Ann ual Repor t Eu Yan Sang International Ltd and Subsidiary ...
Ann ual Repor t Eu Yan Sang International Ltd and Subsidiary ...
Ann ual Repor t Eu Yan Sang International Ltd and Subsidiary ...
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30 June 2000<br />
Director’s <strong>Repor</strong>t <strong>and</strong><br />
Audited Financial Statements<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong><br />
<strong>Subsidiary</strong> Companies<br />
14 Director’s <strong>Repor</strong>t <strong>and</strong> Audited Financial<br />
Statements<br />
15-19 <strong>Repor</strong>t of the Directors<br />
20 Statement by Directors Pursuant to<br />
Section 201(15)<br />
21 Auditor’s <strong>Repor</strong>t to the Members of<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong><br />
22 Profit <strong>and</strong> Loss Accounts for the year<br />
ended 30 June 2000<br />
23 Balance Sheets as at 30 June 2000<br />
24-25 Consolidated Statement of Cash Flows<br />
for the year ended 30 June 2000<br />
25-41 Notes to the Financial Statements -<br />
30 June 2000<br />
42 Proforma Group Profit <strong>and</strong> Loss Account<br />
for the year ended 30 June 2000<br />
43-56 Notes to the Proforma Group Financial<br />
Statements - 30 June 2000<br />
13<br />
2<br />
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<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Directors’ <strong>Repor</strong>t <strong>and</strong> Audited Financial Statements<br />
Directors<br />
Joseph William Yee <strong>Eu</strong> (Chairman)<br />
Richard <strong>Eu</strong> Yee Ming (Managing Director)<br />
Clifford <strong>Eu</strong> Yee Fong (Executive Director)<br />
Alan Leung Sze Yuan (appointed on 17.4.2000)<br />
Robert James <strong>Eu</strong> Yee <strong>Sang</strong><br />
David Yeh Chung Woo (appointed on 7.7.2000)<br />
Dr Jennifer Lee Gek Choo (appointed on 7.7.2000)<br />
Dr David <strong>Eu</strong> Yee Tat (alternate to Richard <strong>Eu</strong> Yee Ming)<br />
Laurence <strong>Eu</strong> Yee Lye (alternate to Clifford <strong>Eu</strong> Yee Fong)<br />
Alex<strong>and</strong>er Thomson (resigned on 28.2.2000)<br />
Alfredo Antonio Imperial Ayala (resigned on 28.2.2000)<br />
Secretaries<br />
Clifford <strong>Eu</strong> Yee Fong<br />
Yvonne Choo (appointed on 12.6.2000)<br />
Linda Law (appointed on 12.6.2000)<br />
Registered Office<br />
269A South Bridge Road<br />
Singapore 058818<br />
Auditors<br />
Ernst & Young<br />
Daniel Soh Chung Hian<br />
Audit Partner<br />
Principal Bankers<br />
Overseas Union Bank<br />
Development Bank of Singapore<br />
Public Bank Berhad
<strong>Repor</strong>t of the Directors<br />
The directors have pleasure in presenting their report together with the audited financial statements<br />
of the Company <strong>and</strong> of the Group for the year ended 30 June 2000.<br />
Change of name<br />
On 6 July 2000, the Company was converted into a public limited company <strong>and</strong> changed its name<br />
from <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> Holdings Pte <strong>Ltd</strong> to <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong>. The Company was<br />
admitted to the official list of the Singapore Exchange Securities Trading Limited (“SGX-ST”) on 28<br />
July 2000.<br />
Principal activities<br />
The principal activities of the Company are investment holding <strong>and</strong> the provision of management<br />
services to its subsidiary companies. The subsidiary companies invest in properties, act as commission<br />
agents for all kinds of pharmaceutical products <strong>and</strong> are engaged in the manufacturing, distribution<br />
<strong>and</strong> sale of traditional Chinese, Western <strong>and</strong> other medicines.<br />
There have been no significant changes in the nature of these activities during the year.<br />
Results for the financial year<br />
Group Company<br />
$’000 $’000<br />
Profit after taxation 2,215 772<br />
Transferred from revenue reserve – 345<br />
Dividends proposed, less tax (1,117) (1 ,117)<br />
Transferred to revenue reserve 1,098 –<br />
In the opinion of the directors, the results of the operations of the Company <strong>and</strong> of the Group during<br />
the financial year have not been affected by any item, transaction or event of a material <strong>and</strong><br />
unus<strong>ual</strong> nature.<br />
Material transfer to/from reserves <strong>and</strong> provisions<br />
Detailed movement of reserves are shown in Note 25 to the financial statements. Apart from these<br />
movements, there have been no material transfers to <strong>and</strong> from reserves or provisions except for<br />
normal amounts set aside for such items as depreciation of fixed assets, provision for doubtful debts,<br />
stock obsolescence <strong>and</strong> income tax as disclosed in the financial statements.<br />
Dividend<br />
(a) During the year a final dividend of 0.5%, less tax of 26%, amounting to $38,587 in respect of the<br />
previous year as proposed in the <strong>Repor</strong>t of the Directors of that year was paid.<br />
(b) The directors propose a first <strong>and</strong> final dividend of 10.5%, less tax of 25.5% amounting to $1,117,339<br />
be paid in respect of the year under review.<br />
See note 7 to the financial statements.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
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<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
<strong>Repor</strong>t of the Directors<br />
Share capital<br />
No shares were issued by the Company during the year.<br />
Subsequent to the financial year, the Company :<br />
(i) increased its authorised shares capital from $40,000,000, comprising 400,000,000 ordinary shares<br />
of $0.10 each, to $80,000,000 comprising 800,000,000 ordinary shares of $0.10 each by creating<br />
additional 400,000,000 ordinary shares of $0.10 each;<br />
(ii) issued 2,798,570 new ordinary shares of $0.10 each at par in consideration for the acquisition of<br />
Essence Holdings Limited pursuant to the Restructuring Exercise, as described in the following<br />
section;<br />
(iii) subdivided each of the ordinary shares of $0.10 each in the authorised <strong>and</strong> issued share capital<br />
of the Company into 2 ordinary shares of $0.05 each; <strong>and</strong><br />
(iv) issued 71,500,000 new ordinary shares of $0.05 each at a premium of $0.30 each pursuant to an<br />
initial public offering exercise.<br />
During the financial year, its subsidiary company, <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> Marketing Private Limited issued 9,998<br />
ordinary shares of $1.00 each at par for cash to provide additional working capital.<br />
Acquisition <strong>and</strong> disposal of subsidiary companies<br />
During the financial year, <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (Singapore) Private Limited subscribed for 1998 ordinary shares<br />
of $1.00 each issued by EYS Ventures Pte <strong>Ltd</strong> at par for cash <strong>and</strong> acquired the remaining two ordinary<br />
shares from the existing shareholders of EYS Ventures Pte <strong>Ltd</strong> at $22 per ordinary share, making EYS<br />
Ventures Pte <strong>Ltd</strong> a wholly-owned subsidiary company of the Group. The net tangible assets of EYS<br />
Ventures Pte <strong>Ltd</strong> prior to the subscription of its ordinary shares by <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (Singapore) Private<br />
Limited is $45,378.<br />
There were no disposal of subsidiary companies during the financial year.<br />
The Restructuring Exercise<br />
Subsequent to the financial year, pursuant to a Restructuring Exercise undertaken on 3 July 2000, the<br />
Company acquired 63,804,085 ordinary shares of HK$1.00 each in Essence Holding Limited (“Essence”)<br />
from the other shareholders of Essence. The purchase consideration for Essence was computed<br />
based on its audited Group net asset value of HK$1,303,546 as at 29 February 2000 <strong>and</strong> taking into<br />
account the 2,011,784 ordinary shares of Essence which were already held by the Company. The<br />
purchase consideration was satisfied by the allotment <strong>and</strong> issue of 2,798,570 new ordinary shares of<br />
$0.10 each at par to the other shareholders of Essence.<br />
On 10 July 2000, Essence was put into members’ voluntary liquidation. Upon completion of its<br />
liquidation on 14 September 2000, all its assets were distributed in specie to the Company. <strong>Subsidiary</strong><br />
companies acquired by the Company pursuant to the restructuring exercise are as follows :<br />
Name of companies<br />
Interest<br />
acquired<br />
%<br />
Essence Holdings Limited (Liquidation on 14 September 2000) 100<br />
<strong>Eu</strong> <strong>Yan</strong>g <strong>Sang</strong> (Hong Kong) Limited 100<br />
Synco (H.K.) Limited 100<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (China Ventures) Limited 100<br />
Top Lot Limited 100<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (Properties) Limited 100<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (Export) Limited 100
<strong>Repor</strong>t of the Directors<br />
Directors of the company<br />
The names of the directors of the Company in office at the date of this report are :-<br />
Joseph William Yee <strong>Eu</strong> (Chairman)<br />
Richard <strong>Eu</strong> Yee Ming (Managing Director)<br />
Clifford <strong>Eu</strong> Yee Fong (Executive Director)<br />
Alan Leung Sze Yuan (appointed on 17.4.2000)<br />
Robert James <strong>Eu</strong> Yee <strong>Sang</strong><br />
David Yeh Chung Woo (appointed on 7.7.2000)<br />
Dr Jennifer Lee Gek Choo (appointed on 7.7.2000)<br />
Dr David <strong>Eu</strong> Yee Tat (alternate to Richard <strong>Eu</strong> Yee Ming)<br />
Laurence <strong>Eu</strong> Yee Lye (alternate to Clifford <strong>Eu</strong> Yee Fong)<br />
The following directors who held office at the end of the financial year had, according to the register<br />
required to be kept under Section 164 of the Companies Act, Cap. 50, an interest in shares of the<br />
Company, as stated below :-<br />
Held in the name of director Deemed interest<br />
At the At the<br />
beginning beginning<br />
of the year/ of the year/<br />
at date of At the end At at date of At the end At<br />
appointment of the year 21.7.00 appointment of the year 21.7.00<br />
Shares of Shares of Shares of Shares of Shares of Shares of<br />
Name of director $0.10 each $0.10 each $0.05 each $0.10 each $0.10 each $0.05 each<br />
Richard <strong>Eu</strong> Yee Ming<br />
Joseph William<br />
6,671,235 12,085,206 8,990,069 17,638,000 21,908,183 62,156,366<br />
Yee <strong>Eu</strong> 4,257,364 5,288,076 10,859,964 – – –<br />
Clifford <strong>Eu</strong> Yee Fong 573,150 4,510,773 2,595 25,870,204 32,133,407 71,016,814<br />
Dr David <strong>Eu</strong> Yee Tat – – – 17,638,000 21,908,183 43,816,366<br />
Laurence <strong>Eu</strong> Yee Lye<br />
Robert James <strong>Eu</strong><br />
– – – 25,870,204 32,133,407 64,266,814<br />
Yee <strong>Sang</strong> – – – 8,613,087 10,698,324 21,970,828<br />
David Yeh Chung Woo – – – – – 5,665,526<br />
Pursuant to an Option agreement dated 7 July 2000, Richard <strong>Eu</strong> Yee Ming granted an Option (“the<br />
Option”) to Alan Leung Sze Yuan to purchase a total of 5,022,086 shares of $0.05 each. The Option is<br />
exercisable in full or in part during the period commencing six months from the date of admission of<br />
the Company to the Main Board of the SGX-ST <strong>and</strong> ending upon the expiry of six months from the<br />
commencement date.<br />
No other directors who held office at the end of the financial year had an interest in shares or<br />
debentures of the Company, or any of the subsidiary companies of the Company. By virtue of<br />
Section 7 of the Companies Act, Cap. 50, Richard <strong>Eu</strong> Yee Ming, Clifford <strong>Eu</strong> Yee Fong, <strong>and</strong> Laurence<br />
<strong>Eu</strong> Yee Lye are deemed to have interest in the subsidiary companies of the Company.<br />
Since the previous financial year, no director has received or has become entitled to receive benefits<br />
under contracts required to be disclosed by Section 201(8) of the Companies Act, Cap. 50 except<br />
those disclosed in the financial statements.<br />
Neither at the end of the financial year, nor at any time during that year, did there subsist any<br />
arrangements, to which the Company is a party, whereby directors might acquire benefits by means<br />
of the acquisition of shares in, or debentures of, the Company or any other body corporate.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
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2<br />
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<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
<strong>Repor</strong>t of the Directors<br />
Audit Committee<br />
The Audit Committee which was formed on 8 July 2000, comprises 3 members. The members of the<br />
Audit Committee at the date of this report are :<br />
Dr Jennifer Lee Gek Choo (Chairman)<br />
David Yeh Chung Woo<br />
Clifford <strong>Eu</strong> Yee Fong<br />
The Audit Committee has reviewed the financial statements of the Group <strong>and</strong> the Company <strong>and</strong><br />
the auditors’ report thereon before their submission to the Board of Directors.<br />
The Audit Committee shall carry out its functions <strong>and</strong> duties as specified in the Companies Act, Cap.<br />
50, the Listing Man<strong>ual</strong> of the Singapore Exchange Securities Trading Limited (SGX-ST) <strong>and</strong> the Best<br />
Practice Guide for the subsequent financial year.<br />
The Committee has recommended to the Board of Directors the nomination of Ernst & Young for<br />
re-appointment as auditors of the Company at the forth coming <strong>Ann</strong><strong>ual</strong> General Meeting.<br />
Employee Share Option Scheme<br />
The <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> Employee Share Option Scheme (“ESOS”) was approved by the shareholders at an<br />
Extraordinary General Meeting held on 3 July 2000. The ESOS will be granted to executive directors,<br />
executives, <strong>and</strong> other employees of the Group <strong>and</strong> associated companies.<br />
Under the ESOS, the options will be granted at the average of the last dealt prices for the shares on<br />
the SGX-ST for the 10 consecutive market days immediately preceding the relevant date of grant for<br />
which there was trading in the shares on the SGX-ST or at a discount of not more than 20% of the<br />
market value.<br />
The ESOS will be administered by a committee comprising Richard <strong>Eu</strong> Yee Ming, Dr Jennifer Lee Gek<br />
Choo <strong>and</strong> David Yeh Chung Woo, all of whom are directors of the Company. The committee has<br />
power to determine, inter alia, the persons to be granted options, the number of shares to be offered<br />
by way of options, the amount of discount to be given <strong>and</strong> recommendations for modifications to<br />
the ESOS. The Committee, in granting options, shall be at liberty to take into consideration factors<br />
including, but not limited to, rank <strong>and</strong> performance of the employees.<br />
At the end of the financial year, no options has been granted pursuant to ESOS.<br />
Asset values<br />
Before the profit <strong>and</strong> loss account <strong>and</strong> balance sheet of the Company were made out, the directors<br />
took reasonable steps to ascertain that :-<br />
(a) proper action had been taken in relation to the writing off of bad debts <strong>and</strong> the making of<br />
provision for doubtful debts <strong>and</strong> have satisfied themselves that all known bad debts had been<br />
written off <strong>and</strong> that adequate provision had been made for doubtful debts; <strong>and</strong><br />
(b) any current assets which were unlikely to realise their book value in the ordinary course of business<br />
were written down to an amount which they might be expected so to realise.<br />
At the date of this report, the directors are not aware of any circumstances which would render :-<br />
(a) the amount written off for bad debts or the amount of the provision for doubtful debts in the<br />
financial statements of the Group inadequate to any substantial extent; <strong>and</strong><br />
(b) the values attributed to current assets in the financial statements of the Group misleading.
<strong>Repor</strong>t of the Directors<br />
Charges <strong>and</strong> contingent liabilities<br />
Since the end of the financial year, no charge on the assets of the Company or any company in the<br />
Group has arisen which secures the liabilities of any other person.<br />
Since the end of the financial year no contingent liability of the Company or any company in the<br />
Group has arisen, other than those disclosed in the notes to the financial statements.<br />
No contingent or other liability of the Company or any company in the Group has become<br />
enforceable or is likely to become enforceable within the period of twelve months after the end of<br />
the financial year which, in the opinion of the directors, will or may substantially affect the ability of<br />
the Company <strong>and</strong> of the Group to meet their obligations as <strong>and</strong> when they fall due.<br />
Other circumstances affecting the financial statements<br />
At the date of this report, the directors are not aware of any circumstances not otherwise dealt with<br />
in this report or the financial statements of the Company <strong>and</strong> of the Group which would render any<br />
amount stated in the financial statements of the Company <strong>and</strong> the Group misleading.<br />
Unus<strong>ual</strong> items after the financial year<br />
In the opinion of the directors, no item, transaction or event of a material <strong>and</strong> unus<strong>ual</strong> nature has<br />
arisen in the interval between the end of the financial year <strong>and</strong> the date of this report which would<br />
affect substantially the results of the operations of the Company or of the Group for the financial<br />
year in which this report is made.<br />
Auditors<br />
The auditors, Ernst & Young, Certified Public Accountants, have expressed their willingness to accept<br />
re-appointment.<br />
On behalf of the Board,<br />
Richard <strong>Eu</strong> Yee Ming<br />
Director<br />
Clifford <strong>Eu</strong> Yee Fong<br />
Director<br />
Singapore<br />
26 September 2000<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
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<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
20<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Statement by Directors Pursuant to Section 201(15)<br />
We, Richard <strong>Eu</strong> Yee Ming <strong>and</strong> Clifford <strong>Eu</strong> Yee Fong, being two of the directors of <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong><br />
<strong>International</strong> <strong>Ltd</strong>, do hereby state that, in the opinion of the directors :<br />
(i) the balance sheets, profit <strong>and</strong> loss accounts <strong>and</strong> consolidated statement of cash flows together<br />
with the notes thereto, set out on pages 22 to 41 are drawn up so as to give a true <strong>and</strong> fair view<br />
of the state of affairs of the Company <strong>and</strong> of the Group as at 30 June 2000; <strong>and</strong> of the results of<br />
the Company <strong>and</strong> of the Group, <strong>and</strong> cash flows of the Group, for the year ended 30 June 2000;<br />
<strong>and</strong><br />
(ii) at the date of this statement there are reasonable grounds to believe that the Company will be<br />
able to pay its debts as <strong>and</strong> when they fall due.<br />
On behalf of the Board,<br />
Richard <strong>Eu</strong> Yee Ming<br />
Director<br />
Clifford <strong>Eu</strong> Yee Fong<br />
Director<br />
Singapore<br />
26 September 2000
Auditor’s <strong>Repor</strong>t to the Members of<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong><br />
We have audited the financial statements of <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> set out on pages 22 to 41.<br />
These financial statements comprise the balance sheets of the Company <strong>and</strong> the Group as at<br />
30 June 2000, <strong>and</strong> the profit <strong>and</strong> loss accounts of the Company <strong>and</strong> the Group <strong>and</strong> the cash flow<br />
statement of the Group for the year then ended. These financial statements are the responsibility of<br />
the Company’s Directors. Our responsibility is to express an opinion on these financial statements<br />
based on our audit.<br />
We conducted our audit in accordance with Singapore St<strong>and</strong>ards on Auditing. Those St<strong>and</strong>ards<br />
require that we plan <strong>and</strong> perform the audit to obtain reasonable assurance about whether the<br />
financial statements are free of material misstatement. An audit includes examining, on a test basis,<br />
evidence supporting the amounts <strong>and</strong> disclosures in the financial statements. An audit also includes<br />
assessing the accounting principles used <strong>and</strong> significant estimates made by the Directors, as well as<br />
evaluating the overall financial statement presentation. We believe that our audit provides a<br />
reasonable basis for our opinion.<br />
In our opinion,<br />
(a) the financial statements <strong>and</strong> consolidated financial statements are properly drawn up in<br />
accordance with the provisions of the Companies Act <strong>and</strong> Statements of Accounting St<strong>and</strong>ard<br />
<strong>and</strong> so as to give a true <strong>and</strong> fair view of :<br />
(i) the state of affairs of the Company <strong>and</strong> of the Group as at 30 June 2000, the results of the<br />
Company <strong>and</strong> of the Group <strong>and</strong> the cash flows of the Group for the year then ended; <strong>and</strong><br />
(ii) the other matters required by Section 201 of the Act to be dealt with in the financial statements<br />
<strong>and</strong> consolidated financial statements;<br />
(b) the accounting <strong>and</strong> other records, <strong>and</strong> the registers required by the Act to be kept by the<br />
Company <strong>and</strong> by those subsidiary companies incorporated in Singapore of which we are the<br />
auditors have been properly kept in accordance with the provisions of the Act.<br />
We have considered the financial statements <strong>and</strong> auditors’ reports of all subsidiary companies of<br />
which we have not acted as auditors, being financial statements included in the consolidated<br />
financial statements. The names of those subsidiary companies audited by our associated firms <strong>and</strong><br />
those audited by other firms are stated in Note 2.<br />
We are satisfied that the financial statements of the subsidiary companies that have been<br />
consolidated with the financial statements of the Company are in form <strong>and</strong> content appropriate<br />
<strong>and</strong> proper for the purposes of the preparation of the consolidated financial statements <strong>and</strong> we<br />
have received satisfactory information <strong>and</strong> explanations as required by us for those purposes.<br />
The auditors’ reports on the financial statements of the subsidiary companies were not subject to<br />
any q<strong>ual</strong>ification <strong>and</strong> in respect of subsidiary companies incorporated in Singapore did not include<br />
any comment made under Section 207(3) of the Act.<br />
ERNST & YOUNG<br />
Certified Public Accountants<br />
Singapore<br />
26 September 2000<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
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<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
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<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Profit <strong>and</strong> Loss Accounts for the year ended<br />
30 June 2000<br />
Note<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Turnover 3 35,433 30,175 3,204 2 ,985<br />
Profit before taxation 4 3,028 1,884 1,150 936<br />
Taxation 6 (813) (373) (378) (319)<br />
Profit after taxation 2,215 1,511 772 617<br />
Transfer from revenue reserve – – 345 –<br />
2,215 1,511 1,117 617<br />
Dividend 7 (1,117) (38) (1,117) (38)<br />
Retained profit for the year 25 1,098 1,473 – 579<br />
Basic earnings per share (cents) 8 2.12 1.45<br />
The accompanying notes form an integral part of the financial statements.
Balance Sheets as at 30 June 2000<br />
Group Company<br />
Note<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Fixed assets 9 25,187 25,332 480 596<br />
Deferred expenditure 10 72 135 – –<br />
<strong>Subsidiary</strong> companies 11 – – 15,549 15 ,539<br />
Associated companies<br />
Investments in unquoted<br />
shares of a company in which<br />
certain directors have<br />
12 1,937 – 4,300 –<br />
substantial interest<br />
Current assets<br />
451 451 451 451<br />
Stocks 13 8,247 6,138 – –<br />
Trade debtors 14 883 874 – –<br />
Other debtors 15 1,352 794 718 117<br />
Amounts due from related parties<br />
Amounts due from subsidiary<br />
16 2,207 1,291 522 666<br />
companies<br />
Amounts due from an<br />
17 – – 6,758 7 ,420<br />
associated company 18 – 209 – 1<br />
Fixed banks deposits 110 300 – 300<br />
Cash <strong>and</strong> bank balances 3,490 3,326 1,384 1 ,182<br />
Deduct : Current liabilities<br />
16,289 12,932 9,382 9 ,686<br />
Amounts due to bankers 19 16,311 14,414 14,490 12 ,490<br />
Trade creditors 4,598 3,170 – –<br />
Other creditors 20 1,739 1,718 425 903<br />
Amounts due to a related party<br />
Amount due to a subsidiary<br />
16 459 1,050 – 873<br />
company<br />
Amount due to an associated<br />
17 – – 2 –<br />
company 18 2,150 – 2,150 –<br />
Provision for taxation 695 421 218 132<br />
Proposed dividend, net 1,117 38 1,117 38<br />
27,069 20,811 18,402 14 ,436<br />
Net current liabilities<br />
Long-term liabilities<br />
(10,780) (7,879) (9,020) (4 ,750)<br />
Bank loan, secured 21 320 485 – –<br />
Hire purchase creditors 22 295 34 269 –<br />
Deferred taxation 23 39 81 – –<br />
(654) (600) (269) –<br />
Capital <strong>and</strong> reserves<br />
16,213 17,439 11,491 11 ,836<br />
Share capital 24 10,429 10,429 10,429 10 ,429<br />
Reserves 25 5,265 6,491 543 888<br />
Share premium 26 519 519 519 519<br />
16,213 17,439 11,491 11 ,836<br />
The accompanying notes form an integral part of the financial statements.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
23<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
24<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Consolidated Statement of Cash Flows for the year ended<br />
30 June 2000<br />
2000 1999<br />
$’000 $’000<br />
Cash flows from operating activities :<br />
Operating income before taxation<br />
Adjustments for :<br />
3,025 1 ,884<br />
Amortisation of deferred expenditure 69 67<br />
Depreciation of fixed assets 1,273 1 ,138<br />
Profit on sale of fixed assets (50) (32)<br />
Currency realignment 19 86<br />
Fixed assets written off 1 12<br />
Interest expense 735 1 ,070<br />
Interest income (7) (27)<br />
Operating income before reinvestment in working capital 5,065 4 ,198<br />
Increase in debtors (553) (413)<br />
Increase in creditors 1,482 2 ,112<br />
(Increase)/decrease in stocks (2,109) 1 ,248<br />
(Increase)/decrease in amounts due from related parties, (net) (1,618) 241<br />
Cash generated from operations 2,267 7 ,386<br />
Interest received 7 27<br />
Interest paid (735) (1 ,070)<br />
Income taxes paid (590) (865)<br />
Net cash provided by operating activities 949 5 ,478<br />
Cash flows from investing activities :<br />
Proceeds from sale of fixed assets 79 80<br />
Purchase of fixed assets (1,183) (1 ,372)<br />
Investment in associated company (4,300) –<br />
Increase in amounts due to associated company<br />
Acquisition of a subsidiary company net of cash <strong>and</strong> cash<br />
2,150 –<br />
equivalent acquired 156 –<br />
Increase in payment of deferred expenditure (6) (110)<br />
Net cash used in investing activities (3,104) (1,402)<br />
Cash flows from financing activities :<br />
Proceeds from/(repayment of) short-term loans 2,000 (1,117)<br />
Repayment of bank loan (179) (228)<br />
Dividends paid (38) (38)<br />
Proceeds from/(repayment of) hire purchase creditors 226 (44)<br />
Decrease/(increase) in amount due from an associated company 209 (180)<br />
Net cash provided by/(used in) financing activities 2,218 (1,607)<br />
Net increase in cash <strong>and</strong> cash equivalents 63 2 ,469<br />
Cash <strong>and</strong> cash equivalent at beginning of year (note 27) 2,181 (288)<br />
Cash <strong>and</strong> cash equivalent at end of year (note 27) 2,244 2 ,181
Consolidated Statement of Cash Flows for the year ended<br />
30 June 2000<br />
The acquisition of a subsidiary company have been shown in the statement as a single item.<br />
The effect on the individ<strong>ual</strong> assets <strong>and</strong> liabilities is set out below:<br />
Debtors<br />
$’000<br />
2<br />
Cash <strong>and</strong> cash equivalents 158<br />
Creditors (2)<br />
Amount due to related companies (111)<br />
Net assets acquired 47<br />
Discount on acquisition (45)<br />
Cash paid 2<br />
Less : Cash <strong>and</strong> cash equivalent acquired (158)<br />
Cash flow arising from acquisition of subsidiary company net of<br />
cash <strong>and</strong> cash equivalents acquired (156)<br />
The accompanying notes form an integral part of the financial statements.<br />
Notes to the Financial Statements – 30 June 2000<br />
1. Significant accounting policies<br />
(a) Basis of accounting<br />
The financial statements of the Company <strong>and</strong> of the Group are prepared under the historical<br />
cost convention modified by revaluation of certain fixed assets.<br />
The financial statements are prepared in accordance with applicable accounting st<strong>and</strong>ards.<br />
(b) Basis of consolidation<br />
The accounting year of the Company <strong>and</strong> all its subsidiary companies ends on 30 June <strong>and</strong><br />
the consolidated financial statements incorporate the financial statements of the Company<br />
<strong>and</strong> all its subsidiary companies.<br />
The results of subsidiary companies acquired or disposed of during the year are included in<br />
or excluded from the respective dates of acquisition or disposal, as applicable. When<br />
subsidiary companies are acquired, any excess of the consideration over the net assets at<br />
the date of acquisition is included in goodwill on consolidation <strong>and</strong> written off against Group<br />
reserves in the year in which it arises. Where the cost of acquisition of a subsidiary company<br />
is less than the fair value of the net assets acquired, the discount on acquisition is taken up as<br />
capital reserve. The name <strong>and</strong> principal activities of the subsidiary companies are indicated<br />
in note 2.<br />
Assets, liabilities <strong>and</strong> results of overseas subsidiary companies are translated into Singapore<br />
dollars on the basis outlined in paragraph (k) below.<br />
(c) <strong>Subsidiary</strong> companies<br />
Investments in subsidiary companies are stated at cost. Provision is made for any permanent<br />
diminution in value.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
25<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
26<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Financial Statements – 30 June 2000<br />
(d) Associated companies<br />
Investments in associated companies are stated at cost. Provision is made for any permanent<br />
diminution in value.<br />
An associated company is defined as a company, not being a subsidiary, in which the Group<br />
has a long-term interest of not less than 20% of the equity <strong>and</strong> in whose financial <strong>and</strong> operating<br />
policy decisions the Group exercises significant influence.<br />
The Group’s investments in associated companies are recorded at cost <strong>and</strong> adjusted to<br />
recognise the Group’s share of the net assets of the associated companies at the date of<br />
acquisition. The excess or deficit between the net assets of the associated companies <strong>and</strong><br />
the consideration paid is adjusted against reserves in the year of acquisition.<br />
The Group’s share of the results of associated companies is included in the consolidated<br />
profit <strong>and</strong> loss account of the Group. The Group’s share of the post-acquisition reserves of<br />
associated companies is included in the investments in associated companies in the<br />
consolidated balance sheet.<br />
(e) Revenue recognition<br />
Revenue from the sale of goods are recognised upon passage of title to the customer which<br />
generally coincides with their delivery <strong>and</strong> acceptance.<br />
Rental income is recognised on an accr<strong>ual</strong> basis. Dividend income is included to the extent<br />
of dividends declared during the year. Interest income is accrued on a day-to-day basis.<br />
(f) Fixed assets<br />
Fixed assets are stated at cost or valuation less accumulated depreciation. The cost of an<br />
asset comprises its purchase price <strong>and</strong> any directly attributable costs of bringing the asset to<br />
a working condition for its intended use including interests capitalised. Expenditure for<br />
additions, improvements <strong>and</strong> renewals are capitalised, <strong>and</strong> expenditure for maintenance<br />
<strong>and</strong> repairs are charged to the profit <strong>and</strong> loss account. When assets are sold or retired, their<br />
cost <strong>and</strong> accumulated depreciation are removed from the financial statements <strong>and</strong> any<br />
gain or loss resulting from their disposal is included in the profit <strong>and</strong> loss account. Any surpluses<br />
held in asset revaluation reserves in respect of previous revaluations of fixed assets disposed<br />
of during the year are regarded as having become realised <strong>and</strong> are transferred to the profit<br />
<strong>and</strong> loss account.<br />
Revaluation surpluses arising on valuations of the Group’s properties are credited direct to<br />
asset revaluation reserves. Revaluation deficits are taken to the profit <strong>and</strong> loss account in<br />
the absence of or to the extent that they exceed any surpluses held in reserves relating to<br />
previous revaluations. Investment properties are revalued ann<strong>ual</strong>ly by the Directors. An<br />
independent professional valuation is conducted periodically based on an open market<br />
value basis.<br />
(g) Deferred expenditure<br />
Deferred expenditure comprises preproduction <strong>and</strong> preliminary expenses which is written<br />
off to profit <strong>and</strong> loss account on a straight line basis over a three-year period commencing<br />
from the date of commercial operations.<br />
(h) Stocks<br />
Stocks are stated at the lower of cost <strong>and</strong> net realisable value. Cost comprises direct materials<br />
on a first-in-first-out basis <strong>and</strong> in the case of finished products, includes direct labour <strong>and</strong><br />
attributable production overheads based on a normal level of activity. Net realisable value<br />
is the estimated selling price less anticipated cost of disposal <strong>and</strong> after making allowance<br />
for damaged, obsolete <strong>and</strong> slow-moving items.
Notes to the Financial Statements – 30 June 2000<br />
(i) Deferred taxation<br />
Deferred taxation is accounted for under the liability method whereby the tax charge for<br />
the year is based on the disclosed book profit after adjusting for all permanent differences.<br />
The amount of taxation deferred on account of all timing differences is reflected in the<br />
deferred taxation account. Deferred tax benefits are not recognised unless there is a<br />
reasonable expectation of their realisation.<br />
(j) Depreciation<br />
Depreciation is calculated on the straight line method to write off the cost or valuation of<br />
fixed assets over their estimated useful lives. The estimated useful lives of fixed assets are as<br />
follows:-<br />
Freehold <strong>and</strong> leasehold buildings – 50 years<br />
Furniture, fittings <strong>and</strong> equipment – 3 - 5 years<br />
Motor vehicles – 5 years<br />
Renovations – 3 - 5 years<br />
Plant <strong>and</strong> machineries – 2 - 5 years<br />
Fully depreciated fixed assets are retained in the financial statements until they are no longer<br />
in use <strong>and</strong> no further charge for depreciation is made in respect of these assets.<br />
Investment properties are stated at valuation <strong>and</strong> no depreciation were deemed necessary<br />
by the directors of the Company.<br />
(k) Foreign currencies<br />
Transactions arising in foreign currencies during the year are converted at rates closely<br />
approximating those ruling on the transaction dates. Foreign currency monetary assets <strong>and</strong><br />
liabilities are converted into local currency at year-end exchange rates. All exchange<br />
differences arising from conversion are included in the profit <strong>and</strong> loss account.<br />
For inclusion in the consolidated financial statements, all assets <strong>and</strong> liabilities foreign subsidiary<br />
companies <strong>and</strong> associated companies are translated into Singapore dollars at exchange<br />
rates ruling at the balance sheet date <strong>and</strong> the results of foreign subsidiary companies <strong>and</strong><br />
associated companies are translated at the average exchange rates. Exchange differences<br />
due to such currency translations are included in Group foreign currencies translation reserve.<br />
(l) Leased assets<br />
Where assets are financed by lease agreements that give rights approximating to ownership<br />
(finance leases), the assets are capitalised under fixed assets as if they had been purchased<br />
outright at the values equivalent to the present values of total rental payable during the<br />
periods of the leases <strong>and</strong> the corresponding lease commitments are included under liabilities.<br />
Lease payments are treated as consisting of capital <strong>and</strong> interest elements <strong>and</strong> the interest is<br />
charged to profit <strong>and</strong> loss account. Depreciation on the relevant assets is charged to profit<br />
<strong>and</strong> loss account on the basis outlined in paragraph (j) above.<br />
<strong>Ann</strong><strong>ual</strong> rental on operating leases is charged to profit <strong>and</strong> loss account.<br />
(m)Investments in unquoted shares<br />
Investment in unquoted shares held on a long term basis are stated at cost. Provision is<br />
made for any diminution in value which is considered to be permanent.<br />
(n) Cash <strong>and</strong> cash equivalents<br />
Cash <strong>and</strong> cash equivalents consist of fixed bank deposits, cash at bank <strong>and</strong> in h<strong>and</strong> less<br />
bank overdrafts.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
27<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
28<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Financial Statements – 30 June 2000<br />
2. General<br />
The financial statements of the Company <strong>and</strong> the consolidated financial statements of the<br />
Group are expressed in Singapore dollars.<br />
The principal activities of the Company, which is incorporated in Singapore are investment<br />
holding <strong>and</strong> the provision of management services to its subsidiary companies. The subsidiary<br />
companies invest in properties, act as commission agents for all kinds of pharmaceutical products<br />
<strong>and</strong> are engaged in the distribution <strong>and</strong> sale of traditional Chinese, Western <strong>and</strong> other medicines.<br />
There have been no significant changes in the nature of these activities during the year.<br />
The subsidiary <strong>and</strong> associated companies at 30 June 2000 are :-<br />
Country of<br />
incorporation Percentage<br />
Name of <strong>and</strong> place of Principal of equity held<br />
company business activities At cost by the Group<br />
2000 1999 2000 1999<br />
$’000 $’000 % %<br />
<strong>Subsidiary</strong> companies<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> Singapore Distribution <strong>and</strong> 3,185 3,185 100 100<br />
(Singapore) sale of traditional<br />
Private Limited Chinese <strong>and</strong><br />
other medicines<br />
* <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (1959) Malaysia Distribution <strong>and</strong> 4,381 4,381 100 100<br />
Sdn Berhad sale of traditional<br />
Chinese <strong>and</strong><br />
other medicines<br />
<strong>Eu</strong> Realty Singapore Property investment 7,866 7,866 100 100<br />
(Singapore) Private <strong>and</strong> sale of traditional<br />
Limited Chinese <strong>and</strong><br />
other medicines<br />
* Weng Li Sendirian Malaysia Commission agent 50 50 100 100<br />
Berhad in all kinds of<br />
pharmaceutical<br />
products <strong>and</strong><br />
manufacturer of<br />
medical pills <strong>and</strong><br />
capsules<br />
**<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> Malaysia Property investment 57 57 100 100<br />
Heritage Sdn Bhd <strong>and</strong> provision of<br />
management services<br />
**EYS Ventures Pte <strong>Ltd</strong> Singapore Remittance commission # – 100 –<br />
agent<br />
**<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> Singapore Dormant 10 @ 100 100<br />
Marketing Private<br />
Limited<br />
* EYS Corporation Hong Kong Dormant @ @ 100 100<br />
Limited
Notes to the Financial Statements – 30 June 2000<br />
2. General (cont’d)<br />
Country of<br />
incorporation Percentage<br />
Name of <strong>and</strong> place of Principal of equity held<br />
company business activities At cost by the Group<br />
2000 1999 2000 1999<br />
$’000 $’000 % %<br />
Associated companies<br />
**Degree Malaysia Property investment @ @ 25 25<br />
Achievement<br />
Sdn Bhd<br />
**Oxford Natural Singapore Conduct laboratories 4,300 – 45 –<br />
Products Asia <strong>and</strong> research in<br />
Private Limited health <strong>and</strong> related<br />
products<br />
**Yin <strong>Yan</strong>g Spa Singapore To develop, @ – 50 –<br />
Pte <strong>Ltd</strong> manufacture <strong>and</strong><br />
distribute Spa<br />
products <strong>and</strong> services<br />
# Held through <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (Singapore) Private Limited<br />
* Audited by associated firms of Ernst & Young, Singapore<br />
** Audited by other firms<br />
@ Denotes amount less than $1,000<br />
3. Turnover<br />
Turnover for the Company represents dividends <strong>and</strong> management fees received from subsidiary<br />
companies.<br />
Turnover for the Group represents sales of goods at invoiced value less returns <strong>and</strong> trade discounts,<br />
management fees <strong>and</strong> rental income. It excludes intra-group transactions.<br />
Turnover is analysed as follows :-<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Dividend income – – 478 564<br />
Management fees 1,648 1,472 2,726 2,421<br />
Rental income 297 394 – –<br />
Sales of goods 33,488 28,309 – –<br />
35,433 30,175 3,204 2,985<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
29<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
30<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Financial Statements – 30 June 2000<br />
4. Profit before taxation<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Profit before taxation is stated after<br />
charging/(crediting) :<br />
Amortisation of deferred expenditure 69 67 – –<br />
Depreciation of fixed assets 1,273 1,138 140 95<br />
Profit on sale of fixed assets (50) (32) (39) (23)<br />
Fixed assets written off 1 12 – –<br />
Directors’ emoluments<br />
Auditors’ remuneration :<br />
- Auditors of parent Company<br />
593 525 593 525<br />
• audit fees 40 43 15 12<br />
• non-audit fees 32 – 28 –<br />
• prior year under provision<br />
- Other auditors<br />
– 3 – 3<br />
• audit fees 20 21 – –<br />
Interest expense (note 5) 735 1,070 546 798<br />
Interest income (7) (27) (228) (310)<br />
Net exchange (gain)/loss<br />
(Writeback of provision)/provision for<br />
(2) (265) 8 (106)<br />
amount owing by an associated company<br />
(Writeback of provision)/provision for<br />
(19) 19 – –<br />
doubtful debts (12) 3 – –<br />
Bad debts written off 34 1 – –<br />
Details of Directors’ remuneration of the Company pursuant to the Singapore Exchange Securities<br />
Trading Limited’s Listing rules are as follows:<br />
Number of Directors in remuneration b<strong>and</strong>s<br />
2000 1999<br />
$500,000 <strong>and</strong> above – –<br />
$250,000 to $499,999 1 1<br />
Below $250,000 8 7<br />
Total 9 8<br />
5. Interest expense<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Interest on bank loan 56 82 – –<br />
Interest on bank overdrafts 131 191 – 1<br />
Interest on hire purchase 12 11 10 11<br />
Interest on short term loan 536 786 536 786<br />
735 1,070 546 798
Notes to the Financial Statements – 30 June 2000<br />
6. Taxation<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Provision for taxation in respect of profit<br />
for the year :<br />
Current taxation - Singapore 360 223 267 206<br />
- Malaysia 513 92 111 79<br />
Deferred taxation<br />
(Over)/underprovision in respect of<br />
(42) (21) – –<br />
previous year (18) 79 – 34<br />
813 373 378 319<br />
The taxation charge for the Group <strong>and</strong> the Company differs from the amount determined by<br />
applying the Singapore income tax rate of 25.5% (1999 : 26%) to the pre-tax profits because of<br />
non-deductible expenses, higher tax rates applicable to overseas subsidiary companies <strong>and</strong><br />
certain subsidiary company utilised its tax losses, unabsorbed capital allowances <strong>and</strong><br />
reinvestment allowance to offset against its tax profits.<br />
As at 30 June 2000, certain subsidiary companies have unutilised tax losses, unabsorbed capital<br />
allowances <strong>and</strong> reinvestment allowance amounting to approximately $1,602,576 (1999 :<br />
$1,879,000) available for setting-off against future taxable profit subject to the regulations <strong>and</strong><br />
agreements by the relevant tax authorities.<br />
7. Dividend<br />
Proposed final dividend 1,117 38 1,117 38<br />
As disclosed in note 33 the Company currently has an issued <strong>and</strong> paid-up share capital of<br />
285,673,158 ordinary shares of $0.05 each. The proposed final dividend is provided at a rate of<br />
10.5% of the par value less income tax of 25.5% on the enlarged share capital. In the previous<br />
year, dividend was proposed at the rate of 0.5% on 104,288,009 ordinary shares of $0.10 each<br />
less income tax of 26%.<br />
8. Earnings per share<br />
Group<br />
2000 1999<br />
$’000 $’000<br />
Earnings after taxation 2,215 1,511<br />
‘000 ‘000<br />
Weighted average number of ordinary shares for<br />
calculation of basic earnings per share 104,288 104,288<br />
Cents Cents<br />
Basic earnings per share 2.12 1.45<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
31<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
32<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Financial Statements – 30 June 2000<br />
9. Fixed assets<br />
Group<br />
Cost <strong>and</strong> valuation<br />
L<strong>and</strong> <strong>and</strong> buildings Furniture,<br />
Long-term fittings <strong>and</strong> Motor Plant <strong>and</strong><br />
Freehold leasehold equipment vehicles Renovations machineries Total<br />
$’000 $’000 $’000 $’000 $’000 $’000 $’000<br />
At 1 July 1999 4,494 18,007 3,660 1,127 727 1,504 29,519<br />
Currency alignment 69 30 25 5 4 27 160<br />
Additions – – 719 90 332 42 1,183<br />
Disposals – – (3) (169) – – (172)<br />
Deficit on valuation (163) – – – – – (163)<br />
At 30 June 2000 4,400 18,037 4,401 1,053 1,063 1,573 30,527<br />
Representing -<br />
Cost – – 4,401 1,053 1,063 1,573 8,090<br />
Valuation 4,400 18,037 – – – – 22,437<br />
4,400 18,037 4,401 1,053 1,063 1,573 30,527<br />
Accumulated depreciation<br />
At 1 July 1999 14 1 2,727 411 387 647 4,187<br />
Currency alignment – – 19 3 2 12 36<br />
Charge for the year 32 63 517 161 194 306 1,273<br />
Disposals – – (2) (140) – – (142)<br />
Transfer to revaluation surplus (14) – – – – – (14)<br />
At 30 June 2000 32 64 3,261 435 583 965 5,340<br />
Charge for 1999 27 94 490 110 121 296 1,138<br />
Net book value<br />
At 30 June 2000 4,368 17,973 1,140 618 480 608 25,187<br />
At 30 June 1999 4,480 18,006 933 716 340 857 25,332
Notes to the Financial Statements – 30 June 2000<br />
9. Fixed assets (cont’d)<br />
Company<br />
Motor<br />
Furniture,<br />
fittings <strong>and</strong><br />
vehicles equipment Total<br />
$’000 $’000 $’000<br />
Cost<br />
At 1 July 1999 675 263 938<br />
Additions – 54 54<br />
Disposals (144) (1) (145)<br />
At 30 June 2000 531 316 847<br />
Accumulated depreciation<br />
At 1 July 1999 115 227 342<br />
Charge for the year 106 34 140<br />
Disposals (115) – (115)<br />
At 30 June 2000 106 261 367<br />
Charge for 1999 56 39 95<br />
Net book value<br />
At 30 June 2000 425 55 480<br />
At 30 June 1999 560 36 596<br />
(a) Included under long-term leasehold l<strong>and</strong> <strong>and</strong> building is investment properties stated at<br />
valuation with a net book value of $8,830,000 (1999 : $8,830,000). The market value of<br />
investment properties was based on independent professional valuation carried out by Jones<br />
Lang LaSalle on 30 June 1999 on the basis of an open market value for existing use. The<br />
directors are of the opinion that this value has not changed materially as at 30 June 2000.<br />
(b) Certain properties of the Group with net book value of $20.9 million (1999 : $22.5 million)<br />
have been mortgaged to secure credit facilities (notes 19 <strong>and</strong> 21).<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
(c) Net book value of fixed assets<br />
under hire purchase 466 560 425 560<br />
10. Deferred expenditure<br />
Group<br />
2000 1999<br />
$’000 $’000<br />
Cost 208 202<br />
Less : Accumulated amortisation (136) (67)<br />
72 135<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
33<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
34<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Financial Statements – 30 June 2000<br />
11. <strong>Subsidiary</strong> companies<br />
Company<br />
2000 1999<br />
$’000 $’000<br />
Unquoted shares, at cost 15,549 15 ,539<br />
12. Associated companies<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Unquoted shares, at cost<br />
Goodwill paid on subscription of<br />
4,300 – 4,300 –<br />
shares in an associated company (2,363) – – –<br />
1,937 – 4,300 –<br />
13. Stocks<br />
Group<br />
2000 1999<br />
$’000 $’000<br />
Trading stocks 8,474 6 ,334<br />
Packaging materials 70 77<br />
8,544 6 ,411<br />
Provision for stocks obsolescence (297) (273)<br />
Analysis of provision for stock obsolescence :<br />
8,247 6 ,138<br />
Balance at beginning of year 273 109<br />
Charge to profit <strong>and</strong> loss 24 164<br />
Balance at end of year 297 273<br />
Stocks consist principally of fine medicine, Chinese <strong>and</strong> Western medicines <strong>and</strong> pills held<br />
for re-sale.<br />
14. Trade debtors<br />
Group<br />
2000 1999<br />
$’000 $’000<br />
Trade debtors are stated after deducting provision for<br />
doubtful debts of 114 125<br />
Analysis of provision for doubtful debts :<br />
Balance at beginning of year 125 122<br />
(Writeback)/charge to profit <strong>and</strong> loss account (12) 3<br />
Currency realignment 1 –<br />
Balance at end of year 114 125<br />
Bad debts written off directly to profit <strong>and</strong> loss account 34 1
Notes to the Financial Statements – 30 June 2000<br />
15. Other debtors<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Sundry deposits 451 332 5 –<br />
Prepaid expenses 622 125 546 10<br />
Tax recoverable 106 94 106 94<br />
Sundry debtors 173 243 61 13<br />
1,352 794 718 117<br />
16. Amounts due (to)/from related parties<br />
Related parties are companies in which certain directors have substantial financial interest.<br />
Amounts due (to)/from related parties are trade related, interest-free <strong>and</strong> have no fixed terms<br />
of repayment.<br />
17. Amounts due from/(to) subsidiary companies<br />
Company<br />
2000 1999<br />
$’000 $’000<br />
Amounts owing by subsidiary companies 1,528 1 ,611<br />
Loans to subsidiary companies 5,148 5 ,664<br />
Dividend receivable 350 413<br />
7,026 7 ,688<br />
Provision for amount owing by a subsidiary company (268) (268)<br />
6,758 7 ,420<br />
The amounts owing by/(to) subsidiary companies are unsecured, interest-free <strong>and</strong> have no<br />
fixed terms of repayment.<br />
The loans to subsidiary companies are unsecured, bear interest between 3.68% to 4.84%<br />
(1999 : 4% to 12%) per annum <strong>and</strong> have no fixed terms of repayment.<br />
18. Amounts due from/(to) associated companies<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Amount due from an associated company – 1 – 1<br />
Loan to an associated company – 227 – –<br />
Amount due to an associated company (2,150) – (2,150) –<br />
Provision for amount owing by an<br />
(2,150) 228 (2,150) 1<br />
associated company – (19) – –<br />
(2,150) 209 (2,150) 1<br />
Amounts due from an associated company <strong>and</strong> loan to an associated company are nontrade<br />
related, unsecured, interest-free <strong>and</strong> have no fixed term of repayment.<br />
Amount due to an associated company is unsecured, interest free <strong>and</strong> is repayable within<br />
three months after balance sheet date.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
35<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
36<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Financial Statements – 30 June 2000<br />
19. Amounts due to bankers<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Bank loan, secured (note 21) 215 229 – –<br />
Bank overdraft, secured<br />
Short term loans<br />
1,356 1,445 – –<br />
- secured 13,740 12,240 13,490 11 ,990<br />
- unsecured 1,000 500 1,000 500<br />
16,311 14,414 14,490 12 ,490<br />
The amounts due to bankers bear interest between 2.75% to 5.2% (1999 : 3.21% to 11.54%) per<br />
annum, <strong>and</strong> are secured by certain properties of the Group (Note 9).<br />
20. Other creditors<br />
Accrued expenses 920 556 249 254<br />
Sundry provisions 443 326 117 97<br />
Sundry creditors 311 736 6 459<br />
Hire purchase creditors (note 22) 65 100 53 93<br />
1,739 1,718 425 903<br />
21. Bank loans, secured<br />
Group<br />
2000 1999<br />
$’000 $’000<br />
Repayable within 12 months (note 19) 215 229<br />
Repayable after 12 months 320 485<br />
535 714<br />
The bank loans which are secured by certain properties of the Group bear interest between<br />
1.75% to 2.00% (1999 : 1.75% to 2.00%) above prevailing prime rate <strong>and</strong> are repayable over a<br />
period of 5 years by 60 monthly instalments.
Notes to the Financial Statements – 30 June 2000<br />
22. Hire purchase creditors<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Repayable within one year (included in<br />
other creditors) 65 100 53 93<br />
Repayable after one year 295 34 269 –<br />
360 134 322 93<br />
The future payments under hire purchase are as follows :<br />
2000 – 32 – 22<br />
2001 73 32 64 22<br />
2002 73 32 64 22<br />
2003 73 32 64 22<br />
2004 73 34 64 26<br />
Remaining years 137 – 129 –<br />
429 162 385 114<br />
Amounts representing interest (69) (28) (63) (21)<br />
360 134 322 93<br />
23. Deferred taxation<br />
The deferred taxation arises as a result of :<br />
Excess of net book value over tax<br />
written down value of fixed assets 39 152 – –<br />
Provision – (71) – –<br />
39 81 – –<br />
24. Share capital<br />
Authorised :<br />
Balance at beginning <strong>and</strong> at end of year<br />
Group <strong>and</strong> Company<br />
2000 1999<br />
$’000 $’000<br />
400,000,000 ordinary shares of $0.10 each<br />
Issued <strong>and</strong> fully paid :<br />
Balance at beginning of year<br />
40,000 40,000<br />
104,288,009 (1999 : 102,350,287) ordinary shares of $0.10 each<br />
Issued during the year :<br />
Nil (1999 : 1,937,722) ordinary shares of $0.10 each<br />
10,429 10,235<br />
at a premium of $nil (1999 : $0.1561) per share (note 26) – 194<br />
Balance at end of year<br />
104,288,009 (1999 : 104,288,009) ordinary shares of $0.10 each 10,429 10,429<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
37<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
38<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Financial Statements – 30 June 2000<br />
25. Reserves<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Non-distributable reserves<br />
Asset revaluation reserve<br />
Balance at beginning of year 4,064 7,677 – –<br />
Less : Deficit on revaluation (149) (3,613) – –<br />
Balance at end of year 3,915 4,064 – –<br />
Distributable reserves<br />
Revenue reserve<br />
At beginning of year 4,438 2,965 888 309<br />
Retained profit for the year 1,098 1,473 – 579<br />
Transfer to profit <strong>and</strong> loss accounts<br />
Goodwill arising on consolidation<br />
– – (345) –<br />
written off (2,318) – – –<br />
At end of year 3,218 4,438 543 888<br />
Foreign currencies translation reserve<br />
At beginning of year (2,011) (2,379) – –<br />
Net movement 143 368 – –<br />
At end of year (1,868) (2,011) – –<br />
Total distributable reserves 1,350 2,427 543 888<br />
Total reserves 5,265 6,491 543 888<br />
26. Share premium<br />
Group <strong>and</strong> Company<br />
2000 1999<br />
$’000 $’000<br />
Share premium account :<br />
At beginning of year<br />
Premium on issuance of nil (1999 : 1,937,722)<br />
ordinary shares of $0.10 each at a premium of $nil<br />
519 216<br />
(1999 : $0.1561) per share (note 24) – 303<br />
At end of year 519 519
Notes to the Financial Statements – 30 June 2000<br />
27. Cash <strong>and</strong> cash equivalents<br />
Cash <strong>and</strong> cash equivalents included in the consolidated statement of cash flows comprise the<br />
following balance sheet amounts :<br />
Group<br />
2000 1999<br />
$’000 $’000<br />
Cash <strong>and</strong> bank balances 3,490 3 ,326<br />
Bank overdrafts (note 19) (1,356) (1,445)<br />
Fixed bank deposits 110 300<br />
2,244 2 ,181<br />
28. Lease commitments<br />
The Group leases certain properties under lease agreements that are non-cancellable within a<br />
year. The leases expires at various dates till 2003. Future minimum lease payments for all leases<br />
with initial or remaining terms of one year or more are as follows :<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
2000 – 1,225 – –<br />
2001 1,353 996 – –<br />
2002 498 269 – –<br />
2003 121 – – –<br />
1,972 2,490 – –<br />
29. Capital commitment<br />
On 8 May 2000, the Company signed a joint venture agreement to subscribe for 50,000 ordinary<br />
shares of $1.00 each at par, representing 50% of the initial paid up capital of Yin <strong>Yan</strong>g Spa Pte<br />
<strong>Ltd</strong> (“YYS”), a company incorporated in Singapore on 26 May 2000. As at year end, the Company<br />
has not paid up any capital for YYS.<br />
Under the joint venture agreement, the Company is given an option to acquire from the other<br />
shareholder of YYS 1% of the issued <strong>and</strong> paid up capital of YYS to increase the Company’s<br />
shareholding in YYS to 51%. The option is exercisable one year after the date of the joint venture<br />
agreement at a price which is equivalent to YYS’s net tangible assets at the date which the<br />
option is exercised.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
39<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
40<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Financial Statements – 30 June 2000<br />
30. Related party transactions<br />
The Company <strong>and</strong> the Group have the following transactions with subsidiary companies <strong>and</strong><br />
related parties at rates <strong>and</strong> terms agreed between the parties :<br />
Group Company<br />
2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000<br />
Dividend income from subsidiary<br />
companies<br />
Interest received from subsidiary<br />
– – – (564)<br />
companies<br />
Management fee received from subsidiary<br />
– – (223) (310)<br />
companies – – (1,225) (1,081)<br />
Rental paid to a subsidiary company – – 54 54<br />
Management fee received from related<br />
parties (1,501) (1,340) (1,501) (1,340)<br />
Sales of goods to related parties (2,665) (1,088) – –<br />
Purchase of goods from related parties 916 849 – –<br />
Rental received from related parties – (35) – –<br />
31. Contingent liabilities<br />
Company<br />
2000 1999<br />
$’000 $’000<br />
Contingent liabilities not provided in the financial statements :<br />
Corporate guarantees given to bankers for credit<br />
facilities granted to subsidiary companies 4,500 4,000<br />
32. Segment reporting<br />
Turnover<br />
Profit<br />
before taxation Assets employed<br />
2000 1999 2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000 $’000 $’000<br />
(a) By activities<br />
TCM 33,488 28,309 2,274 1,586 26,907 23,784<br />
Others 1,945 1,866 754 298 15,092 14,857<br />
Associated companies – – – – 1,937 209<br />
35,433 30,175 3,028 1,884 43,936 38,850<br />
(b) By geographical location based on country of incorporation<br />
Singapore 19,600 17,201 989 662 27,171 25,193<br />
Malaysia 15,833 12,974 2,039 1,222 14,828 13,448<br />
Associated companies – – – – 1,937 209<br />
35,433 30,175 3,028 1,884 43,936 38,850
Notes to the Financial Statements – 30 June 2000<br />
33. Subsequent events<br />
Subsequent to the balance sheet date, the Company :<br />
(i) increased its authorised shares capital from $40,000,000, comprising 400,000,000 ordinary<br />
shares of $0.10 each, to $80,000,000 comprising 800,000,000 ordinary shares of $0.10 each,<br />
by creating additional 400,000,000 ordinary shares of $0.10 each;<br />
(ii) issued 2,798,570 new ordinary shares of $0.10 each at par in consideration for the acquisition<br />
of Essence Holdings Limited pursuant to a Restructuring Exercise on 3 July 2000. The Company<br />
acquired 63,804,085 ordinary shares of HK$1.00 each in Essence Holding Limited (“Essence”)<br />
from the other shareholders of Essence. The purchase consideration of Essence was<br />
computed based on its audited Group net asset value of HK$1,303,546 as at 29 February<br />
2000 <strong>and</strong> taking into account the 2,011,784 ordinary shares of Essence which were already<br />
held by the Company;<br />
(iii) subdivided each of the ordinary shares of $0.10 each in the authorised <strong>and</strong> issued share<br />
capital of the Company into 2 ordinary shares of $0.05 each;<br />
(iv)issued 71,500,000 new ordinary shares of $0.05 each at a premium of $0.30 each pursuant to<br />
an initial public offering exercise; <strong>and</strong><br />
(v) listed on the SGX-ST on 28 July 2000.<br />
Upon the completion of the initial public offering exercise, the resultant issued <strong>and</strong> paid up<br />
share capital of the Company increased from $10,428,801 comprising 104,288,009 ordinary shares<br />
of $0.10 each to $14,283,658 comprising 285,673,158 ordinary shares of $0.05 each.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
41<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
42<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Proforma Group Profit <strong>and</strong> Loss Account for the year<br />
ended 30 June 2000<br />
Note 2000 1999<br />
$’000 $’000<br />
Turnover 3 72,092 64 ,205<br />
Profit before taxation 4 7,316 5 ,122<br />
Taxation 6 (1,557) (1 ,111)<br />
Profit after taxation 5,759 4 ,011<br />
Dividend 7 (1,117) (38)<br />
Retained profit for the year 4,642 3 ,973<br />
Basic earnings per share (cents) 8 2.69 1.87<br />
The accompanying notes form an integral part of the Proforma financial statements.<br />
Proforma Group Balance Sheet as at 30 June 2000<br />
Note 2000 1999<br />
$’000 $’000<br />
Fixed assets 9 32,226 33 ,634<br />
Deferred expenditure 10 72 135<br />
Associated companies<br />
Current assets<br />
11 1,937 –<br />
Stocks 12 14,767 11 ,639<br />
Trade debtors 13 3,386 2 ,723<br />
Other debtors 14 3,495 2 ,283<br />
Amounts due from an associated company 15 – 209<br />
Fixed banks deposits 174 408<br />
Cash <strong>and</strong> bank balances 4,251 5 ,464<br />
Deduct : Current liabilities<br />
26,073 22 ,726<br />
Amounts due to bankers 16 29,254 15 ,071<br />
Trade creditors 5,844 4 ,371<br />
Other creditors 17 3,015 3 ,105<br />
Amounts due to an associated company 15 2,150 –<br />
Provision for taxation 1,357 1 ,113<br />
Proposed dividend, net 1,117 39<br />
42,737 23 ,699<br />
Net current liabilities<br />
Long-term liabilities<br />
(16,664) (973)<br />
Bank loan, secured 18 320 485<br />
Hire purchase creditors 19 295 34<br />
Deferred taxation 20 39 81<br />
(654) (600)<br />
16,917 32 ,196<br />
Shareholders’ equity 21 16,917 32 ,196<br />
The accompanying notes form an integral part of the Proforma financial statements.
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
1. Basis of presentation of Proforma Group financial statements<br />
The financial information set out in the Proforma financial statements is based on the audited<br />
financial statements of the companies that comprise the Proforma Group for the financial years<br />
ended 30 June 1999 <strong>and</strong> 30 June 2000. It has been prepared in accordance with the accounting<br />
policies set out in the notes to the financial statements on the basis that the Proforma Group, as<br />
reconstructed pursuant to the Restructuring Exercise described below, had been in place<br />
throughout the financial years ended 30 June 1999 <strong>and</strong> 30 June 2000 <strong>and</strong> after making<br />
appropriate consolidation adjustments.<br />
In connection with the Company’s listing exercise, a Restructuring Exercise took place pursuant<br />
to which the Company acquired the entire issued <strong>and</strong> paid-up share capital of Essence Holdings<br />
Limited (“Essence”) <strong>and</strong> through its subsidiary company, <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (Singapore) Private Limited,<br />
acquired EYS Ventures Pte <strong>Ltd</strong>.<br />
On 28 February 2000, Essence repurchased 66,666,667 of its own shares of par value of HK$1.00<br />
each from some of its shareholders at a total consideration of HK$80,000,000.<br />
On 3 July 2000, the Company acquired 63,804,085 ordinary shares of HK$1.00 each in Essence<br />
from the other shareholders of Essence. The purchase consideration for Essence was computed<br />
based on its audited Group net asset value of HK$1,303,546 as at 29 February 2000 <strong>and</strong> taking<br />
into account the 2,011,784 ordinary shares of Essence which were already held by the Company.<br />
The purchase consideration was satisfied by the allotment <strong>and</strong> issue of 2,798,570 new ordinary<br />
shares of $0.10 each at par to the other shareholders of Essence.<br />
On 10 July 2000, Essence was put into member’s voluntary liquidation. On 14 September 2000,<br />
upon completion of its liquidation, all its assets including 183,017,105 ordinary shares of <strong>Eu</strong> <strong>Yan</strong><br />
<strong>Sang</strong> (Hong Kong) Limited, were distributed in specie to the Company.<br />
On 1 June 2000, EYS Ventures Pte <strong>Ltd</strong> issued 1,998 additional ordinary shares of $1.00 each to <strong>Eu</strong><br />
<strong>Yan</strong> <strong>Sang</strong> (Singapore) Private Limited at par for cash to increase its paid up share capital to<br />
$2,000.<br />
On 5 June 2000, <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (Singapore) Private Limited acquired the remaining two ordinary<br />
shares of $1.00 each in EYS Ventures Pte <strong>Ltd</strong> from the existing shareholders of EYS Ventures Pte<br />
<strong>Ltd</strong> at approximately $22 per ordinary share. The consideration for the acquisition of the shares<br />
of EYS Ventures Pte <strong>Ltd</strong> was based on its adjusted net tangible assets of $44,780 as at 29 February<br />
2000, after taking into account the additional shares issued to <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (Singapore) Private<br />
Limited.<br />
Upon the completion of the restructuring exercise, <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (Hong Kong) Limited <strong>and</strong> EYS<br />
Ventures Pte <strong>Ltd</strong> became wholly-owned subsidiary companies of the Company <strong>and</strong> the resultant<br />
issued <strong>and</strong> paid-up share capital of the Company increased from $10,428,801 comprising<br />
104,288,009 ordinary shares to $10,708,658 comprising 107,086,579 ordinary shares.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
43<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
44<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
1. Basis of presentation of Proforma Group financial statements (cont’d)<br />
Upon completion of the Restructuring Exercise, the Company has the following subsidiary <strong>and</strong><br />
associated companies (referred to collectively with the Company as the “Proforma Group”) :<br />
Country of<br />
Issued <strong>and</strong> paidup/registered<br />
incorporation capital (after Percentage<br />
Name of <strong>and</strong> place of Principal Restructuring of equity held<br />
company business activities Exercise) by the Group<br />
<strong>Subsidiary</strong> companies<br />
’000 %<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> Singapore Distribution <strong>and</strong> S$ 500 100<br />
(Singapore) sale of traditional<br />
Private Limited Chinese <strong>and</strong><br />
other medicines<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (1959) Malaysia Distribution <strong>and</strong> RM 6,033 100<br />
Sdn Berhad sale of traditional<br />
Chinese <strong>and</strong><br />
other medicines<br />
<strong>Eu</strong> Realty Singapore Property investment S$ 827 100<br />
(Singapore) Private <strong>and</strong> sale of traditional<br />
Limited Chinese <strong>and</strong> other<br />
medicines<br />
Weng Li Sdn Bhd Malaysia Commission agent<br />
in all kinds of<br />
pharmaceutical<br />
products <strong>and</strong><br />
manufacturer of<br />
medical pills <strong>and</strong><br />
capsules<br />
RM 100 100<br />
Essence Holdings The Investment HK$ 65,816 100<br />
Limited (Liquidated British holding<br />
on 4 September 2000) Virgin<br />
Isl<strong>and</strong>s<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> Malaysia Property investment RM 100 100<br />
Heritage Sdn Bhd <strong>and</strong> provision of<br />
management services<br />
EYS Ventures Singapore Remittance commission S$ 2 100<br />
Pte <strong>Ltd</strong> # agent<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong><br />
Marketing Private<br />
Limited<br />
Singapore Dormant S$ 10 100
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
1. Basis of presentation of Proforma Group financial statements (cont’d)<br />
Country of<br />
Issued <strong>and</strong> paidup/registered<br />
incorporation capital (after Percentage<br />
Name of <strong>and</strong> place of Principal Restructuring of equity held<br />
company business activities Exercise) by the Group<br />
<strong>Subsidiary</strong> companies<br />
’000 %<br />
EYS Corporation<br />
Limited<br />
Hong Kong Dormant @ 100<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> Hong Kong Manufacturing HK$ 18,302 100<br />
(Hong Kong) processing <strong>and</strong><br />
Limited sales of traditional<br />
Chinese medicines<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong><br />
(China Ventures)<br />
Limited<br />
Hong Kong Dormant @ 100<br />
Synco (H.K.) Hong Kong Manufacturing, HK$ 700 100<br />
Limited processing <strong>and</strong><br />
sales of western<br />
pharmaceutical<br />
products<br />
Top Lot Limited Hong Kong General trading<br />
<strong>and</strong> provision of<br />
advertising agency<br />
HK$ 3,610 100<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong><br />
(Properties) Limited<br />
Hong Kong Property investment @ 100<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> The British Dormant @ 100<br />
(Export) Limited Virgin<br />
Isl<strong>and</strong>s<br />
Associated companies<br />
Degree Achievement<br />
Sdn Bhd<br />
Malaysia Property investment @ 25<br />
Oxford Natural Singapore Conduct laboratories 2,150 45<br />
Products Asia <strong>and</strong> research in<br />
Private Limited health <strong>and</strong> related<br />
products<br />
Yin <strong>Yan</strong>g Spa Singapore To develop, manufacture @ 50<br />
Pte <strong>Ltd</strong> <strong>and</strong> distribute Spa<br />
products <strong>and</strong> services<br />
# Held through <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> (Singapore) Private Limited<br />
@ Denote amount less than $1,000<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
45<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
46<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
2. Significant accounting policies<br />
(a) Basis of accounting<br />
The Proforma Group financial statements, which are expressed in Singapore dollars, are<br />
prepared under the historical cost convention modified by revaluation of certain fixed assets.<br />
The Proforma Group financial statements are prepared in accordance with applicable<br />
accounting st<strong>and</strong>ards.<br />
(b) Basis of consolidation<br />
The accounting year of the Company <strong>and</strong> all its subsidiary companies ends on 30 June <strong>and</strong><br />
the Proforma Group financial statements incorporate the financial statements of the<br />
Company <strong>and</strong> all its subsidiary companies.<br />
The results of subsidiary companies acquired or disposed of during the year are included in<br />
or excluded from the respective dates of acquisition or disposal, as applicable. When<br />
subsidiary companies are acquired, any excess of the consideration over the net assets at<br />
the date of acquisition is included in goodwill on consolidation <strong>and</strong> written off against<br />
Proforma Group reserves in the year in which it arises. Where the cost of acquisition of a<br />
subsidiary company is less than the fair value of the net assets acquired, the discount on<br />
acquisition is taken up as capital reserve. The name <strong>and</strong> principal activities of the subsidiary<br />
companies are indicated in note 1.<br />
Assets, liabilities <strong>and</strong> results of overseas subsidiary companies are translated into Singapore<br />
dollars on the basis outlined in paragraph (k) below.<br />
(c) <strong>Subsidiary</strong> companies<br />
Investments in subsidiary companies are stated at cost. Provision is made for any permanent<br />
diminution in value.<br />
(d) Associated companies<br />
Investments in associated companies are stated at cost. Provision is made for any permanent<br />
diminution in value.<br />
An associated company is defined as a company, not being a subsidiary, in which the<br />
Proforma Group has a long-term interest of not less than 20% of the equity <strong>and</strong> in whose<br />
financial <strong>and</strong> operating policy decisions the Proforma Group exercises significant influence.<br />
The Proforma Group’s investments in associated companies are recorded at cost <strong>and</strong><br />
adjusted to recognise the Proforma Group’s share of the net assets of the associated<br />
companies at the date of acquisition. The excess or deficit between the net assets of the<br />
associated companies <strong>and</strong> in consideration paid is adjusted against reserves in the year of<br />
acquisition.<br />
The Proforma Group’s share of the results of associated companies is included in the Proforma<br />
Group profit <strong>and</strong> loss account of the Proforma Group. The Group’s share of the postacquisition<br />
reserves of associated companies is included in the investments in associated<br />
companies in the Proforma Group balance sheet.
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
(e) Revenue recognition<br />
Revenue from the sale of goods are recognised upon passage of title to the customer which<br />
generally coincides with their delivery <strong>and</strong> acceptance.<br />
Rental income is recognised on an accr<strong>ual</strong> basis. Dividend income is included to the extent<br />
of dividends declared during the year. Interest income is accrued on a day-to-day basis.<br />
(f) Fixed assets<br />
Fixed assets are stated at cost or valuation less accumulated depreciation. The cost of an<br />
asset comprises its purchase price <strong>and</strong> any directly attributable costs of bringing the asset to<br />
a working condition for its intended use including interests capitalised. Expenditure for<br />
additions, improvements <strong>and</strong> renewals are capitalised, <strong>and</strong> expenditure for maintenance<br />
<strong>and</strong> repairs are charged to the profit <strong>and</strong> loss account. When assets are sold or retired, their<br />
cost <strong>and</strong> accumulated depreciation are removed from the financial statements <strong>and</strong> any<br />
gain or loss resulting from their disposal is included in the profit <strong>and</strong> loss account. Any surpluses<br />
held in asset revaluation reserves in respect of previous revaluations of fixed assets disposed<br />
of during the year are regarded as having become realised <strong>and</strong> are transferred to the profit<br />
<strong>and</strong> loss account.<br />
Revaluation surpluses arising on valuations of the Proforma Group’s properties are credited<br />
direct to asset revaluation reserves. Revaluation deficits are taken to the profit <strong>and</strong> loss<br />
account in the absence of or to the extent that they exceed any surpluses held in reserves<br />
relating to previous revaluations. Investment properties are revalued ann<strong>ual</strong>ly by the Directors.<br />
An independent professional valuation is conducted periodically based on an open market<br />
value basis.<br />
(g) Deferred expenditure<br />
Deferred expenditure comprises preproduction <strong>and</strong> preliminary expenses which is written<br />
off to profit <strong>and</strong> loss account on a straight line basis over a three-year period commencing<br />
from the date of commercial operations.<br />
(h) Stocks<br />
Stocks are stated at the lower of cost <strong>and</strong> net realisable value. Cost comprises direct materials<br />
on a first-in-first-out basis <strong>and</strong> in the case of finished products, includes direct labour <strong>and</strong><br />
attributable production overheads based on a normal level of activity. Net realisable value<br />
is the estimated selling price less anticipated cost of disposal <strong>and</strong> after making allowance<br />
for damaged, obsolete <strong>and</strong> slow-moving items.<br />
(i) Deferred taxation<br />
Deferred taxation is accounted for under the liability method whereby the tax charge for<br />
the year is based on the disclosed book profit after adjusting for all permanent differences.<br />
The amount of taxation deferred on account of all timing differences is reflected in the<br />
deferred taxation account. Deferred tax benefits are not recognised unless there is a<br />
reasonable expectation of their realisation.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
47<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
48<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
(j) Depreciation<br />
Depreciation is calculated on the straight line method to write off the cost or valuation of<br />
fixed assets over their estimated useful lives. The estimated useful lives of fixed assets are as<br />
follows:-<br />
Freehold <strong>and</strong> leasehold buildings - 50 years<br />
Furniture, fittings <strong>and</strong> equipment - 3 - 5 years<br />
Motor vehicles - 5 years<br />
Renovations - 3 - 5 years<br />
Plant <strong>and</strong> machineries - 2 - 5 years<br />
Plastic moulds - 5 years<br />
Fully depreciated fixed assets are retained in the financial statements until they are no longer<br />
in use <strong>and</strong> no further charge for depreciation is made in respect of these assets.<br />
Investment properties are stated at valuation <strong>and</strong> no depreciation were deemed necessary<br />
by the directors of the Company.<br />
(k) Foreign currencies<br />
Transactions arising in foreign currencies during the year are converted at rates closely<br />
approximating those ruling on the transaction dates. Foreign currency monetary assets <strong>and</strong><br />
liabilities are converted into local currency at year-end exchange rates. All exchange<br />
differences arising from conversion are included in the profit <strong>and</strong> loss account.<br />
For inclusion in the consolidated financial statements, all assets <strong>and</strong> liabilities foreign subsidiary<br />
companies <strong>and</strong> associated companies are translated into Singapore dollars at exchange<br />
rates ruling at the balance sheet date <strong>and</strong> the results of foreign subsidiary companies <strong>and</strong><br />
associated companies are translated at the average exchange rates. Exchange differences<br />
due to such currency translations are included in Group foreign currencies translation reserve.<br />
(l) Leased assets<br />
Where assets are financed by lease agreements that give rights approximating to ownership<br />
(finance leases), the assets are capitalised under fixed assets as if they had been purchased<br />
outright at the values equivalent to the present values of total rental payable during the<br />
periods of the leases <strong>and</strong> the corresponding lease commitments are included under liabilities.<br />
Lease payments are treated as consisting of capital <strong>and</strong> interest elements <strong>and</strong> the interest is<br />
charged to profit <strong>and</strong> loss account. Depreciation on the relevant assets is charged to profit<br />
<strong>and</strong> loss account on the basis outlined in paragraph (j) above.<br />
<strong>Ann</strong><strong>ual</strong> rental on operating leases is charged to profit <strong>and</strong> loss account.<br />
3. Turnover<br />
Turnover for the Proforma Group represents rental income <strong>and</strong> sales of goods at invoiced value<br />
less returns <strong>and</strong> trade discounts. It excludes intra-group transactions.<br />
2000 1999<br />
$’000 $’000<br />
Turnover is analysed as follows :-<br />
Rental 297 705<br />
Sales of goods 71,795 63 ,500<br />
72,092 64 ,205
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
4. Profit before taxation<br />
Profit before taxation is stated after charging/(crediting) :<br />
2000 1999<br />
$’000 $’000<br />
Amortisation of deferred expenditure 69 67<br />
Depreciation of fixed assets 3,094 3 ,169<br />
(Profit)/loss on sale of fixed assets (13) 5<br />
Fixed assets written off 19 12<br />
Directors’ emoluments<br />
Auditors’ remuneration :<br />
- Auditors of parent Company<br />
593 525<br />
• audit fees 40 43<br />
• non-audit fees 32 –<br />
• prior year underprovision<br />
- Other auditors<br />
– 3<br />
• audit fees 80 115<br />
• prior year under provision – 9<br />
Interest expense (note 5) 1,121 1 ,533<br />
Interest income (76) (76)<br />
Net exchange gain<br />
(Writeback of provision)/provision for amount<br />
(36) (308)<br />
owing by an associated company (19) 19<br />
(Writeback of provision)/provision for doubtful debts (68) 223<br />
Bad debts written off 36 1<br />
Details of Directors’ remuneration of the Company pursuant to the Singapore Exchange Securities<br />
Trading Limited’s Listing rules are as follows:<br />
Number of Directors in remuneration b<strong>and</strong>s<br />
2000 1999<br />
$500,000 <strong>and</strong> above – –<br />
$250,000 to $499,999 1 1<br />
Below $250,000 8 7<br />
Total 9 8<br />
5. Interest expense<br />
2000 1999<br />
$’000 $’000<br />
Interest on bank loan 426 522<br />
Interest on bank overdrafts 148 214<br />
Interest on hire purchase 11 11<br />
Interest on short term loan 536 786<br />
1,121 1 ,533<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
49<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
50<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
6. Taxation<br />
Provision for taxation in respect of profit for the year :<br />
2000 1999<br />
$’000 $’000<br />
Current taxation - Hong Kong 839 738<br />
- Singapore 360 223<br />
- Malaysia 513 92<br />
Deferred taxation (42) (21)<br />
(Over)/underprovision in respect of previous year (113) 79<br />
1,557 1, 111<br />
The taxation charge for the Proforma Group is materially lower than the amount determined by<br />
applying the Singapore income tax rate of 25.5% (1999 : 26%) to the pre-tax profits because of<br />
lower tax rates applicable to overseas subsidiary companies <strong>and</strong> certain subsidiary company<br />
utilised its tax losses, unabsorbed capital allowances <strong>and</strong> reinvestment allowance to offset against<br />
its tax profits.<br />
As at 30 June 2000, certain subsidiary companies have unutilised tax losses, unabsorbed capital<br />
allowances <strong>and</strong> reinvestment allowance amounting to approximately $2,073,000 (1999 :<br />
$2,261,000) available for setting-off against future taxable profit subject to the regulations <strong>and</strong><br />
agreements by the relevant tax authorities.<br />
7. Dividend<br />
2000 1999<br />
$’000 $’000<br />
Proposed final dividend 1,117 38<br />
As disclosed in note 25 the Company currently has an issued <strong>and</strong> paid up share capital of<br />
285,673,158 ordinary shares of $0.05 each. The proposed final dividend is provided at a rate of<br />
10.5% of the par value less income tax of 25.5% on the enlarged share capital. In the previous<br />
year, dividend was proposed at the rate of 0.5% on 104,288,009 ordinary shares of $0.10 each<br />
less income tax of 26%.<br />
8. Earnings per share<br />
2000 1999<br />
$’000 $’000<br />
Earnings after taxation 5,759 4 ,011<br />
Weighted average number of ordinary shares for<br />
‘000 ‘000<br />
calculation of basic earnings per share 214,173 214 ,173<br />
Cents Cents<br />
Basic earnings per share 2.69 1.87
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
9. Fixed assets<br />
L<strong>and</strong> <strong>and</strong> buildings Furniture,<br />
Long-term fittings <strong>and</strong> Motor Plant <strong>and</strong> Plastic<br />
Freehold leasehold equipment vehicles Renovations machineries moulds Total<br />
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000<br />
Cost <strong>and</strong> valuation<br />
At 1 July 1999 4,494 24,186 11,941 1,368 727 1,504 110 44,330<br />
Currency alignment 69 115 138 8 4 27 2 363<br />
Additions – – 1,210 90 332 42 8 1,682<br />
Disposals – – (335) (169) – – (1) (505)<br />
Deficit on valuation (163) – – – – – – (163)<br />
At 30 June 2000 4,400 24,301 12,954 1,297 1,063 1,573 119 45,707<br />
Representing -<br />
Cost – 6,264 12,954 1,297 1,063 1,573 119 23,270<br />
Valuation 4,400 18,037 – – – – – 22,437<br />
4,400 24,301 12,954 1,297 1,063 1,573 119 45,707<br />
Accumulated depreciation<br />
At 1 July 1999 14 1,195 7,779 593 387 647 81 10,696<br />
Currency alignment – 16 88 6 2 12 1 125<br />
Charge for the year 32 282 2,077 183 194 306 20 3,094<br />
Disposals<br />
Transfer to revaluation<br />
– – (279) (140) – – (1) (420)<br />
surplus (14) – – – – – – (14)<br />
At 30 June 2000 32 1,493 9,665 642 583 965 101 13,481<br />
Charge for 1999 27 310 2,251 136 121 296 28 3,169<br />
Net book value<br />
At 30 June 2000 4,368 22,808 3,289 655 480 608 18 32,226<br />
At 30 June 1999 4,480 22,991 4,162 775 340 857 29 33,634<br />
(a) Included under long-term leasehold l<strong>and</strong> <strong>and</strong> building is investment properties stated at<br />
valuation with a net book value of $8,830,000 (1999 : $8,830,000). The market value of<br />
investment properties was based on independent professional valuation carried out by Jones<br />
Lang LaSalle on 30 June 1999 on the basis of an open market value for existing use. The<br />
directors are of the opinion that this value has not changed materially as at 30 June 2000.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
51<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
52<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
9. Fixed assets (cont’d)<br />
(b) Certain properties of the Group with net book value of $25.7 million (1999 : $26.5 million)<br />
have been mortgaged to secure credit facilities (notes 16 <strong>and</strong> 18).<br />
2000 1999<br />
$’000 $’000<br />
(c) Net book value of fixed assets under hire purchase 466 560<br />
10. Deferred expenditure<br />
Cost 208 202<br />
Less : Accumulated amortisation (136) (67)<br />
72 135<br />
11. Associated companies<br />
Unquoted shares, at cost<br />
Goodwill paid on subscription of shares in an<br />
4,300 –<br />
associated company (2,363) –<br />
1,937 –<br />
12. Stocks<br />
Raw materials 1,431 1 ,375<br />
Work-in-progress 644 567<br />
Finished goods 13,274 10 ,194<br />
Packaging materials 70 77<br />
15,419 12, 213<br />
Provision for stocks obsolescence (652) (574)<br />
Analysis of provision for stock obsolescence :<br />
14,767 11 ,639<br />
Balance at beginning of year 574 487<br />
Charge to profit <strong>and</strong> loss 78 87<br />
Balance at end of year 652 574<br />
13. Trade debtors<br />
Trade debtors are stated after deducting provision for<br />
doubtful debts of 618 678<br />
Analysis of provision for doubtful debts :<br />
Balance at beginning of year 678 463<br />
(Writeback)/charge to profit <strong>and</strong> loss account (68) 223<br />
Written off against bad debts – (8)<br />
Currency realignment 8 –<br />
Balance at end of year 618 678<br />
Bad debts written off directly to profit <strong>and</strong> loss account 36 1
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
14. Other debtors<br />
2000 1999<br />
$’000 $’000<br />
Sundry deposits 2,179 1 ,590<br />
Prepaid expenses 1,030 137<br />
Tax recoverable 106 94<br />
Sundry debtors 180 462<br />
3,495 2 ,283<br />
15. Amounts due from/(to) associated companies<br />
Amount due from an associated company – 1<br />
Loan to an associated company – 227<br />
Amount due to an associated company (2,150) –<br />
(2,150) 228<br />
Provision for amount owing by an associated company – (19)<br />
(2,150) 209<br />
Amounts due from an associated company <strong>and</strong> loan to an associated company are nontrade<br />
related, unsecured, interest-free <strong>and</strong> have no fixed term of repayment.<br />
Amounts due to an associated company is unsecured, interest free <strong>and</strong> is repayable within<br />
three months after balance sheet date.<br />
16. Amounts due to bankers<br />
Bank loan, secured (note 18) 215 229<br />
Bank overdraft, secured<br />
Short term loans<br />
3,199 1 ,445<br />
- secured 24,840 12 ,897<br />
- unsecured 1,000 500<br />
29,254 15 ,071<br />
The amounts due to bankers bear interest between 1.75% to 12.5% (1999 : 1.75% to 11.54%) per<br />
annum, <strong>and</strong> are secured by certain properties of the Group (Note 9).<br />
17. Other creditors<br />
Accrued expenses 1,314 1 ,017<br />
Sundry provisions 1,315 1 ,225<br />
Sundry creditors 321 763<br />
Hire purchase creditors (note 19) 65 100<br />
3,015 3 ,105<br />
18. Bank loans, secured<br />
Repayable within 12 months (note 16) 215 229<br />
Repayable after 12 months 320 485<br />
535 714<br />
The bank loans which are secured by certain properties of the Group bear interest between<br />
1.75% to 2.00% (1999 : 1.75% to 2.00%) above prevailing prime rate <strong>and</strong> are repayable over a<br />
period of 5 years by 60 monthly instalments.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
53<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
54<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
19. Hire purchase creditors<br />
2000 1999<br />
$’000 $’000<br />
Repayable within one year (included in other creditors) 65 100<br />
Repayable after one year 295 34<br />
360 134<br />
The future payments under hire purchase are as follows :<br />
2000 – 32<br />
2001 73 32<br />
2002 73 32<br />
2003 73 32<br />
2004 73 34<br />
Remaining years 137 –<br />
429 162<br />
Amounts representing interest (69) (28)<br />
360 134<br />
20. Deferred taxation<br />
The deferred taxation arises as a result of :<br />
Excess of net book value over tax written down value<br />
of fixed assets 39 152<br />
Provision – (71)<br />
39 81<br />
21. Shareholders’ equity<br />
The shareholders’ equity set out in the Proforma balance sheet is represented by the following :<br />
Share capital 10,709 10 ,709<br />
Reserves 6,208 21 ,487<br />
16,917 32 ,196<br />
22. Lease commitments<br />
The Group leases certain properties under lease agreements that are non-cancellable within a<br />
year. The leases expires at various dates till 2003. Future minimum lease payments for all leases<br />
with initial or remaining terms of one year or more are as follows :<br />
2000 – 1 ,713<br />
2001 2,829 3 ,038<br />
2002 2,272 1 ,460<br />
2003 243 –<br />
5,344 6 ,211
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
23. Capital commitments<br />
(a) On 8 May 2000, the Company signed a joint venture agreement to subscribe for 50,000<br />
ordinary shares of $1.00 each at par, representing 50% of the initial paid up capital of Yin<br />
<strong>Yan</strong>g Spa Pte <strong>Ltd</strong> (“YYS”), a company incorporated in Singapore on 26 May 2000. As at year<br />
end, the Company has not paid up any capital for YYS.<br />
Under the joint venture agreement, the Company is given an option to acquire from the<br />
other shareholder of YYS one percent of the issued <strong>and</strong> paid up capital of YYS to increase<br />
the Company’s shareholding in YYS to 51%. The option is exercisable one year after the date<br />
of the joint venture agreement at a price which is equivalent to YYS’s net tangible assets at<br />
the date which the option is exercised.<br />
2000 1999<br />
$’000 $’000<br />
(b) Other capital commitments authorised <strong>and</strong> contracted<br />
but not provided for in the financial statements 937 –<br />
24. Segment reporting<br />
Profit/(loss)<br />
Turnover before taxation Assets employed<br />
2000 1999 2000 1999 2000 1999<br />
$’000 $’000 $’000 $’000 $’000 $’000<br />
(a) By activities<br />
TCM 65,234 57,028 6,907 5,333 40,587 35,884<br />
Ethical drugs 6,562 6,473 1,369 1,085 4,676 6,150<br />
Others 296 704 (960) (1,296) 13,108 14,252<br />
Associated companies – – – – 1,937 209<br />
72,092 64,205 7,316 5,122 60,308 56,495<br />
(b) By geographical location based on country of incorporation<br />
Hong Kong 40,972 36,590 4,539 3,303 19,027 19,244<br />
Singapore 15,434 14,642 885 596 24,585 23,456<br />
Malaysia 15,686 12,973 1,892 1,223 14,759 13,586<br />
Associated companies – – – – 1,937 209<br />
72,092 64,205 7,316 5,122 60,308 56,495<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
55<br />
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t
2<br />
<strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t<br />
56<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notes to the Proforma Group Financial Statements –<br />
30 June 2000<br />
25. Subsequent events<br />
Subsequent to the financial year, the Company :<br />
(i) increased its authorised shares capital from $40,000,000, comprising 400,000,000 ordinary<br />
shares of $0.10 each, to $80,000,000 comprising 800,000,000 ordinary shares of $0.10 each,<br />
by creating additional 400,000,000 ordinary shares of $0.10 each;<br />
(ii) subdivided each of the ordinary shares of $0.10 each in the authorised <strong>and</strong> issued share<br />
capital of the Company into 2 ordinary shares of $0.05 each;<br />
(iii) issued 71,500,000 new ordinary shares of $0.05 each at a premium of $0.30 each pursuant to<br />
an initial public offering exercise; <strong>and</strong><br />
(iv)listed on the SGX-ST on 28 July 2000.<br />
Upon the completion of the initial public offering exercise, the resultant issued <strong>and</strong> paid up<br />
share capital of the Company increased from $10,428,801 comprising 104,288,009 ordinary shares<br />
of $0.10 each to $14,283,658 comprising 285,673,158 ordinary shares of $0.05 each.
Portfolio of Properties<br />
Properties/ Location Tenure Floor Area (sq ft) Usage<br />
Properties occupied by the Group<br />
Singapore<br />
265A South Bridge Road 999 years from<br />
1/10/1823<br />
1,408 Office<br />
269 South Bridge Road Lot 99871A 999 years 15,048 Shop/ office/<br />
from 1/10/1823<br />
Lot 99869K, 99868A &<br />
99866P 999 years from<br />
1/10/1827<br />
warehouse<br />
273A South Bridge Road 999 years from 1/10/1823 2,526 Office<br />
Malaysia<br />
Nos. 9 & 11 Jalan Petaling Freehold 5,464 Shop/ office/<br />
K<strong>ual</strong>a Lumpur warehouse<br />
Nos 22 & 23 Jalan Dato B<strong>and</strong>ar<br />
Tunggal Negeri Sembilan<br />
Freehold 13,263 Shop<br />
No. 1 SS 2/67 SEA Park Petaling<br />
Jaya Selangor<br />
Freehold 7,418 Shop/ office<br />
Nos 36 & 38 Leech Street,<br />
Ipoh Perak<br />
Freehold 5,880 Shop/ warehouse<br />
No. 2 Jalan Othman Talib & No 1<br />
Lorong Isk<strong>and</strong>ar Shah, Ipoh Perak<br />
Freehold 4,140 Shop/ warehouse<br />
No. 98 Jalan Idris Kampar Freehold 4,600 Shop/ warehouse<br />
No. 156 Lebuh Chulia Georgetown Freehold 18,800 Shop/ office/<br />
Pulau Pinang warehouse<br />
Lot No. LG15, Lower Ground floor<br />
The Summit, Subang<br />
Freehold 778 Shop<br />
No 4 Persiaran 1/118C, Desa Tun 99 years lease expiring 11,360 Factory<br />
Razak Industrial Park II Cheras on 20/3/2085<br />
Hong Kong<br />
3rd floor, Units B & F 4th floor, 75 years lease from 40,989 Office/ factory/<br />
Unit F 10th floor 1/1/63; renewable for laboratory/<br />
Sunview Industrial Building<br />
No 3 On Yip Street, Chai Wan<br />
a further 75 years warehouse<br />
Ground floor, 192 Lai Chi Kok Road 75 years lease from 617 Shop<br />
Shamshuipo Kowloon 23/3/1923; renewable<br />
for a further 75 years<br />
Investment Properties<br />
Singapore<br />
265, 265B&C South Bridge Road 999 years from 1/10/1823 4,182 Shop/office<br />
273, 273B&C South Bridge Road 999 years from 1/10/1823 7,501 Shop/office<br />
Malaysia<br />
No 2 Persiaran 1/118C, Desa Tun 99 years lease expiring 7,200 Factory<br />
Razak Industrial Park II Cheras on 20/3/2085<br />
Lot B1-36 Lower Ground floor, Freehold 415 Shop<br />
Skudai Parade Johor Bahru<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
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2<br />
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58<br />
Corporate Governance<br />
The Group is committed to maintaining a high st<strong>and</strong>ard of corporate governance in order to protect<br />
the interest of its shareholders. To achieve this objective, the Group has put in place the following:<br />
BOARD OF DIRECTORS<br />
The Board comprises the following directors:<br />
Mr <strong>Eu</strong> Joseph William Yee (Non-Executive Chairman)<br />
Mr <strong>Eu</strong> Yee Ming Richard (Managing Director & CEO)<br />
(Alternate: Dr <strong>Eu</strong> Yee Tat David)<br />
Mr <strong>Eu</strong> Yee Fong Clifford<br />
(Alternate: Mr Laurence Yee Lye <strong>Eu</strong>)<br />
Mr Leung Alan Sze Yuan<br />
Mr <strong>Eu</strong> Yee <strong>Sang</strong> Robert James<br />
Mr Yeh Chung Woo David (Non-Executive)<br />
Dr Jennifer Lee Gek Choo (Non-Executive)<br />
The Board reviews <strong>and</strong> approves the Group’s key strategic operational plans, major investments<br />
<strong>and</strong> funding decisions, financial performance <strong>and</strong> internal controls, as well as ensure that the principal<br />
risks of the Group are identified <strong>and</strong> properly managed. It also reviews <strong>and</strong> approves the<br />
announcement of the half-year <strong>and</strong> full-year results of the Group <strong>and</strong> the Company. Since the<br />
initial public offering (IPO) of the Company in July 2000, the Board had met once to review <strong>and</strong><br />
approve the announcement of the full-year results.<br />
The Board is also responsible for establishing a healthy corporate environment conducive to<br />
maintaining <strong>and</strong> promoting good corporate governance within the Group.<br />
The functions mentioned above are carried out directly or indirectly through various committees of<br />
the Board or through key management personnel.<br />
• Audit Committee<br />
The Audit Committee comprises:<br />
Mr Yeh Chung Woo David (Chairman)<br />
Dr Jennifer Lee Gek Choo<br />
Mr <strong>Eu</strong> Yee Fong Clifford
The Committee has adopted a Terms of Reference to regulate <strong>and</strong> govern its role, responsibilities<br />
<strong>and</strong> proceedings. The Committee reviews the overall scope of the external audit, the assistance<br />
given by Management to the Auditors, the audit plan <strong>and</strong> evaluates the Company’s system of<br />
internal controls, including Interested Person Transactions where appropriate.<br />
Since the IPO of the Company, the Committee had met once to review the announcement of<br />
the full-year results before it was presented to the Board for approval, <strong>and</strong> monitored the extent<br />
of the Group’s compliance with the Listing Man<strong>ual</strong> of the Singapore Exchange Limited (“SGX”).<br />
The Committee had also recommended the re-appointment of Messrs Ernst & Young as Auditors<br />
of the Company at the forthcoming <strong>Ann</strong><strong>ual</strong> General Meeting.<br />
In the opinion of the Board, the Company has complied with the Best Practices Guide with<br />
respect to audit committees issued by the SGX.<br />
• Securities Transactions<br />
The Group has issued a policy on securities dealings by officers of the Company <strong>and</strong> its subsidiaries<br />
<strong>and</strong> adopted a Code of Best Practices on Securities Dealings (“the Code”) to govern <strong>and</strong><br />
regulate such transactions. The Code was based on the Best Practices Guide issued by the SGX<br />
<strong>and</strong> has been circulated to all relevant parties.<br />
• Employee Share Option Scheme (“ESOS”) Committee<br />
The Group has established an ESOS which provides Executives, Directors <strong>and</strong> employees with<br />
an opportunity to participate in the equity of the Company <strong>and</strong> to motivate them towards<br />
better performance through increased dedication <strong>and</strong> loyalty. A committee comprising Mr<br />
Yeh Chung Woo David, Dr Jennifer Lee Geok Choo <strong>and</strong> Mr <strong>Eu</strong> Yee Ming Richard has been set<br />
up to administer the ESOS.<br />
• Management Committee<br />
The senior executives of the Group, including the Executive Directors <strong>and</strong> the Group General<br />
Managers meet regularly to review the Group’s operational performance, brainstorm business<br />
strategies, <strong>and</strong> analyse <strong>and</strong> evaluate new projects <strong>and</strong> growth opportunities.<br />
• Group Procedures<br />
The Group has adopted a code of conduct covering pertinent operational, financial <strong>and</strong><br />
administrative aspects of the Group’s business, including the setting of authority limits <strong>and</strong><br />
guidelines for all employees. At the date of this <strong>Ann</strong><strong>ual</strong> <strong>Repor</strong>t, this code of conduct is being<br />
drafted into a Group Procedures <strong>and</strong> Authorities (GPA) man<strong>ual</strong>. The GPA will be reviewed <strong>and</strong><br />
updated from time to time by the Board to ensure that they meet the needs of the Group <strong>and</strong><br />
are in compliance with prevailing laws <strong>and</strong> regulations.<br />
Corporate Governance<br />
59<br />
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<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notice of <strong>Ann</strong><strong>ual</strong> General Meeting<br />
NOTICE IS HEREBY GIVEN that the <strong>Ann</strong><strong>ual</strong> General Meeting of the Company will be held at Wangz<br />
Business Centre 7 Temasek Boulevard, The Penthouse #44-01 Suntec Tower One, Singapore 038987<br />
on 16 November 2000 at 3 pm for the following purposes:<br />
AS ORDINARY BUSINESS<br />
1. To receive <strong>and</strong> adopt the Directors’ <strong>Repor</strong>t <strong>and</strong> the Audited Accounts of the Company for the<br />
year ended 30 June 2000 together with the Auditors’ <strong>Repor</strong>t thereon. (Resolution 1)<br />
2. To declare a first <strong>and</strong> final dividend of 10.50% (or 0.525 cents per share) less tax at 25.5% for the<br />
year ended 30 June 2000. (Resolution 2)<br />
3. To re-elect the following Directors retiring pursuant to Articles 92 <strong>and</strong> 109 of the Company’s<br />
Articles of Association:<br />
Mr Leung Alan Sze Yuan (Retiring under Article 92) (Resolution 3)<br />
Dr Jennifer Lee Gek Choo<br />
(independent member of the Audit Committee)<br />
(Retiring under Article 92) (Resolution 4)<br />
Mr <strong>Eu</strong> Yee <strong>Sang</strong> Robert James (Retiring under Article 109) (Resolution 5)<br />
4. To consider <strong>and</strong> if thought fit, to pass the following resolutions:<br />
(a) That pursuant to Section 153(6) of the Companies Act, Cap. 50, Mr <strong>Eu</strong> Joseph William Yee be<br />
re-appointed a Director of the Company to hold office until the next <strong>Ann</strong><strong>ual</strong> General Meeting.<br />
[see Explanatory Note (i)] (Resolution 6)<br />
(b) That pursuant to Section 153(6) of the Companies Act, Cap. 50, Mr Yeh Chung Woo David<br />
(independent member of the Audit Committee) be re-appointed a Director of the Company<br />
to hold office until the next <strong>Ann</strong><strong>ual</strong> General Meeting. [see Explanatory Note (i)] (Resolution 7)<br />
5. To re-appoint Messrs Ernst & Young as the Company’s Auditors <strong>and</strong> to authorise the Directors to<br />
fix their remuneration. (Resolution 8)<br />
6. To transact any other business that may be transacted at an <strong>Ann</strong><strong>ual</strong> General Meeting.<br />
AS SPECIAL BUSINESS<br />
7. To consider <strong>and</strong>, if thought fit, to pass the following resolutions as Ordinary Resolutions, with or<br />
without modifications:<br />
(a) “That pursuant to Section 161 of the Companies Act, Chapter 50 <strong>and</strong> Clause 941(3)(b) of the<br />
Listing Man<strong>ual</strong> of the Singapore Exchange Limited, the Directors be empowered to allot <strong>and</strong><br />
issue new shares in the Company at any time <strong>and</strong> upon such terms <strong>and</strong> conditions <strong>and</strong> for<br />
such purposes as the Directors may, in their absolute discretion, deem fit provided that the<br />
aggregate number of shares to be allotted <strong>and</strong> issued pursuant to this Resolution shall not<br />
exceed fifty per centum (50%) of the issued share capital of the Company for the time being,<br />
of which the aggregate number of such shares to be allotted <strong>and</strong> issued other than on a prorata<br />
basis to all share holders shall not exceed twenty per centum (20%) of the issued share<br />
capital of the Company for the time being, <strong>and</strong> that unless revoked or varied by the Company<br />
in general meeting, such authority shall continue in force until the conclusion of the Company’s<br />
next <strong>Ann</strong><strong>ual</strong> General Meeting.”<br />
(Resolution 9)
Notice of <strong>Ann</strong><strong>ual</strong> General Meeting<br />
(b) “That the Directors of the Company be authorised to offer <strong>and</strong> grant options in accordance<br />
with the provisions of the <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> Employee Share Option Scheme (“the Scheme”) <strong>and</strong> to<br />
allot <strong>and</strong> issue from time to time such number of ordinary shares as may be required to be<br />
issued pursuant to the exercise of options under the Scheme PROVIDED ALWAYS THAT the<br />
aggregate number of additional ordinary shares to be allotted <strong>and</strong> issued pursuant to the<br />
Scheme shall not exceed fifteen per centum (15%) of the total issued share capital of the<br />
Company from time to time.”<br />
[See Explanatory Note (ii)] (Resolution 10)<br />
(c) “That the Directors of the Company be authorised to offer <strong>and</strong> grant to Mr <strong>Eu</strong> Yee Ming<br />
Richard, an Executive Director <strong>and</strong> a Controlling Shareholder, options from time to time to<br />
subscribe for shares not exceeding the limit of 4,285,097 shares in any one financial year<br />
subject to the terms of the Scheme, <strong>and</strong> to allot <strong>and</strong> issue, contingent to the passing of the<br />
preceding ordinary Resolution 10 above, shares to him under the Scheme.”<br />
[See Explanatory Note (iii)] (Resolution 11)<br />
(d) “That the Directors of the Company be authorised to offer <strong>and</strong> grant to Mr <strong>Eu</strong> Yee Fong<br />
Clifford, an Executive Director <strong>and</strong> a Controlling Shareholder, options from time to time to<br />
subscribe for shares not exceeding the limit of 4,285,097 shares in any one financial year<br />
subject to the terms of the Scheme, <strong>and</strong> to allot <strong>and</strong> issue, contingent to the passing of the<br />
preceding ordinary Resolution 10 above, shares to him under the Scheme.”<br />
[See Explanatory Note (iii)] (Resolution 12)<br />
By Order of the Board<br />
<strong>Eu</strong> Yee Fong Clifford<br />
Yvonne Choo<br />
Company Secretaries<br />
Singapore, 25 October 2000<br />
Explanatory Notes:<br />
(i) The effect of the Ordinary Resolutions proposed in item 4 above, if passed, is to re-appoint Mr <strong>Eu</strong><br />
Joseph William Yee <strong>and</strong> Mr Yeh Chung Woo David who are both over 70 years old. Section<br />
153(6) of the Companies Act, Cap. 50 requires the Resolutions to be passed by a majority of not<br />
less than three-fourths of shareholders present (in person or by proxy) <strong>and</strong> voting at the <strong>Ann</strong><strong>ual</strong><br />
General Meeting of the Company.<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
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62<br />
<strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong> <strong>and</strong> <strong>Subsidiary</strong> Companies<br />
Notice of <strong>Ann</strong><strong>ual</strong> General Meeting<br />
(ii) The Ordinary Resolution proposed in item 7(b) above, if passed, will authorise the Directors to<br />
offer <strong>and</strong> grant options in accordance with the provisions of the Scheme which was approved<br />
at an Extraordinary General Meeting of the Company on 3 July 2000 <strong>and</strong>, from the date of the<br />
above Meeting until the next <strong>Ann</strong><strong>ual</strong> General Meeting, to allot <strong>and</strong> issue shares in the Company<br />
of up to a number not exceeding in total fifteen per centum (15%) of the total issued share<br />
capital of the Company for the time being pursuant to the exercise of the options under the<br />
Scheme.<br />
(iii) Contingent to the passing of the Ordinary Resolution proposed in item 7(b) above, the Ordinary<br />
Resolutions proposed in items 7(c) <strong>and</strong> 7(d) above, if passed, will empower the Directors of the<br />
Company to grant options to <strong>and</strong> to issue, in the event of the exercise of the options to Mr <strong>Eu</strong><br />
Yee Ming, Richard <strong>and</strong> Mr <strong>Eu</strong> Yee Fong, Clifford, both Executive Directors <strong>and</strong> Controlling<br />
Shareholders of the Company, up to 4,285,097 shares <strong>and</strong> 4,285,097 shares respectively.<br />
Notes:<br />
As at this date hereof, no option has been granted to or exercised by Mr <strong>Eu</strong> Yee Ming Richard<br />
<strong>and</strong> Mr <strong>Eu</strong> Yee Fong Clifford. The number of options stated in the Ordinary Resolutions proposed<br />
in items 7(c) <strong>and</strong> 7(d) above had been reviewed <strong>and</strong> determined by the Committee<br />
administering the Scheme, <strong>and</strong> the terms of such options will be subject to the provisions of the<br />
Scheme. The rationale for the participation of Mr <strong>Eu</strong> Yee Ming Richard <strong>and</strong> Mr <strong>Eu</strong> Yee Fong<br />
Clifford in the Scheme is as set out on Pages 71 <strong>and</strong> 72 (inclusive) of the Company’s Prospectus<br />
dated 14 July 2000.<br />
“Controlling Shareholder” is defined under the Listing Man<strong>ual</strong> of the Singapore Exchange<br />
Limited as:<br />
“A person or persons exercising control over a company. Unless rebutted, a person who controls<br />
directly or indirectly a shareholding of 15% or more of a company’s issued share capital shall be<br />
presumed a controlling shareholder of that company.”<br />
1. A member entitled to attend <strong>and</strong> vote at the <strong>Ann</strong><strong>ual</strong> General Meeting is entitled to appoint a proxy or proxies (not more<br />
than two) to attend <strong>and</strong> vote on his/her behalf. A proxy need not be a member of the Company.<br />
2. The instrument appointing a proxy or proxies must be under the h<strong>and</strong> of the appointor or of his/her attorney duly authorised<br />
in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under<br />
its Common Seal or by its attorney or by an officer duly authorised.<br />
3. The instrument appointing a proxy or proxies must be deposited at the Company’s Registered Office at 269A South Bridge<br />
Road, Singapore 058818 at least 48 hours before the time fixed for the Meeting.
Proxy Form<br />
I/We<br />
of<br />
EU YAN SANG INTERNATIONAL LTD<br />
(Incorporated in the Republic of Singapore)<br />
being a member/members of <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> <strong>International</strong> <strong>Ltd</strong>, hereby appoint<br />
or failing him/her of<br />
of<br />
or failing him/her, the Chairman of the meeting as my/our proxy to vote for me/us on my/our behalf at the <strong>Ann</strong><strong>ual</strong><br />
General Meeting of the Company to be held on 16 November 2000 at 3 p.m. <strong>and</strong> at any adjournment thereof. The<br />
proxy is to vote on the business before the meeting as indicated below. If no specific direction as to voting is given,<br />
the proxy will vote or abstain from voting at his/her discretion, as he/she will on any other matter arising at the Meeting:<br />
NO. RESOLUTIONS RELATING TO: FOR AGAINST<br />
1 Directors’ <strong>Repor</strong>t, Auditors’ <strong>Repor</strong>t <strong>and</strong> Audited Accounts for the year ended 30 June 2000<br />
2 Payment of a proposed first <strong>and</strong> final dividend<br />
3 Re-election of Mr Leung Alan Sze Yuan as a Director<br />
4 Re-election of Dr Jennifer Lee Geok Choo as a Director<br />
5 Re-election of Mr <strong>Eu</strong> Yee <strong>Sang</strong> Robert James as a Director<br />
6 Re-appointment of Mr <strong>Eu</strong> Joseph William Yee as a Director<br />
7 Re-appointment of Mr Yeh Chung Woo David as a Director<br />
8 Re-appointment of Messrs Ernst & Young as Auditors<br />
9 Authority to allot <strong>and</strong> issue new shares<br />
10 Authority to grant <strong>and</strong> issue shares under the <strong>Eu</strong> <strong>Yan</strong> <strong>Sang</strong> Employee Share<br />
Option Scheme<br />
11 Authority to grant options <strong>and</strong> issue shares to Mr <strong>Eu</strong> Yee Ming Richard<br />
12 Authority to grant options <strong>and</strong> issue shares to Mr <strong>Eu</strong> Yee Fong Clifford<br />
Please indicate with a cross [ X ] in the space provided whether you wish your vote to be cast for or against the<br />
Resolutions as set out in the Notice of the Meeting<br />
Dated this day of 2000
Proxy Form (cont’ d)<br />
Total Number of Shares in: No. of Shares<br />
(a) CDP Register<br />
(b) Register of Members<br />
Signature of Shareholder(s) or Common Seal<br />
To be valid, this form must be lodged at the Company’s Registered Office at 269A South Bridge Road, Singapore 058818 not less than 48 hours before<br />
the time appointed for the <strong>Ann</strong><strong>ual</strong> General Meeting.<br />
Notes:<br />
1. Please insert the total number of Shares held by you. If you have Shares entered against your name in the<br />
Depository Register (as defined in Section 130A of the Companies Act, Chapter 50 of Singapore), you should<br />
insert that number of Shares. If you have Shares registered in your name in the Register of Members, you should<br />
insert that number of Shares. If you have Shares entered against your name in the Depository Register <strong>and</strong> Shares<br />
registered in your name in the Register of Members, you should insert the aggregate number of Shares entered<br />
against your name in the Depository Register <strong>and</strong> registered in your name in the Register of Members. If no<br />
number is inserted, the instrument appointing a proxy or proxies shall be deemed to relate to all the Shares held<br />
by you.<br />
2. A member of the Company entitled to attend <strong>and</strong> vote at a meeting of the Company is entitled to appoint a<br />
proxy or proxies (not more than two) to attend <strong>and</strong> vote on his/her behalf. A proxy need not be a member of the<br />
Company.<br />
3. Where a member appoints two proxies, he/she shall specify the proportion of his/her shareholdings (expressed as<br />
a percentage of the whole) to be represented by each proxy, failing which the first named proxy shall be<br />
treated as representing 100 per cent of the shareholdings <strong>and</strong> the second named proxy shall be alternate to the<br />
first named proxy.<br />
4. The instrument appointing a proxy or proxies must be deposited at the Company’s Registered Office, 269A South<br />
Bridge Road, Singapore 058818, not less than 48 hours before the time appointed for the <strong>Ann</strong><strong>ual</strong> General Meeting.<br />
5. The instrument appointing a proxy or proxies must be under the h<strong>and</strong> of the appointor or of his/her attorney duly<br />
authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be<br />
executed either under its Common Seal or by its attorney or by an officer duly authorised.<br />
6. A corporation which is a member may authorise by resolution of its directors or other governing body appoint<br />
such person as it thinks fit to act as its representative at the <strong>Ann</strong><strong>ual</strong> General Meeting, in accordance with Section<br />
179 of the Companies Act, Chapter 50 of Singapore.<br />
General:<br />
The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or<br />
illegible or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specified in the<br />
instrument appointing a proxy or proxies. In addition, in the case of Shares entered in the Depository Register, the Company may<br />
reject any instrument appointing a proxy or proxies lodged if the member, being the appointor, is not shown to have Shares entered<br />
against his/her name in the Depository Register as at 48 hours before the time appointed for holding the <strong>Ann</strong><strong>ual</strong> General Meeting, as<br />
certified by The Central Depository (Pte) Limited to the Company.
STATISTICS OF SHAREHOLDINGS<br />
AS AT 2 OCTOBER 2000<br />
Authorised share capital : $80,000,000<br />
Issued <strong>and</strong> fully paid-up capital : $14,283,657.90<br />
Class of shares : Ordinary share of $0.05 each<br />
Voting rights : One vote for each share<br />
SIZE OF SHAREHOLDINGS<br />
Number of Shareholders % Number of Shares %<br />
1 - 1,000 4,162 60.76 4,162,000 1.46<br />
1,001 - 10,000 2,045 29.85 8,660,595 3.03<br />
10,001 - 1,000,0000 621 9.07 53,100,943 18.59<br />
1,000,001 <strong>and</strong> above 22 0.32 219,749,620 76.92<br />
6,850 100.00 285,673,158 100.00<br />
SUBSTANTIAL SHAREHOLDERS AS AT 2 OCTOBER 2000<br />
(as recorded in the Register of Substantial Shareholders)<br />
No. of shares of $0.05 Each Fully Paid<br />
Direct % Deemed %<br />
Interest Interest<br />
<strong>Eu</strong>co Investments Pte <strong>Ltd</strong> 56,286,814 19.70 7,980,000 2.79<br />
Ridalege Investments Pte <strong>Ltd</strong> 43,816,366 15.34 - -<br />
Best<strong>and</strong> Development Corporation - - 21,970,828 7.69<br />
Overseas Union Bank Nominees (Pte) <strong>Ltd</strong> 42,060,069 14.72 - -<br />
<strong>Eu</strong> Yee Ming Richard - - 71,146,435 24.90<br />
<strong>Eu</strong> Yee Fong Clifford 2,595 * 71,016,814 24.86<br />
Laurence Yee Lye <strong>Eu</strong> - - 64,266,814 22.50<br />
Dr <strong>Eu</strong> Yee Tat David - - 43,816,366 15.34<br />
<strong>Eu</strong> Yee Kwong Geoffrey 2,285,574 0.80 43,816,366 15.34<br />
Helena <strong>Eu</strong><br />
* Insignificant<br />
- - 43,816,366 15.34<br />
Notes:<br />
(i) <strong>Eu</strong>co Investment Pte <strong>Ltd</strong> (“<strong>Eu</strong>co”), <strong>Eu</strong> Yee Ming Richard <strong>and</strong> <strong>Eu</strong> Yee Fong Clifford are the beneficial owners of the<br />
shares held by Overseas Union Bank Nominees (Pte) <strong>Ltd</strong>.<br />
(ii) <strong>Eu</strong> Yee Fong Clifford <strong>and</strong> Laurence Yee Lye <strong>Eu</strong> are deemed interested in all the shares held by <strong>Eu</strong>co by virtue of<br />
Section 7 of the Companies Act, Cap. 50.<br />
(iii) <strong>Eu</strong> Yee Ming Richard, Geoffrey <strong>Eu</strong>, Dr David <strong>Eu</strong> <strong>and</strong> Helena <strong>Eu</strong> are deemed interested in the shares held by Ridalege<br />
Investments Pte <strong>Ltd</strong> by virtue of Section 7 of the Companies Act, Cap. 50.<br />
TWENTY LARGEST SHAREHOLDERS AS AT 2 OCTOBER 2000<br />
NAME NO. OF SHARES %<br />
1. <strong>Eu</strong>co Investments Pte <strong>Ltd</strong> 56,286,814 19.70<br />
2. Ridalege Investments Pte <strong>Ltd</strong> 43,816,366 15.34<br />
3. Overseas Union Bank Nominees (Pte) <strong>Ltd</strong> 42,060,069 14.72<br />
4. United Overseas Bank Nominees Pte <strong>Ltd</strong> 25,931,590 9.08<br />
5. <strong>Eu</strong> Joseph William Yee 10,859,964 3.80<br />
6. Universal <strong>International</strong> Investment Limited 5,665,526 1.98<br />
7. HSBC (Singapore) Nominees Pte <strong>Ltd</strong> 5,433,612 1.90<br />
8. <strong>Eu</strong> Yee Shun 4,479,928 1.57<br />
9. G K Goh Stockbrockers Pte <strong>Ltd</strong> 4,246,000 1.49<br />
10. <strong>Eu</strong> Keng Iu Roy <strong>and</strong> <strong>Eu</strong> <strong>Yan</strong> Wai Hing Virgina 2,471,434 0.87<br />
11. <strong>Eu</strong> Yee Kwong Geoffrey 2,285,574 0.80<br />
12. Lee Mui Gek Pauline 2,000,000 0.70<br />
13. Great Expectations Investments Inc 1,873,848 0.66<br />
14. Hambrecht 1980 Revocable Trust 1,873,848 0.66<br />
15. Woldseth Corporation Inc 1,724,600 0.60<br />
16. Lee Wee Kit 1,489,733 0.52<br />
17. Lee Mon-Pi Mrs San Mun Onn @ Hedy Lee 1,416,382 0.50<br />
18. Ng Tee Khiang 1,261,508 0.44<br />
19. Ridalege Hong Kong <strong>Ltd</strong> 1,175,814 0.41<br />
20. Lu Suk Ching @ Lu Moi Teh 1,150,000 0.40<br />
217,502,610 76.14