms.

Trade payables of the Group is denominated in the following currencies:

Group2012 2011

$’000 $’000

Singapore dollar 7,284 7,216United States dollar 9,556 5,411Malaysia Ringgit 2,664 2,490Chinese Renminbi 19,157 19,856Thai Baht 1,193 546Others 202 75

Total 40,056 35,594

23. OTHER PAYABLES AND ACCRUALS

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Accrued operating expenses 27,896 27,822 76 44Accrued payroll and related expenses 11,562 10,036 550 490Payables for property, plant and equipment 5,125 3,356 – –Payables to joint venture company 12,810 12,810 12,810 12,810Other payables 10,077 9,308 79 60

67,470 63,332 13,515 13,404Advance payments and deposits from

customers 1,011 765 – –

68,481 64,097 13,515 13,404

Included in payables to joint venture company is an amount payable to JHS Holding Pte Ltd, which is to be settled against the net investment upon completion of its Members’ Voluntary Liquidation.

Other payables are unsecured, non-interest bearing and expected to be repaid within the next 12 months.



24. AMOUNTS DUE TO SUBSIDIARY COMPANIES

Company2012 2011

$’000 $’000

Trade 119 102Non-trade 4,515 3,557

4,634 3,659

Amounts due to subsidiary companies are unsecured, non-interest bearing, repayable on demand and are to be settled in cash.

Amounts due to subsidiary companies are denominated in the following currencies:

Company2012 2011

$’000 $’000

Singapore dollar 96 97United States dollar 1,440 1,524Thai Baht – 1,667Indonesia Rupiah 3,098 371

Total 4,634 3,659

25. HIRE PURCHASE CREDITORS

The Group entered into hire purchase agreements for certain items of motor vehicles and other assets (Note 10). The average range of discount rates implicit in the agreements is 2.00% to 4.14% (2011: 2.00% to 4.14%).

Future minimum lease payments together with the present value of the net minimum lease payments are as follows:

Group Minimum lease

payments

Present value of

payments

Minimum lease

payments

Present value of

payments2012 2012 2011 2011

$’000 $’000 $’000 $’000

Not later than one year 239 217 239 217Later than one year 412 377 638 582

Total minimum lease payments 651 594 877 799Amount representing finance charges (57) – (78) –

Present value of minimum lease payments 594 594 799 799

122 A NEW ERA


26. BANK BORROWINGS

Group2012 2011

$’000 $’000

Current:Bank loans (secured) – 911

The secured bank loans of the Group which carried interest at 6.75% per annum and was repayable by 60 equal monthly installments commencing on 1 November 2007 had been fully repaid during the financial year.

27. DEFERRED GAIN

In January 2007, the Group completed the sale and leaseback arrangement with HSBC Institutional Trust Services (Singapore) Limited as a trustee of Ascendas Real Estate Investment Trust, for the sale of its property at Senoko. The Group has leased back the property for a period of 7 years commencing on 8 January 2007.

An option was granted by HSBC Institutional Trust Services (Singapore) Limited to the Company to renew the lease for a further term of seven years upon expiry of the initial term of 7 years subject to the consent of the relevant authority. The agreed rental is $3,376,000 per annum and will escalate at 2% per annum during the initial term. On renewal, the rental will be renegotiated based on prevailing market rates.

An excess of $22,000,000 of the sales proceeds over the fair value of the property was deferred and recognised over the leaseback period of 7 years at $3,143,000 per annum.

Group $’000

Excess of sales proceeds over fair valueAt 31 December 2011 and 31 December 2012 22,000

Accumulated gain recognisedAt 31 December 2011 15,714Recognised for the year 3,143

At 31 December 2012 18,857

Deferred gainAt 31 December 2012 3,143

At 31 December 2011 6,286

2012 $’000

2011$’000

Disclosure in balance sheet:Not later than one year 3,143 3,143Later than one year – 3,143

At 31 December 3,143 6,286



28. SHARE CAPITAL AND TREASURY SHARES

(a) Share capital


No. of ordinary

shares $’000 $’000

No. of ordinary

shares$’000 $’000

Issued and fully paid ordinary shares:At 1 January and 31 December 557,739 163,543 557,739 163,543

The holders of ordinary shares (except treasury shares) are entitled to receive dividends as and when declared by the Company. All ordinary shares carry one vote per share without restrictions. The ordinary shares have no par value.

(b) Treasury shares


No. of ordinary

shares $’000 $’000

No. of ordinary

shares$’000 $’000

At 1 January (270) (272) (369) (372)Treasury shares reissued pursuant

to Share Award Scheme 78 79 99 100

At 31 December (192) (193) (270) (272)

Treasury shares relate to ordinary shares of the Company that are held by the Company.

The Company acquired 369,000 shares in the Company by way of on-market purchase for a total consideration of $372,000 in 2010 and this has been presented as a component within shareholders’ equity.

78,000 (2011:99,000) treasury shares were awarded to certain directors on 17 August 2012 pursuant to the Super Group Share Award Scheme during the financial year ended 31 December 2012. Subsequent to the aforementioned transfers, the number of treasury shares is 192,000 (2011: 270,000).

124 A NEW ERA


29. RESERvES

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Asset revaluation reserve 895 1,563 – –Capital reserve 94 94 – –Reserve on consolidation 358 358 – –Statutory reserve 7,011 2,473 – –Foreign currency translation reserve (27,024) (12,054) – –Dividend reserve 28,435 21,184 28,435 21,184Discount on acquisition of non-controlling

interests 99 – – –Gain on reissuance of treasury shares reserve 135 42 135 42Accumulated profits 225,564 189,976 24,875 14,142

235,567 203,636 53,445 35,368

(a) Asset revaluation reserve

The asset revaluation reserve represents increases in the fair value of the Group’s leasehold land and buildings, net of tax, and decreases to the extent that such decrease relates to an increase on the same asset previously recognised in other comprehensive income.

(b) Capital reserve

The capital reserve represents a one-time tax incentive granted to a foreign subsidiary in accordance with the laws of the foreign jurisdiction and the Group’s share of joint venture company’s capital reserves.

(c) Reserve on consolidation

Reserve on consolidation represents the difference between the fair value of the net assets and the purchase consideration in respect of the subsidiary companies acquired prior to 1 January 2001.

(d) Statutory reserve fund

In accordance with the Foreign Enterprise Law applicable to the subsidiary companies in the People’s Republic of China (“PRC”) and Thailand, the subsidiary companies are required to make appropriation to a Statutory Reserve Fund (“SRF”).

In the PRC, at least 10% of the statutory profits after tax as determined in accordance with the applicable PRC accounting standards and regulations must be allocated to the SRF until the cumulative total of the SRF reaches 50% of the subsidiary companies’ registered capital. Subject to approval from the relevant PRC authorities, the SRF may be used to offset any accumulated losses or increase the registered capital of the subsidiary companies.

In Thailand, the subsidiary company is required to allocate at least 5% of its profit each time a dividend is paid out, until the SRF reaches 10% of its registered share capital.

The SRF in both countries are not available for dividend distribution to shareholders.

(e) Foreign currency translation reserve

The foreign currency translation reserve represents exchange differences arising from the translation of the financial statements of foreign operations whose functional currencies are different from that of the Group’s presentation currency.



29. reserves (cont’D)

(f) Dividend reserve

The dividend reserve represents amounts transferred from accumulated profits for dividends proposed by the directors on or before the balance sheet date.

(g) Fair value reserve

Fair value reserve represents the Group’s share of associated and joint venture companies’ fair value reserves and the cumulative fair value changes, net of tax, on available-for-sale financial assets until they are disposed of or impaired.

(h) Gain or loss on reissuance of treasury shares

This represents the gain or loss arising from purchase, sale, issue or cancellation of treasury shares. No dividend may be paid, and no other distribution (whether in cash or otherwise) of the Company’s assets (including any distribution of assets to members on a winding up) may be made in respect of this reserve.

(i) Discount on acquisition of non-controlling interests

This represents the difference between the consideration and the carrying value of the additional equity interest in a subsidiary acquired from its non-controlling interest.

30. DIvIDENDS


$’000 $’000

Declared and paid during the year:

Dividends on ordinary shares:- Final exempt (one-tier) dividend for 2011: 3.8 cents (2010: 3.6 cents) per share 21,184 20,065- Interim exempt (one-tier) dividend for 2012: 2.0 cents (2011: 2.0 cents) per share 11,151 11,149

32,335 31,214

Proposed but not recognised as a liability as at 31 December:

Dividends on ordinary shares subject to shareholders’ approval at the AGM:- Final exempt (one-tier) dividend for 2012: 5.1 cents (2011: 3.8 cents) per share 28,435 21,184

126 A NEW ERA


31. COMMITMENTS AND CONTINGENCIES

(a) Operating lease commitments – as lessee

The Group and Company have entered into commercial leases for the use of leasehold land, warehouses and offices. There are no restrictions placed upon the Group or the Company by entering into these leases.

Future minimum lease payments under non-cancellable operating leases as at 31 December 2012 are as follows:

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Not later than one year 4,872 4,641 – –Later than one year but not later

than five years 1,765 5,484 – –Later than five years 8,010 7,869 – –

14,647 17,994 – –

(i) The 30-year lease of a subsidiary company’s leasehold land, with an option to renew for 28 years, will expire on 28 February 2027. The lease rental is subject to an annual revision based on the market rent prevailing at the time of revision.

(ii) The Group leases a number of premises for warehouse and office purposes under operating leases.

(b) Operating lease commitments – as lessor

The Group has entered into commercial property leases on its properties. These non-cancellable leases have remaining lease terms of between one and four years. All leases include a clause to enable upward revision of the rental charge on an annual basis based on prevailing market conditions.

Future minimum rental receivable under non-cancellable operating leases as at 31 December 2012 are as follows:

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Not later than one year 431 312 – –Later than one year but not later

than five years 555 428 – –

986 740 – –



31. commitments anD continGencies (cont’D)

(c) Capital commitments

Capital expenditure contracted for as at balance sheet date but not recognised in the financial statements are as follows:

Group2012 2011

$’000 $’000

Capital commitments in respect of property, plant and equipment 43,487 20,298

(d) Other commitments

(i) As at balance sheet date, the Group had committed to the following equipment location fee as follows:

Group2012 2011

$’000 $’000

Not later than one year – 24Later than one year but not later than five years – 16

– 40

(ii) Forward commitments

As at the balance sheet date, the Group had outstanding contracts as follows:

Group2012 2011

$’000 $’000

Purchase raw materials 75,085 48,396

(iii) Guarantees

The Company had provided the following guarantees as at 31 December:

Company2012 2011

$’000 $’000

Guarantees given to financial institutions as security for credit facilities granted to subsidiary companies 25,825 30,499

(iv) The Company has provided letters of financial support to certain subsidiary companies.

128 A NEW ERA


32. RELATED PARTY DISCLOSURES

(a) Sale and purchase of goods and services

In addition to the related party information disclosed elsewhere in the financial statements, the following significant transactions between the Group and related parties took place at terms agreed between the parties during the financial year:

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

Related partiesLoans and advances to

associated company (2,808) (543) (2,313) –Refund of prepayments to

associated company – (2,033) – –Income from a non-controlling

interest – 29 – –Sales of finished goods to

associated companies 30,728 15,132 – –Accounting fees charged to

associated company 12 12 – –Marketing fees paid to firms

related to key management personnel of the Company (874) (108) – –

(b) Compensation of key management personnel

Details of the key management personnel compensation are as follows:

Group2012 2011

$’000 $’000

Short-term employee benefits 9,086 7,812Contributions to national pension schemes 215 187Share-based payments 172 142

9,473 8,141

Comprise amounts paid to- directors of the Company 7,924 6,749- key management personnel 1,549 1,392

9,473 8,141



32. relateD party Disclosures (cont’D)

(b) Compensation of key management personnel (cont’d)

Directors’ remuneration includes salaries, bonuses, fees and other emoluments. In addition to the above, the Company provides medical benefits to all employees, which include key management personnel.

The Company’s directors receiving remuneration from the Group:

2012 2011

Number of directors in remuneration bands:- $500,000 and above 2 2- $250,001 to $499,000 3 4- Below $250,000 10 9

15 15

Directors’ interests in Share Awards Scheme

During the financial year, 78,000 (2011:99,000) share awards were granted to two of the Company’s executive directors under the Share Awards Scheme at the price of $2.200 (2011:$1.435) each.

33. FINANCIAL RISK MANAGEMENT OBJECTIvES AND POLICIES

The Group and the Company is exposed to financial risks arising from its operations and the use of financial instruments. The key financial risks include foreign currency risk, credit risk, liquidity risk, market price risk and commodity price risk. The Board of directors reviews and agrees policies and procedures for the management of these risks, which are executed by the management. The Audit Committee provides independent oversight to the effectiveness of the risk management process. The Group does not undertake any trading of derivative financial instruments.

The following sections provide details regarding the Group’s and Company’s exposure to the above-mentioned financial risks and the objectives, policies and processes for the management of these risks.

There has been no change to the Group’s exposure to these financial risks or the manner in which it manages and measures the risks.

(a) Foreign currency risk

The Group has transactional currency exposures arising from sales or purchases that are denominated in a currency other than the respective functional currencies of the entities within the Group. The foreign currency in which these transactions are denominated is mainly the United States Dollar (“USD”).

Entities within the Group customarily conduct their business in the functional currency in the locations they operate in. However, a certain proportion of transactions are made in foreign currencies and these transactions are mainly between related companies. These related company transactions usually for the purchases of raw materials are mainly denominated in USD.

The Group is also exposed to currency translation risk arising from its net investments in foreign operations. The Group’s net investments in Malaysia, People’s Republic of China and Thailand are not hedged as currency positions in Malaysia Ringgit (“RM”), Chinese Renminbi (“RMB”) and Thai Baht are considered to be long-term in nature.

The Group generally does not hedge currency risk.

130 A NEW ERA


33. financial risk manaGement objectives anD policies (cont’D)

(a) Foreign currency risk (cont’d)

Sensitivity analysis for foreign currency risk

The following table demonstrates the sensitivity of the Group’s profit net of tax to a reasonably possible change in the USD exchange rate against the respective functional currencies of the entities within the Group, with all other variables held constant.

Group2012 2011

Profit net of tax

Profit net of tax

$’000 $’000

USD/SGD- strengthened 6% (2011: 1%) 1,818 201- weakened 6% (2011: 1%) (1,818) (201)

USD/RM- strengthened 3% (2011: 3%) 30 1- weakened 3% (2011: 3%) (30) (1)

USD/RMB- strengthened 1% (2011: 6%) 93 94- weakened 1% (2011: 6%) (93) (94)

(b) Credit risk

Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its obligations. The Group’s and the Company’s exposure to credit risk arises primarily from trade and other receivables.

The Group’s objective is to seek continual revenue growth while minimising losses incurred due to increased credit risk exposure. The Group trades only with recognised and creditworthy third parties. It is the Group’s policy that all customers who wish to trade on credit terms are subject to credit verification procedures. In addition, receivable balances are monitored on an on-going basis with the result that the Group’s exposure to bad debts is not significant.

Excess risk concentration

Risk concentration arises when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have the same economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political and other conditions. Concentrations indicate the relative sensitivity of the group’s performance to developments affected to a particular industry.

In order to avoid excessive concentrations of risk, the group’s policies and procedures include specific guidelines to focus on maintaining a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.




(b) Credit risk (cont’d)

Exposure to credit risk

At the balance sheet date, the Group’s and the Company’s maximum exposure to credit risk is represented by:

(i) the carrying amount of each class of financial assets recognised in the balance sheets; and

(ii) a nominal amount of $14,665,000 (2011: $15,014,000) relating to corporate guarantees provided by the Company to banks on a subsidiary’s bank loan.

Information regarding credit enhancements for trade receivables is disclosed in Note 18.

Credit risk concentration profile

The Group determines concentrations of credit risk by monitoring the country profile of its trade receivables on an on-going basis. The credit risk concentration profile of the Group’s trade receivables at the balance sheet date is as follows:

Group2012 2011

$’000 % $’000 %

Singapore 7,664 8 7,197 9Malaysia 7,850 8 11,072 14Thailand 35,260 37 24,030 31China 20,569 22 16,013 21Myanmar 13,781 14 9,714 12Others 10,521 11 10,077 13

95,645 100 78,103 100

As of 31 December 2012, 8 (2011: 9) major customers accounted for 66% (2011: 62%) of trade receivables. These customers are located in Singapore, Malaysia, Myanmar, China and Thailand.

Financial assets that are neither past due nor impaired

Trade and other receivables that are neither past due nor impaired are creditworthy debtors with good payment record with the Group. Cash and cash equivalents are placed with reputable financial institutions.

Financial assets that are either past due or impaired

Information regarding financial assets that are either past due or impaired is disclosed in Notes 18 (Trade receivables), 15 (Other receivables and deposits) and 19 (Amounts due from subsidiary companies).

132 A NEW ERA



(c) Liquidity risk

Liquidity risk is the risk that the Group or the Company will encounter difficulty in meeting financial obligations due to shortage of funds. The Group’s and the Company’s exposure to liquidity risk arises primarily from mismatches of the maturities of financial assets and liabilities. The Group’s and the Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of stand-by credit facilities.

To ensure continuity of funding, the Group’s policy is to manage the debt maturity profile to support the operating cycle of the business. Short-term funding is obtained from bank borrowings and bank overdrafts for working capital purposes, if necessary.

The table below summarises the maturity profile of the Group’s and the Company’s financial assets and liabilities at the balance sheet date based on contractual undiscounted repayment obligations.

Analysis of financial instruments by remaining contractual maturities

The table below summarises the maturity profile of the Group’s and Company’s financial assets and liabilities at the balance sheet date based on contractual undiscounted repayment obligations.

TotalWithin1 year

After 1 year but within

5 yearsAfter

5 years$’000 $’000 $’000 $’000

Group2012

Financial assetsInvestment securities 2,976 2,976 – –Trade receivables 95,645 95,645 – –Other receivables 17,688 7,413 – 10,275Cash and bank balances 112,194 112,194 – –

Total undiscounted financial assets 228,503 218,228 – 10,275

Financial liabilities Bank overdrafts 670 670 – –Trade payables 40,056 40,056 – –Other payables 55,671 55,671 – –Hire purchase creditors 651 239 412 –Payables to joint venture and

associated companies 12,810 12,810 – –

Total undiscounted financial liabilities 109,858 109,446 412 –

Total net undiscounted financial assets 118,645 108,782 (412) 10,275




(c) Liquidity risk (cont’d)

TotalWithin1 year


5 yearsAfter

5 years$’000 $’000 $’000 $’000

Group2011

Financial assetsInvestment securities 1,856 1,856 – –Trade receivables 78,103 78,103 – –Other receivables 19,988 9,673 3,361 6,954Cash and bank balances 122,672 122,672 – –

Total undiscounted financial assets 222,619 212,304 3,361 6,954

Financial liabilities Bank overdrafts 779 779 – –Trade payables 35,594 35,594 – –Other payables 51,287 51,287 – –Loans and borrowings 1,841 1,203 638 –Payables to joint venture and


Total undiscounted financial liabilities 102,311 101,673 638 –

Total net undiscounted financial assets 120,308 110,631 2,723 6,954

TotalWithin1 year


5 yearsAfter

5 years$’000 $’000 $’000 $’000

Company2012

Financial assetsInvestment securities 2,976 2,976 – –Other receivables and deposits 9,274 7 – 9,267Amounts due from subsidiary companies 98,362 98,362 – –Cash and bank balances 18,292 18,292 – –


Financial liabilities Amounts due to subsidiary companies 4,634 4,634 – –Other payables 705 705 – –Payables to joint venture and associated

companies 12,810 12,810 – –

Total undiscounted financial liabilities 18,149 18,149 – –

Total net undiscounted financial assets 110,755 101,488 – 9,267

134 A NEW ERA



(c) Liquidity risk (cont’d)

TotalWithin1 year


5 yearsAfter

5 years$’000 $’000 $’000 $’000

Company2011

Financial assetsInvestment securities 1,856 1,856 – –Other receivables and deposits 6,977 23 – 6,954Amounts due from subsidiary

companies 60,914 60,914 – –Cash and bank balances 39,702 39,702 – –


Financial liabilities Amounts due to subsidiary companies 3,659 3,659 – –Other payables 594 594 – –Payables to joint venture and


Total undiscounted financial liabilities 17,063 17,063 – –

Total net undiscounted financial assets 92,386 85,432 – 6,954

The table below shows the contractual expiry by maturity of the Company’s commitments. The maximum amounts of the guarantees are allocated to the earliest period in which the guarantees could be called.

TotalWithin1 year


5 yearsAfter

5 years$’000 $’000 $’000 $’000

Company2012

Financial guarantees – – – –

2011

Financial guarantees 911 911 – –




(d) Market price risk

Market price risk is the risk that the fair value or future cash flow of the Group’s financial instruments will fluctuate because of changes in market prices (other than interest or exchange rates). The Group is exposed to equity price risk arising from its investment in quoted equity instruments. These instruments are quoted on the SGX-ST and are classified as held-for-trading financial assets.

The Group and Company’s objective is to manage investment returns and equity price risk by monitoring the fluctuations in the price of the quoted investment and the dividend yield.

Sensitivity analysis for market price risk

At the balance sheet date, if the share price of the investment securities had been 19.7% (2011: 17.0%) higher/lower, the Group’s profit net of tax would have been $586,000(2011: $315,000) higher/lower, arising as a result of higher/lower fair value changes on held-for-trading investments in equity instruments.

(e) Commodity price risk

The Group’s raw materials include coffee bean and sugar. Coffee bean and sugar are traded commodities and their prices are subject to the fluctuations of the commodity markets. Any fluctuation in the prices of raw materials will have an impact on the results of the Group’s operations. The Group monitors price fluctuations closely and evaluates alternative sources of supply and pricing policies.

136 A NEW ERA


34. FINANCIAL INSTRUMENTS

The financial instruments of the Group and Company as at 31 December by classes are as follows:

Group Company2012 2011 2012 2011

$’000 $’000 $’000 $’000

(a) Loans and receivablesTrade receivables 95,645 78,103 – –Other receivables (non-current) 10,275 10,315 9,267 6,954Other receivables and deposits (current) 7,413 9,673 7 23Amounts due from subsidiary companies – – 98,362 60,914Cash and bank balances 112,194 122,672 18,292 39,702

225,527 220,763 125,928 107,593

(b) Held-for-trading financial assetsInvestment securities 2,976 1,856 2,976 1,856

(c) Financial liabilities measured at amortised cost

Bank overdrafts 670 779 – –Trade payables 40,056 35,594 – –Other payables and accruals 68,481 64,097 13,515 13,404Amounts due to subsidiary companies – – 4,634 3,659Hire purchase creditors 594 799 – –Bank borrowings – 911 – –

109,801 102,180 18,149 17,063



35. FAIR vALUES

(a) Fair value of financial instruments that are carried at fair value

Investment securities

The carrying amounts approximate their fair values which are determined by reference to their published market bid prices at the balance sheet date.

In accordance with FRS 107, the fair value have been determined based on the Level 1 fair value hierarchy where the quoted prices are determined based on quoted prices (unadjusted) in active markets for identical assets.

There have been no transfers between Level 1 and Level 2 fair value measurements during the financial years ended 2012 and 2011.

(b) Fair value of financial instruments by classes that are not carried at fair value and whose carrying amounts are reasonable approximation of fair value

Trade receivables, other receivables and deposits (current), amounts due from/to subsidiary companies, cash and bank balances, bank overdrafts, trade payables, other payables and accruals, hire purchase creditors (current) and bank borrowings

The carrying amounts of these financial assets and liabilities are reasonable approximation of fair values due to their short-term nature.

(c) Fair value of financial instruments by classes that are not carried at fair value and whose carrying amounts are not reasonable approximation of fair value

The fair values of financial assets and liabilities by classes that are not carried at fair values and whose carrying amounts are not reasonable approximation of fair values are as follows:

2012 2011Carrying

valueFair

valueCarrying

valueFair

value$’000 $’000 $’000 $’000

Group

Financial assetsOther receivables (non-current) 10,275 * 10,315 *

Financial liabilitiesHire purchase creditors (non-current) 377 394 582 675

Company

Financial assetsOther receivables (non-current) 9,267 * 6,954 *

* Other receivables (non-current)

It is not practical to estimate the fair values of the other receivables (non-current) as there are no fixed terms of repayment.

Hire purchase creditors (non-current)

The fair values as disclosed in the table above are estimated by discounting expected future cash flows at market incremental lending rate for similar types of lending, borrowing or leasing arrangements at the balance sheet date.

138 A NEW ERA


36. SEGMENT REPORTING

The Group’s revenue and profit are primarily derived from the manufacture and distribution of beverages and food products. For management purposes, the Group is organised into geographical segments. The Group operates in three principal geographical areas, Singapore, Southeast Asia and East Asia. In presenting information on the basis of geographical segments, the segment revenue by destination is based on the geographical location of the customers. Segment revenue and segment assets by asset locations are based on the geographical location of the assets.

Management monitors the operating results of each geographical segment separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating profit or loss. Group financing (including finance costs) and income taxes are managed on a group basis and are not allocated to operating segments.

Inter-segment pricing is determined on mutually agreed terms.

(a) Geographical segments

Non-current assets information based on the geographical location of the assets are as follows:

2012 2011$’000 $’000

Singapore 33,473 25,351

Southeast AsiaMyanmar 1,484 2,030Malaysia 109,349 77,916Thailand 6,617 6,244Vietnam 5,949 5,398

East AsiaChina 57,693 51,925

Others 185 401

214,750 169,265

Non-current assets information presented above consist of property, plant and equipment and intangible assets, as presented in the consolidated balance sheet.



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37. CAPITAL MANAGEMENT

The primary objective of the Group’s capital management is to ensure that it maintains a strong credit rating and healthy capital ratios in order to support its business and maximise shareholder value.

The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. No changes were made in the objectives, policies or processes during the years ended 31 December 2012 and 2011.

As disclosed in Note 29(d), certain subsidiary companies of the Group are required by the Foreign Enterprise Laws of the PRC and Thailand to contribute and maintain a non-distributable statutory reserve fund whose utilisation is subject to approval by the relevant authorities. These externally imposed capital requirements have been complied with by the above-mentioned subsidiary companies for the financial years ended 31 December 2012 and 2011.

The Group monitors capital using its debt-to-equity ratio as follows:

Group2012 2011

$’000 $’000

Total Liabilities 126,196 120,268

Total Equity 416,667 382,178

Debt-to-Equity 0.30 times 0.31 times

38. AUTHORISATION OF FINANCIAL STATEMENTS

The financial statements for the year ended 31 December 2012 were authorised for issue in accordance with a resolution of directors on 12 March 2013.

142 A NEW ERA

shareholoDers’ information as at 12 March 2013

SHARE CAPITAL

Number of Issued Shares (excluding Treasury Shares) : 557,546,980Number/Percentage of Treasury Shares : 192,000 (0.03%)Class of Shares : Ordinary ShareVoting Rights (excluding Treasury Shares) : One Vote Per Share

STATISTICS OF SHAREHOLDINGS

Size of ShareholdingNo. of

Shareholders % No. of Shares %

1 – 999 187 6.78 83,580 0.021,000 – 10,000 2,219 80.52 7,403,439 1.3310,001 – 1,000,000 330 11.97 15,469,536 2.771,000,001 and above 20 0.73 534,590,425 95.88

Total 2,756 100.00 557,546,980 100.00

SUBSTANTIAL SHAREHOLDERS’ INTEREST AS AT 12 MARCH 2013(As recorded in the Register of Substantial Shareholders)

Direct Interest % Deemed Interest %

Teo Kee Bock 65,367,375 11.72 – –Goi Seng Hui 64,070,908 (1) 11.49 26,319,000 (2) 4.72Te Lay Hoon 67,596,125 12.12 150,000 (3) 0.03Te Kok Chiew 51,824,625 9.30 – –YHS Investments Pte Ltd 65,105,648 11.68 – –Yeo Hiap Seng Limited – – 65,105,648 (4) 11.68Far East Organisation Pte. Ltd. – – 65,105,648 (4) 11.68Ng Teng Fong, Deceased – – 65,105,648 (4) 11.68Tan Kim Choo @ Teng Kim Choo – – 65,105,648 (4) 11.68The Capital Group Companies, Inc. – – 50,464,000 (5) 9.05

Notes:

(1) The breakdown of Mr Goi Seng Hui’s direct interest is as follows: – 19,070,908 shares in own name; and – 45,000,000 shares held by DBS Nominees Pte Ltd as bare trustee.

(2) Mr Goi Seng Hui is deemed to be interested in the shares held by Tee Yih Jia Food Manufacturing Pte Ltd by virtue of Section 7 of the Companies Act, Cap. 50.

(3) Madam Te Lay Hoon is deemed to be interested in the shares held by the nominee, CPF Bank Nominees.

(4) By virtue of Section 7 of the Companies Act, Cap. 50, the following are deemed to be interested in the shares held by YHS Investments Pte Ltd: (a) Yeo Hiap Seng Limited (b) Far East Organisation Pte. Ltd. (c) Mr Ng Teng Fong, Deceased (d) Madam Tan Kim Choo @ Teng Kim Choo

(5) The Capital Group Companies, Inc is deemed to be interested in the shares held by DBS Nominees Pte Ltd.


shareholoDers’ information as at 12 March 2013 (cont’d)

TWENTY LARGEST SHAREHOLDERS

No. Name No. of Shares %

1 DBS Nominees Pte Ltd 88,931,582 15.952 Citibank Nominees Singapore Pte Ltd 88,684,054 15.913 Te Lay Hoon 67,596,125 12.124 Teo Kee Bock 65,367,375 11.725 YHS Investment Pte Ltd 65,105,648 11.686 Te Kok Chiew 51,824,625 9.307 Tee Yih Jia Food Manufacturing Pte Ltd 26,319,000 4.728 Goi Seng Hui 19,070,908 3.429 HSBC (Singapore) Nominees Pte Ltd 15,788,381 2.8310 DBSN Services Pte Ltd 12,115,400 2.1711 Te Lay Guat 8,530,696 1.5312 United Overseas Bank Nominees Pte Ltd 6,969,500 1.2513 BNP Paribas Securities Services 3,677,000 0.6614 Teo Sze Hwee Elaine 2,677,000 0.4815 Raffles Nominees Pte Ltd 2,634,357 0.4716 Khoo Tow Kiew 2,585,000 0.4617 Teh Kiu Cheong 2,144,000 0.3818 Sharon Teo Siow Hwee (Sharon Zhang XiaoHui) 2,091,000 0.3819 DB Nominees(S) Pte Ltd 1,443,230 0.2620 Morgan Stanley Asia (Singapore) Securities Pte Ltd 1,035,544 0.19

Total 534,590,425 95.88

PERCENTAGE OF SHAREHOLDING IN PUBLIC’S HANDS

Approximately 26.89% of the Company’s shares are held in the hands of public. Accordingly, the Company has complied with Rule 723 of the Listing Manual of the SGX-ST.

144 A NEW ERA

notiCe of annual General meetinG

SUPER GROUP LTD.(Company Registration No. 199101696K) (Incorporated in Singapore with limited liability)

NOTICE IS HEREBY GIvEN that the Annual General Meeting of Super Group Ltd. (“the Company”) will be held at 2 Senoko South Road, Super Industrial Building, Singapore 758096 on Friday, 26 April 2013 at 10.30 a.m. for the following purposes:

AS ORDINARY BUSINESS

1. To receive and adopt the Directors’ Report and the Audited Accounts of the Company for the year ended 31 December 2012 together with the Auditors’ Report thereon. (Resolution 1)

2. To declare a 2nd and final dividend of 5.1 cents per ordinary share (tax-exempt, 1-tier) for the year ended 31 December 2012

(2011: 3.8 cents per ordinary share (tax-exempt, 1-tier)). (Resolution 2)

3. To re-elect the following Directors of the Company retiring pursuant to Article 88 of the Articles of Association of the Company: Mr Goi Seng Hui (Resolution 3) Mr Te Kok Chiew (Resolution 4) Mr Li Kang @ Charles K Li (Resolution 5) Mr Ko Chuan Aun (Resolution 6)

Mr Te Kok Chiew will, upon re-election as a Director of the Company, remain as a member of the Remuneration Committee and will be considered non-independent.

Mr Ko Chuan Aun will, upon re-election as a Director of the Company, remain as a member of the Audit Committee and will be considered independent.

4. To re-appoint the following Directors of the Company retiring under Section 153(6) of the Companies Act, Cap. 50, to hold office from the date of this Annual General Meeting until the next Annual General Meeting of the Company:

Mr Goh Boon Kok (Resolution 7) Mr Chandra Das S/O Rajagopal Sitaram (Resolution 8)

[See Explanatory Note (i)]

Mr Goh Boon Kok will, upon re-appointment as a Director of the Company, remain as Chairman of the Audit Committee and member of the Nominating and Remuneration Committees and will be considered independent.

5. To approve the payment of Directors’ fees of S$550,000 for the year ended 31 December 2012 (2011: S$540,000). (Resolution 9)

6. To appoint Messrs KPMG LLP as Auditors of the Company in place of the retiring Auditors, Messrs Ernst & Young LLP and to authorise the Directors of the Company to fix their remuneration. [See Explanatory note (ii)] (Resolution 10)

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



AS SPECIAL BUSINESS

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

8. Authority to issue new shares

That pursuant to Section 161 of the Companies Act, Cap. 50 and Rule 806 of the Listing Manual of the Singapore Exchange Securities Trading Limited, the Directors of the Company be authorised and empowered to:

(a) (i) issue shares in the Company (“shares”) whether by way of rights, bonus or otherwise; and/or

(ii) make or grant offers, agreements or options (collectively, “Instruments”) that might or would require shares to be issued, including but not limited to the creation and issue of (as well as adjustments to) options, warrants, debentures or other instruments convertible into shares,

at any time and upon such terms and conditions and for such purposes and to such persons as the Directors of the Company may in their absolute discretion deem fit; and

(b) (notwithstanding the authority conferred by this Resolution may have ceased to be in force) issue shares in pursuance of any Instruments made or granted by the Directors of the Company while this Resolution was in force,

provided that:

(1) the aggregate number of shares (including shares to be issued in pursuance of the Instruments, made or granted pursuant to this Resolution) to be issued pursuant to this Resolution shall not exceed fifty per centum (50%) of the total number of issued shares (excluding treasury shares) in the capital of the Company (as calculated in accordance with sub-paragraph (2) below), of which the aggregate number of shares to be issued other than on a pro rata basis to shareholders of the Company shall not exceed twenty per centum (20%) of the total number of issued shares (excluding treasury shares) in the capital of the Company (as calculated in accordance with sub-paragraph (2) below);

(2) (subject to such calculation as may be prescribed by the Singapore Exchange Securities Trading Limited) for the purpose of determining the aggregate number of shares that may be issued under sub-paragraph (1) above, the total number of issued shares (excluding treasury shares) shall be based on the total number of issued shares (excluding treasury shares) in the capital of the Company at the time of the passing of this Resolution, after adjusting for:

(a) new shares arising from the conversion or exercise of any convertible securities;

(b) new shares arising from exercising share options or vesting of share awards which are outstanding or subsisting at the time of the passing of this Resolution; and

(c) any subsequent bonus issue, consolidation or subdivision of shares;

(3) in exercising the authority conferred by this Resolution, the Company shall comply with the provisions of the Listing Manual of the Singapore Exchange Securities Trading Limited for the time being in force (unless such compliance has been waived by the Singapore Exchange Securities Trading Limited) and the Articles of Association of the Company; and

(4) unless revoked or varied by the Company in a general meeting, such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company is required by law to be held, whichever is earlier.

[See Explanatory Note (iii)] (Resolution 11)

146 A NEW ERA


9. Authority to issue shares under the Super Group Share Award Scheme

That pursuant to Section 161 of the Companies Act, Cap 50, the Directors be authorised to grant awards in accordance with the provisions of the prevailing Super Group Share Award Scheme (the “Share Award Scheme”) and to issue, transfer and/or deliver from time to time such number of fully paid-up shares as may be required to be issued and delivered pursuant to the vesting of the awards under the Share Award Scheme, provided that the aggregate number of shares to be issued or delivered pursuant to the Share Award Scheme and pursuant to all other share option or other share schemes of the Company, if applicable, shall not exceed 15 per centum (15%) of the total number of issued shares of the Company (excluding treasury shares) in the share capital of the Company from time to time and that such authority shall, unless revoked or varied by the Company in a general meeting, continue in force until the conclusion of the next Annual General Meeting of the Company or the date by which the next Annual General Meeting of the Company is required by law to be held, whichever is earlier.[See Explanatory Note (iv)] (Resolution 12)

10. Renewal of Share Purchase Mandate

That for the purposes of Sections 76C and 76E of the Companies Act, Cap. 50, the Directors of the Company be and are hereby authorised to make purchases or otherwise acquire issued shares in the capital of the Company from time to time (whether by way of market purchases or off-market purchases on an equal access scheme) of up to 2.5% of the total number of issued shares (excluding treasury shares) in the capital of the Company (as ascertained as at the date of Annual General Meeting of the Company) at the price of up to but not exceeding the Maximum Price (as defined in the Letter to Shareholders dated 10 April 2013 as attached), and this mandate shall, unless revoked or varied by the Company in general meeting, continue in force until the earliest of (i) the date on which the next Annual General Meeting of the Company is held or required by law to be held; or (ii) the date on which the share purchases are carried out to the full extent mandated; or (iii) the time when the authority conferred by this mandate is revoked or varied by Shareholders in general meeting. [See Explanatory Note (v)] (Resolution 13)

By Order of the Board

Tan Cher LiangSecretarySingapore, 10 April 2013



Explanatory Notes:

(i) The effect of the Resolutions 7 and 8 proposed in item 4 above, are to re-appoint Directors of the Company who are over 70 years of age.

(ii) Resolution 10 in item 6 is to approve the appointment of Messrs KPMG LLP (“KPMG LLP”) as external Auditors in place of retiring Auditors, Messrs Ernst & Young LLP (“E&Y LLP”) and to authorise the Directors of the Company to fix their remuneration.

E&Y LLP, the retiring Auditors have served as the external auditors for the Company since 2006. As part of ongoing good corporate governance initiatives, the Board and Audit Committee are of the view that the external auditors should be rotated and would like to propose that KMPG LLP be appointed in place of E&Y LLP for the financial year ending 31 December 2013.

KPMG LLP is a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. KPMG International is one of the largest professional services networks and globally recognised as one of the “Big Four” audit firms, providing audit, tax and advisory services. KPMG International’s member firms employ more than 145,000 people across a range of disciplines in 152 countries.

Ms Teo Han Jo will be the audit partner in charge of the Company’s audit for the financial year ending 31 December 2013 upon KPMG LLP’s appointment. Ms Teo Han Jo, the partner-in-charge in KPMG Singapore, is a practicing member of the Institute of Certified Public Accountants of Singapore and a public accountant approved by the Accounting and Corporate Regulatory Authority (ACRA). She has more than 15 years of auditing experiences and has the relevant experiences in audit engagements covering food and beverages multinational and local clients.

The proposed change of auditors have been reviewed and recommended by the Audit Committee, after taking into consideration the suitability of KPMG LLP as the Company’s external auditors and ensuring compliance with the Listing Manual.

The Directors have taken into account the Audit Committee’s recommendation, and have considered various factors, including the adequacy of the resources of KPMG LLP, their experience and audit engagements, the number and experience of the supervisory and professional staff who will be assigned to the audit of the consolidated accounts and KPMG LLP’s proposed audit arrangements for the Group, and are of the opinion that KPMG LLP will be able to meet the audit requirements of the Group and that Rule 712(1) of the Listing Manual has been complied with. Subject to the passing of this resolution at the Annual General Meeting, Rule 715 of the Listing Manual will be complied with accordingly and the Directors confirmed that KPMG LLP will be appointed to audit the accounts of the Company, its Singapore and foreign-incorporated subsidiaries and its Singapore and foreign-incorporated significant associated companies. The Directors have obtained the written consent from KPMG LLP on 19 March 2013 to act as Auditors in place of E&Y LLP for the financial year ending 31 December 2013, subject to shareholders’ approval. Having considered the rationale and benefit of the proposed change of auditors, the Directors are of the opinion that the proposed change of auditors is in the best interests of the Company. Accordingly, the Directors recommend that the Shareholders to vote in favour of the Resolution 10 for the proposed change of auditors. In connection with the proposed change of auditors, E&Y LLP has confirmed to KPMG LLP that it is not aware of any professional reasons why KPMG LLP should not accept appointment as Auditors of the Company.

In accordance with the requirements of Rule 1203(5) of the Listing Manual, the Company confirms the following:

(a) that there were no disagreements with the outgoing Auditors, E&Y LLP on accounting treatments within the last 12 months;

(b) that is not aware of any circumstances connected with the proposed change of Auditors that should be brought to the attention of the shareholders of the Company; and

(c) the specific reasons for the proposed change of Auditors are as disclosed above.

148 A NEW ERA


The Directors collectively and individually accept full responsibility for the accuracy of the information given in this Notice and confirm after making all reasonable enquiries that, to the best of their knowledge and belief, this Notice constitutes full and true disclosure of all material facts about the proposed change of auditors, the Company and the Directors are not aware of any facts the omission of which would make any statement in this Notice misleading.

Where information in the Notice has been extracted from published or otherwise publicly available sources or obtained from a named source, the sole responsibility of the Directors has been to ensure that such information has been accurately and correctly extracted from those sources and/or reproduced in the Notice in its proper form and context.

The Directors wish to express their appreciation for the past services rendered by E&Y LLP.

Pursuant to Section 205 of the Companies Act, Cap 50, a copy of the notice of nomination of the proposed new Auditors dated 27 February 2013 is enclosed as Appendix I in this Annual Report.

(iii) Resolution 11 in item 8 above, if passed, will empower the Directors of the Company, effective until the conclusion of the next Annual General Meeting of the Company, or the date by which the next Annual General Meeting of the Company is required by law to be held or such authority is varied or revoked by the Company in a general meeting, whichever is the earlier, to issue shares, make or grant Instruments convertible into shares and to issue shares pursuant to such Instruments, up to a number not exceeding, in total, 50% of the total number of issued shares (excluding treasury shares) in the capital of the Company, of which up to 20% may be issued other than on a pro-rata basis to shareholders.

For determining the aggregate number of shares that may be issued, the total number of issued shares (excluding treasury shares) will be calculated based on the total number of issued shares (excluding treasury shares) in the capital of the Company at the time this Ordinary Resolution is passed after adjusting for new shares arising from the conversion or exercise of any convertible securities or share options or vesting of share awards which are outstanding or subsisting at the time when this Ordinary Resolution is passed and any subsequent bonus issue, consolidation or subdivision of shares.

(iv) The Ordinary Resolution 12 proposed in item 9 above, if passed, will empower the Directors of the Company from the date of the above Meeting until the next Annual General Meeting, to grant awards under the Share Award Scheme in accordance with the provisions of the Share Award Scheme and to issue or transfer from time to time such number of fully-paid shares pursuant to the vesting of the awards under the Share Award Scheme subject to the maximum number of shares prescribed under the terms and conditions of the Share Award Scheme. The aggregate number of ordinary shares which may be issued pursuant to the Share Award Scheme, all other share option scheme and any other share scheme is limited to 15% of the total issued share capital (excluding treasury shares) of the Company from time to time.

(v) The Ordinary Resolution 13 proposed in item 10 above, if passed, will empower the Directors of the Company from the date of the above Meeting until the earliest of (i) the date on which the next Annual General Meeting of the Company is held or required by law to be held; or (ii) the date on which the share purchases are carried out to the full extent mandated; or (iii) the time when the authority conferred by this mandate is revoked or varied by Shareholders in general meeting, to repurchase ordinary shares of the Company by way of market purchases or off-market purchases of up to 2.5% of the total number of issued shares (excluding treasury shares) in the capital of the Company at the Maximum Price (as defined in the Letter to Shareholders attached). The rationale for, the authority and limitation on, the sources of funds to be used for the purchase or acquisition, including the amount of financing and financial effects of the purchase or acquisition of ordinary shares by the Company pursuant to the Share Purchase Mandate on the audited consolidated financial accounts of the Group for the financial year ended 31 December 2012 are set out in greater detail in the Letter to Shareholders dated 10 April 2013 attached to this Annual Report.

Notes:

1. A Member entitled to attend and vote at the Annual General Meeting (the “Meeting”) is entitled to appoint not more than two proxies to attend and vote in his/her stead. A proxy need not be a Member of the Company.

2. The instrument appointing a proxy must be deposited at the Registered Office of the Company at 2 Senoko South Road, Super Industrial Building, Singapore 758096 not less than forty-eight (48) hours before the time appointed for holding the Meeting.


appenDix I

NOTICE OF NOMINATION

Te Kok Chiew71 Neram RoadSingapore 807769 27 February 2013

The Board of DirectorsSUPER GROUP LTD.2 Senoko South RoadSuper Industrial BuildingSingapore 758096

Dear SirsPursuant to Section 205 of the Companies Act, Cap. 50, I, Te Kok Chiew, holder of NRIC no. S1195762E, being a shareholder of the Company, hereby nominate KPMG LLP of 16 Raffles Quay #22-00, Hong Leong Building, Singapore 048581 for appointment as auditors of the Company in place of the retiring auditors, Messrs Ernst & Young LLP, at the forthcoming annual general meeting of the Company.

Yours faithfully

Te Kok Chiew

150 A NEW ERA

SUPER GROUP LTD.Company Registration No. 199101696K(Incorporated In The Republic of Singapore)

proxy form(Please see notes overleaf before completing this Form)

I/We,

of

being a member/members of SUPER GROUP LTD. (the “Company”), hereby appoint:

Name NRIC/Passport No. Proportion of ShareholdingsNo. of Shares %

Address

and/or (delete as appropriate)

Name NRIC/Passport No. Proportion of ShareholdingsNo. of Shares %

Address

or failing the person, or either or both of the persons, referred to above, the Chairman of the Meeting or such other person the Chairman of the Meeting may designate as *my/our proxy/proxies to vote for me/us on my/our behalf at the Annual General Meeting (the “Meeting”) of the Company to be held at 2 Senoko South Road, Super Industrial Building, Singapore 758096 on Friday, 26 April 2013 at 10.00 a.m. and at any adjournment thereof. *I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at the Meeting as indicated hereunder. If no specific direction as to voting is given or in the event of any other matter arising at the Meeting and at any adjournment thereof, the proxy/proxies will vote or abstain from voting at *his/her discretion. The authority herein includes the right to demand or to join in demanding a poll and to vote on a poll.

(please indicate your vote “for” or “against” with a tick [] within the box provided.)

No. Resolutions relating to: For Against1 Directors’ Report and Audited Accounts for the year ended 31 December 20122 Payment of proposed 2nd and final dividend3 Re-election of Mr Goi Seng Hui as a Director4 Re-election of Mr Te Kok Chiew as a Director5 Re-election of Mr Li Kang @ Charles K Li as a Director6 Re-election of Mr Ko Chuan Aun as a Director7 Re-appointment of Mr Goh Boon Kok as a Director8 Re-appointment of Mr Chandra Das S/O Rajagopal Sitaram as a Director9 Approval of Directors’ fees amounting to S$550,000

10 Appointment of Messrs KPMG LLP as Auditors in place of retiring Auditors, Messrs Ernst & Young LLP 11 Authority to issue new shares12 Authority to issue shares under the Super Group Share Award Scheme13 Renewal of Share Purchase Mandate

Dated this day of 2013

Total number of Shares in: No. of Shares(a) CDP Register

Signature of Shareholder(s) (b) Register of Membersor, Common Seal of Corporate Shareholder * Delete where inapplicable

IMPORTANT:

1. For investors who have used their CPF monies to buy SUPER GROUP LTD.’s shares, this Report is forwarded to them at the request of the CPF Approved Nominees and is sent solely FOR INFORMATION ONLY.

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

3. CPF investors who wish to attend the Meeting as an observer must submit their requests through their CPF Approved Nominees within the time frame specified. If they also wish to vote, they must submit their voting instructions to the CPF Approved Nominees within the time frame specified to enable them to vote on their behalf.

Notes:

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

2. A member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies to attend and vote in his/her stead. A proxy need not be a member of the Company.

3. Where a member appoints two proxies, he/she shall specify the proportion of his/her shareholder (expressed as a percentage of the whole) to be represented by each proxy. If no such proportion is specified, the first named proxy shall be treated as representing 100% of the shareholding and any second named proxy as an alternate to the first named proxy.

4. Completion and return of this instrument appointing a proxy shall not preclude a member from attending and voting at the Meeting. Any appointment of a proxy or proxies shall be deemed to be revoked if a member attends the meeting in person, and in such event, the Company reserves the right to refuse to admit any person or persons appointed under the instrument of proxy to the Meeting.

5. The instrument appointing a proxy or proxies must be deposited at the registered office of the Company at 2 Senoko South Road, Super Industrial Building, Singapore 758096 not less than 48 hours before the time appointed for the Meeting.

6. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its seal or under the hand of an officer or attorney duly authorised. Where the instrument appointing a proxy or proxies is executed by an attorney on behalf of the appointor, the letter or power of attorney or a duly certified copy thereof must be lodged with the instrument.

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

General:

The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible, or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the instrument appointing a proxy or proxies. In addition, in the case of Shares entered in the Depository Register, the Company may reject any instrument appointing a proxy or proxies lodged if the member, being the appointor, is not shown to have Shares entered against his name in the Depository Register as at 48 hours before the time appointed for holding the Meeting, as certified by The Central Depository (Pte) Limited to the Company.

Super InduStrIalbuIldIng

Chap Hup Chong Food Industries

Everich

Tee Yih JiaBLDG

West Admiralty Rd

Seno

ko S

outh

Rd

Senoko South Rd

Kwong On Cheong

Food Industries

SumitomoBakelite

RoyalFood

Metal ComponentEngineering

Kong Hwee Iron

Works & Contruction

Singapore Storage &

Warehouse

Sin Hwa Dee Foodstuff Industries

2 Senoko South RoadSuper Industrial Building

Singapore 758096Tel: (65) 6753 3088Fax: (65) 6753 7833

Website: www.supergroupltd.comEmail: [email protected]

A N E W E R AS U P E R G R O U P LT D • A N N UA L R E P O R T 2 0 1 2

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AR2013

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Transcript of AR2013