final output

In 1998, we were upgraded to an L5 contractor under the category “Electrical Engineering” and L6
contractor under the category “Plumbing and Sanitary Works”. The L5 and L6 categorisation allow us
to tender for projects of up to $10 million for electrical engineering works and unlimited value for
plumbing and sanitary works respectively. In that same year, we were also graded L1 contractor
under the categories “Air-conditioning Refrigeration and Ventilation Works”, “Communication and
Security Systems”, “Fire Prevention and Protection Systems” and “Underground Pipeline for
Telecommunications”. As at the date of this Prospectus, our BCA gradings are still intact. Our BCA
gradings will be due for review by BCA on 1 April 2001. During the year, we were awarded a project
for the supply and installation of plumbing & sanitary, electrical, air-conditioning and mechanical
ventilation (“ACMV”), fire protection and sprinkler systems for the Rivervale Executive Condominium
with an approximate contract value of $18.7 million.
In recognition of our quality management system for our services, our two subsidiaries, KWC and
K&W, were awarded ISO 9002 certification by the European Quality Assurance Limited in January
1999. ISO 9002 requires that we have a quality control system for all activities affecting the quality
of works and services performed. Examples of such activities are training, purchasing of materials,
inspection and quality control, documentation and data control.
Between April 1997 to September 2000, we completed over 33 contracts aggregating $173.1 million
in contract value in Singapore.
BUSINESS
We are principally engaged in the business of providing mechanical and electrical (“M&E”) engineering
services in Singapore. We are M&E subcontractors to main contractors in the Singapore building and
construction industry. Our M&E engineering services involve projects in the public and private residential
sectors. Our ancillary business is to supply, deliver and service portable lavatories to various sites,
such as property development work sites and areas where public events, such as the National Day
Parade and the Millennium Party, are held.
We derived approximately 98% of our turnover from our M&E services in the last three financial
years, of which plumbing and sanitary activities contributed approximately 79% to our turnover in the
last three financial years. Electrical system installation contributed approximately 19% to our turnover
in the same period. As our customers usually award fire protection as part of our plumbing and
sanitary contract and award communications and security system installation as part of our electrical
system installation contract, we are unable to differentiate the revenue derived from these other M&E
services. The remaining 2% of our turnover was derived from the lease rental income from our
portable lavatories.
Our revenue by activity are set out on page 44 of this Prospectus.
We provide a wide range of M&E engineering services and these can be classified as follows:-
(a) plumbing and sanitary systems;
(b) electrical engineering systems;
(c) fire protection and alarm systems;
(d) air-conditioning and mechanical ventilation systems;
(e) communication and security systems; and
(f) underground pipeline communication systems.
M&E systems must be designed by qualified and certified project architects and engineers. Our
customers will furnish us with the plans and designs for the M&E systems. Upon engagement for the
installation of M&E systems by our customers, we would purchase the required M&E materials such
as pipes and fittings and install them in accordance with the certified and approved building plans
set out by the project architect. Upon request by our customers, we may recommend certain cost
saving modifications to the project architect.
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